China's Procurement Policy Analysis
As part of my Marketing Strategy Class, I was required to write a current event analysis on any important event. I chose to write an analysis on China's new procurement policy that it has implemented to encourage development of intellectual property and other knowledge in China.
Quite frankly, I didn't pick the news article because it interested me, but because I didn't find any suitable choices. The day this assignment was due, was also the day of my Marketing Strategy Final Exam. To make things worse, 15 mins before the class started (and the exam), I realized that I forgot to do the Current Event Analysis. I hurried back to the library, and tried to find an article on which I could find something to easily write an analysis on. Failing to find a nice suitable news article to write a current event analysis, I settled with the Chinese Procurement Policy. I don't remember where the original news article is on which I wrote the current event analysis on, but I am sure that readers can find a suitable alternative by searching for China's procurement policy.
On a note, the Current Event Analysis of China's procurement policy was the second current event analysis I wrote. My first current event analysis was on Sprint. You can check out the Sprint Analysis.
Current Event Analysis
China implemented a new procurement policy whereby all companies bidding on government projects are now required to gain accreditation from the government. The accreditation gives those select companies preference over other companies when bidding for government contracts. One of the requirements of the accreditation is that intellectual property be developed and owned in China, and that any trademarks be originally registered in China. This would essentially mean that if a company gains an accreditation, it would hand over its control and technology to a Chinese partner, or would be forced to invest R&D capital that could have been used elsewhere.
The new procurement policy puts billions of dollars in government contracts at stake, which in 2008 alone accounted for $87.7 billion. If companies refuse to participate in these new requirements they risk losing billions in contracts, and if they do participate in the new procurement policy, they risk transferring their technology to Chinese entities and in turn creating future competitors or losing their Bhascompetitive advantage.
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