Competition scenario in the Lao PDR

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Competition scenario in the Lao PDR. CUTS-NERI Advocacy and Capacity Building on Competition Policy and Law in Asia (7Up2 Project) Alice Pham-Saykham Vodalet. Introduction. Geographical location, population and other geographical characteristics - PowerPoint PPT Presentation

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<ul><li><p>Competition scenario in the Lao PDRCUTS-NERIAdvocacy and Capacity Building on Competition Policy and Law in Asia (7Up2 Project)Alice Pham-Saykham Vodalet </p></li><li><p>IntroductionGeographical location, population and other geographical characteristicsEconomic performance, structure and other characteristicsThe launching of the New Economic Mechanism (NEM) in 1986GDP growth rateOther economic indexesEconomic policies: Industrial policy, trade policy, Privatisation policy, investment policy</p></li><li><p>Industrial policyState-Owned Enterprises (SOEs) vs. private sector developmentSmall and Medium-sized Enterprises (SMEs) development policyEncouragement of import-substitution industries Implications for competition</p></li><li><p>Trade policyDomestic trade liberalisationDecree 12 on Promotion of goods and money circulationOne market, one price principleExternal trade policyDecree 18 on State monopoly on strategic export and import goodsTariff regimes after liberalisationLaos integration into the regional and global markets Bearings on competition</p></li><li><p>Privatisation policyDecree 17 of 1990 on the Conversion of SOEs to Other forms of OwnershipThe Disengagement planCurrent situation: by 2003 there are only round 93 wholly SOEs (of which 32 are considered strategic)Separate negotiation vs. competitive bidding Competition?</p></li><li><p>Investment PolicyForeign Investment Law of 1988 (amended in 1994)Domestic Investment Law of 1994Intended overhaul Implications on competition</p></li><li><p>Importance of competition in the economic policy regime The NEMThe 1991 Constitution of Lao PDR Article 14. The state protects and expands all forms of state, collective and individual ownership, as well as private ownership of domestic capitalists and foreigners who make investments in the Lao Peoples Democratic Republic. The state encourages all economic sectors to compete and cooperate with one another in expanding their production and business. All economic sectors are equal before the law.The Business Law No. 03/NA dated 18 July 1994 All types of operations conducted by enterprises in all economic sectors are inter-related and competing on an equal footing before the law. (Art.5). </p></li><li><p>Market structure and competitionMarket structure and competitionManufacturing sectorsServices and UtilitiesRestructuring trendsBarriers to competitionAdministrative and other policy-induced barriersBarriers to competition by private anticompetitive behaviours </p></li><li><p>Market structure and competitionMonopolistic sectors: Beer, insurance, domestic aviation, electricity, water, etc Oligopolistic sectors: Telecommunications, petroleum, international aviation, banking, logging, cementSectors with competitive market structure: Textile and garment, tobacco, steel, pharmaceuticals, etc.</p></li><li><p>Sectoral policiesElectricity: EdLTelecommunications: LTC, ETL, LAT, and MillicomBanking: State-owned commercial banks and foreign branchesForestry: 03 SOEs and small sawmillsPharmaceuticals: Class I, Class II, Class III pharmaciesLicensingPricingOperational standards</p></li><li><p>Consumer PolicyLaws and institutionsNo comprehensive legislation on consumer protectionThe Prime Ministers Decree on Goods Price Control (October 2001)Issues related to standards, quality, testing and metrologyFood safety The state of consumer welfare in Lao PDR in the framework of 08 fundamental rights:The right to satisfaction of basic needsThe right to safetyThe right to be informedThe right to chooseThe right to be heardThe right to redressThe right to consumer educationThe right to a healthy environment</p></li><li><p>Anticompetitive practices CartelsDefinitionExamplesIn Lao PDRRestrictive trade practices (RTPs)Abuse of dominanceUnfair trade practices (UTPs)</p></li><li><p>Perspectives on competition policy amongst stakeholders in the Lao PDRSurvey results presented by Dr. Saykham Vodalet (NERI) </p></li><li><p>Competition LawThe Prime Ministers Decree on Trade Competition 2004ObjectivesPrinciplesScope of applicationThe Trade Competition Commission Some critical views</p></li><li><p>The Way ForwardEstablishing the Trade Competition CommissionBuilding capacity of national stakeholders to effectively implement the DecreeA hybrid approach for both competition and consumer protection</p></li></ul>

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