Parliament reviews bills on procurement and small business promotion
During Friday’s session, Parliament conducted the first reviews of amendments to laws on state procurement, and promotion of small and medium-sized enterprises.
Authors of the amendments to the Law on State Procurement believe that the proposed amendments will address challenges for public procurement, and ensure a fair and transparent tendering process.
At the session, lawmakers stressed that including parts that will promote procurement of eco-friendly domestic products in the amendments will be crucial in promoting domestic businesses.
They also emphasized that as the current law sets murky regulations in terms of accountabilities of companies providing inadequate services and lowquality products to the government and state officials engaging in illegal tender selection or organizing unfair tenders, the proposed amendments’ authors have a responsible to make such regulations clear, eradicate corruption from the public procurement process, and adopt a system that ensures a transparent tendering process by taking advantage of innovative technology which meets international procurement standards, and strengthening accountability of tender organizers.
MP G.Temuulen said, “I believe that a commission formed of only state officials cannot organize a fair and transparent tendering process on state procurement, and a tender process should be carried out under collaboration between a state organization and an independent team made up of representatives from the private sector, procurement experts, and the public.”
During the review of amendments to the Law on Promotion of Small and Medium-Sized Enterprises, some legislators asked the amendments’ authors about the changes made to the law.
MP J.Ganbaatar, an author of the amendments, pointed out that as the main aim of the amendments is to promote small and medium-sized enterprises through taxation, loan, investment, and other support, he believes that after the amended version of the law enters into force, people operating such business will be protected through the law from needless administrative, inspection and tax pressures, as well as increase their eligibility for soft loans with flexible conditions and terms.
He added that small and mediumsized businesses will be able to receive a loan of up to 500 million MNT from the Government’s Fund to Promote Small and Medium-Sized Enterprises.
The authors have proposed to annually allocate at least 10 percent of the state budget for projects and programs to promote small and medium-sized businesses in the amendments.
Lawmaker B.Undarmaa said that as terms of loans for promoting small business are very short, which are usually two or three years, small enterprises’ development is still poor, which is why the legislature and government need to focus on providing long-term soft loans with low interest rates to entrepreneurs doing small business.
MP B.Javkhlan stated that there have not been a consolidated and complex government policy to promote small and medium-sized enterprises because institutions in charge of issuing loans for promoting, guaranteeing loans, and receiving interests of the loans are operating under different ministries, and noted that without bringing these separations of duties to a joint administration, promoting development of these enterprises will be ineffective.
Legislator M.Oyunchimeg noted that as the three things small business operators want are to reduce interest rates of loans, increase access to and availability of loans, the authors should concentrate on reaching these three requirements of small businesses.
Lawmaker B.Bat-Erdene criticized that commercial banks are not making efforts to promote small business, they put their interests to gain more profits from their loans first.
Some legislators told the authors to focus on including provisions that support purchases and exports of goods made by small and mediumsized enterprises in the proposed amendments.
The amendments were submitted to standing committees for further discussions.