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| Prince William Lema Jr. |
Entrepreneurship is the process of starting a business or other
organization. The entrepreneur develops a business model, acquires the
human and other required resources, and is fully responsible for its success or
failure.
In recent years, entrepreneurship has
been extended from its origins in business to include social and political
activity. Entrepreneurship within an existing firm or large
organization has been referred to as intrapreneurship and may include corporate
ventures where large entities spin off subsidiary organizations. Entrepreneurs are leaders willing to take risk and
exercise initiative, taking advantage of market opportunities by planning,
organizing, and employing resources, often by innovating new or
improving existing products.
The process by which international aid
agencies and social entrepreneurs
Each pursues their goals and objectives
are dramatically different. The large development agencies tend to justify the
expenditure of large amounts of money by focusing not on the validity of results,
but rather on the process devised to achieve those results. Thus indicators of
a job well done are defined by bureaucratic or ceremonial factors like the
number of conferences, and studies or meetings that take place to discuss
subjects such as global poverty, and the number of keynote publications
prepared.
Recently, with the introduction of private
donors to the mix, the total amount of money committed has become a measure of
success.
In Tanzania
During colonial days.
Totalitarian rule continued. Indigenous productive
activities were suffocated by colonial regulations and competition from
imports. Throughout the colonial period, a consistent policy was adopted to
keep the colony as a producer of raw material for use in industries in Europe,
and, consequently, dependent on manufactured goods from colonial masters. There
was also a deliberate policy to limit participation of indigenous Africans, and
to a lesser extent, Asians, in business activities. Thus, manufacturing,
importing and exporting, banking and insurance were mainly done by Caucasians.
Africans participation in
business was restricted to very small firms, such as dukawalas (tiny shops).
Tanganyika’s first five-year
development plan (1961-1966) envisaged developing the economy by attracting
foreign direct investment (FDI). Towards the end of the five-year period, it
was apparent that the expected FDI was not flowing in as expected. There was
also a concern that not much had been achieved by way of redressing the legacy
of the marginal position of Africans in the economic field left by the colonial
government. The leadership started looking for alternative development
strategies. In 1967, the government officially adopted a radical transformation
to a socialist development strategy, through the Arusha Declaration. Activities
categorized as constituting the “commanding heights” of the economy, including
banking, import-export, insurance, large houses, farms, schools, hospitals, etc
were also nationalized. The government invested heavily in the nationalized
entities as well as new ones.
Consistent
with the socialist policy, private business entrepreneurship was actively
discouraged in favor of government, community-based or co-operative-owned
ventures. Regulations were introduced to bar civil servants and leaders of the
ruling party from engaging in business activities. Since all educated Africans
were civil servants, this means that, business activities were left to Asians
and those indigenous people who had no job opportunities, and these tended to
be people who had no substantial education.
Theoretically
the socialist policy encouraged peoples’ participation in decision making.
However, in practice, the government embraced a centralized; mainly top-down
decision-making approach. It made a whole range of decisions, from who should
go to which school or college, where one had to live, crops to be grown, their
prices and where they should be sold, salary levels, etc. a culture of
dependency on the state and unquestioning obedience took root in all walks of
life. This must have contributed to stifling development of entrepreneurial
values such as initiative, willingness to take risks, need for achievement and related
competencies.
The
economic crisis that began in the mid-1970s intensified in the early 1980s,
forcing the government to liberalize trade and start implementing a radical
transformation program with the urging and support of the World Bank and the
International Monetary Fund (IMF) from 1986. The Economic Restructuring Program
involved liberalization of virtually all sectors of the economy and privatizing
and nationalizing employment in the public sector. Under the ERP, the
government gradually changed its economic policy from reliance on state-run
enterprises to promotion of foreign investment and local entrepreneurship. The
private sector is now seen as the engine of economic growth and the role of
government has been redefined to focus on facilitation rather than direct
ownership and operation of enterprises.
The
reforms did not fully ease the problem of low salaries. On the contrary, the
retrenchments, freezing of employment, privatization of state enterprises and
disengagement of the government from some activities led to substantial job
losses and limited openings for school and college graduates. Their most
pronounced effect has been a substantial net increase in the number of people whose
only means of survival is self-employment. Most of those who cannot find jobs
as well as salaried workers have, out of necessity, started micro and informal
businesses to enable them to eke out a living. Aware of its limitation to help
out in the situation, the government started encouraging workers to do so. For
example, in 1992, the government deliberately reduced the working week by half
a day to give employees more time to engage in income generating projects to
supplement their official incomes. This played a significant role in enhancing
the legitimacy of entrepreneurship activities.
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