SOUTH African companies investing in the rest of Africa have had a relatively easy time of it if one considers the rigours US retail giant Walmart has been going through in SA recently. Our local multinationals have been combing the continent’s markets looking for merger and acquisition targets, mostly unencumbered by the kind of competition law considerations Walmart, and others before it, face here.

Only about 25 African countries have competition bodies and it is taking time for the concept to get traction. Earlier this year, the 23-country African Competition Forum was launched in Nairobi, which is likely to provide impetus to such policies.

 It is worth noting that the very arguments the trade unions in SA are using to forestall Walmart’s ambitions in SA could equally apply to our retailers investing in other African countries, where manufacturers struggle to compete with SA’s economy-of- scale pricing and supply chains.

Although six African countries approved the Walmart merger with , the nature of the subsequent debate on the issues in SA may influence their thinking in future deals of this sort. Already, the conditions the Namibian authority imposed, overturned in court on appeal, reflected those the South Africans want.

Given that SA has the deepest competition experience and institutions in Africa, it is likely that arguments and judgments here may inform other countries’ attitudes to the same issues. For example, the hostility towards multinationals is prevalent in many other nations, who see foreign companies as a threat, rather than a benefit, to their economies.

There is also a tendency to see protecting jobs as being more important than promoting their growth by making economies more competitive in order to attract investment, which in turn creates jobs if the environment is conducive.

Local procurement is a growing issue in the rest of Africa, despite the fact that most industry outside SA is not yet able to supply goods at the same price and quality as those provided by the South Africans.

There are other decisions made by SA’s competition authorities that may have anticompetitive reverberations in other African countries. The unfortunate wording of the Competition Commission in blocking the R170bn tie-up between MTN and India’s Bharti Airtel — that it would lead to MTN losing its “national character” — sets an unfortunate precedent that could make it easy for governments to protect local monopolies from foreign competition.

 The onerous and costly conditions imposed in SA in the takeover bid by Japan’s Kansai Paint of local company Coatings, which included a three-year freeze on retrenchments and a 10-year commitment to manufacture in SA and establish a local facility within five years, may also resonate with African governments.

One of the key issues the Walmart case raises is the link between the competition authorities and the governments’ own agenda. Critics have pointed to SA’s government using the tribunal to reflect its own growth plan considerations rather than the interests of consumers.

Increasingly, critics argue that SA is mirroring some of the bad practices on the continent. It is worth noting in this regard that it has been governments in Africa that have been the most uncompetitive force in their economies for various reasons. These include the tendency to crowd out the private sector with inefficient parastatals, skew the playing field to favour local monopolies and use licensing and regulation to protect the private interests of top government officials. The issues in SA are different but are still linked largely to government.

To date, competition policy in the rest of Africa, where it exists, has been viewed positively as a vehicle to reduce risk for both local and foreign companies and to level the playing field.

 But there is an outside chance the well-publicised arguments in the Walmart case could get competition authorities to look differently at similar potential deals in their own countries . This could have repercussions for South African companies, who already face anti-South African sentiment in some African markets where their dominance has created resentment among competitors — and victims.