Competition Policy : The case of Mauritius RESEARCH TEAM : Dr k. Jankee , Mrs R. Peerun

1. Competition Policy : The case of Mauritius RESEARCH TEAM : Dr k. Jankee , Mrs R. Peerun & Mr S. Bundoo Contents 1.0 General background of the Mauritian Economy 2.0 Competition policies 3.0 Market Structures in Mauritius 4.0 Competition Law and the Role of the Competition Authority 5.0 Interface between the regulatory institutions and competition regime 6.0 Participation in Regional Trading Blocs 7.0 Consumer protection law 8.0 Conclusion

2. Background 1. Mauritius as an example of economic success and middle income • General background • Small island economy in southern Africa with area of only 2040 km2 • Increased life expectancy, high literacy rate , multicultural • Mauritius is well known for its econimc miracle in the 1980s and 1990s • with average growth rates of over 5 % and per capta income over • US $ 4000. • Benefited from preferential markets • Slowdown in economic activity : high unemployment , high budget • deficit • Political democracy

4. Competition policies • Trade policy : External trade From import substitution to export led growth taking advantages of LOME convention, multi -fibre agreement, development of EPZ sector , sugar protocol • Trade in services : Tourism , banking and financial • Diversification of the economy and development of new sectors such as fishing, ICT • diversification of markets ; AGOA and regionalisation , SIDS • Domestic trade : reduction in tariffs leading to higher competition for domestic producers . However, domestic producers are fairly protected especially in agricultural imports and even non agricutural ones • Import quotas still apply to a number of commodities : potatoes,onions, garlic and salt. • The State trading corporation, Agricultural marketing board, Meat authority have import monopoly and fixaximum prices on some strategic products such as flour, rice, cement , petroleum products , potatoes, onions , garlic and meat.

5. Dismantling of quantitative import restrictions • Investment policy : Incentives • · Agricultural Development Scheme/Freight Rebate Scheme • · Export Enterprise Scheme • · Health Development Certificate Scheme • · Hotel Management Scheme • · Industrial Building Enterprise Scheme • · Information and Communication Technology Scheme • · Integrated Resort Scheme • · Modernisation and Expansion Scheme • · Pioneer Status Enterprise Scheme • · Regional Development Certificate Scheme • · Technology Diffusion Scheme

6. Government Procurement • October 2000 Central Tender board Act • Public purchasing call for tenders Over Rs 500, 000 • special thresholds for civil engineering works • tenders are open only to local firms and local agents of foreign suppliers • price preferences up to 15% is given to local suppliers • International agency has its own guidelines • Wage policy • 1. Tripartite wage negotiation ; PRB and NRB • Labour law and high degree of govt intervention ? Debate

7. Role of Small and medium entreprises • Promotion of SMES in terms of institutional infrastructure, financing • and several incentives • Creation of employment • Linkages in the economy and democratisation of the economy

8. Market structures • Market concentration in many sectors such as public utilities, television broadcasting, import and distribution of cement, banking, insurance, air transport , petroleum products • presence of restrictive trade practices • Role of parastatal bodies such as State trading corporation in importing of essential products and use of price controls • Agricultural marketing board • Central electricity board, central water authority, Waste water authority, Mauritius Freeport authority , and others in various sectors of the economy • Mauritius meat authority, State investment corporation • There is a big debate on privatisation or corporatisation ???? • Telecommunications : Open up following commitments with WTO up to January 2003.Monopoly situation • November 2000 strategic partnership with France telecom ( 40%) Monopoly in terms of connectivity till 2008. • Role of information communication and technology authority regarding licences and tariffs.

9. Central electricity board and Independent power producers central water authority Cargo handling corporation construction and cement industry Tourism and air transport financial sector insurance sector Agricultural sector

10. competition law and Role of competition authority • 1. Competition act ( 2003) : legal framework for controlling restrictive trade practices and regulate competition , offer fair trading • establishment of an office of fair trading as the competition authority • competition appeal tribunal and competition advisory council • advise minister , maintain communication with consumer organisations • ACT : abuse of monopoly power, collusive agreements, anti-competitive agreements and bid -rigging. • Exclusion of goods and services like aviation and harbour services, broadcasting services, electricity, financial services, freeport services, ICT, postal services, water etc

11. Interface between Regulatory bodies and competition regime • Financial sector ; role of the Bank of mauritius and financial services commission • New legislations and institutional , banking acts , securities , insurance , • Utilities sector : Utility Regulatory authority , ICTA • Regional cooperation and competition policy • There is a big debate on the a uniform competition policy

12. Consumer protection law • Protection ( price and supplies control )_ ACT 1998 provides for better • protection of consumers in terms of fix maximum mark ups, code of practice, • labelling, information, Vat charges, horading, warehusing , establishment of court, • Competition act 2003 • FOOD Act ( 1998) • Genetically modifies organisms ACT • Consumer protection UNIT

13. Conclusion • historical and structural factors • Role of government • Need to develop competition culture especially following the • loss of markets • liberalisation and market forces • Delay in greater role of the competition authority • Competition is not only influenced by economic factors