Black entrepreneural experience and practice in Port Elizabeth ; Development Studies Working Paper, no. 36

Abstract

Black business development in South Africa has been restricted by discriminatory legislation, regulation and custom for many years. Black entrepreneurs have been deliberately and systematically excluded from access to economic opportunities which might have facilitated their participation in moulding the national economy. This situation stemmed from a widely-held White view that Blacks should not have a permanent stake in non- "homeland" South African towns and that the interests of White business should be protected (Hart, 1972). Given these circumstances, Black business has not developed and diversified with the growth of capitalism in South Africa. In fact, capitalism's predominant interest in the Black population has been as labour units, not as partners in economic ventures. Those Blacks in business who have grown, and have established relatively successful business ventures, have done so despite the obstacles devised by the system. The successful Black businessman, therefore, reflects a particular brand of entrepreneurship characterised by determination, tenacity and a capacity to adapt over and above that which is usually required for survival in a competitive environment. The nature and scale of businesses to which Blacks were allowed access was limited to those which provide the daily domestic necessities of urban Black communities; ie, mainly convenience retailing (Davies, 1972). Black businessmen were also denied the right to acquire land in urban areas and such businesses as were allowed had to be conducted from rented premises. Thus, Black experience of crucial elements of entrepreneural development (such as locational choice, market selection and capital formation through property ownership) has been minimal, and so conditional that the aspirations of all but the most determined businessmen have been severely inhibited. Even the most competent Black entrepreneur has not been able to stray very far from the mould of "trader", which has become the stereotype of Black business. Hence, most business ventures in urban Black townships are associated with convenience retailing and service activities, mainly of modest proportions and not necessarily a reflection of the individual's business choice. The underdeveloped status of Black entrepreneurship in South Africa is thus due entirely to their exclusion from opportunities to gain experience, to take risks and to compete. The view of Blacks as not having an interest in, or an aptitude for, business is little more than a transparent rationalisation for institutionalised racism. The apparent lack of competitiveness amongst Blacks is the result of a complex set of inequities imposed over decades of "relative deprivation in terms of upbringing, nutritional standards, education and training, medical services, entrepreneural and professional opportunities, and horizontal and vertical mobility" (Leatt et al, 1986). It is against this background that the situation of Black business in Port Elizabeth must be seen. ; Digitised by Rhodes University Library on behalf of the Institute of Social and Economic Research (ISER)