Mariana Romero Roy
A historic wave of hospital modernization is sweeping across Latin America. However, modernization is just one piece of the puzzle in the region. Increasingly, this modernization must also go hand in hand with a new mandate: global sustainability. As governments secure funding from multilateral lenders to construct the hospitals of 2030, environmental, social, and governance (ESG) criteria are moving from “nice-to-have” add-ons to mandatory requirements in public procurement scoring.
For MedTech suppliers, the rules of engagement are changing. A state-of-the-art clinical product is no longer enough to secure a regional contract. In the public tender of the near future, the greenest devices may win out over the cheapest ones.
The Funding Mandate
The push toward Sustainable Public Procurement (or Compras Públicas Sostenibles – CPS) is not just a trend: It is a financial requirement. The infrastructure boom is heavily financed by institutions like the Inter-American Development Bank (IDB). Through its Impact Management Framework, IDB Invest ties infrastructure and healthcare financing directly to rigorous ESG (environmental, social, and governance) criteria, including standards related to environmental safeguards and greenhouse gas reduction targets.
The Platform Reality
The stricter environmental requirements of these investors are already having a trickle-down effect in countries throughout Latin America. Countries such as Colombia and the Dominican Republic, for example, are actively updating their national procurement manuals to mandate Sustainable Public Procurement (CPS – Compras Públicas Sostenibles).
Before a dollar is disbursed for a new hospital in Colombia or a modernized clinic in the Dominican Republic, the project must align with climate resilience and greenhouse gas (GHG) reduction targets. Consequently, national governments are cascading these environmental requirements down to their supply chains — meaning the medical equipment filling those hospitals must also meet strict sustainability metrics.
The Chilean Guidelines
Another prime example is in Chile. Through its “Mercado Público” platform and the “Estado Verde” (Green State) initiative, government buyers are explicitly instructed to look beyond the initial purchase price. Chilean procurement guidelines state that public entities must evaluate the “maximum value for money across the entire life cycle,” which allows them to assign higher evaluation scores to suppliers whose products demonstrate a lower ecological footprint.
Brazil’s Approach
Brazil also has a public procurement law, enacted in 2021 and now fully enforced, that has a similar impact. Put simply, the Brazilian law allows procurement officials to reject the lowest bid in favor of devices with superior life cycle environmental performance. This simple change has revolutionized the procurement process in Brazil and made environmental sustainability a more important factor in many cases than price alone.
Changes Across the Region
These countries are far from the only ones in Latin America that are moving toward “green procurement.” In fact, the Inter-American Network on Government Purchasing (RICG) has been highly active in standardizing sustainable procurement across the region. This network provides reports on how different Latin American countries are advancing Sustainable Public Procurement policies. Their manual on Implementing Sustainable Public Procurement in Latin America and the Caribbean details exactly how environmental criteria are being integrated into technical specifications and contract adjudications across the region.
The MedTech Angle: From Compliance to Competitive Advantage
Hospital administrators and public procurement boards are under intense pressure to reduce the massive carbon and waste footprint of the healthcare sector. When governments evaluate a multi-million-dollar tender to outfit a new hospital wing, they are increasingly penalizing equipment that consumes excessive energy, utilizes non-recyclable materials, or lacks safe end-of-life disposal programs.
To win in this environment, MedTech commercial teams must learn to translate their global corporate ESG reports into localized, competitive advantages. This requires a strategic pivot in how products are pitched to regional health ministries:
- Life-Cycle Efficiency: Highlight lower energy consumption and water usage during device operation.
- Circular Economy Integration: Emphasize modular repairability to reduce electronic waste and promote active “take-back” programs for end-of-life disposal.
- Sustainable Packaging: Demonstrate a reduction in single-use plastics and non-recyclable packaging materials in bulk shipments.
As Latin America builds its sustainable healthcare future, suppliers who can offer proven “Green Solutions” will not only secure higher evaluation scores — they will lock in long-term contracts for the region’s largest infrastructure projects.
Next Steps
Contact GHI to learn more about green procurement and how you can optimize your company’s strategy for success. Our team of researchers can provide the analysis you need to gain valuable insights to support strategic decision-making in your industry.
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Sources:
https://idbinvest.org/en/impact-management-framework
https://www.chilecompra.cl/2023/03/compras-publicas-sustentables-para-avanzar-hacia-un-estado-verde/
https://www.meddeviceonline.com/doc/new-sustainability-mandates-in-brazil-and-chile-are-quietly-disqualifying-medical-devices-0001
https://noharm.org/procurement
https://ricg.org/en/
