Monday, September 28, 2020

We welcome the Competition Commission, but…

The Minister of Trade and Industry, Dorcas Makgatlho-Malesu, recently announced the makeup of the Board of the long awaited Competition Commission.

We have always believed that the establishment of a statutory body that would help ensure that there is an even trade competition was long overdue.

It has often happened in the past that consumers were shortchanged by possible collusion of traders, retailers and companies, and yet had nowhere to turn to.

It has often happened in this country that companies merged and or acquired others resulting in market distortions and structural defects that, in the process, substantially undermined fair competition and made it almost impossible for smaller and new firms to enter the sectors.
It is an open secret that some retailers in Botswana, owing to their market dominance and, in some rare cases, exclusionary rights with regard to certain products have been increasing their prices almost on a daily basis.

The food and, to a lesser extent, the construction sectors have been the worst abused.
Without going into details, consumers and other competitors have always cried foul that they were being excluded or discriminated against by those players that were more dominant, established and or entrenched.

In some instances, groups of companies, monopolies is more like it, often owned by same individuals, have often behaved in a manner that is not much different from cartel arrangements and activity ÔÇô controlling the markets and effectively deciding, often capriciously, by way of sitting at a table on the price codes and such things, like discounts, across the entire country.
While all these distortions happened, people have always felt helpless as there was no law they could turn to for recourse.

Given the high retail prices that Batswana have had to contend with over the last two to three years, there is no doubt that an authority that has a clear backing of law is the one that is best placed to undertake thorough and broader investigations of the shenanigans that are likely to be going on.

There was simply no way a modern economy that is fast developing and getting more and more integrated into the global and world trade such as Botswana’s was going to continue to remain immune from events that happen elsewhere.

Just across the border in South Africa, trade disputes and disagreements stemming from unfair competition are the order of the day.

Not so long ago, it was found that companies involved in the production of bread were actually colluding to artificially fix the price of bread.

Milling companies were also recently found guilty of artificially fixing prices of maize and wheat.
The victims, as is to be expected, have in all instances been the poor who always form the majority of people.

The upshot of the absence of a law that ensures even-handed competition in Botswana has been an evil concentration of ownership of critical economic sectors.

It is not by accident that the owners of these means of production happen to be the same people that bankroll the ruling party.

They do so with a strategic objective of influencing the authorities to simply turn a blind eye on their transgressions.

The establishment of the Competition Commission has taken too long to happen.
Just how effective this authority will be in uplifting Batswana remains to be seen.
We have no wish to do a background check of the commissioners save to say we hope they are not friends of either the industrialists or the ruling party ÔÇô the twins of evil who, over the years, have built and sustained a system of patronage that has robbed the poor and sidelined capable people viewed not close enough to the ruling party.

RELATED STORIES

Read this week's paper

Political appointments frustrate career diplomats- Mmolotsi

Government’s predisposition to compensate politicians who have lost elections by appointing them to ambassadorial positions is blocking the progression of Botswana’s career...