HILARY JOFFE: No small solution to SA’s big monopolies
A debate about why the structure of SA’s economy is so concentrated and what to do about it is much needed
Does SA have a concentration problem or a competition problem? It’s a question that was asked by one of the competition economists at a recent University of Cape Town competition law conference, where Economic Development Minister Ebrahim Patel’s plans to empower the competition authorities to tackle SA’s high levels of economic concentration and social exclusion were the subject of robust discussion. Patel has an expert advisory panel working on proposed legislative amendments that would mandate the competition authorities to look into sectors that are dominated by just a handful of companies and give them the power to break up companies deemed too dominant — even where they have done nothing wrong. The minister seems well aware of the damage such legislation could do to investor confidence and South African corporate life. He clearly is listening to the panel’s cautions and to the reservations expressed by the competition community. He is likely to try to frame legislation that co...