CRCAL Presents: Workshop on the State of Competition in Key Economic Sectors in Honduras

Rodrigo Rios, Aug 19, 2013

The Regional Competition Center for Latin America (CRCAL), the World Bank (WB), the Bank Netherlands Partnership Program (BNPP), and the local competition authority (Comisión para la Defensa y Promoción de la Competencia from Honduras: CDPC) held on July 29, 2013 a workshop on the “Current State of Competition in Key Economic Sectors in Honduras.” Renowned international consultants were in charge of presenting the results of studies in the retail banking, basic grains and supermarket sectors in Honduras.

In the morning session Germán Coloma, Professor from the CEMA University in Buenos Aires, was in charge of presenting some of the most important features of different type of financial institutions in Honduras, such as public and commercial banks, saving a loan associations and financial companies. Among the conclusions that can be drawn from the study is that the concentration level of the market is intermediate and that no bank has more than 20 percent of the market. Also, through the use of econometric regressions it can be inferred that the market does possess a healthy level of competitiveness.

Professor Emek Basker from the University of Missouri was in charge of presenting a study on competition conditions in the supermarkets sector in Latin America. The study mentioned that market definition in the region is complex since it needs to take into account several factors such as the consumer basket, location of facilities as well as transportation and storage costs, which are specific to each country.¹

Alcides Castillo, a Honduran consultant specialized in basic grains presented his conclusions on a study on that field. The document mentioned that there are existing legal barriers that limit competitors from entering the market. Among the most important conclusions are that a zero quota import tariff is awarded to certain producers only when they comply with certain conventions and trade agreements, thus distorting the competition process in the sector.²

It is worth noting that among the attendees to the event were Agriculture, Industry and Commerce Ministers, as well as Central Bank officers. Industry and consumer association’s representatives were also present. The goal of this type of event is to encourage relevant stakeholders to share their needs and concerns with the Competition Authority. Moreover, for CRCAL the Tegucigalpa seminar represents a way to showcase how its guidelines and sector studies can be customize to the specific needs of it member countries like Honduras.

1 The study can be consulted fully at the CRCAL webpage www.crcal.org
2 German Coloma and Alcides Castillo study will be available at the CRCAL webpage next month.