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Market collusion haunts consumers

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Reports from the Competition and Fair Trading Commission (CFTC) show some traders are still engaged in price fixing and in the process stifling competition and consumer welfare.

This, according to CFTC, is more prevalent among traders operating under groups or associations.

CFTC has confirmed that the groups secretly fix prices for goods and services and set common conditions which are against the provisions of the Competition and Fair Trading Act.

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CFTC Director of Consumer Welfare and Education, Lewis Kulisewa, however said the Commission is working on various strategies to address the problem.

Malawi joined the rest of the world to commemorate

the World Competition Day and activities to mark the day were observed under the theme, Effects of Cartels on Consumers.

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Said Kulisewa; “this theme is relevant because of the high prevalence of anti-competitive practices and collusion on the market. We believe collusion hurts the market in a number of ways and the problem in Malawi is very huge leading to price fixing, among others.”

He said there are different associations, business groups and organisations that continue to secretly fix prices.

Kulisewa also faulted the groupings for recommending terms and conditions to members which he said goes against competition and fair trading practices.

“Cartels are very bad for business; they are bad for consumers and lead to price exploitation. They limit innovation on the market, consumer choices and they limit new investments in an economy. We, therefore, call on all consumers to report any form of anti-competitive practices they encounter,” Kulisewa said.

He said the Commission is engaged in activities to raise awareness of anti-competitive practices among consumers.

“The law enforcement for competition policy is relatively new and there are not many consumers that know. There is a very little awareness and that is the reason why the traders on one hand continue to engage in price fixing or cartels. It is an issue about awareness,” he said.

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