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Wednesday
Jun242015

African Youth Want to do Business in Fast-growing Economy

 

Africa’s growing economy is meeting head-on an optimistic young population keen to start businesses. At least that is what a new poll of African youth says, finding that one in five Africans between the ages of 15 and 24 without a current business wants to start one in the next 12 months.

The Gallup surveys (www.gallup.com) of 27 African countries and areas also found young women were just as keen as young men to start a business.

Throughout the decade of the 2000s, Africa experienced an average economic growth rate of 5.4 percent (World Bank) – a big gain from the poor growth rates of the 1980s and early 1990s.

The turnaround in Africa’s economic growth prospects was the product of a number of trends and factors. One has been better policies and easier trade. Other factors include rising tourism, a growing service sector, rising commodity prices, greater demand for African exports in emerging economies and rapidly improving communications: the surge in mobile phone usage during the last five years has surprised many. Africans are also avid spenders on goods and services, spending US $860 billion on them in 2008, more than India’s US $635 billion or Russia’s US $821 billion (Economic Report on Africa 2011).

The African Development Bank predicts Africa’s growth rate for 2011 will decline to 3.7 percent from 2010’s 4.9 percent, largely as a result of turmoil in North Africa. East Africa is projected to grow the fastest this year at 6.7 percent, with West Africa close behind at 5.9 percent.

Africa as a continent collectively had a gross domestic product in 2009 of US $1.6 trillion: equal to Brazil’s or Russia’s. The continent is considered among the fastest-expanding economic regions in the world (McKinsey & Company).

In fact, while economic prospects are grim in many developed countries, Africa joined Asia as the only continents to grow during this recession.

But major problems still confront the continent, among them youth unemployment. Those between 15 and 24 make up more than 60 percent of the continent’s population and are 45 percent of the total labor force (African Economic Outlook). Sub-Saharan Africa is experiencing a youth explosion, with the proportion of youth there to rise to 75 percent of the population by 2015. Demographers forecast this rising youth trend will not stop for the next 20 years.

Getting these youth actively engaged in the economy and society is a major challenge for the continent. Already, 133 million African youth are illiterate. They have few skills and are marginalised from more productive sectors of the economy.

Even those with an education find their skills often don’t match the needs of the labor market. In sub-Saharan Africa, youth unemployment is believed to be 20 percent.

So even with better economic prospects and growing economies and incomes, youth unemployment looms large.

The Economic Report on Africa 2011 (www.uneca.org/era2011/) finds the “persistent high youth unemployment rate is a cause of concern and a potential source of political instability.” Job creation is still not adequate: “The growth rates are still below the levels needed to make a significant impact on unemployment and poverty reduction.”

While Africa will experience higher growth in 2011, for youth it is looking like a “jobless recovery,” according to the report. Overseas investors are mostly throwing their money at the resource sector, which doesn’t create many jobs in the economy.

But for young Africans looking to start a business, the opportunities are there in sectors such as retailing, telecommunications, banking, infrastructure-related industries, resource-related businesses, and all along the agricultural value chain.

The booming communications industry has added 316 million new subscribers since 2000, for example. And all those people now connected need new services.

And once a business is up and running, it is possible to make higher profits in Africa than on other continents, according to the UN. Africa leads the emerging market economies for returns for businesses. This is because competition isn’t as intense and there is still plenty of built-up consumer demand that needs to be met.

All of this means young people willing to start a business and put in the hard work, will have a better chance of reaping the rewards.

By David South, Development Challenges, South-South Solutions

Published: July 2011

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP's South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South's innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

Follow @SouthSouth1

Google Books: https://books.google.co.uk/books?id=3YKYBgAAQBAJ&dq=development+challenges+july+2011&source=gbs_navlinks_s

Slideshare: http://www.slideshare.net/DavidSouth1/development-challengessouthsouthsolutionsjuly2011issue

Southern Innovator Issue 1: https://books.google.co.uk/books?id=Q1O54YSE2BgC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 2: https://books.google.co.uk/books?id=Ty0N969dcssC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 3: https://books.google.co.uk/books?id=AQNt4YmhZagC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 4: https://books.google.co.uk/books?id=9T_n2tA7l4EC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 5: https://books.google.co.uk/books?id=6ILdAgAAQBAJ&dq=southern+innovator&source=gbs_navlinks_s

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Wednesday
Jun242015

Kenyan Safari Begins Minutes from Airport

 

Many people find the prospect of staying in airport hotels dreary at best. They tend to be located in industrial parts of cities or far from city centres. They can be surrounded by roads and highways and are built to move lots of people, not to look nice. The surrounding areas can be very common to all nations – warehouses, office parks, nondescript restaurants and hotels – and give few clues to where you are apart from the weather and the languages on the sign boards.

In short, they are the last place you would choose to stay to get a flavour of a country or culture. But in Nairobi, Kenya, this experience has been turned on its head. While many people travel to Africa to take in the breathtaking beauty of the continent and absorb the fascinating cultures and people, they usually wait to do this once they are far from the airport. But not in Nairobi, where it is possible to begin an African adventure right at the airport.

The Nairobi Tented Camp (www.nairobitentedcamp.com) opened in December 2010. It allows tourists to sleep in the open savannah (http://en.wikipedia.org/wiki/Savanna). The experience is properly wild, with game animals roaming near the camp. Started by Kenyan Guy Lawrence and drawing on his years of experience running safaris and adventure travel, he partnered with Will Knocker, Marian Mason and Ibrahim Ali Abayo, an elder from the Boran tribe who works as assistant camp manager.

The business makes effective use of its website, interlinking good design, photographs and a blog with other social media to make the camp appealing to tourists using the web.

Tourists can expect to see rhino, zebra, giraffe, wildebeest, leopard, antelope and possibly lions while listening to the yelps of hyenas at night.

Located just minutes from Nairobi’s Jomo Kenyatta Airport (www.kenyaairports.co.ke/kaa/airports/jkia/), Wilson Airport and Nairobi City itself, the camp is nestled in a forest in Nairobi National Park (http://www.kws.org/parks/parks_reserves/NANP.html). It is the first accommodation to be allowed in this part of the park.

In total, it takes 30 minutes from landing at the airport to be settled in the camp. The last 20 minutes of the drive to the camp takes place in the park, and gets the wild game adventure started early.

In real estate people talk about “location, location location”: find the right place, and you reap the benefits. And you cannot find a better location than Kenya’s oldest national park – 12,000 hectares in size – located beside East Africa’s dynamic regional hub of Nairobi, Kenya. The business is a good example of how a twist on the traditional safari camp and resort can attract attention.

The camp is surrounded by savannah plains on one side, and the city of Nairobi on the other.

The tented camp pitches itself at travellers looking for a better option than just staying in a nondescript airport hotel, or who are looking for a great way to begin a longer journey into Kenya.

“Safaris in Kenya used to start after a long five-hour drive down to the Maasai Mara,” camp owner Gary Lawrence told Monocle magazine. “But now your safari can start 10 minutes after leaving the airport.”

Kenya has been in recovery mode since its tourism industry was hit hard by a combination of events in 2008. Kenya experienced violent rioting during the 2007 and 2008 elections and a body blow from the 2008 global economic crisis. Both events caused a severe drop in tourism.

In 2007, the country received more than 2 million foreign tourists and close to US $1 billion in revenue, but numbers fell the following year. However, tourism grew 15 percent from 2009 to 2010 in Kenya, putting the country on course to meet its 2012 goal of returning to 2 million tourists a year.

Tourism is a critical foreign currency earner for Kenya and saw growth in revenues of 18 percent in 2010 from 2009 (Kenya Tourist Board).

Kenya’s strategy has included aggressive marketing campaigns in new markets to attract tourists. The country is billing itself as a “high value for high spending tourists” and it has seen increasing numbers of visitors from the booming emerging economies of India, Russia, China and the Middle East. Most of Kenya’s tourists come from the United Kingdom, the United States, Italy and Germany.

By David South, Development Challenges, South-South Solutions

Published: July 2011

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP's South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South's innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

Follow @SouthSouth1

Google Books: https://books.google.co.uk/books?id=3YKYBgAAQBAJ&dq=development+challenges+july+2011&source=gbs_navlinks_s

Slideshare: http://www.slideshare.net/DavidSouth1/development-challengessouthsouthsolutionsjuly2011issue

Southern Innovator Issue 1: https://books.google.co.uk/books?id=Q1O54YSE2BgC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 2: https://books.google.co.uk/books?id=Ty0N969dcssC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 3: https://books.google.co.uk/books?id=AQNt4YmhZagC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 4: https://books.google.co.uk/books?id=9T_n2tA7l4EC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 5: https://books.google.co.uk/books?id=6ILdAgAAQBAJ&dq=southern+innovator&source=gbs_navlinks_s

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This work is licensed under a
Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.

Wednesday
Jun242015

Brazilian Restaurant Serves Amazonian Treats

 

 

The vast Amazon rainforest has inspired a cuisine pioneer in Brazil. Combining the sensual pleasures of fine dining and the joy of tasting new flavours with a pursuit of sustainable and profitable local farming, a chef is inventing a new Brazilian cuisine and showing the way to create sustainable incomes.

The kitchens of chef Alex Atala are as much a laboratory of food experimentation as a place to cook meals. He applies French and Italian cooking styles to traditional Brazilian dishes and ingredients. Since opening his restaurant D.O.M in 1999 in Sao Paulo, Atala has relentlessly pursued – through adventurous journeys around Brazil and into the Amazon rainforest – new flavours, foods and cuisines native to the country. When he started out, he was surprised to discover the lack of knowledge about native Brazilian ingredients, both within the country and outside. He has turned himself into a champion for local communities, helping them turn local foods into sources of income.

Brazil, home to the largest portion of the Amazon rainforest, is hoping to become the world’s biggest food producer – it is currently second after the United States – addressing a major global problem and providing income for Brazil’s farmers.

The challenge is to increase food production – providing income for Brazil’s farmers and helping address a major global problem – without destroying the Amazon’s complex ecosystem.

Amazonia, the region that takes in the mighty Amazon River and the vast Amazon rainforest, is home to the most diverse range of plant and animal species in the world (http://en.wikipedia.org/wiki/Amazon_Rainforest).
Brazil is currently debating legislation to ease restrictions on how small farmers can use land in the Amazon rainforest. It would loosen regulations on farming near river banks and hilltops. Many working in Brazil’s agricultural industry believe the country is not living up to its potential. They say Brazil could surpass the United States as an agricultural producer if allowed to use all its arable land.

This is a crucial debate not only for the future of the environment, but also for humanity. World demand for food keeps rising as populations increase and living standards rise in many countries, such as China. Another trend at work is increasing global urbanization, where more people are leaving agriculture as a business to live in cities and peri-urban areas to pursue a better quality of life. These growing megacities will need vast amounts of food to feed their populations.

Brazil has, in recent years, increased the amount of territory designated as a protected area in the Amazon forest.

The National Institute for Space Research in Brazil (http://www.inpe.br/ingles/index.php) has satellite photographs showing deforestation in the Amazon at its slowest pace for two decades. But more recent reports show deforestation accelerating again in 2011.

Sao Paulo’s D.O.M. Restaurante (http://www.domrestaurante.com.br) – the name is an acronym for the Latin phrase “God, the best and greatest” – has used the rainforest’s rich harvest of foods to create an award-winning destination restaurant that prioritises sustainable sources. It was ranked seventh in this year’s S. Pellegrino World’s 50 Best Restaurants list.

Atala says on his website he “is bringing a new sustainable Brazilian cuisine to the world’s attention.” His motto is “It is necessary to cook and eat as a citizen.”

The restaurant celebrates small-scale producers when sourcing food products (http://www.domrestaurante.com.br/#/en-us/menu/ingredientes).  One pioneering food producer Atala works with is DRO Ervas e Flores (herbs and flowers) (http://www.droervaseflores.com). Located in the city of Cequilho, it grows edible herbs and flowers for restaurants. The flowers cultivated by DRO serve mainly to decorate plates, but can also be eaten. At the company farm, the flowers produced include violas, begonias, borago, monks cress, chrysanthemums, pumpkin flowers, coriander flowers, sweet alyssum, mini roses, basil flowers, roses, rockets and violets.

One notable success has been the Amazonian root priprioca. Once it was used only for cosmetics, but Atala has turned it into an essence for cooking. He has conducted original research into uses for the root, which is produced by small communities in the Amazon.

Other Brazilian foods he champions include black rice, an unusual variety sought after for its health benefits. It has 30 percent more fibre and 20 percent more protein than white rice, and less fat and calories than brown rice. The black rice used at D.O.M is produced in the Paraiba Valley in Sao Paulo state by Chicao Ruzene (http://www.arrozpreto.com.br), who researches new varieties on the rice farm.

Jambu, a herb from the Amazon, gives an electrical sensation when it is chewed. Tucupi, a yellowish liquid from pressed wild manioc tuber, is used to season typical Amazonian dishes made with fish, fowl and ducks.

Already well known in his native Brazil, Atala has become the country’s first internationally known celebrity chef and standard-bearer for the “New Brazilian Gastronomy.”

His origins are inspiring: a former DJ and punk, he sold his records and went on a trip backpacking in Europe when he was 18. He made a living as a painter and dishwasher until a friend convinced him to go to catering school. Upon graduation, he worked in some of the top restaurants in Italy and France. This apprenticeship left Atala skilled in the techniques of French cuisine – considered one of the most disciplined and methodical in the world – and he returned in 1994 to Brazil.

The restaurant has ultra-modern design and the sleek kitchen is home to a collection of Amazonian art. Atala acts as an ambassador for the country’s cuisine and flavours to the world. He opened a second restaurant in 2009, Dalva e Dito (http://www.dalvaedito.com.br), which celebrates home cooking by mothers and grandmothers and features only local produce.

Atala’s inclusion of ‘wild’ ingredients has inspired other chefs. His expeditions into the Amazon continue to discover and study the biodiversity of the rainforest and the culinary culture of its inhabitants.

His long-term agenda is to boost local farmers and food production and to increase the availability of ‘wild’ foods in the nation’s supermarkets. If he gets his way, people around the world will be eating the Brazilian way.

“French, Italian, Spanish and Japanese chefs, for example, have their own cuisine and give value to their terroir (local) produce,” Atala explained his passion to The World’s 50 Best Restaurants. “We have to do the same in Brazil! Our ingredients are exotic now, but can become popular in the near future.”

By David South, Development Challenges, South-South Solutions

Published: June 2011

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP's South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South's innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

Follow @SouthSouth1

Google Books: https://books.google.co.uk/books?id=JIKYBgAAQBAJ&dq=development+challenges+june+2011&source=gbs_navlinks_s

Slideshare: http://www.slideshare.net/DavidSouth1/development-challengessouthsouthsolutionsjune2011issue

Southern Innovator Issue 1: https://books.google.co.uk/books?id=Q1O54YSE2BgC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 2: https://books.google.co.uk/books?id=Ty0N969dcssC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 3: https://books.google.co.uk/books?id=AQNt4YmhZagC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 4: https://books.google.co.uk/books?id=9T_n2tA7l4EC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 5: https://books.google.co.uk/books?id=6ILdAgAAQBAJ&dq=southern+innovator&source=gbs_navlinks_s

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This work is licensed under a
Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.

Wednesday
Jun242015

Civet Cat Coffee Brews Filipino Opportunity

 

In the Philippines, one animal’s call of nature has become a business opportunity.

The civet cat, a member of the mongoose family, ingests the fruit of coffee plants, and expels the beans. This has created an unexpected by-product – a prized beverage for the world’s savvy coffee drinkers seeking the next taste sensation. The partially digested coffee beans are gathered from the faeces of the cat and used to make a much-coveted, smooth-flavoured cup of coffee.

It is a good example of how value can be added to a product, in this case coffee beans, producing a substantially higher income. The coffee is startlingly expensive: 50 grams cost US $70, 100 grams US $90, and 1 kilogram is a whopping US $870. The coffee is a blend of Arabica, Liberica and Exelsa beans, all of which have passed through the civet cats.

The highly prized coffee is driving a growing market for these rare beans around the world. But as demand rises, it becomes clear it is a market needing quality control and ethical practices.

One business that is trying to do this is Coffee Alamid (www.arengga.com), based in Las Pinas in the Philippines. It bills the coffee as the “World’s Rarest Brew. The Philippines’ Pride.”

Coffee Alamid’s founders, Basil and Vie Reyes, call themselves “coffee entrepreneurs” who started in the business from scratch.

“When we started Cafe Alamid, we were not even coffee drinkers,” they explain on the company’s website. “We didn’t know anything about coffee at all!”

Experienced in making Arengga vinegar (http://www.arengga.com/index.php/arengga-pinnata-its-not-just-a-vinegar.mpc), they discovered the civet cats that lived among the sugar palm trees used for making the vinegar. They did some research and were inspired by the Kopi Luwak, the Indonesian variety of civet cat coffee and wondered why they couldn’t do the same thing in the Philippines.

They consulted with the local forest-dwellers of Indang, Cavite and Batangas, who confirmed they gathered the civet cat droppings to make into coffee, part for personal consumption, with the rest sold in local markets. Gathering the civet droppings provides an income to the forest residents, who collect an average of one kilogram a day.

Some were sceptical of the idea: why bother with such a time-consuming product? But the Reyeses were inspired by the success of civet coffee in Indonesia and it inspired them to try it in the Philippines. They see themselves as “enlightened entrepreneurs” who believe in marrying business with social development.

The coffee is made from the wild civet cat droppings harvested from the forest floors of mountains in Malarayat, Lipa, Batangas and Mount Matutum, General Santos and South Cotabato in the Philippines. The beans are roasted and exported to Japan, Taiwan, Korea, Australia, the United States and Italy. The company produces between 1 and 1.5 tons of beans a year.

A proud moment for the business was becoming the first Filipino firm to participate in the Tea and Coffee World Cup in Geneva, Switzerland in 2007.

The brand’s name, Alamid, is the local name for the civet cat (Paradoxorus Philippinensis). It belongs to the mongoose family and forages for food at night, eating the ripest and sweetest coffee cherries during the coffee season.

By morning the civet cats excrete the undigested beans. While inside the cat’s stomach, enzymes and stomach acids go to work on the beans, altering their structure. The beans ‘ferment’ in the cat’s stomach, a process that has been analyzed by Dr. Massimo Marcone, a scientist from Canada’s University of Guelph.

Marcone traveled to Ethiopia and Indonesia in 2003 to collect the rare coffee beans. He found the beans’ taste – described as “earthy, musty, syrupy, smooth and rich with jungle and chocolate undertones” – was due to the lack of protein in the bean.

“The civet beans are lower in total protein, indicating that during digestion, proteins are being broken down and are also leaked out of the bean,” Marcone told the Luwak Kopi website. “Since proteins are what make coffee bitter during the roasting process, the lower levels of proteins decrease the bitterness of Kopi Luwak coffee.”

“Civet beans are typically extensively washed under running water after collection, which dislodges bacteria,” he said.

Marcone published his research into the beans in the paper “Composition and properties of Indonesian palm civet coffee (Kopi Luwak) and Ethiopian civet coffee.” (http://www.sciencedirect.com/science/article/pii/S0963996904001309)

The beans are greenish-brown when they come out in the cat faeces. Marcone found the process in the civet cat removes some of the caffeine, giving a strong cup of coffee less kick; this also makes the flavour smoother.

Supply is tight and this has led to some people forging the coffee or using unethical practices to get their hands on the beans. It is a business that needs to be run in an ethical way to ensure the rich profits are shared with everyone involved.

Marcone warns against imitations. “About 42 percent of all the kopi luwaks that are presently on sale are either adulterated or complete fakes, unfortunately,” he told the Los Angeles Times.

Coffee Alamid’s parent company, Bote Central, started as a family-owned company in 2002, with the idea of using agro-forestry products to create sustainable livelihoods and help preserve the environment. It wanted to introduce Fair Trade principles to the Philippines coffee industry.

Structurally, the company uses community roasting business units (CRBU) across the Philippines, in particular the countryside, to improve the way coffee is sold and make it more profitable for local economies. There are currently 12 such units, and more are planned. The company has put together a guide book on best practice for harvesting Arabica coffee beans based on their first-hand experience. It also explains how they maintain quality control (http://www.scribd.com/doc/19991462/Production-Guide-for-Arabica-Coffee-by-Bote-Central-Inc-Maker-of-Coffee-Alamid).

The company deals directly with farmers to avoid middlemen gouging profits, and tries to use technology to make the business more efficient and sustainable.

To keep quality improving, the company has also produced a manual on how to grow and harvest Arabica coffee beans. It is designed to tackle the practical realities of coffee production and show how to improve current methods to produce a better-quality bean. This is critical for the overall business as competition is fierce and quality has to constantly be improved.

Coffee Alamid has successfully positioned itself as a high-end, high-cost product. It is sold by Japan Airlines and by department stores in Japan and specialty coffee shops around the world.

Civet cat coffee continues to develop new fans. In Britain, the Birmingham-based Urban Coffee Company (http://www.urbancoffee.co.uk) has started selling the coffee.

‘It’s actually really nice,” sales manager Mark Bridgens told the Daily Mail newspaper. “It has a unique, soft taste. I’d definitely buy a cup of it, it’s very different.”

By David South, Development Challenges, South-South Solutions

Published: June 2011

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP's South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South's innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

Follow @SouthSouth1

Google Books: https://books.google.co.uk/books?id=JIKYBgAAQBAJ&dq=development+challenges+june+2011&source=gbs_navlinks_s

Slideshare: http://www.slideshare.net/DavidSouth1/development-challengessouthsouthsolutionsjune2011issue

Southern Innovator Issue 1: https://books.google.co.uk/books?id=Q1O54YSE2BgC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 2: https://books.google.co.uk/books?id=Ty0N969dcssC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 3: https://books.google.co.uk/books?id=AQNt4YmhZagC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 4: https://books.google.co.uk/books?id=9T_n2tA7l4EC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 5: https://books.google.co.uk/books?id=6ILdAgAAQBAJ&dq=southern+innovator&source=gbs_navlinks_s

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This work is licensed under a
Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.

Wednesday
Jun242015

Indonesia Best for Entrepreneurs

 

A global survey has unearthed hotspots across the global South for start-up businesses and private enterprise. It shows there are now many places in the South where people are actively encouraged to start businesses and engage in innovation and enterprise. The top place in the world for entrepreneurship, according to the survey for the British Broadcasting Corporation (BBC), is Indonesia.

The poll shows that Indonesians perceive their country as a place where it is easy to put ideas into practice. Innovation and creativity are highly valued in Indonesia as well, two important elements of business success. Asia as a whole, with a few exceptions, stood out for valuing these qualities.

India came second in the survey, while China and Nigeria were also perceived by their own people as relatively favourable places for new businesses.

The survey for the BBC’s Extreme World TV series polled more than 24,000 people across 24 countries (http://www.globescan.com/news_archives/bbc2011_entrepreneur/backgrounder.html). Respondents were asked whether innovation was highly valued in their country; whether it was hard for people like them to start a business; whether entrepreneurs were highly valued; and whether people with good ideas could usually put them into practice.

Interestingly, not only were several countries in East Asia and the Pacific doing well, but three sub-Saharan African countries – Nigeria, Kenya and Ghana – ranked above the global average.

The survey found work still needed to be done in Latin America. While Mexico and Peru scored highly, Brazil and Colombia ranked below average.

So, what are the things that make Indonesia so positive for entrepreneurs and private business? And what do they do – or not do – for small business start-ups?

According to Bali International Consulting Group, the Indonesian economy is highly dependent on small and medium-sized enterprises: they make up 99.95 percent of the total number of enterprises, and provide most of the country’s jobs. Authorities have identified a problem with the sector, however: productivity per worker is very low compared to large enterprises. Poor productivity matters because it means people are working very hard for low return and this affects the overall standard of living in the country and its human development.

The Indonesian government has set about boosting productivity in the sector, adopting a ‘clustering’ approach in partnership with non-governmental organizations (NGOs). Like-minded businesses tend to cluster together across the archipelago of islands that makes up the nation. By targeting these places with resources and support, it can use those resources more efficiently. The country has a dedicated ministry for small and medium enterprises (http://www.depkop.go.id) and a wide range of businesses and services targeting them. From dedicated trading and office facilities (http://www.smescoindonesia.com) to an online marketplace to display, trade and sell SME products (http://www.smescotrade.com), extensive resources are applied to give SMEs a boost and a competitive edge in the global marketplace.

From past experience, Indonesia learned it was more effective to use business development services in clusters to promote and develop SMEs, rather than centralised, top-down government models or other approaches.

As Bali International Consulting Group notes, “The government has introduced many models for promoting SMEs, including business incubators, business consulting clinics and technology centers. However, those sponsoring programs have not been productive and could not sustain themselves for a long time. The government then turned to supporting BDS (Business Development Services) providers to serve a certain cluster in a selected area.”

Developed countries like the United States significantly grew their wealth by allowing entrepreneurs and small and medium-sized enterprises to flourish. The USA’s highly innovative and globe-straddling high tech and information technology businesses would not have been so successful without entrepreneurs. Think of Bill Gates, one of the founders of Microsoft, or Steve Jobs, one of the pioneers behind the Apple computer brand.

China – the country that has seen the largest lifting of people out of poverty in our time – is awash with entrepreneurs. So successful at providing manufacturing services to foreign companies, China is fast on track to become the wealthiest country in the world. The International Monetary Fund recently issued a report predicting China would be number one within five years.

Entrepreneurs play a key role in any country’s economic strategy. The more they are encouraged to flourish – and build wealth and their businesses – the better a country can do. Large human development gains can come about when entrepreneurs are matched with a fair and transparent tax system, balancing between social and economic needs.

China is the source of one of the most successful aids to small business growth in the global South. Hong Kong-based Alibaba (http://www.alibaba.com) is an online trading and selling marketplace aimed at small businesses and start-ups. Packed with support, advice and inspiration, it makes it possible for people anywhere in the world to get trading and selling.

To help small businesses trade with each other, New Delhi, India-based Go4World Business.com (http://indonesia.go4worldbusiness.com) has for the past 12 years helped exporters and importers to explore new markets and increase their international business in a simple, cost effective manner.

The Internet has not only radically transformed how to trade and sell, it has also opened up many ways for small and medium-sized businesses to raise funds and borrow money. Examples include Zopa (www.zopa.com) – “Where people meet to lend and borrow money”; social lenders like Kiva (www.kiva.org)w, whose mission is to connect people, through lending, for the sake of alleviating poverty; and Betterplace (www.betterplace.org), an online marketplace for projects to raise funds. It is free to use, and it passes on 100 percent of the money raised on the platform to the projects. For those with a creative business idea, Kickstarter (http://www.kickstarter.com) is a funding platform for artists, designers, filmmakers, musicians, journalists, inventors, and explorers.

By David South, Development Challenges, South-South Solutions

Published: June 2011

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP's South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South's innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

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