Competition Policy for Investment Climate

completed

Well-functioning, contestable markets are essential for private sector participation to deliver the greatest benefits to the economy and population. However, market competition is restricted by (1) sector specific regulations that limit entry or affect firm’s capacity to expand and compete; (2) distortionary state aid and incentives; and (3) ineffective enforcement of competition rules to combat anticompetitive business practices and mergers. In order to promote more competitive markets, this project will provide technical assistance to governments and regional blocks in different regions - including Mexico, Moldova and COMESA - to strengthen their competition policies. The project will involve working with the private sector, competition agencies and sector government institutions to help develop procompetitive regulatory frameworks, more efficient government practices, and expertise in the implementation of competition policies. To this end, the project plans to advise on amending anticompetitive regulations, conduct knowledge sharing activities such as technical workshops and events to disseminate best practices, and analyze the effects of more pro-competitive policies with a view of informing on the benefits of greater market competition in the selected jurisdictions. In Oaxaca Mexico, activities focus on identifying and removing barriers to competition in key sectors created by subnational regulations, with the objective of unlocking investment opportunities. In Moldova advisory targets effective implementation of state aid control policies in order to minimize distortions to competition and negative effects on private sector participation. In COMESA activities concentrate on supporting the efficient implementation of merger control policies to prevent concentrations with likely anticompetitive effects while minimizing undue burden on private investors.