Cartels: just a special kind of corruption

2012-02-18 09:15

Corruption is a cancer that eats at the country’s ability to progress because resources are diverted by the greedy and crooked.

Cartels are as great a danger, and the South African economy and its consumers are being choked. This week Telkom, the telecommunications parastatal, appeared before the Competition Tribunal in a case brought by value-added network operators who want to compete in the broadband and telecommunications industry.

It is a vital future industry where the more competition there is, the better the service will be and the lower the cost of communication. In the 21st century, it is the sine qua non of progress. Ask India. Ask Kenya. Ask China. But because Telkom has the cables tied, we have not experienced the broadband revolution delivered at speed and cost to attain the communications modernity that we deserve.

It looks as if Telkom will not come close to paying the R3-billion fine for failing to liberalise the local loop it monopolises, but it should receive the message loud and clear that its cartel-like behaviour has to end.
The malady not only affects telecommunications; this week Brazil threatened to take South Africa to the World Trade Organisation for imposing heavy duties on imported chicken. The end result: we pay more.

It’s foul. South Africans pay the highest bank charges in the world. Our mobile phone costs are much higher and less flexible than offerings made by the same giant companies that operate much more competitively in the rest of Africa and the emerging world than they do.

This week, Business Report showed that the prices of entry market cars are much higher than in most other global regions. The list goes on. Why do we put up with it?

For too long, the South African consumer has been a sitting duck, accepting high prices, poor service and less competition than might be expected in a modern economy. We should all familiarise ourselves with the work of the Competition Commission and ensure that we make our voices heard to break the cartels.

It’s just corruption in a different form.

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