African countries have much to gain by encouraging open and competitive markets, particularly as a means to spur sustainable economic growth and alleviate poverty. However, such development is seriously hampered by the prevalence of cartels, anticompetitive business practices, and rules that prevent fair competition.
Competition authorities have made progress in increasing market competitiveness, but important additional steps must be taken: 1) setting fines and penalties that are higher than the expected profits to deter anticompetitive behaviour; 2) use more effective tools for detecting cartels and investigating them; and 3) adopt leniency programmes that allow cartel members to confess and cooperate with investigations in exchange for immunity or reduced penalties.
In addition to fighting the ‘spoilers’, policymakers should take measures to actively promote competition. Priority should be given to sectors that are especially important to the growth of African economies (such as cement, fertilizers, and telecommunications) that directly affect the competitiveness of African producers, but lack a level playing field.