Firm Performance by Ownership

“
BEHIND
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THE
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BORDER
” CONSTRAINTS ON AFRICAN
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ASIAN TRADE AND INVESTMENT FLOWS
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State of Competition in Domestic Markets of Four African
Countries
Average domestic market share among firms in a sector is one measure of intensity of market competition in that sector.
Table 4.1 lists the average domestic market share by sector and country,
as perceived by the firms surveyed. According to the data, the construction, nonconstruction services, and non-oil minerals and metals sectors appear to be least concentrated or most competitive. The chemicals sector appears to be the most concentrated sector in Senegal, South Africa, and
Tanzania. Overall, the sectors in Senegal tend to be more concentrated than the sectors in the other three countries.
As shown in figure 4.5, domestic market shares are greater for firms of larger scales, which is to be expected. For any sector, there is generally a positive correlation between size and average market share. Number of competitors that firms face is another dimension to measure intensity of market competition.
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The competitors here include overseas competitors through imports.
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The figure shows that larger firms on average face fewer competitors in the majority of the sectors. The only exceptions are the chemicals, construction, and nondurable sectors.
Foreign Import Competition
Typically, the most immediate channel through which competition is introduced to domestic markets is imports from other countries. In Africa,
import competition appears to have differentiated impacts. In the survey
TABLE 4.1

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