||Like it? PLEASE +1 it! Thanks!|
SMEs - regulation in Africa
The question is always raised as to whether or not developing countries are over-regulated or not. The World Bank Doing Business Report in particular assesses these aspects of these African countries and the general consensus is that they are over-regulated.
There are essentially two problems here however. The first is whether over-regulation is a bad thing. I am no expert on the USA, but it is my understanding that it is a very highly regulated environment, and also extremely complex in that it can vary dramatically from city to city and state to state. So then, is the African problem that itis over-regulated? I think the observation is being misinterpreted and the problem is not in fact over-regulation (a generalisation) but rather a case of the governments being inept and unable to manage the regulatory environment they have created.
This leads to the second problem. South Africa is a good example. Since independence in 1994, the ANC government has introduced many new laws. Many of these are in fact extremely advanced in their thinking, but South Africa does not have ability to enforce the regulations. A classic example is the smoking legislation. While as a non-smoker I fully endorse the legislation, they have absolutely no chance of this legislation succeeding as they do not have the capacity, in all respects, to implement and enforce this legislation. They same holds true for a number of these new laws.
South Africa has legislation that is extremely advanced, and often ahead of many leading developed countries. However, their ineptitude and inability to manage their own legislation leads to a complete disrespect for the rule of law. This is because that as business sees new legislation arriving they initially see the pro's and con's and decide if it presents an opportunity or a threat. However, once nothing arises from its passage through Parliament, it soon becomes obvious that it is simply just another law on the books, and the impact will be nil. And so the disrespect for the legal system develops into a Western style free for all.
So perhaps these African countries are not over-regulated, but are rather under-managed. It is not about passing sophisticated legislation, but rather about enforcing the legislation that exists.
Related ArticlesRestricted Access to Finance
SMEs - surviving the recession in Africa
Expanding the supply of finance through the non-financial private sector - Increasing SME Access to Finance: A Four Pronged Approach
SMEs in Africa - is capitalism really dead?
Helping SMEs meet the requirements of formal financing - Increasing SME Access to Finance: A Four Pronged Approach
SMEs - opportunities in Africa
Facts about SMEs in Africa
SMEs in Africa - do interventions help SMEs
SMEs - a changing trend in SME failure
SMEs – SMEs struggling in South Africa. Why?
SMEs - my PhD topic and African context
SMEs in Africa: the “Missing Middle”
5.5 Energy access as market failure: Enterprise solutions to poverty
SMEs - SMEs and labour rigidity
Leverage Subject Matter Experts
SME's - left wing politics in the new South African government
SMEs - the impact of corruption has deep roots
A New Framework of Economic Development in African Countries PART III Access to Finance for SMEs
SME's - regulation in Africa
5.2.1 The MIT-SME section: Support for Growth-oriented Women Entrepreneurs in Tanzania, 2005
Free PDF Download
SMEs and entrepreneurs in Africa
By Dr. Rob Smorfitt
About the Author: Dr. Rob Smorfitt
RSS for Dr. Rob's articles - Visit Dr. Rob's website
Have an MBA and a PhD in entrepreneurship. Three key areas of ongoing research are entrepreneurship and innovation in large business strategy, the impact of legislation on SME development and SME finance. Run my own SME blog at http://sme-smb-smme.blogspot.com as well as an entrepreneurship and innovation for large businesses blog at http://innoveur.blogspot.com. I have been self-employed since 1982. I have started or purchased in excess of 50 businesses since then. Most were sold again and a few were shut down because of a lack of profitability. Many were run by staff or family while I worked full time in my bigger businesses. Author of 6 books. Written articles for various magazines, newspapers and websites. Experienced in research within developing countries.
Click here to visit Dr. Rob's website.
More from Dr. Rob Smorfitt
SMEs the impact of regulation
SMEs can entrepreneurialism survive in Africa
SMEs African confusion with entrepreneurship
SMEs regulation in Africa
SMEs survivalist start ups in South Africa present a unique problem
Related Forum PostsRe: In-House or Outsource?
Re: need advice
Re: Newbie from Africa
Adventure travel to Africa.
Re: Newbie from Africa
Share this article. Fund someone's dream.
Share this post and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.
By: Evan Carmichael
By: Evan Carmichael
||Like this page? PLEASE +1 it!|