E-Newsletter
Vol. II

• Cambodian Legal Resources Development Centre (CLRDC) in Cambodia;
• National Economic Research Institute (NERI) in Lao PDR;
• Central Institute for Economic Management (CIEM) and Vietnam Standard and Consumer Association (VINASTAS) in Vietnam;
• Bangladesh Enterprise Institute (BEI) in Bangladesh; and
• South Asia Watch on International Trade, Economics & Environment (SAWTEE) in Nepal.

Project Progress…

In the Mekong region, all the partners are in the process of preparing the Project Country Report – a document presenting the competition scenario (in respects of policy issues as well as ground realities) in their respective countries, on the basis of field surveys and interviews undertaken earlier.

The Country Report incorporates findings of questionnaire surveys undertaken in each of the project countries. These questionnaires were administered to assess the level of awareness and perception of consumers, policy-makers and the business community in each of the project countries about competition in the market. The questionnaires were desinged in such a manner that cases of anti-competitive practices prevalent in the country could be identified.

In Nepal, in parallel with preparing the said report, SAWTEE has been undertaking effective and innovative advocacy activities viz. having a consultation meeting with economic journalists on the role of media in promoting competition culture in Nepal; and a (regular) radio programme on competition related issues affecting consumers, being aired every Friday.  A quarterly newsletter entitled Fair Competition (in Nepalese) is also circulated with the objective of raising the level of awareness on competition issues of various stakeholders in Nepal.

July brought some good news, when the Asia Regional Poverty Fund (ARPF) of the Department for International Development (DFID), UK agreed to support an adjunct component of this project in Bangladesh and India. Therefore, the project is now being simultaneously implemented in six project countries, Vietnam, Lao PDR and Cambodia in Southeast Asia and India, Nepal and Bangladesh in South Asia.

Activities in India are being implemented by CUTS under a project entitled 'Towards a Functional Competition Policy for India' (FunComp Project).

Regional Launch Meeting at Dhaka

CUTS, in collaboration with BEI, organised the Regional Launch Meeting of the project on 22-23 September in Dhaka, Bangladesh.

Speaking in the inaugural session of the meeting, the Commerce Minister of Bangladesh, Air Vice Marshal (Retd.) Altaf Hossain Chowdhury, upheld the commitment of the Bangladesh government to promoting effective and well-functioning markets. The minister expressed his hope that the project would bring out significant learnings, helping Bangladesh in shaping its policies on market regulation.

Pradeep S Mehta, Secretary General of CUTS emphasised that a competition policy and law is not a luxury for the developing world but a necessary governance instrument for all countries.

Farooq Shobhan, President of Bangladesh Enterprise Institute (BEI) highlighted the need for competition policy and law especially in the era of globalisation and liberalisation as the country is engaged in market-oriented reforms. “Markets cannot take care of everything and the government needs to ensure that appropriate regulatory frameworks are in place so that market failures do not thwart the efforts of the government to ensure better standards of living for the people”, reasoned Sobhan during his inaugural speech to the august gathering of academicians, experts, representatives from various civil society organisations, the media and government agencies, who had gathered to flag off the 7Up2 project in Bangladesh.

Frank Matseart of DFID Bangladesh expressed the commitment of DFID in promoting competition policy and law as a component of their private sector development strategy, which has important bearing on growth and poverty reduction in developing countries. He also noted that the current project was imperative to permeate the achievements of the 7-Up1 project implemented earlier by CUTS in seven Commonwealth countries (with support from DFID), to other parts of the developing world.

The event was well covered both by the electronic and print media. The Press Release can be found in the ‘Advocacy’ section of the project webpage: www.cuts-international.org/7up2.htm                        

Reconnaissance visit to Dhaka

In continuation to the trip to Dhaka for the purpose of launching the project there, a member of the Project Coordination and Management Unit extended his visit for a week in order to make contacts with some key stakeholders in the country, and tried to assess their perception of competition policy and law there.

Though the acting Chairman of the Bangladesh Tariff Commission thought that competition is a ‘dead issue’, as it was no longer being discussed under the WTO, he admitted that the implementation of competition law would help protecting the interest of the domestic companies (especially the myriad SMEs operating in the country). Representative of the Industrial Promotion and Development Company, a Bangladeshi financial institute, thought that some policies of the government were actually creating entry barriers for businesses and needed to be appropriately pruned to create an enabling environment for the private sector to flourish. Meetings with people from the business community and the press were also useful, as instances of anti-competitive practices prevalent in Bangladesh could be dug out from these meetings.

• Bangladeshi garment exporters have suggested formulating a code of conduct for shipping agents and freight forwarders to prevent them from realising 'arbitrary and unjustified' shipping charges. They complain that such high shipping charges are making export-import costlier and as a result the readymade garment manufacturers of the country might lose their competitiveness in the international market. This demand raised by the Bangladesh Garment Manufacturers & Exporters Association, has been backed by the country’s Chamber of Commerce and Industries. (Read full story...)

• Bangladesh has to depend heavily on imports mostly to meet the demand of consumer items, especially onions, pulses, edible oil, sugar, which result in price hike, especially during the holy month of Ramadan. Importers and wholesalers allege that prices of onions, pulses and sugar are marked up in line with the price hike in the international market over this period. The business community has urged the government to take appropriate measures to address this problem. (Read full story...)

• A high level committee has been entrusted with the responsibility of amending the Companies Act of the country. The Company Law Reform Committee, in its report, had suggested sweeping changes in the existing Companies Act 1994, to improve the shortcomings of the existing act, especially in terms of catalysing the emergence of the private sector as a driving force for the improvement of Bangladesh’s economy. (Read full story...)

• Economists feel that WTO membership will put Cambodia to a stiff test on account of the obligations required in areas like Agriculture and Pharmaceuticals. The entry would test whether poor countries in the world could be better off by becoming members of the global trade body.  (Read full story...)

• A high level of corruption in pubic administration threatens to derail development initiatives of international donors for the country’s millions of poor people. A recent probe by the UN has revealed that the benefits from the World Food Programme failed to reach a large chunk of the needy on account of embezzlements in the government circuit. (Read full story...)

• The Supreme Court of India has asked the government to amend the Competition legislation of the country. In the apex court's view it appeared from the government's earlier suggestions that executive functions take an upper hand over judicial functions. The government had filed these suggestions in response to a write petition, challenging the appointment of a bureaucrat to head the Competition Commission of India. (Read full story...)

• Indian Prime Minister Manmohan Singh announced that a committee would be set up under his chairmanship to monitor the focus of all key infrastructure projects in the country, with the Planning Commission of India being the executive arm of the committee. He has assured that the government would prepare a regulatory framework for infrastructure. (Read full story...)

• There is a possibility that the monopoly of Container Corporations of India (Concor) would soon end with the entrance of private players in movement of cargo containers by rail. The Railway ministry has signaled its intentions to permit private players enter the sector, realising the surge of demand for cargo movement by rail, and the inability of Concor to meet them. (Read full story...)

• As a means to ensure efficiency and transparency in approving foreign investment projects, the Laotian government is all set to announce the country’s new investment policy. This move comes in continuation with the governments’ efforts to decentralize the entire process to save time and evoke participation of the local authorities, who are directly affected by a host of these investments. (Read full story...)

Nepal

• Experts in the country feel that the private sector would have to raise their voice to push the government to enact the competition legislation for the country. However, a prerequisite would be for the private sector, especially domestic manufacturers to assimilate the need for the legislation.
  (Read full story...)

• The private sector’s decision of importing sugar eventually led to normalizing of its prices. Lately, as the price of sugar kept on soaring in Nepal, the government and the private sectors were involved in blaming each other for this. (Read full story...)

Vietnam

• A recent survey of pharmacies in Hanoi and Ho Chi Minh city by the Ministry of Health has revealed that prices of most of the imported drugs were marked up. Observes feel that the monopolistic nature of the system for importing, distributing and pricing of drugs in the country has led to this. (Read full story...)

• The National Assembly of Vietnam recently passed the Competition legislation for the country. Some concerns were raised over the period before adoption of the law. (Read full story...)