Competition policy is one of the policy key mechanisms to ensure healthy
and efficient economic development, particularly in small countries where
monopolistic anti-competitive practices are frequent. Competition
policies may also help to attract foreign investment while providing local
companies, especially small enterprises, with efficient mechanisms for
controlling abuses of dominant positions and other threats to free
competition. In small countries, where it is more difficult to have
competitive markets, competition policies could foster and inclusive
development as well as defending consumer interests and contribute to the
overall economic productivity.

This project is developed by the Economic Commission for Latin America and
the Caribbean (ECLAC) in Mexico and the International Development Research
Center (IDRC) from Canada. The project will strengthen the technical and
institutional capacities of Central America in order to promote and
protect competition within their countries, initiate a coordinated
normative framework for the region, and participate in the construction of
an international competitive framework for the world economy.

As globalization increasingly involves the Central American economies,
through international trade and financial flows liberalization, economic
integration processes, free trade agreements, and the increasing relevance
of the WTO, it is important to develop institutions and policies in order
to create an adequate competition framework.

Central America is in the process of creating such framework in the
region. So far three countries (Costa Rica, El Salvador and Panama) have
created competition laws, while Guatemala, Honduras and Nicaragua have law
proposals in different stages of preparation. The ECLAC / IDRC project
will identify the types of standards and organizational/institutional
alternatives best suited to the specific political, legal and cultural
realities of each country and the region within a set of common criteria.
Taking into account the relevance of participating in the competition
international fora, the project intends to contribute to a regional
discussion so that Central American Isthmus may develop common policies
based on common interests to address mergers, anti-competitive agreements
and other global economic phenomena that limit competition in the region