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Training for free trade

One might wonder why a small land-locked developing country where 75 percent of the population is employed in subsistence farming and 60 percent of the population live on less than the equivalent of $1.25 per day needs policies governing economic competition, but Professor Robert Kudrle argues that it does.

"Getting ripped off hurts more when you are poor," he says. "Developing countries need to protect themselves."

An expert on the international aspects of competition, taxation, and other economic policies, Kudrle recently returned from the Kingdom of Swaziland where he was invited to present at a workshop on competition policy to government representatives and staff of the Swaziland Competition Commission (SCC), as well as local law firms and businesses. The European Development Fund, the International Institute for Advanced Studies, and TradeCom Facility sponsored the workshop.

Formal competition law concerns three main areas, Kudrle explains:

Amalgamation by mergers and acquisitions among firms, which can lead to monopolies and threaten the competitive process;
Collusion by agreements that restrict competition among business, including the suppression of competition caused by cartels; and
Exclusion by such practices as predatory pricing, marketing restrictions, and other actions intended to drive competitors out of business or to keep them from entering.
The Kingdom of Swaziland is an absolute monarchy, says Kudrle, where the king exercises ultimate governing authority. The country has a parliament and a well-structured bureaucracy, but there also are deeply entrenched economic interests.

One of the principal functions of the SCC should be to eliminate anticompetitive activity fostered elsewhere within the government through various forms of regulation. In addition, 90 percent of Swaziland's imports come from South Africa, so many of the competition problems it faces have their roots abroad. This call for strong cooperation with competition authorities in South Africa and elsewhere.

"The issue goes well beyond getting the right laws the books. That's the easy part," Kudrle says. "The government must be alert to a broad range of practices that lower the purchasing power of the Swazi people.

Part of Kudrle's considered four industries that are important in many African countries: sugar, beer, cement, and telecommunications.

Swaziland is making progress toward a freer market. Three years ago, the Swaziland legislature enacted the 2007 Competition Act, creating the SCC, which is charged both with improving trade and economic liberalization and with enabling effective prosecution of region-wide anti-competitive market practices.

Kudrle's hopes for the project are even broader.

"The aim is to maximize transparency and make the market work freely. We want to try to encourage people working on these issues to be aggressive. We want them to become strong advocates for competition and choice in the marketplace."

The ultimate goal is to equip the SCC with the tools to support a free market where consumers benefit, bringing greater economic prosperity and reducing poverty. Kudrle will make at least one more trip to Swaziland in the near future.

"It's exciting to share lessons from abroad with people who are setting the groundwork for an important new venture. I think it builds morale--theirs and mine--to know that professionals all over the world face similar challenges and want to help each other," he says. "This is what networked governance is all about."

On September 29, the University of Minnesota Alumni Association honored outstanding alumni volunteers, groups, and programs, including former Humphrey School Advisory Council and Alumni Board member Bernadine Joselyn (MPA '99), pictured here with mentor and Advisory Council member Tom Swain.

"The University of Minnesota community benefits in many ways from the valuable contributions and service of its dedicated alumni," said Phil Esten, president and chief executive officer of the alumni association. "We are honored to annually recognize individuals who devote an incredible amount of time, energy and talent to promote the University of Minnesota across the state, nation and world, and who encourage engagement through unique and meaningful ways."

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