1. COMPETITION ASSESSMENT IN MALAWI TRANPORT SECTOR The Executive Director CFTC, Mpikisano House, Area 4, P/Bag 332 Lilongwe 3, Malawi Phone: +265 1 759 506/7 Email: competitioncommission@cftc.mw www.cftc.mwcompetitioncommission@cftc.mw www.cftc.mw

2. PRESENTATION OUTLINE 1.Introduction 2.Objectives 3.Methodology 4.Findings 5.Conclusions 6.Recommendations

3. INTRODUCTION Malawi Transport Sector: Plays a crucial role in economic development Significant effects on trade Critical in land-locked country, importer of fuel ( registers relatively high transport costs) Past studies : Transport costs in Malawi do not compare favourably with other land-locked countries in the region Is competition an issue?

4. OBJECTIVES Overall : To analyze competition in Transport Sector (Road, Air, Water) in Malawi Specific: 1.To determine the level of competition 2.To understand the behaviour of market players and possible effects

5. METHODOLOGY Study Areas: Lilongwe and Blantyre Interviews with regulators, operators and consumers in the transport sector. Review of literature Structure, Conduct, Performance Analysis

6. RESULTS Road transport - Freight : High competition (in terms of number of players) in recent years with an influx of small domestic operators plus Mozambican trucks However, this has not been reflected in lower priced transport. There is strong evidence of coordinated conduct facilitated by associations in freight forwarding or brokering subsector: – Associations involved in fixing tariffs – Clearing and Forwarding Agents Association of Malawi (CAFAAM) and the Indigenous Customs Clearing and Forwarding Association (ICCFA) appear to be culprits.

7. RESULTS Road Transport- Passenger: Prices appear to be the same for each category of passenger transport operators (buses, minibuses and taxis). National Bus Company (also a dominant operator in big bus category) appears to leverage its control over access to key infrastructure to the disadvantage of its rival operators.

8. RESULTS The members of association of TAXI OPERATORS, in cooperation with tourism and airport authorities, appear to have agreed flat rates that are charged on services rendered to and from the airports.

9. RESULTS There are natural monopolies in rail and marine transportation. There are also monopoly concerns in provision of air transport services. Competition in air transport sector is low.

10. RECOMMENDATIONS Basing on the findings of the study, It is recommended that CFTC should :- 1.Investigate and take necessary enforcement measures to curb the cartel and other anticompetitive practices by freight operators, buses and taxis. 2.Facilitate an advocacy initiative with Ministries of Transport and Local Government to address issues of access and management of terminals by big buses. 3.Engage with the regulators in air and marine transport to ensure that the terms and conditions of access to the key infrastructure by the concessionaires are fair. 4.Collaborate with the Department of Civil Aviation to improve the policy and regulations (including those on bilateral agreements) for the approval of more, particularly smaller airlines to enter the Malawian market to offer competition to existing operators.

11. “ZIKOMO KWAMBIRI” THANK YOU VERY MUCH FOR YOUR ATTENTION