27 April 2010 | Neil Oelofse in South Africa

Angola’s goods and services market is flawed and lacks competition, its minister of state for economic coordination said this month.

Addressing the press in Luanda, Manuel Nunes Júnior said high prices and inadequate competition prompted the government to intervene and work to regulate the market.

The Public Contract Draft Law, published this month, will apply to the purchase of goods, services and the contracting and management of public works. The proposed legislation aims to simplify the country’s procurement procedures, which will result in a significant cost reduction for the government. The government is now seeking input from public sector buyers, among others, to comment on the draft.

Speaking to SM, South Africa-based competition law specialist Nkonzo Hlatshwayo from Webber Wentzel, said: “The supply market is highly concentrated. If you cannot procure goods or services from a certain supplier, you have to do without or spend more money to get it from distant suppliers.”

A number of sub-Saharan African countries are in the process of adopting competition laws to enhance economic growth, including Botswana, Namibia and Angola.

Namibia launched its competition legislation in December, while Botswana took its laws to parliament in the second half of 2009.

Competition laws should remove entry barriers for businesses, to enable more firms to set up or expand, and to attract direct foreign investment.

Human Rights Watch has called on Angola to fight against corruption. The watchdog’s business and human rights programme director Arvind Ganesan said while the proposed new laws showed a willingness on government’s part to fight corruption, sceptics would wait to see if meaningful action would accompany President Jose Eduardo dos Santos’ promises.

Angola ranks as the world’s 18th most corrupt state in Transparency International’s 2009 index.