Monday, May 17, 2021

CAAB signs MoU with Competition Authority

The Competition Authority, which enforces competition law and policy, has signed a Memorandum of Understanding with the Civil Aviation Authority of Botswana (CAAB) to ensure fair competition in the aviation industry.

Government has liberalized the aviation industry to end the monopoly that was a preserve for Air Botswana.

The MOU seeks to bring synchronization of the two entities, building a culture of cooperation and cross agency knowledge management. Commercial air transport is an important part of national and economic development. Research has shown that tourism relies heavily on air transport, hence the importance of an enabling environment through aviation development.

“The industry provides enormous direct and indirect growth opportunities for Botswana and we believe that an aviation sector open to competition would provide better economic outcomes,” said Thula Kaira, the Chief Executive Officer at the Competition Authority.

Kaira said competitive commercial air transport can be constrained by abuse of dominance as a result of monopolization of air space.

Usual competition problems include a small market size, which creates a hive of collusive and protectionist tendencies through price fixing of air tickets.

The agreement is expected to assist the two institutions to build a culture of cooperation to facilitate a more efficient and effective way of dealing with competition problems in the aviation sector.

Kaira said the MOU is not cast in stone but can be reviewed by mutual agreement as the industry is highly dynamic. He acknowledged the agreement is necessary as the Aviation is a complex industry.
Retired Major General Jefferson Tlhokwane said CAAB would need a partner like CA to investigate anti-competitive practices. Tlhokwane said the aviation industry is important in diversifying the economy and job creation.

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