Kenya’s business environment has been weakening over recent years and this has limited the private sector’s ability to grow, create jobs, and contribute to economic development. Competitive domestic markets are necessary to boost Kenya’s competitiveness. There are two pillars that sustain effective competition policy: (i) opening markets and removing anticompetitive regulation; and (ii) effectively enforcing competition law. The main focus of this report is the identification of regulations that could restrict competition and distort markets and business decisions, having a negative effect on Kenya’s competitiveness and growth. This report contains results from a review of the regulatory framework in key areas identified using Organisation for Economic Co-operation and Development's (OECD) Product Market Regulation (PMR) indicators, the World Bank Group’s framework to identify anticompetitive regulations, and interviews with stakeholders. This report is concerned only with certain regulations that affect market competition in select sectors and topical areas. The report stems from the policy dialogue with various Kenyan institutions, supported by the Kenya Investment Climate Program. This report contains three parts. Part one identifies restrictive regulations that affect the whole economy, while Part two focuses on select sectors. Part three provides policy recommendations to promote greater competition in Kenyan markets through the assessment and modification of regulations that create obstacles to competition. It also provides estimates of the potential benefits of reforming product market regulations.
Abstract
Kenya’s business environment has been weakening over recent years and this has limited the private sector’s ability to grow, create jobs, and contribute to economic development. Competitive domestic markets are necessary to boost [...]
Digital transformation of industries and markets remains a key challenge for the modern competition policy. Digital ecosystems are playing increasingly important roles in the structure of the economy. That is why their regulation is becoming an especially relevant problem for antitrust regulators. The goal of this preprint is to identify key specific factors of competition restraints on markets for goods and services in the spheres of digital ecosystems functioning. The authors of the research aggregate and compare main concepts and models of digital ecosystems with a focus on procompetitive and anticompetitive factors of their activities. The authors also summarize main issues raised in the process of market behavior qualification and market structure assessment for artificial intelligence (AI) intensive companies (ecosystem leaders). These issues include enhanced market concentration, risks of price discrimination and algorithmic collusion. The main research method in this regard is the legal and economic analysis, which is based on the economic assessment of Russian and foreign legal documents. The specific challenge in that sphere is the dependence of AI efficiency on big-data-based machine learning. This feature causes an increase in market concentration, strengthens the positions of market leaders, and potentially weakens the competitive environment. The results of the research include the systematization of digital ecosystem concepts, the detection of main factors for their modeling and the identification of presumptions and consequences of the modernization of antitrust regulation. Antitrust bodies are recommended to improve their own digital competencies and analytical capabilities to prevent the loss of control over the market, as well as the elimination of AI benefits.
Abstract
Digital transformation of industries and markets remains a key challenge for the modern competition policy. Digital ecosystems are playing increasingly important roles in the structure [...]
This study shows how the World Bank Group’s Markets and Competition Policy Assessment Tool (MCPAT) can help economies identify reform areas that would make government interventions in freight and logistics services more conducive to competition. The study focuses on three case studies among Asia-Pacific Economic Cooperation (APEC) countries - Peru, Philippines and Vietnam - to illustrate the importance of identifying specific areas for behind-the-border reforms. The analysis focuses on containerized cargo and multimodal transport links between road and maritime transportation, building on primary data collection through novel questionnaires for stakeholders. This study identifies potential competition issues to monitor and makes specific recommendations by country and topic. Potential competition issues include abuse of dominance through exclusionary or discriminatory practices, predominantly in access to multimodal infrastructure and slot allocation along the chain, as well as potential collusive practices in the wholesale segment (for example, among carriers) and in highly specialized services, such as pilotage and towing in port terminals. Furthermore, given the tendency toward (horizontal and vertical) mergers and acquisitions in freight forwarding, it is essential to continue evaluating changes in market structure and the potential impact of these changes on market contestability.
Abstract
This study shows how the World Bank Group’s Markets and Competition Policy Assessment Tool (MCPAT) can help economies identify reform areas that would make government interventions in freight and logistics services more conducive to [...]