– says Finance Minister
The current crisis has, more than anything else in recent memory, forced policymakers around the world to revisit old orthodoxies perhaps and in many places to re-open ideological debates on issues that some may have regarded as long settled or long closed. Indeed, policymakers in some parts of the world have actually found and expressed comfort in the fact that the limited state of the integration of their domestic jurisdictions into global markets has actually helped to contained their exposure to and provided them with some measure of insulation from, crisis unfolding in the major markets of the world.’ – Dr. Ashni Singh
MINISTER of Finance, Dr. Ashni Singh yesterday advocated that competition policy “must protect consumers and public interests and promote economic growth and development in the domestic and regional economic space”.

He made this remark at the opening of a one-day workshop on Competition Law and Policy in CARICOM, jointly sponsored by the Guyana Competitive Commission and CARICOM Competition Commission and the Ninth European Development Fund (EDF), at the Guyana International Conference Centre, Liliendaal, East Coast Demerara.

“Throughout all of our deliberations, the imperatives of protecting consumers and public interests, and promoting economic growth and development in our domestic and Regional economic space – must be at the centre of our competition policy,” Dr. Singh insisted.

“I believe that the Revised Treaty of Chaguaramas has already laid the main foundation for these objectives to be achieved,” he stated.

Noting that the workshop is timely from a number of perspectives, the minister said it comes just over one-and-a-half year since the CARICOM Competition Commission, established under Article 171 of the Revised Treaty of Chaguaramas, was inaugurated and almost exactly one year since its first Executive Director was appointed.

He recalled that the Commission is mandated to perform the several functions under Article 173 of the Revised Treaty including: apply the rules of competition in respect of anti-competitive cross-border business conduct; promote and protect competition in the Community; monitor anti-competitive practices of enterprises operating in the CSME ( CARICOM Single Market and Economy); investigate and arbitrate cross-border disputes; keep the Community Competition Policy under review and advise and make recommendations to COTED (CARICOM Council for Trade and Economic Development) to enhance its effectiveness; provide support to Member States in promoting and protecting consumer welfare; and develop and disseminate information about Competition Policy and Consumer Protection Policy.

“It is significant to note that Chapter Eight of the Revised Treaty juxtaposes, appropriately in my mind, the twin issues of competition policy and consumer protection,” the Guyanese Finance Minister posited.

Turning to a domestic outlook, he insisted that the session comes at a time when Guyana is embarking on the process of bringing into operation its own Competition Commission with legislation having been passed recently for this purpose.

He said in Guyana, the Competition and Fair Trading Act establishes the Competition Commission and assigns to it important functions which must be kept constantly in view.

These include keeping under review commercial activities with a view to ascertaining practices which may adversely affect the economic interests of consumers; conduct investigations and inquiries to determine whether any firm is engaging in business practices in contravention of the Act; take such action as it considers necessary with respect to the abuse of a dominant position by any enterprise; and eliminate anti-competitive agreements.

He noted the Guyana Commission is also assigned important powers that include declaring certain business practices to be abuses of dominant position; prohibit discrimination or preferences in prices; require the publication of transparent price lists; and order enterprises to cease and desist from any form or conduct that has or is likely to have as its object or effect the lessening of competition.

Also, he reiterated that the Ministry of Tourism, Industry and Commerce is in the process of preparing new consumer protection legislation for submission to the National Assembly.

“These legislative and other initiatives on the domestic front reflect the explicit recognition in Guyana’s National Competitiveness Strategy (NCS) of the importance of competition and consumer protection policy in promoting national competitiveness,” the Finance Minister stated.

In this regard, he said the NCS identifies competition policy among the core policies for promoting national competitiveness.

“The NCS also identifies a number of important realities that obtain in environments such as ours,” he posited.

Dr. Singh outlined that the strategy identified a number of objectives which include setting up the Competition Commission and enactment of the Consumer Protection legislation and establishment of Consumer Protection Commission; training; outreach programme; public awareness; and dialogue with private and public stakeholders on Mergers and Acquisitions, anti-dumping and structure of institutional regulatory framework.

He also alluded to the issue of dominant market positions and being abused in some cases and, in Guyana’s case, cited the issue of telecommunications and transportation as examples.

Dr. Singh also touched on the current global economic and financial crisis noting, “I believe that there are a number of dimensions of this crisis that are relevant as we consider some of the issues that we will (discuss) during the workshop.”

“The current crisis has, more than anything else in recent memory, forced policymakers around the world to revisit old orthodoxies perhaps and in many places to re-open ideological debates on issues that some may have regarded as long settled or long closed,” he stated.

“Indeed, policymakers in some parts of the world have actually found and expressed comfort in the fact that the limited state of the integration of their domestic jurisdictions into global markets has actually helped to contain their exposure to and provided them with some measure of insulation from, crisis unfolding in the major markets of the world,” he observed.

Dr. Singh also referred to the re-opened debates on the efficiency of markets, the occurrence of market failure, the provision of public goods including global public goods such as financial stability and the role of the state especially in ensuring sound regulation in the interest of stable markets.

“I highlight these issues because they are not unrelated to some that you will be seeking to address in the course of your deliberations. For example, some would even argue that excessive competition or overly aggressive and unregulated competitive behaviour was actually an important contributory factor in the genesis of the United States sub-prime mortgage market crisis that was to lead to the subsequent global financial meltdown and the onset of global recessionary conditions,” he said.

The Finance Minister said the financial services sector is a good example of a sector where “unfettered and unregulated competition amongst too large a number of operators will probably inevitably lead to sub-optimal outcomes”.

“In Guyana’s case as it relates to the financial services sector, we have committed ourselves firmly to ensuring that our own financial system is strong, sound and well regulated, a commitment from the part of the government that I have no doubt has contributed significantly to the stability that we have managed to preserved throughout this global crisis,” he stated.

He insisted, “We would need to reflect on the reality that our domestic markets are extremely small, that even the largest of our regional producers (of both goods and services) are tiny by global standards, that regional producers will depend on export markets for sustained long term growth, and that economies of scope and scale will better enable these regional producers to be competitive and to compete in a world characterised increasingly by integrated markets.”

“The question of promoting competition in small markets is by no means an easy one to answer in my mind. In other words, the potential for natural monopolies to arise is considerably greater in smaller markets than in larger markets,” he said.

“Indeed, because of the obvious barriers to entry that exist in small markets such as ours, the potential for dominant market positions to develop and in turn potentially to be abused is considerably greater than elsewhere,” he went on.

The Finance Minister also told the audience this reality is one that he would urge them to pay particular attention to, “as we seek solutions that are responsive to our domestic realities”.

Also, he said the issues of competition and consumer protection must be viewed not only from Regional and national contexts, but also from a sub-national context.

He acknowledged that operating environments are characterised by limited human resources and well-known fiscal constraints noting, “These are realities that are not likely to disappear in the immediate term.”

“For this reason, I believe that legislative and institutional arrangements that we establish (including to administer competition and consumer protection policies) must reflect available human resource availability and indeed fiscal space,” Dr. Singh stated.

Also delivering remarks at the opening ceremony was Minister of Tourism, Industry and Commerce, Mr. Manniram Prashad; and among those present were Minister within the Ministry of Finance, Dr. Jennifer Webster and officials of the CARICOM Competitive Commission and other member States.