Entrepreneurship development in the second economy as a rural development measure

Abstract

In September 2000, the UN unanimously made the Millennium Declaration, outlining the primary goals for aiding the developing world over the first quarter century of the new millennium. The Millennium Development Goals (MDGs) signal not only the enormous importance of poverty alleviation to the global community, but also the immensity of the challenges facing the world , if poverty is to be significantly reduced and development stimulated where necessary. Fourteen years on from South Africa's transition to democracy, it is clear that underdevelopment and poverty persist. Karl Marx said that men make their own history, not under circumstances they choose but under circumstances given from the past (Marx 1972:120). The enormous disparities in wealth, opportunity and social rank that continue to define South Africa do not make the country unique. What does distinguish this country is its history in terms of the sharp contrast, in every area of social life, which revolves around the fundamental black or white divide, around white wealth and privilege on the one hand, and black exploitation and oppression on the other. The history of rural communities in South Africa is one of dispossession, forced removals, and disparity. The movement towards and from the rural areas has historically formed a circuit providing cheap labour in the industrial areas and causing dependency in the rural areas. Low wages were the norm, due in part to welfare and cultural support in the rural areas. Rural communities are still basically characterised by lines of division between commercial farming and the

former homeland reserves; the former are visibly improved areas with dams and infrastructure; the latter remain intensely populated areas with poor land utility. The elements described above of the burden of the past have depleted available rural resources and social capacity of rural populations. Such elements provide a socio-economic and historical background to rural poverty which persists today. In this study, the terms 'informal area' , 'rural area' or 'under-developed area' refer synonymously to sparsely populated areas where people depend largely on agriculture or natural resources, including villages and small towns which serve as rural centres. It is understood that these terms include larger or 'closer' settlements that were created by the 'dumping' of populations in the former homelands during the apartheid era. The population in most rural areas depends on the migratory labour system and remittances for survival. The challenges of rural development need to become more central in the second economy. A substantial number of people live in the rural areas: some 45% of South Africa's population live in 'non-urban' areas, depending on the definition used. Of these, 85% live in the former homelands, and the rest on commercial farms and in small towns (ISRDS 2000: para 36). A large number of rural people still depend on the land, even though there is a low level of agricultural or pastoral activities. The land serves a welfare function, as many older migrants and urban residents retire here, to be free of rent and

service charges, even though the prices of basic commodities are undoubtedly higher. The Integrated Sustainable Rural Development Strategy (ISRDS, 2000) published in 2000 has the following goals: • To increase investment in physical infrastructure and delivery of social services in rural areas; • To enhance rural economic development and improve income generating opportunities; • To consolidate democratic governance and redistribution in rural areas; • To ensure gender equity, including the participation of the youth and the disabled; • To facilitate a partnership between government, civil society and donor institutions in the rural development process. The ISRDS report (ISRDS 2000: vi) points out that the ISRDS focuses essentially on the regional and provincial levels within South Africa, to ensure effective implementation, a context which is now changing. The strategy concentrates on poverty eradication as "the main policy challenge confronting rural development processes".

ACHIEVEMENTS OF RURAL DEVELOPMENT FROM 1994-2000 Some examples of achievements under the various departmental programmes include: • Small-scale mining activity was promoted through managerial support, infrastructure investments and support services. • Eskom completed 1.1 million electrical connections in rural areas between 1994 and 1999 and provided electricity to 3891 rural schools. • Spatial Development Initiatives (SOis) created spin-offs such as job opportunities, socio-economic upliftment, economic empowerment, upgrading of infrastructure. • Community-based public works programmes focused on poverty alleviation, job creation and infrastructure provision, primarily in three provinces. • Investment in water infrastructure development projects increased the access of rural communities to water. • Telephone services extended to rural communities increased access from 20% to 40% of households. • Cell phone networks and TV signals have been extended to rural areas ensuring that most households in rural areas now receive a TV signal. • Under the land reform programme, 350 000 households gained access to 6.5 million hectares of land. Source: ISRDS, 38:55 The background of South African capitalist development, the labour situation, and the socio-economic structures of segregation, poverty and underdevelopment laid the foundation for and provided the rationale behind this study.