INTERNATIONAL BIDDING Dr. Nguyễn Thị Vân Hà Faculty of Transport and Economics Departement of Business Administration McGraw-Hill/Irwin Copyright © 2006, The McGraw-Hill Companies, Inc. Subject Introduction ❖ Reference book General overview of international bidding Regulations and preparation related to international bidding Organization and Evaluation of international bidding International biding for selecting consultant International bidding for goods and service purchasing Bidding for construction projects • Bidding References chapter 2 Asian Development Bank (2015), “Guidelines for Procurement”, pages • Basic terms in international bidding References, Chapter 1 Asian Development • Bank (2015), “Procurement Guide”, pages 11-13; 33-40, April 2015. ❖ Test and Examination • Attendance, Participation, Interaction, Assignments (30%) • Interim Test (20%) • Final Examination: 50% • Type of final examination: Multiple Choice and Essays ❖ Group Seminar 10/01/2024 Dr. Nguyen Thi Van Ha - UTC - DBA 2 CHAPTER 1: GENERAL OVERVIEW OF INTERNATIONAL BIDDING 10/01/2024 Dr. Nguyen Thi Van Ha - UTC - DBA 3 OUTLINE OF THE CHAPTER Related concepts and Definitions Related stakeholder in international bidding Roles and Features of international bidding General processes of international bidding General processes of opening international bid RELATED CONCEPTS OF BIDDING Auction (Đấu giá) is where the seller plays an organizational role so that buyers compete with each other on price in a fair way declared at a certain time. Which buyer has the offer price? The highest proposal will be the winner and gain the right buy those goods Bidding (Đấu thầu) is the process of selecting contractors who meet the requirements of the bidding party to carry out bidding packages of projects according to the provisions of the Bidding Law on the basis of ensuring competitiveness, fairness, transparency and efficiency. economic results (Bidding Law, Article 4, Clause 2). International bidding is a bidding process with the participation of foreign contractors and domestic contractors RELATED CONCEPTS OF BIDDING DIFFERENCES BETWEEN AUCTION AND BIDDING Criteria for comparison Auction Bidding The investor is the buyer or seller Seller Buyer >>> <<< Floor price (ceiling with Dutch price) Ceiling price < > Yes Yes Price Ceiling price, floor price Procedure Deposit RELATED CONCEPTS OF BIDDING Game theory and behaviors in bidding and auctions Game theory studies tactical situations in which opponents/competitors choose different actions to try to maximize their payoff/results. The most famous is the Nash equilibrium of mathematician John Nash (Lý thuyết cân bằng), who received a Nobel Prize for his work on game theory. Use game theory to analyze a wide range of economic phenomena, including bidding, bargaining... ❑ How can you compare bids using game theory? To compare bids using game theory, you need to consider the type of auction and its rules, the number and identity of the bidders and their valuations of the good or service, the information available to the bidders and the seller, and the rationality and risk preferences of the bidders and the seller. From these factors, you can construct a game model that captures the essential features of the auction and analyze its equilibrium. This equilibrium can provide insight into expected payoffs from different bids, helping you determine your optimal bid for your situation. RELATED CONCEPTS OF BIDDING Asymmetric information Asymmetric information (thông tin phi đối xứng), in economics, is a state of imbalance in the information structure between transaction subjects with unequal levels of information holding. Affects bidding and other behaviors of bidding and auction participants RELATED CONCEPTS OF BIDDING INFORMATION FOR INTERNATIONAL BIDDING ▪ http://www.youtube.com/watch?v=4fxBcTHlm2E ▪ http://123.30.180.154:8080/Plus.aspx/vi/News/38/0/327/0/1403/THONG_BAO_KE_ HOACH_DAU_THAU_Du_an_xay_dung_duong_cao_toc_Da ▪ http://tuanvietnam.vietnamnet.vn/2011-06-17-khi-hau-hetcac-goi-thau-epc-vao-taytrung-quoc ▪ http://www.pim.vn/Web/Content.aspx?distid=609 ▪ http://www.baomoi.com/Siet-quan-ly-goi-thauEPC/148/6284656.epi ROLES AND FEATURES OF BIDDING HISTORY OF BIDDING ❑ Bidding is a civilized form of competition in the market economy, a special transaction method for large-scale transactions that require efficiency and transparency. ❑ Bidding is a new trend in Vietnam and the world FEATURES OF BIDDING ❑ Bidding creates competition => The bidding market is also fiercely competitive, but many businesses still want to participate. ❑ Previously, bidding in Vietnam was associated with the use of state budget resources. ❑ Nowadays investment is not only for the state (public procurement). ROLES AND FEATURES OF BIDDING FEATURES OF BIDDING ❑ Large private enterprises (Vingroup, Logtte,...) also organize bidding ❑ In the international market, there is 100% online bidding, no investor lobbying or having to give a percentage to the bidding party if winning the bid... WHY WE NEED BIDDING ❑ The bidding party wants to choose the contractor (or investor) with the best price and satisfy its technical and quality requirements at the lowest cost. ❑ Participant (if winning the bid will receive a "lucrative" business project? ROLES AND FEATURES OF BIDDING WHY WE NEED BIDDING ❑ Projects requiring investment using state budget are required to comply with the Bidding Law (No. 43/2013/QH13). ❑ In private bidding, which is not regulated by the bidding law, the bidding party has the right to choose to apply the bidding law (or not depending on the needs of the new bidder). SHOULD WE JOIN BIDDING? ❑ Bidding competitions are increasingly transparent and follow the true nature of bidding, which is transparent and smooth competition => Contractors should use software to exploit bidding information and bid. RELATED STAKEHOLDER IN BIDDING Parties directly participate IN BIDDING Authorized person (Người có thẩm quyền) Investor (Chủ đầu tư) Bidding party (bên mời thầu) Bidding expert team (Tổ chuyên gia đấu thầu) Appraisal agencies and organizations (Cơ quan, tổ chức thẩm định) Contractor (Nhà thầu) RELATED STAKEHOLDER IN BIDDING Parties indirectly participate State management agency for bidding (Cơ quan quản lý nhà nước về đấu thầu) Inspection, examination and supervision agencies (Cơ quan thanh tra, kiểm ta, giám sát) State audit (Kiểm toán nhà nước) Independent auditing organizations and companies (Tổ chức, công ty kiểm toán độc lập) Banks and financial institutions (Ngân hàng, tổ chức tài chính) Economic security agency, police investigation (Cơ quan an ninh kinh tế, cảnh sát điều tra) Public policy, press and community (Công luận, báo chí và cộng đồng) THANK YOU (TO BE CONTINUED)
