Socio-economic and cultural factors, labour market characteristics, financial wealth, and the quality of institutions play a strong role in the emergence of entrepreneurship in a society, writes Lois Stevenson in ‘ Private Sector and Enterprise Development: Fostering growth in the Middle East and North Africa ' ( www.idrc.ca ).

Citing studies, she reminds that entrenched cultural perceptions and attitudes regarding risk, economic security and socially-valued occupations, education systems, the nature of employment options and the incentive structure can be major hindering or supporting influences. “The determinants of entrepreneurship can be influenced through a variety of interventions geared to create awareness of entrepreneurship as an option; profile entrepreneurs as role models; open doors to opportunity; reduce fear, uncertainty and disincentives; and provide access to the necessary resources for establishing an enterprise, such as counselling, advice, financing, training, information and technical support.”

Deterrents

An important caution that the author sounds is that certain government policies and actions can, inadvertently or otherwise, deter entrepreneurial activity. She observes that disincentives to entrepreneurship can be found in the taxation and regulatory environment, labour laws, social security regimes, bankruptcy laws, the system of property rights, financial markets, and the intellectual property regime.

Attracting FDI

A section on ‘foreign direct investment performance' rues that consistently from 1989 onwards the MENA region has been less successful in attracting FDI than others, with only a slight increase in the share of global FDI since 1970. This, as the author notes, signals a lack of business opportunities, an unattractive local business environment or higher risk perceptions. Educative reference.

Related Topics
comment COMMENT NOW