gec 2017: zoltan acs
TRANSCRIPT
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THE ENTREPRENEURIALECOSYSTEM OF SOUTH AFRICA:A STRATEGY FOR GLOBAL LEADERSHIP 2017
Zoltan AcsThe Global Entrepreneurship and Development Institute
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South Africa is an entrepreneurial leader in sub-Saharan Africa. The country has made significant progress to overcome structural factors and produce some of the most innovative and successful enterprises on the continent. The country provides the institutional support necessary for high-growth businesses to emerge and thrive, while government policies work to close historical gaps. With the addition of targeted, coordinated policies to address remaining bottlenecks, the country is poised to achieve greater growth through entrepreneurship.
Summary
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• Research organization that advances knowledge on links between entrepreneurship, economic development and prosperity• Founded by world-leading entrepreneurship scholars from the LSE,
George Mason University, University of Pécs and Imperial College London• Main contribution is the Global Entrepreneurship Index• Covered by The Economist, The Wall Street Journal, Financial Times and
Forbes• Methodology has also been endorsed by the European Commission and
has been used to inform the allocation of EU Structural and Cohesion Funds
The Global Entrepreneurship and Development Institute
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Two views of entrepreneurship: GEI and TEA
TEA: Negatively correlated with development GEI: Positively correlated with development
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South Africa in the African context:South Africa benefits from a multitude of entrepreneurial support programs, as well as infrastructure that is better than most other African countries. South Africa is a clear leader in the regional context, and is second only to Botswana in its overall GEI score.
Burkina FasoMalawi
UgandaAngola
CameroonEthiopiaSenegalNigeriaZambiaGhana
NamibiaSouth Africa
Botswana
0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0 40.012.513.113.8
15.016.7
19.320.720.621.3
23.032.3
35.535.9
11.411.912.613.3
15.316.2
18.619.219.8
21.129.029.8
32.9
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South African performance by pillar PILLARS INSTITUTIONAL VARIABLES INDIVIDUAL VARIABLES
Entrepreneur
ial Attitu
des
Opportunity Perception 0.42 Freedom and Property 0.53 Opportunity Recognition 0.60
Start-up skills 0.07 Education 0.21 Skill Perception 0.49Risk Acceptance 0.43 Business Risk 0.44 Risk Perception 0.78
Networking 0.31 Agglomeration 0.51 Know Entrepreneurs 0.49
Cultural Support 0.38 Corruption 0.49 Career Status 0.72
Entrepreneurial Attitudes 28.8
Entrepreneur
ial Abiliti
es
Opportunity Startup 0.34 Tax and government 0.52 Opportunity Motivation 0.53
Technology Absorption 0.21 Tech Absorption 0.71 Technology Level 0.39Human Capital 0.25 Labor Market 0.66 Educational Level 0.30
Competition 0.63 Competitiveness and Regulation 0.65 Competitors 0.85
Entrepreneurial Abilities 31.2
Entrepreneur
ial Aspirations
Product Innovation 0.54 Technology Transfer 0.56 New Product 0.73Process Innovation 0.50 Science 0.55 New Tech 0.95
High Growth 0.55 Finance and strategy 0.57 Gazelle 0.74
Internationalization 0.49 Economic complexity 0.54 Export 0.70
Risk Capital 0.18 Depth of Capital Market 0.86 Informal Investment 0.30
Entrepreneurial Aspirations 38.0
GEI 32.6 Institutional 0.56 Individual 0.61
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Time trend in South Africa
2006 2008 2009 2010 2011 2012 2013 2014 201520
25
30
35
40
45
33.6
37.335.1
33.0 32.8 33.6 34.9 33.9 32.6
ATT ABT ASP GEI
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Peer comparison: Botswana and the West African countries
1. Opportunity Perception2. Startup Skills
3. Risk Acceptance
4. Networking
5. Cultural Support
6. Opportunity Startup
7. Technology Absorption8.Human Capital
9. Competition
10. Product Innovation
11. Process Innovation
12. High Growth
13. Internationalization
14. Risk Capital
0.00
0.20
0.40
0.60
0.80
1.00
South Africa Botswana West Africa
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Peer comparison: BRICS1. Opportunity Perception
2. Startup Skills
3. Risk Acceptance
4. Networking
5. Cultural Support
6. Opportunity Startup
7. Technology Absorption8.Human Capital
9. Competition
10. Product Innovation
11. Process Innovation
12. High Growth
13. Internationalization
14. Risk Capital
0.00
0.20
0.40
0.60
0.80
1.00
South Africa Brazil China Russia
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Country comparisonCountry ATT ABT ASP GEI Institutional Individual
GDP per capita
Botswana 46.8 32.2 23.8 34.2 0.46 0.66 14779Brazil 30.4 20.5 12.1 21 0.51 0.44 14416China 29.3 26.9 49.3 35.1 0.56 0.58 10822Colombia 36.5 33.5 46.1 38.7 0.47 0.73 11621Egypt 16 19.9 32.3 22.7 0.35 0.6 9807Indonesia 29.7 18.8 15.1 21.2 0.48 0.53 9278Mexico 34.8 24.8 21.4 27 0.5 0.5 15958Namibia 32.7 27.5 29.2 29.8 0.41 0.71 8995Nigeria 24.2 23.7 18.5 22.1 0.33 0.66 5207Russia 23.9 29.1 21.3 24.8 0.47 0.47 22795South Africa 28.4 32.7 39.4 33.5 0.55 0.63 11967Thailand 28 30.1 26.3 28.1 0.52 0.55 13495Tunisia 36.5 41.5 38.7 38.9 0.48 0.7 10232United Kingdom 67.2 81 63.3 70.5 0.87 0.66 36806United States 75.8 80.5 86.5 80.9 0.93 0.76 50756Vietnam 16.9 24.9 24.8 22.2 0.37 0.57 5043
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South African performance by pillar – bottlenecks from GEI
PILLARS INSTITUTIONAL VARIABLES INDIVIDUAL VARIABLES
Entrepreneur
ial Attitu
des
Opportunity Perception 0.42 Freedom and Property 0.53 Opportunity Recognition 0.60
Start-up skills 0.07 Education 0.21 Skill Perception 0.49Risk Acceptance 0.43 Business Risk 0.44 Risk Perception 0.78
Networking 0.31 Agglomeration 0.51 Know Entrepreneurs 0.49
Cultural Support 0.38 Corruption 0.49 Career Status 0.72
Entrepreneurial Attitudes 28.8
Entrepreneur
ial Abiliti
es
Opportunity Startup 0.34 Tax and government 0.52 Opportunity Motivation 0.53
Technology Absorption 0.21 Tech Absorption 0.71 Technology Level 0.39Human Capital 0.25 Labor Market 0.66 Educational Level 0.30
Competition 0.63 Competitiveness and Regulation 0.65 Competitors 0.85
Entrepreneurial Abilities 31.2
Entrepreneur
ial Aspirations
Product Innovation 0.54 Technology Transfer 0.56 New Product 0.73Process Innovation 0.50 Science 0.55 New Tech 0.95
High Growth 0.55 Finance and strategy 0.57 Gazelle 0.74
Internationalization 0.49 Economic complexity 0.54 Export 0.70
Risk Capital 0.18 Depth of Capital Market 0.86 Informal Investment 0.30
Entrepreneurial Aspirations 38.0
GEI 32.6 Institutional 0.56 Individual 0.61
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Bottlenecks from survey data
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Root causes of bottlenecks from survey data
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Impacts of bottlenecks from survey data
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South African - Ecosystem bottlenecks
Identified in survey Identified in GEI analysis(number of respondents) (severity of bottleneck)
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Strategy to target bottlenecks1. Startup skills
• Education is the number one priority• Deregulation• Unemployment/re-employment training• Informal to formal• Wage subsidies to reduce systemic bias
2. Banking and finance• Mobile banking• Crowd funding• Higher touch SME loan management• Credit scores to reduce systemic bias
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Strategy to target bottlenecks (continued)
3. Technology absorption• Increase penetration of digital technologies• Increase digital inclusion• Encourage digital entrepreneurs• Empower digital users• Build digital platforms
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Thank you
Zoltan AcsFounder and President
The Global Entrepreneurship and Development [email protected]
www.thegedi.org