When Shoprite leaves Ghana, it’s more than a headline about a major retailer’s departure. It’s a pivotal moment that could shape the country’s retail landscape for years. While some see it as an opportunity for local businesses to expand, others fear the move could lead to market concentration, higher prices, and reduced consumer choice.
Ghana’s retail market is growing rapidly, with malls, supermarkets, and online shopping platforms gaining popularity. However, without strong competition laws in place, the exit of a giant like Shoprite could tip the balance in ways that hurt both consumers and suppliers.
Ghana’s Missing Guardrails: The Competition Law Gap
Since 2007, Ghana has had a draft Competition and Fair Trade Practices Bill, but it has never been passed into law (UNCTAD report). Without such legislation, mergers and acquisitions in the retail sector face no formal oversight.
This is in sharp contrast to the telecom sector, where the National Communications Authority (NCA) reviewed MTN’s market dominance before labeling it a Significant Market Power (NCA press release). Without similar scrutiny in retail, dominant players can expand without checks — potentially pushing smaller competitors out.
Why the Buyer’s Identity Matters
If Shoprite’s assets are acquired by an already dominant player like Melcom, it could drastically increase market concentration. Melcom’s expansion after GAME’s exit in 2022 shows how quickly market share can consolidate.
High concentration in urban retail could lead to:
- Higher prices due to less competition
- Fewer consumer choices in products and brands
- Increased pressure on local suppliers to accept lower margins
Economists at the OECD note that concentrated markets often result in less innovation and slower product variety growth.
The Risk to Consumers and Suppliers
Without regulatory oversight, large retailers can exercise “buyer power,” dictating terms to suppliers. The Food and Agriculture Organization (FAO) warns this can weaken small producers (FAO report on buyer power).
This could mean:
- Local farmers and producers getting squeezed on prices
- Reduced shelf space for Ghana-made goods
- Slower growth for new retail startups
Lessons from Other Countries
Other nations have dealt with similar challenges more proactively:
- Malawi — Its Competition and Fair Trading Commission is reviewing Shoprite’s exit to safeguard market fairness.
- Namibia — Competition law ensures all large acquisitions are reviewed for public interest.
- South Africa — The Competition Commission has blocked mergers harmful to consumers, such as in healthcare.
- United Kingdom — The CMA blocked the 2019 Sainsbury’s–Asda merger due to risks of higher prices and reduced choice.
A Way Forward for Ghana
Even without a competition law, Ghana’s Ministry of Trade and Industry can review such transactions and set conditions. But long-term, the country needs to:
- Pass the Competition and Fair Trade Practices Bill — to review large acquisitions and prevent anti-competitive behavior.
- Strengthen consumer protection laws — to safeguard against price hikes and reduced quality.
- Support small suppliers — through fair contract terms and shelf space guarantees.
The Bigger Picture: Ghana’s Retail Growth
Shoprite’s exit is happening during a period of significant retail transformation. Malls are expanding in Accra and Kumasi, e-commerce platforms are growing, and consumer spending is on the rise. But without fair competition, these gains could disproportionately benefit a few players — limiting long-term economic inclusivity.
Passing Competition and Consumer Protection Laws
Shoprite’s exit shows how important laws are in shaping markets. Without competition laws, Ghana risks a retail market dominated by few players. This hurts consumers, limits innovation, and weakens small suppliers.
Passing the Competition and Fair Trade Practices Bill and strong consumer protection laws must be a priority. This would help ensure fair competition and protect public interest in future deals.
Read further on Shoprite’s Exit from Nigeria.
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