Dhaka,September 23, 2004, Press Release

23 September 2004, Dhaka: “Bangladesh government is committed to promoting effective and well-functioning market”, stated Altaf Hossain Chowdhury, the Minister of Commerce of Bangladesh. He was speaking at the regional launch meeting of a project on “Advocacy and Capacity Building on Competition Policy and Law in Asia”, codenamed as 7Up2, held at Dhaka on 22-23 September, 2004. The meeting was organised by Bangladesh Enterprise Institute (BEI) in partnership with CUTS International, India, which is also the lead partner of the project that covers five other countries: Cambodia, India, Lao PDR, Nepal, and Vietnam. The minister expressed his hope that the project will bring out significant learnings, which will help Bangladesh in shaping its policies on market regulation.

Earlier in the day, Mr. Farooq Shobhan of BEI highlighted the need of 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 thwarts the efforts of the government to ensure better standards of living for the people”, reasoned Sobhan.

Speaking on the occasion, Pradeep S Mehta of CUTS argued, “a competition policy and law is not the luxury of the developing world but a necessary governance instrument for all countries. It is true that as of now it is found mainly in developing countries but countries like the US, Canada and Australia adopted a competition law more than hundred years back when they were at a stage of development where developing countries find themselves today”. He also provided a brief account of the developments that have taken place on the competition policy and law front around the world.

Frank Matseart of the Department for International Development (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 achievements of the 7-Up1 project also implemented by CUTS in seven developing countries with support from DFID. He expressed the hope that the present project will be equally successful if not more.

Atiur Rahman, a reputed economist of Bangladesh noted that there is feeling in several countries including Bangladesh that in the aftermath of competition policy being dropped from the WTO Doha Round Agenda, the issue has become dead. However, he cautioned, “developing countries need a competition law for their own benefits irrespective of whatever happens at the WTO”.

The meeting also noted that several anticompetitive practices are taking place everyday that originate from outside a country or affect a number of countries or even the entire world. It was felt that there is an urgent need to adopt some multilateral framework to take care of these practices. However, it was also felt the proposals made at the WTO may not be appropriate. Not only because the WTO is not the most appropriate forum but also because under the proposals most cross-border anti-competitive practices that affect developing countries more will remain unaddressed. It was suggested that a new forum entirely dedicated to competition issues under the auspices of the UN could be considered.

It was also mentioned that there are regional dimensions of the issue as well. In South Asia, India being a very large country and countries like Nepal, Bhutan and Bangladesh having significant trade linkages, anti-competitive practices organised in India also affect the other countries. It happens in the reverse direction as well but at a lower scale. It was suggested that as the SAARC countries integrate more and more, a regional competition framework can be evolved. Some participants also opined that India which has relatively better regulatory arrangements should address the concerns of neighbouring countries and give access to them in its relevant forums.

Experiences from countries like India, Pakistan, Sri Lanka, Nepal, Cambodia, Lao PDR and Vietnam were shared in the meeting. It came out that the three countries: India, Pakistan and Sri Lanka have reasonably long experience with competition law, however, not very encouraging. Problems have been there with the design of the law and more so with its implementation which was not taken seriously by the policy makers. Countries like Bangladesh and Nepal have a different story as anti-competitive practices thrive without any threat of law. The three countries of Mekong region are no better where the markets are still dominated by state-owned enterprises.

The participants in the meeting also discussed about promoting a healthy competition regime in the project countries and the strategies and actions required to achieve this objective. It was highlighted that an appropriate competition policy and law would help everybody in the economy including the business. It needs to be emphasised that a competition regime is to create an enabling environment in which business thrives and grows though there are often apprehensions to the contrary. It is absolutely essential to involve all stakeholders in designing as well as implementing a competition regime was the consensus that prevailed among the participants.