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Karl Pfeffer
Green Jobs, ILO Pretoria
Creating green jobs
through sustainable enterprise development
• Importance of SMME’s for the SA Economy • The entrepreneurial process and entrepreneurial
activity • Profile and characteristics of some green entrepreneurs • Barriers to overcome by (green) entrepreneurs • A systemic approach to developing the Green Economy
in South Africa
Presentation roadmap
• SMMEs are defined as separate and distinct business entities managed by one owner or more. This includes amongst others social and green enterprises, cooperatives,….
• 5.6 million SMMEs in SA • 11.6 Million Jobs • 300.000 SME employ over 5 employees • Total early Stage Entrepreneurial Activity (TEA) in SA is lowest
amongst 10 sub-Saharan countries
Sources=Global Entrepreneurship Monitor 2012, SA; JP Morgan
report 2010
Importance of SMMEs for SA Economy
Total early Stage Entrepreneurial Activity The entrepreneurial process
Potential Entrepreneurs: beliefs and abilities
Nascent Established New
Entrepreneurship Phases
Intentions
Entrepreneurship Profile Inclusiveness • Sex • Age
Impact • Business growth • Innovation • Internationalization
Industry • Sector
Discontinuance
(TEA) Total Early-Stage Entrepreneurial Activity
The highest average TEA rates were found in Sub-Saharan Africa and Latin America/Caribbean. Zambia (41%) and Ecuador (27%) reported the highest rates in these regions.
How can we change mindsets of young South Africans to be more entrepreneurial and equipped to start and maintain green businesses?
South Africa’s TEA index is lower than other developing countries:
Of all the age groups, South African youth are least likely to start a business:
2012 2011 2010 2009
South Africa 7.3% 9.1% 8.9% 5.9%
Brazil 15% 14.9% 17.5% 15.3%
China 13% 24.0% 14.4% 18.8%
18-24 yrs
25-34 yrs
35-44 yrs
45-54 yrs
55-64 yrs
2010 20% 36% 24% 14% 6%
2011 16% 24% 32% 19% 9%
Country Perceived capabilit-
ies
*Quality of
education
TEA 2012
Malawi 86% 65 36%
Zambia 84% 39 41%
Namibia 76% 126 18%
Ethiopia 74% 85 15%
Ghana 86% 62 37%
Nigeria 86% 83 35%
Botswana 70% 55 28%
Uganda 88% 69 36%
South Africa
40% 140 7%
South African’s perceive their entrepreneurial capabilities as the lowest of 10 sub-Saharan countries
Even if they do start a business, it is not likely to last...
Country
Nas
cent
en
trep
rene
ursh
ip
rate
New
bus
ines
s ow
ners
hip
TEA
Esta
blis
hed
busi
ness
ow
ners
hip
rate
Disc
ontin
uatio
n of
bu
sine
sses
Malawi 18 20 36 11 29
Zambia 27 15 41 4 20
Namibia 11 7 18 3 12
Ethiopia 6 9 15 10 3
Ghana 15 23 37 38 16
Nigeria 22 14 35 16 8
Botswana 17 12 28 6 16
Uganda 10 28 36 31 26
South Africa 4 3 7 2 5
1. Eco-Post Recycling Company (Kenya) 2. 5 Star Stoves (South Africa) 3. MRDP Sunwater (South Africa) 4. Duncan Village Secondary Recycling Cooperative
(South Africa)
Who are green entrepreneurs: Examples of green entrepreneurs/enterprises
Eco-Post Recycling Company (Kenya)
- Nairobi produces 2400 tonnes garbage of which 20% is plastic (480 tonnes).
- recycles plastic waste into fencing post aka plastic lumber
- Alternative to timber (deforestation)
- 40 direct Jobs, 500 indirect Jobs
- Lorna Ruto – winner of ILO/Enablis Business Plan Competition
Who are Green entrepreneurs?
5 Star Stoves (SA) - Cooperative - sustainable clean cooking
stove business - producing biomass pellets to
cook and heat - Stove assembly on site - Distribution through franchise
model - 20 direct jobs created - Saving in energy resources
and costs (up to 360 R/month)
Who are Green entrepreneurs?
MRDP Sunwater (SA) - Part of Rural Development
Programme supporting young entrepreneurs to start their business in SWH
- Low tech and low maintenance passive water heating system in low income and or rural communities
- Use of PVC hoses - Monthly household spending
on firewood can be reduced by up to ZAR 400.
Who are Green entrepreneurs?
Duncan Village Secondary Recycling Cooperative (SA)
- Cooperatives PPP local municipality and DBSA
- Collection of waste through source separation of waste at a household level.
- Establishing composting facilities
- Reduction of waste to land fill, re-use and recycle
- Potential for 150 green jobs
Who are Green entrepreneurs?
12
Characteristics of green entrepreneurship
• Sustainable business • Providing green products and services • Innovation driven • Opening new markets • Opportunities for youth and gender
13
But can they do it on their own? Barriers or enabling factors for
(green) entrepreneurs
Do potential green entrepreneurs have • Market demand? • Enabling Policy framework? • Access to finance? • Skills (technical as well as business skills)? • Support in the start up phase, i.e. the Total Early
Stage Entrepreneurial Activity (TEA) phase that is so crucial for sustainability?
14
Towards a framework for green jobs creation through SMME
development
- Looking at the wide diversity of barriers, there is no single solution or one silver bullet
- SMMEs are located at crossroads of different networks of actors and
interaction, at the different systemic levels - Meta level: perceptions and attitudes - Macro level: rules of doing business - Micro level: SMME’s
- Need for an integrated systemic approach which a. links the principal actors across system levels b. improve interaction by fostering or establishing connections
between principal stakeholder
15
Macro level: Create an enabling business environment for the green economy
Micro level: Stimulation of innovation, entrepreneurship and sustainable enterprises
Meta level: Nurture a culture of green entrepreneurship among (young) men and women
Systemic Approach to the Development of a Green Economy in South Africa (meta, macro,
micro levels)
16
An example – The 2014 Free State enterPRIZE Job Creation Challenge to stimulate green
entrepreneurship
www.enterprizejobchallenge.co.za
Thank you