Competitive Advantage and Competition Policy in Developing Countries

Competitive Advantage and Competition Policy in Developing Countries

The CRC Series on Competition, Regulation and Development

Edited by Paul Cook, Raul Fabella and Cassey Lee

The book discusses competition from different theoretical perspectives and examines the implications these viewpoints have for policy. The contributors assess competitiveness in domestic markets and the impact of foreign competition. They also review the experiences of a range of countries in developing competition policy and examine both the strengths and weaknesses of these policies.

Chapter 8: Competition Policy and Enterprise Development: The Role of Public Interest Objectives in South Africa’s Competition Policy

Trudi Hartzenberg

Subjects: development studies, development economics, law and development, economics and finance, competition policy, development economics, public sector economics, law - academic, law and development


Trudi Hartzenberg INTRODUCTION Competition policy reform was high on the agenda of South Africa’s new government after the first democratic elections in 1994. The African National Congress (ANC) had espoused strong socialist principles during the years preceding South Africa’s democratic transition. However, by the time the ANC came to power, the winds of political and policy change had shifted substantively, internationally and in South Africa too. Instead of a policy of nationalization of private enterprises, the ANC looked to competition policy as an instrument to regulate private enterprise and to address the legacy effect of apartheid and economic isolation on domestic markets. South Africa’s Competition Act No. 89 of 1998, which was drafted and promulgated after an extensive and inclusive policy-making process of consultation and debate, reflects the political concerns of the ANC. In addition to economic efficiency, the Competition Act explicitly includes equity and distributive goals. The preamble to the Act notes the high levels of concentration of ownership and control, ineffective checks on anti-competitive practices and restrictions on economic participation, especially by black South Africans due to apartheid laws and policies, and articulates a conviction that credible competition law and institutions to implement the law effectively are necessary for an efficiently functioning economy. Furthermore, the Act says that an economic environment balancing the interests of workers, owners and consumers will benefit all South Africans. A hallmark of the Act is thus its concern with public interest issues, equity and justice, balanced...

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