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Accelerators and brakes to public procurement in the Spain of 2022

The AESMIDE Forum dedicated to the recovery of economic activity reviews the keys to boosting national reconstruction
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 -   Round table on "The keys to transformation"

The coalition government presided over by Pedro Sánchez is waiting for Brussels to disburse the first 35 billion euros of the Next Generation funds to boost the reactivation of the Spanish economy.

The forward and backward evolution of the COVID-19 pandemic, the rising cost of energy raw materials, the strangulation of imports of manufactured goods and the permanence of inflation are some of the uncertainties that make this ship called Spain sail through turbulent waters.

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Cristina Herrero Sánchez, President of the Independent Authority for Fiscal Responsibility (AIREF).

The reality is that economic activity is declining and fiscal deterioration is causing reconstruction to be less intense than expected, and this, moreover, is taking place in an environment full of worrying unknowns. However, the siren songs are keeping the government excited, especially the rain of millions from the European Union, which the Moncloa is longing for like someone waiting for manna. 

At the Forum dedicated to the recovery of economic activity organised by the Association of Companies Contracting with Public Administrations (AESMIDE) led by Gerardo Sánchez Revenga, the president of the Independent Authority for Fiscal Responsibility (AIREF), Cristina Herrero, was very clear in warning of the fragility of the national situation.

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Journalist Roberto Arce interviews MP Mario Garcés

On the one hand, the recovery of the national economy is taking place from a position of vulnerability due to the increase in public debt. On the other, the real impact of the Recovery, Transformation and Resilience Plan and Next Generation Funds, the latter being the largest stimulus package ever created by the European Union, remains to be seen.

 Awaiting a medium-term plan

Consciously or unconsciously, but with the backing of the Catalan and Basque pro-independence parties and the parties of the left and ultra-left - after payment in cash or in kind for their votes - the government has yet to draw up a medium-term plan that guarantees a balance between the sustainability of public accounts, economic growth and the quality of public policies. This is of the utmost importance, as it must specify a strategy that reconciles the economic and budgetary challenges in order to bring certainty to the Spanish economy.

The general state budget for 2022 totals more than 40 billion euros, a large part of which is financed by the Recovery and Resilience mechanism, of which the Ministry of Transport, Mobility and the Urban Agenda and its important core of companies will lead around 40 per cent. 

This means around 16,300 million that must be sought in the financial markets and which, according to the department's undersecretary, Jesús Manuel Gomez García, "there is no problem in obtaining". Of the aforementioned amount, more than 7,000 million will go towards the railway sector, more than 2,500 million will go to roads, above all to their conservation and maintenance. And another 3.2 billion for urban housing. All of the above is expected to have a significant accelerating effect on government procurement.
 

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Carme Artigas, secretaria de Estado de Digitalización e Inteligencia Artificial, durante la inauguración del Foro AESMIDE-2021

But companies, especially small and medium-sized ones, face barriers that are difficult to break down. From the point of view of administrative procedures, it is clear that further regulatory changes are needed to break them down. On the contractual level, it is exaggerated that in the 21st century, harmonised procurements take 8 months from the start of the tendering process to the award of the contract. 

No one is unaware of the importance of maintaining legal guarantees, but in comparison with Anglo-Saxon legislation and that of other non-EU countries, "more dynamic systems and centralised purchasing to speed up the process" should be sought, stresses Mario Garcés, PP deputy and spokesman for economic affairs. Others are in favour of reducing delays by eliminating formalities of dubious efficiency.
 

 Facilitating the creation of new companies

New procurement systems should be put in place that guarantee competition, that do not generate monopolies, that prevent a single bidder from covering the entire space in the supply of goods or services. This would have a huge impact on SMEs, which are the backbone of job creation and wealth distribution in Spain. It is also very important to expand the deteriorated business fabric, facilitating the creation of new companies by simplifying the procedures and formalities required by the different administrations.

Aid and facilities to promote the birth of new entrepreneurs is one of the workhorses that AESMIDE and its president Gerardo Sánchez Revenga repeatedly put on the table, along with the demand for mechanisms to facilitate greater participation of small and medium-sized enterprises in public procurement and innovation processes.
 

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Isabel Valldecabres, Director of the Fábrica Nacional de Moneda y Timbre, where the event was held, together with Gerardo Sánchez Revenga, President of AESMIDE

The growing importance of public-private collaboration is evident, particularly in the implementation of digitalisation. It is a fundamental vector of economic and social change to achieve the "structural reforms that make a more competitive production model a reality", emphasises the Secretary of State for Digitalisation and Artificial Intelligence, Carmen Artigas. It is up to her and her team to make these oft-heard words a reality. 

In terms of the defence industry, the impact of the pandemic has led to a "contraction in activity of 6%, below the 19% of industry in general", according to the Secretary of State for Defence, Esperanza Casteleiro. The data provided give an idea of the resilience of a sector that generates 75% of its turnover abroad, develops dual-application products and contributes a high technological content to national industrial capabilities.

Pedro Sánchez has just announced a 400 million euro Strategic Project for Economic Recovery and Transformation (PERTE) for the aerospace sector. Let us hope that this will soon become a reality, because the equivalent announced last July for the promotion of electric and connected vehicles is still in limbo.