Contents of module
- Competition
- Introduction
- Terminology
- Basic Principles
- Competition Requirements
- Competition Laws
- The Regulator’s Role
- Complaints
- Mergers, Acquisitions and Investments
- Miscellaneous Issues
- Appendix I
- Appendix II
- eLearning main Index
Section 9: Miscellaneous Issues
Competition Policies and Trade Policies
Concern has been expressed in a number of quarters about a possible mismatch between a country’s competition policy and trade policies. The issue is of particular importance in relation to the work of the World Trade Organisation (WTO) in its efforts to reduce barriers to trade world-wide.
A mismatch can occur because the two issues have different objectives. A competition policy is formulated to be suitable to the conditions of a particular country, while trade policies are concerned with international issues.
Areas where mismatches have been identified between the two types of policy are in such issues as:
- objectives of the policies;
- their priorities;
- their time-scales; and
- their treatment of different concepts such as intellectual property rights.
It is hoped that such conflicts can be resolved country by country through negotiation.
There is an incentive to reach an accommodation where such conflicts exist because it is recognised that the two types of policy can be self-supporting as well as being at times in conflict.
Developed and Developing Economies
A second issue relates to the distinctions between the developed and the developing economies. One of the objectives of a competition policy is to increase efficiency which, in many cases, means that fewer people are needed to do the same work. This may well conflict with social policies in countries where a surplus of labour is already a serious problem.
Again, the introduction of competition tends to lead to a situation where knowledge workers are in greater demand, especially in an industry such as telecoms where emphasis is placed on innovation and technical expertise. Developing countries may not have such people readily available, and therefore do not gain the benefits of competition that the more developed economies may do.
Further Reading
A considerable volume of literature on these issues is available on the WTO website.
One such document of particular relevance is titled:
Participation of Developing Countries in World Trade: Overview of Major Trends and Underlying Factors
In addition, Industry Canada has produced a document titled Options for the Internationalization of Competition Policy which contains a section on the potential impediments to obtaining a multilateral agreement on competition policy.