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Entrepreneurship: Unlocking Africa’s Riches

Jeremiah Koshal

Introduction

In 2000, The Economist wrote that Africa was “the hopeless continent”. At the time, floods had deluged Mozambique and Madagascar, famine had started to reappear in Ethiopia, and Zimbabwe had just succumbed to government-sponsored thuggery.1 Furthermore, Africa is also known for its many dreadful wars of tribal animosity and ethnic cleansing, despotic leadership, HIV/AIDS epidemics, and rampant corruption.2

Those sentiments came at a time the continent had registered signs of improvement as evidenced in the mid-1990s. World Bank figures then showed a clutch of African countries achieving economic growth rates of more than 6 per cent, enough to lift most of their nationals out of poverty. Similarly, multi-party democracy was spreading across the continent and bringing forth a new crop of leaders—like Nelson Mandela of South Africa—who were seemingly eager to pursue peace and good governance, provide a better life for their people through basic healthcare and

J. Koshal (H)

Chandaria School of Business, United States International University—Africa,

Nairobi, Kenya

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© The Author(s) 2017 37

K. Patterson, B. Winston (eds.), Leading an African Renaissance, Palgrave Studies in African Leadership,

DOI 10.1007/978-3-319-40539-1_3

education, and free market policies. These led to the talk of an “African Renaissance”.3

Africa suffers from and is susceptible to many ills—brutality, despotism, war, endemic poverty and corruption—but these are not exclusive to the continent.4 No wonder 13 years later, The Economist, having insinuated earlier that Africa was economically backward with no chance of growth and with a political leadership that was at best corrupt and at worst murderous, swallowed its pride and admitted that it was wrong. This time it painted a picture at odds with Western images of Africa. War, famine and dictators have become rarer; human development has made huge leaps. Secondary school enrolment grew by 48 per cent between 2000 and 2008 following the expansion of education programmes and the scrapping of school fees by many countries. Malaria deaths in some of the worst affected countries have declined by 30 per cent and HIV infections by up to 74 per cent. Life expectancy across Africa has increased by 10 per cent and child mortality rates in most countries have been falling steeply. Most importantly, a growing economy has made a big difference since over the past 10 years real income per person has increased by more than 30 per cent, whereas in the previous 20 years it shrank by nearly 10 per cent.5

Africa has delivered many reasons for hope over the past decade. Growth has outpaced the rest of the world. World-beating businesses have emerged and, given Africa’s rich natural resources, financiers are finally waking up to the investment potential of the continent. The geniuses in investment banks who used to arrogantly deride the risks of investment in Africa while pouring billions into phony derivatives based on the American housing bubble, have been proven to be as spectacularly wrong on Africa as they were on everything else.6

With a heightened focus on entrepreneurship, business growth and good governance, the star of Africa is rising. This chapter argues that many African countries are making great strides not just economically, but also in governance and leadership. It examines the concept of entrepreneurship—definition, early thinking, contemporary view and different types of entrepreneurship; entrepreneurship in Africa—entrepreneurial culture, role of SMEs, as well as challenges they face and mitigation strategies; and finally good governance and leadership in Africa with a specific focus on South Africa, Botswana and Mauritius.

 
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