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Entrepreneurship

Marginal changes for the many or focusing on the few? Trade-offs in firm support policies and jobs

David McKenzie's picture

Should governments aiming to improve job opportunities devote additional resources towards trying to provide programs that attempt to generate marginal changes in many micro and small firms, or try to target the support towards making larger impacts on a smaller number of high-growth and larger firms? For example, should a government spend an additional $5 million on grants and training programs that support 25,000 micro firms at $200 each, use it to give 100 grants of $50,000 each to 100 high-growth potential firms, or use it as a single $5 million tax incentive to encourage one large multinational to set up a manufacturing plant in the country? I’ve been asked my thoughts on this question quite a few times, so thought I’d share them here.
 
The answer involves many different trade-offs and considerations, and I attempt to summarize some of the key ones in this post. The bottom line is that there are trade-offs (at least in the short-run) between poverty alleviation and productivity growth, and that different policies will have impacts on different types of job creation. A key lesson for policymakers is to be clear about what the job problem is that they are trying to solve, and not try to use the same policy instrument to achieve multiple competing priorities.

In Africa, technology and human capital go hand in hand

Sheila Jagannathan's picture
Photo: eLearning Africa
Rwanda’s progress from the devastating civil war two decades ago to one of the most rapidly developing African countries is a remarkable narrative on development.

Twenty-four years ago, the country was torn apart by civil war and one of the worst genocides human history has known; one in which more than a million people were killed in only three months.

Now, with years of sustained economic growth—predicted to be around 6.5% this year, the country is well on the way to achieving many of the ambitious development goals set out in the Rwandan Government’s ‘Vision 2020.’ This strategy seeks to move away from agriculture and rely instead on services and knowledge as the new engines of economic growth, with the objective of achieving middle-income status in the near term.

I had the privilege of getting a snapshot view of Rwanda’s success during the few days I spent in the country last month attending elearning Africa 2018, the continent’s largest conference on technology-assisted learning and training. The choice of Kigali as the location for this year’s conference is highly symbolic: Rwanda has put education and skills at the heart of its national strategy, and can send a powerful message to other African countries about the importance of investing in human capital to support overall development.

Lebanese youth are helping to bring tourism back to Tripoli

Chadi Nachabe's picture


Alaa Jundi, 27, from Tebbaneh outside Tripoli, Lebanon, didn’t have the chance to continue his education. But he loved the arts and had an ambition was of being an actor one day. After feeling hopeless that he had no opportunities, he took art classes that were part of a World Bank project to build his skills. “At first, I felt this was a dream, I was just participating to fill my time and practice my hobby.” But the skills he learned led him to opening an entertainment company with a colleague to host kids’ birthday parties and events.

Empowering MENA Youth through “the Cloud”

Safaa El-Kogali's picture
Tech and Youth in MENA - Ahed Izhiman

When I was your age “checking your mail” meant walking to the post office and collecting letters, “tweet” meant the chirping of a bird, and “cloud” meant rain! Today, we live in a very different world.

How can digital technology help transform Africa’s food system?

Simeon Ehui's picture
Also available in: Français 
Photo: Arne Hoel/World Bank
There’s no question that agriculture is critical to Africa’s biggest development goals. It is fundamental for poverty reduction, economic growth and environment sustainability. African food market continues to grow. It is estimated that African food markets will triple to US$1 trillion from its current US$300 billion value. Farming accounts for 60% of total employment in Sub-Saharan Africa—and food system jobs account for even more. In Ethiopia, Malawi, Mozambique, Tanzania, Uganda and Zambia, the food system is projected to add more jobs than the rest of the economy between 2010 and 2025.

And yet, Africa’s agriculture sector is facing serious challenges. Agricultural productivity in Africa lags behind other regions. One in four people in Sub-Saharan Africa are chronically undernourished. Africa’s food system is further strained by rapid population growth and climate change. The food security challenge will only grow as climate change intensifies, threatening crop and livestock production. If no adaptation occurs, production of maize—which is one of Africa’s staple crops—could decline by up to 40% by 2050. Clearly, business as usual approaches to agriculture in Africa aren’t fit for transforming the sector to meet its full potential.

Digital technology could be part of the solution. But how can digital technology help transform Africa’s food system?

It’s instructive to look at startups, which are an emerging force in Africa’s agriculture sector.

Stories of success: We-Fi’s Women Entrepreneurs Reporting Award

Priya Basu's picture
 
Amanda Burrell, Documentary Filmmaker. © World Bank
Amanda Burrell, documentary filmmaker, receiving the award. © 2018 One World Media Awards


Jordan’s Water Wise Women initiative puts women at the heart of efforts to combat severe challenges in water supply and sanitation by training more than 300 local women to be plumbers.  The program, led by the German government, led to the formation of a women’s cooperative that bids for commercial contracts in schools, mosques, and government agencies.
 
A short documentary film produced for Al Jazeera showcases how these women are not only challenging stereotypes by thriving in the male-dominated profession of plumbing, but also implementing a range of water management techniques for their communities.
 
Each group of Water Wise Women is trained to eradicate water leakage and improve hygiene.  Trained women receive toolboxes and funding for outreach to disseminate information within their community and reach at least 20-25 other women.
 
The film was just awarded the Women Entrepreneurs Journalism Award, sponsored by the Women Entrepreneurs Finance Initiative (We-Fi), as part of the 2018 One World Media Awards. This is the first time that the One World Media Awards have included reporting on women’s entrepreneurship as a category. The award covers broadcast, digital, film or print journalism that explores women’s entrepreneurship in developing countries. Reporting can showcase stories of successful female entrepreneurs, the challenges women face in trying to start or grow their businesses, and/or the critical role that women entrepreneurs play in economic development by boosting growth and creating jobs. 

Making marble from bottles: plastic waste’s second life in Kenya

Justine White's picture
It is estimated that every day Nairobi generates 3,000 tons of waste; 12% is plastic. At the same time, the demand for new houses is growing at a rate of 600 per day. Innovative climate technologies can offer solutions that tackle both the challenges of plastic recycling and the increasing housing demand. But what is an effective approach to introducing technologies that can impact a critical number of companies in the value chain?
 
“From plastic waste to building materials,” a partnership supported by the World Bank Group gathering six private sector frontrunners in Kenya, is testing exactly this.
From plastic to marble. Photo © Better Future Factories
From plastic to marble. Photo © Better Future Factory

African leaders committed to building a digital economy

Ceyla Pazarbasioglu's picture
Mbarak Mbigo helps his colleagues who are software developers at Andela, in Nairobi, Kenya. © Dominic Chavez/IFC


We only have to look at the way we communicate, shop, travel, work and entertain ourselves to understand how technology has drastically changed every aspect of life and business in the last 10 years.

Technology-driven changes are radically transforming the world and enabling developing countries to leapfrog decades of “traditional” industrial development. But disruptive technology also increases the stakes for countries, which cannot afford to be left behind.

Sub-Saharan Africa demonstrated its capacity to harness technology when it embraced the mobile telecom revolution in the 2000s. Now again, there is huge potential for digital impact in Africa. But to achieve that, the five foundations of a digital economy need to be in place - digital infrastructure, literacy and skills, financial services, platforms, and digital entrepreneurship and innovation.

#AfricaCAN: Retired nurse reinvents her career as an entrepreneur

Sarah Farhat's picture



"I grew up raised by two parents who were farmers, but as I grew up, I hated farming." That's one of the first things I heard as I met with Ntuba Masena, the owner of a fruit and vegetable drying business in Lesotho. Ntuba remembered spending long days plowing the fields with her parents, and as a result, agriculture was the last thing on her mind. It's safe to say that it has been an unusual journey for the 61-year-old retired nurse who had reinvented herself as an entrepreneur and small business owner.

Mentoring entrepreneurs: Finding out what works and what doesn’t

Raj Nandy's picture
The Caribbean CIC Team after the Workshop kick-off. © Elaine Tinsley
The Caribbean CIC Team after the Workshop kick-off. © Elaine Tinsley

Start-ups in emerging markets are disadvantaged when it comes to accessing mentors and mentorship programs. The infoDev Climate Technology Program has been working to fix this challenge and recently launched two mentorship pilots in partnership with Climate Innovation Centers in Ghana and the Caribbean.  
 
Entrepreneurs are powerful agents of change. They are catalysts for job creation and drivers of economic growth. Successful entrepreneurs from developed technology hubs often engage mentors so that they can learn from experienced industry veterans, solve unfamiliar problems, and navigate blind spots. In emerging economies, great mentors are harder to come by, founders are less familiar with what to expect from a mentor, and support programs and networks are less established.


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