The Changing Strategies of Large Corporations in South Africa Under Democracy and the Role of Competition Law

We assess the relationships between the strategies of large corporations, increased participation and investment in improved productive capabilities, and competition through a case study of South Africa. South Africa is a particularly pertinent case study as the economic reform process undertaken by successive democratic governments from 1994 can be understood as the application of a 'good governance' agenda, establishing independent institutions and drawing up rules, while implementing far-reaching liberalization. The paper gives a brief background on the structure and concentration of the South African economy, and provides an overview of the competition regime. Three sectors are then examined in detail to assess the way in which firms with substantial market power, individually and in tight knit groups, resulting from their positions under apartheid prior to 1994, have responded to liberalization and the introduction of the Competition Act of 1998. In light of the industry cases the competition regime in South Africa is critically assessed