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Main areas for improvement of antimonopoly policy in terms of deepening of economic reforms

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Duration: November 2016 - May 2017

Main areas for improvement of antimonopoly policy in terms of deepening of economic reforms

The creation of a competitive environment is an essential condition for the development and deepening of market relations. Competition not only contributes to the efficient functioning of the market, but is also a natural regulator of various disproportions arising from economic activities. The main restrictor of competition is the concentration of market power in the hands of a narrow circle of market participants. It is no accident that in many countries of the world, despite the more than 200-year history of the existence of antimonopoly laws, the search for the most effective forms of antimonopoly policy implementation is still ongoing.

A structural approach has been adopted to formulate Uzbekistan’s antimonopoly policy. Its feature is the use of direct impact policy instruments.

The existing antimonopoly policy is becoming less conducive to deepening competition because: a) its methodology is based primarily on regulating the activities of natural monopolies, playing an insignificant role in terms of deepening competition; b) the mechanism for declaring prices is based on the cost method (costs + minimum profit), which stimulates the growth of production costs reducing competitive incentives; c) direct methods of impact are becoming less effective when small business and private entrepreneurship account for 77.9% of employment and 56.5% of GDP (2016).

The search for solutions, which would enable the transition from a structural to a non-structural approach in the implementation of antimonopoly policy, takes on particular significance in conditions when competitive markets are becoming a key factor in deepening economic reforms and increasing the competitiveness of the economy.

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Main areas for improvement of antimonopoly policy in terms of deepening of economic reforms