Africa is open for business it seems, many investors from all over the world are attracted to the African landscape. Africa is competing with major economies for investor dollars.
But how has the concept of entrepreneurship been received by the African youth? In 2012 the Global Entrepreneurship Index sited a decline in entrepreneur activity in South Africa, this was after the anticipated increase after the 2010 World Cup. This loss of entrepreneurial spirit was attributed to a complicated cocktail of problems, including the poor education system, difficult and onerous labour laws, crime, government corruption and nepotism and generally unfavourable conditions for entrepreneurs in South Africa.
These results have however changed, it seems that the problems that countries faced presented an opportunity. History has proven that when the state of the economy declines, entrepreneurship plays a major role in getting it stable again. In the 2014 GEI, South Africa places 53 out of 130 countries participating and by virtue of its score is operating at 40% of its entrepreneurship capacity. By comparison the index suggest that, as a whole, the world is at 52 % of its entrepreneurial capacity. This score places South Africa at the top of the Sub Saharan Africa region, well above the next highest ranked country, Botswana which placed 66.
An ACCA study titled, 100 Drivers of Change for the Global Accountancy Profession, panel members outlined different factors that have changed the face of the business discipline in our age. These factors, it seems, know no boundaries, they affect Africans that wish to enter the entrepreneurial space too. They are: technology, education and the economic state. Technology has made its effects felt in Africa, the most notable factor is its ability to lower entry barriers to industries/markets that Africans could not get into in the past. Access to information through the internet, although not at its peak, has become easier for African entrepreneurs.
The ACCA study highlights the costs of university fees and the greater demand from students as another factor that has led the youth into entrepreneurship. There are a lot of efforts that governments have done in helping the youth get the proper education sought-after, but with the increase in population, those efforts have not been able to help everyone. In embracing the entrepreneurial spirit, the African youth seems to have adopted the belief that universities are not the only way to be prepared for entrepreneurship. Abai Schulze, owner of ZAAF Collections based in Ethopia, “I don’t think business school was going to teach me how to run a business in Ethiopia. You don’t go by the book when you are running a business here. You just have to jump into it and learn as you go.”
It is only fair that Africans exploit the fertile ground of their land first before external investors can enjoy the fruits that Africa offers in business. Entrepreneurship plays a huge role in dealing with issues such as unemployment. It is pleasing to see that there is a rise in entrepreneurial activity and that the African youth is charting its own thinking regarding entrepreneurship. Business in Africa needs careful study and as many big corporations have discovered, strategies that worked in other parts of the world cannot just be copied and pasted if one desires to enjoy success in the African context.
The change in thinking by the African youth also poses a new challenge for professionals that service the industries in Africa. Salin Talavdekar, senior accountant at Citadel Risk, advises that accountants evolve into businesses partners rather than just service providers. It is professionals that understand the mindset that African entrepreneurs employ that will be service this market.