There is indeed light at the end of the tunnel as the executive arm of the Nigerian executive government finally endorsed the Federal Competition and Consumer Protection Bill into law. The bill is very important to many stakeholders who encourage competition and consumer protection as a tool to boost the Nigerian economy and the business environment. Just two months ago during a World Competition Day event in Abuja; which was hosted by the Centre for Trade and Business Environment Advocacy (CTBA), many stakeholders expressed optimism, hoping that the executive and legislature would resolve their areas of difference speedily. So much excitement was shown on February 6, 2019 as President Mohammed Buhari finally enacted the FCCP bill into law.
Competition between businesses has been shown to increase efficiency, expand consumer choices and influence pricing. As Nigeria strives towards achieving a diversified private sector-led economy, it became essential to have effective legislation that encourages and regulates competition. The bill will create an opportunity for relatively small businesses to compete and thrive in the markets alongside the larger ones. According to the Economic Impact Assessment Report developed by the National Assembly Business Environment Roundtable (NASSBER), “competition law and policy is based on clear insights from economic history that public interest is best served by free competition in trade and industry. Competition amongst producers and suppliers improves quality, increases efficiency and results in lower (“more competitive”) prices. Global research suggests that real prices drop by between 25-50% as a result of competition and deregulation in previously uncompetitive industries and quality of service also improves. Research also suggests an approximately 2.5% increase in employment as well as significant economic growth’’.
Speaking on the signing of the Federal Competition and Consumer Protection Bill signing, Mr ‘Laoye Jaiyeola, CEO Nigerian Economic Summit Group (NESG), stated based on global research evidence, that the new Competition Act may result in a 10% reduction in prices in uncompetitive sectors and
a 1% economy-wide price reduction, both of which manifests as an income effect. For poor households especially, this implies 318,021 additional employment over 5 years, with average yearly job creation of 63,604 and total income effect estimated at an average of N148.30 billion annually; and N741.52 billion projection in 5 years. A resultant effect may influence a decrease in poverty, higher employment rates, and lower prices may precipitate an 11.8% reduction in relative poverty within 5 years.
Furthermore, many are optimistic that the Federal Competition and Consumer Protection Bill will create a competitive consumer-centric market by providing competitive prices, product choices and most importantly economic efficiency via the prohibition of restrictive business practices that constitute an abuse of dominant market position in Nigeria. With such efficiency, Nigerians can be hopeful about better pricing of goods and services, higher employment generation, better productivity, increased consumer savings, increased investment and fast economic growth that the country deserves.