Albanese Government Courts emirati Retail Giant Lulu Hypermarket to Challenge Supermarket Duopoly
CANBERRA – Prime Minister Anthony Albanese has invited Lulu Hypermarket, a major retail chain based in the United Arab Emirates, to establish a presence in Australia, aiming to increase competition in the supermarket sector currently dominated by Coles and Woolworths. The move comes amid ongoing scrutiny of grocery prices and concerns about market concentration.
Critics have long argued that the australian supermarket sector is too concentrated, leading to a lack of competition and inflated prices. The Coalition previously proposed “break-up powers” to possibly force Coles and Woolworths to divest assets if found to be acting uncompetitively, a suggestion initially dismissed by Albanese who stated last year that Australia was “not the old Soviet Union” and he would not forcibly break up the supermarket giants.
instead, the government has focused on measures to encourage greater competition, including consultations with states and territories to revise zoning and planning laws to facilitate the establishment of new stores.Foreign competitors have previously cited difficulties entering the market due to existing chains acquiring potential sites without developing them.
The invitation to Lulu Hypermarket follows a recent ACCC review which found a “limited incentive” for Coles and Woolworths to compete vigorously on price due to their market dominance, though the review stopped short of declaring recent price rises excessive. Despite this finding, Albanese committed to investigating an “excessive pricing regime” to be policed by the competition watchdog to penalize supermarkets engaged in price gouging.
The ACCC’s March report echoed concerns about the profitability of Australia’s supermarkets compared to their global counterparts. The government hopes Lulu Hypermarket’s entry will disrupt the existing market dynamic and provide consumers with more choice and competitive pricing.
