President Cyril Ramaphosa delivers his state of the nation address at a joint sitting of parliament in Cape Town, February 7 2019. Picture: GCIS
President Cyril Ramaphosa delivers his state of the nation address at a joint sitting of parliament in Cape Town, February 7 2019. Picture: GCIS

President Cyril Ramaphosa says he will soon sign the Competition Amendment Bill into law as part of efforts to increase investment and foster greater economic inclusion.

Delivering his state of the nation address (Sona) in Parliament on Thursday, Ramaphosa said it had long been recognised that one of the constraints that inhibited the growth of the economy was the high level of economic concentration.

“The structure of our economy was designed to keep assets in a few hands,” Ramaphosa said in his address.

The aim of the bill, which was adopted by Parliament late in 2018, includes giving the competition authorities and government more power to tackle high levels of economic concentration. It is also meant to tackle the limited transformation of the economy and the abuse of market power by dominant firms.

Opposition parties objected to various proposals in the bill, with criticism including that it gives too much power to the economic development minister. Various analysts have also raised concern about the clause on mergers involving foreign companies, saying this would give the government the right to block foreign investment.

Ramaphosa said the highly concentrated nature of the South African economy had stifled growth and enterprise and had, to a large extent, kept many young South African entrepreneurs and small enterprises out of the economy or confined them to the margins.

He said the amendment to the Competition Act would give the competition authorities the ability to address this problem and open up new opportunities for many South Africans to enter various sectors of the economy and compete on an equal footing.

phakathib@businesslive.co.za