JOHANNESBURG, South Africa’s Competition Commission has warned that the monopoly and oligopoly culture which exists in many of the country’s industries is stifling economic growth.

Commission Spokesperson Sipho Ngwema says the problem of monopoly is widespread, and having one or only a few players dominating a market can be extremely problematic.

“If there is only one dominant player, it means they can control prices, they can control who participates in that field. We are trying to open up these sectors so that we can have as many players as possible,” Ngwema said here Wednesday.

The lack of competition is also robbing South Africans of opportunities for competitive prices, better quality products and innovative ideas.

The African National Congress (ANC), whose National Policy Conference ended here Wednesday, has also noted monopoly as one of the barriers to economic transformation.

In the Economic Transformation document discussed at the policy conference, the ANC suggests that “strict enforcement of competition legislation aimed at stamping out monopolistic practices is required”.

The ANC says although some progress has been made, much more needs to be done. It has also noted the work of the Competition Commission in dealing with the problem of monopoly.

This year alone, the Commission has dealt with monopolist and anti-competitive practices in industries such as agriculture, pay-TV, grocery retail, pharmaceuticals, meat production and banking.

Ngwema says even though the problem is widespread, the Commission has decided to specifically focus on four industries — construction, telecommunications, agriculture and health.

In the agriculture sector for example, the commission wants to make sure that the market is shared among people of all race groups while in the telecommunications sector, it feels that having only three or four players and high data charges is a problem.

Ngwema says the problem of monopoly in South Africa is largely a legacy of apartheid, where one race was allowed to centralise the economy. The commission also has a couple of market inquiries to help understand exactly what leads to the thriving of monopoly in South Africa.


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