The cooperative as a model to foster an entrepreneurial culture in South Africa

Abstract

One of the great challenges facing the South African economy is to increase the number and variety of viable and sustainable economic enterprises. We have a history that has brought about many interruptions in the development of enterprises in particular. This has been particularly associated with our racial history and the destruction of wealth in black hands in both the rural and urban areas. It has adverse effects on income distribution, entrepreneurship and employment creation. The recent history of South Africa cannot ignore the role of cooperatives in developing its economic foundation. Cooperatives in the financial, service and agricultural sectors were backbones of the apartheid economy, hence we see the cooperative idea resonates on numerous platforms in the democratic Government as part of its empowerment discourse and addressing the national objective of economic growth, poverty and unemployment reduction. A number of studies have identified that the culture of entrepreneurship is one of the prerequisites for the prosperity and the high rate of economic development registered by most of the developed countries. However in terms of South Africa, the low level of entrepreneurship activity compared to its peers has been identified as one of the key factors responsible for the low rate of economic growth experienced by South Africa over the past 10 years, and cooperatives as model can be a solution to foster entrepreneurial culture and as a result maximise economic growth, reduce poverty and unemployment.