Competitive tenders enable Ukraine's logistics operator to save almost US$404.3 million on procurement

Ukraine’s State Logistics Operator, the Ministry of Defence's procurement agency, has saved UAH 16.7 billion (approx. US$404.3 million) of public money to supply the army during the first ten months of 2024.

Source: the press service for Ukraine’s Defence Ministry 

Details: UAH 7 billion (approx. US$169.4 million) was saved on food supply contracts, UAH 6 billion (US$145.2 million) on fuel, and UAH 3.7 billion (US$89.5 million) on materiel.

The ministry explained that this was made possible by fierce competition in the tenders held by the State Logistics Operator through the Prozorro system. [Prozorro is a public electronic procurement system where Ukrainian state and municipal customers announce tenders for the opportunity to become a state supplier – ed.]

On average, tenders attract 4.2 prospective counterparties: 5.4 for materiel, 3.7 for food supplies, and 2.3 for fuels and lubricants.

"Intense competition in the tenders has enabled us to get the best deals, resulting in significant savings for the state budget. For example, the State Logistics Operator has attracted 45 new suppliers of materiel," said Deputy Defence Minister Dmytro Klimenkov.

Background: The State Logistics Operator has developed restrictive measures for suppliers who fail to fulfil their contractual obligations.

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