Opening the Economy

Please login to access download links.

Barriers to Entry and Competition What does it take for entrepreneurs to be effective competitors? What are the factors affecting entry and participation in sectors where there are historically strong incumbent firms? Opening the South African Economy brings to light the challenges of concentration, inequality and exclusion in different sectors of the South African economy. The book begins with an assessment of the current state of the economy. Detailed case studies then recount the experiences – good and bad – of well-known South African entrant firms in sectors that are critical for facilitating economic growth, including retail, food, fuel, telecommunications, airlines and banking. Important cross-cutting chapters reflect on the role that government policies can play in achieving a more open, inclusive and competitive economy and the use (and misuse) of policy tools such as competition law, black economic empowerment and state procurement. It concludes with a set of concrete recommendations for opening up the South African economy, improved coordination among state institutions and inclusive industrial development. 'Accessible and practical,Opening the South African Economy will appeal to a broad readership of business people, policy-makers, students and academics. ‘A persuasive book …. The authors offer an agenda to meet the urgent challenge.’ Eleanor M Fox, Walter J Derenberg Professor of Trade Regulation at New York University School of Law ‘ … compelling economic research and a fascinating read.’ Frederic Jenny,Professor of Economics at ESSEC Business School in Paris and Chairman of the OECD Competition Committee ‘ … a timely review of South Africa’s journey to opening up markets … ‘ Mondo Mazwai,Chairperson, Competition Tribunal of South Africa

List of figures

List of tables

Foreword

Acknowledgements

Acronyms and abbreviations

Introduction: Challenges to a more open economy

Sumayya Goga and Thando Vilakazi

1. Key competition challenges in the South African economy: Large firms, concentration and lack of dynamism

Jason Bell and Sumayya Goga

SECTION ONE: ENTERING MARKETS: WHAT DO RIVALS REQUIRE?

2. Entry challenges in vertically integrated industries: Insights from three agro-processing value chains in South Africa

Maria Nkhonjera

3. Barriers to entry in concentrated industries: A case study of Soweto Gold

Pamela Mondliwa

4. Confronting entry barriers in South Africa’s grocery retail sector

Shingie Chisoro-Dube and Reena das Nair

5. Contesting the skies: Entry and rivalry in the South African airline industry

Thando Vilakazi

6. South African community newspaper publishers: The effects of exclusionary strategies on independent firms

Avias Ngwenya

7. The competition implications of recent developments in the liquid fuels supply chain

Anthea Paelo, Genna Robb and Thando Vilakazi

SECTION TWO: REGULATING FOR RIVALRY IN NETWORK INDUSTRIES

8. Bridging the digital divide in South Africa: Case studies in incumbency versus competition

Genna Robb

9. Competition, barriers to entry and inclusive growth in retail banking: Capitec case study

Trudi Makhaya and Nicholas Nhundu

10. Breaking barriers through different business models: Mobile money in South Africa and Kenya

Anthea Paelo

SECTION THREE: REVIEWING POLICIES FOR INCLUSION IN SOUTH AFRICA

11. Assessing the record of competition law enforcement in opening up the economy

Simon Roberts

12. Lost opportunities? Barriers to entry and Transnet’s procurement of 1 064 locomotives

Rod Crompton and Lauralyn Kaziboni

13. Black economic empowerment and barriers to entry

Pamela Mondliwa and Simon Roberts

Conclusion: Towards a more competitive and open economy

Sumayya Goga, Simon Roberts and Thando Vilakazi

Contributors

Index

Thando Vilakazi is Director of the Centre for Competition, Regulation and Economic Development (CCRED).

Sumayya Goga is a Senior Researcher at CCRED.

Simon Roberts is a professor at the University of Johannesburg, in the School of Economics, and Lead Researcher at CCRED.