A new Omidyar Network report states Africa’s position can be elevated with the formalisation of entrepreneurship, despite its reputation for continually lagging behind the rest of the world.
HumanIPO reported on Friday on the release of the Accelerating Entrepreneurship in Africa Initiative in Johannesburg, South Africa.
Emphasising the essential necessity for Africa to evolve beyond its neediness, the findings proceed to make suggestions for six sub-Saharan countries to make significant progress from its present status in the entrepreneurial sphere.
“We submit that entrepreneurship can address this stubborn income gap in Africa if – and only if – it is able to evolve beyond its current state of necessity-based informality into one that is vibrant and robust enough to promote sustained economic growth and generate long-term, viable livelihoods across the continent.”
Optimistic about Ethiopia’s entrepreneurial landscape, the report believes rationalisation of governmental legislation and privatisation of enterprises will spur on further economic growth.
Business growth in Ethiopia is also rated positively with regards to the development of entrepreneurial culture in the country.
“It is not surprising then that the legitimacy of entrepreneurship is growing, and a culture of entrepreneurship is emerging,” the research on the country concludes.
Driven mainly by tourism, agriculture and manufacturing, Kenya’s future is faced with the challenges of poverty, unemployment and corruption.
Although its financial hub has great potential, lack of support and access from and to banks, accountants and lawyers are challenges to overcome.
In Nigeria, a limited fear of failure is noted as a positive aspect for entrepreneurial growth, while the lack of micro management keeps performance behind.
While entrepreneurial network growth is praised, lack of basic municipal services such as electricity supply needs improved on.
Ghana’s market is reportedly relatively young, but it made it into World Bank’s Ease of Doing Business Index for 2012, despite its limited availability of capital resources.
GDP is forecasted to continue to grow at six to seven per cent annually in the coming years after a relatively strong improvement record over the last 10 years.
In Tanzania unemployment poses a serious impediment to the needy infrastructure, which is struggling to be established by a small private sector at present stage.
Gold, tourism and agriculture are viewed as possible sectors of aspiring success, while lack of access to capital is still hampering growth.
Despite these challenges, the GDP has increased up to seven per cent for almost a decade since 2008, with its hope lying in small businesses to push for further expansion.
Although the country still faces the obstacle of severe income equality, South Africa is deemed the “economic powerhouse of Africa”.
The country supplies 20 per cent of the continent’s GDP, which sits at US$1.9 trillion.
Concern is raised about the 50 per cent of South Africans still living in poverty, although entrepreneurship could aid.
The research was conducted in collaboration with Monitor Group with the motive of understanding the local challenges and reality entrepreneurs in Africa faces.
