• Policy to govern consumer protection and competition is good, provided …
After an earlier attempt in 2002 to introduce an anti-trust regime through the instrument of legislation, the Federal Government is said to be pushing for a new competition and consumer protection policy. The policy, described by industry, trade and investment minister, Olusegun Aganga, as “consistent with global trends, for a robust legal and regulatory framework to govern consumer protection and competition”, is said to “underlie the need for fair and competitive environment for industry, trade and investment”.
According to the minister, the policy has become necessary to “forestall and/or minimise the emergence of private monopolies who would replace the public monopolies that the government was moving away from”. It is also to ensure that Nigerian consumers got value for their money.
Clearly, the dynamics of the Nigerian business environment in the last decade, particularly the relentless push by the managers of the economy for greater liberalisation of the economy are such that have made the proposed regulation both necessary and inevitable. Most certainly, it goes beyond the need to ensure due observance of sound business practices, particularly in the area of trade regulation and consumer protection, to one of addressing a fundamental lacuna in our trade practices.
We are witnesses to how the push for liberalisation has spawned the emergence of the big players – particularly of monopolies/oligopolies and powerful cartels. One natural consequence of the development is the rising fear of possible exploitation of the consumer through collusion and other forms of anti-competition practices by dominant players in the economy. We see the coming of the proposed law as speaking to the need to ensure that regulations are in lock-step with the dynamics of the economy; to fill the lacuna created by the lack of effective competition regulations.
The law however is only one step in the long journey to true competition under which the consumer is said to be availed of an array of possibilities which he/she could choose from. Underlying this is the notion that no single player is allowed to be so powerful as to be able to unilaterally fix prices.
Truth is; the nation has a long way to go in this regard. To start with, the choices available to the Nigerian consumer remain extremely limited; as we know, the barriers to business – big or small – remain impregnable. The latter is at the heart of why the few dominant operators are allowed to carry on as they please – a situation that was only compounded by the absence of institutional or regulatory restraints.
Of course, some of the factors behind this are partly understandable. For instance, the more glaring examples of monopolies have merely benefited from years of a head-start in specific sectors in addition to other innumerable incentives from government; others have emerged after years of intense market research and development efforts; others simply took advantage of weak regulation to emerge as octopus. Unfortunately, in almost all of the cases, such advantages enjoyed have often been to the detriment of the consumer.
The law will, hopefully, change that by ensuring that no player is allowed to exploit the benefits of its dominance to prey on the market.
However, the greater challenge, in our view, is for the Federal Government to work on fostering an environment that truly promotes competition and fair play for all economic actors, a system that rewards true entrepreneurship as against one that is a cover for rent and patronage. To the extent that the nation is a long way from such an environment, this should engage the Federal Government as much as the proposed law.
