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Zambezia (1998), XXV (ii).

TOWARDS THE SOCIOLOGY OF ZIMBABWEANINDIGENOUS ENTREPRENEURSHIP

F. M A P H O S A

Department of Sociology, University of Zimbabwe

bstractEarly writers on entrepreneurship were concerned mainly with entrepreneurialmotivations. They assumed that an entrepreneurial personality was in-born.Contemporary studies of entrepreneurship, particularly those carried out bysocial scientists, emphasise social experience in accounting for the supplyand success of entrepreneurs in any social group. Th is article analyses someof the social forces that account for the supply and success of indigenousentrepreneurs in Zimbabwe.

INTRODUCTION

THE ROLE OF THE entrepreneur in economic growth has long beenacknowledged (Schumpeter 1947, 1968; Kent, Sexton and Vesper, 1982).Early writers on entrepreneurship were concerned mainly with themotivations of entrepreneurs. They assumed that the entrepreneurialflair, the ability to take risks and the desire to create a business, wasinherent in the individual (Birley, 1989, 8). Entrepreneurs werecharacterised as individuals endowed with an innovative drive(Schumpeter, 1947), a high need for achievement (MacLelland, 1961) or aninternal locus of control (Rotter, 1966). By innovation Schumpeter (1947,151) referred to . . . the doing of new things or the doing of things that arealready done in a new way .

For MacLelland (1961) it is the need for achievement that predisposesindividuals to become entrepreneurs rather than the need for affiliation.

Rotter s internal locus of control is a personality characteristic thatpredisposes an individual to believe that he or she can control the outcomeof his or her efforts. In contrast, an individual with an external locus ofcontrol believes that his or her life depends on forces outside his or hercontrol.

MacLelland carried out studies that demonstrated thatentrepreneurship is not genetically determined. He found that thedevelopment of entrepreneurial characteristics were related to parentaltreatment. High achievers were those who had been expected andencouraged by their parents to be capable of self-reliant and independentaction at an early age. Since then, entrepreneurial studies have focused onsocial experiences and situational conditions to explain the origins and

success of entrepreneurs.173

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174 SOCIOLOGY OF ZIMBABW EAN INDIGENOUS ENTRE PRENE URSH IP

THE SOCIOLOGY OF ENTREPRENEURSHIP

Sociologists em phasise social exp erien ce (Mead, 1934) to acco un t for

both the development of an entrepreneurial personality and the successof the entrepreneurial function. One of the earliest attempts to locate theorigins of entrep reneursh ip in social factors was W eber s theore tical work,The Protestant Ethic and the Spirit of Capitalism. He a t t r ibuted thedevelopment of capitalism in Sixteenth C entury Western E urope to religiousvalues associated with ascetic Protestantism. Its emphasis on vigorousactivity in a secular vocation to prov e on e s calling resu lted in high r at esof saving and continued hard work, both of which are favourable toeconomic progress (Weber, 1947).

W eber s work prompted other scholars to believe that en trep ren eu rsare social or cultural dis siden ts (Cheater, 1987,103; Kennedy, 1988, 160),those whose values differ from those of the mainstream society. Cheaterargues that every kind of change social, political, economic resultsfrom th e manipulative tactics of cultural dissidents . Th ese ar e th e pe op lewho have the courage to breach and redefine their society s n orm s andvalues in pursuit of their own interests. For Kennedy (1988, 160), one hasto be an outsider in order to brea ch th e norm s and values of society withimpunity. Immigrants, becau se the y are aliens, can d isrega rd local n orm sand values because they have no moral obligation to uphold th os e no rm sand values. There is also a symbolic outsider. One becomes a symbolicoutside r by converting into a certa in form of religion w ho se beliefs en titlehim or her to breach the norms and values of society.

The sociology of entrepreneurship has therefore concentrated on

locating which groups (social, cultural, ethnic, institutional, econ om ic orreligious) produce more entrepreneurial events than others, and why?According to Shapero and Sokol (1982), it is differences in soc ial expe riencethat explain why such groups as the Jews and the Lebanese in the UnitedSta tes, the Ibos in Nigeria and th e Gujerati Indians in Africa, a re as so ciate dwith entrepren eursh ip rath er tha n o ther grou ps. Hagen (1957) s socialmarginality thesis attem pts to explain w hy certain social grou ps pr od uc emore entrepreneurs than others. He argued that entrepreneurship wasassociated with low status group s.

Entrepreneurs are mem bers of subo rdinate grou ps, seeking to r ed re sstheir social grievances through economic creativity and venturing.Flemming (1979), however, found that in Argentina it was the elite inM endoza Province wh o we re th e major en trepr ene urs.

METHODOLOGY

This article is based on da ta ob tained from a case stu dy of 10 small-scaleb i i Zi b b l t d th h i li f

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reg ister obtain ed from the Indigenous Business Development Cen tre (IBDC).Data w as collected mainly throug h in-depth, un stru ctu red interviews. Thelimited n atu re of the ca se studies does not allow for broa d gene ralisations.Further and more extensive research is necessary if we are to arrive atm ore em ph atic g eneralisations. The evidence, however, provide s insightson the social factors that encourage or impede the development andsuccess of Zimbabwean indigenous entrepreneurship.

SOCIALISATION

Socialisation has an influence on the development of an entrepreneurialpersonal i ty. The main socia l i s ing agents in the development ofentrepreneurial character is t ics are the family, the school and theorganisation previously worked for. An entrepreneurial personality is notin itself a sufficient condition for the initiation and successful operation ofa business venture. In other words, besides the characteristics of theindividual entrepreneur, entrepreneurial success depends on the social,legal and political factors in th e environm ent in which th e entrepren euria lactivity takes place.

By encouraging behaviour that is associated with self-reliance, risktaking, innovation and individualism, pa ren ts or other relatives help the irchildren develop an entrepreneurial personality. The influence of thefamily in the development of an entrepreneurial personality is strongerw here ther e is a family tradition of bu siness . A business family, particu larlythe father and mother, besides encouraging behaviour associated withentrepreneurship, also provides role models. Six of the business peopleindicated that on e of their paren ts o r relatives owned a busine ss. A

businesswoman stated:I owe a lot of what I am today to my father. He used to sell hides andcarvings and I used to admire him a lot. I remember how he wanted tosend me to England to study law. also admired him for his bravery. Hewas very politically minded and always opposed to the regime. I think Itake after him.

Although not always the case, a family tradition of business can alsoinfluence the type of business one ventures into. In this study, parentalinfluence was more evident in businesses owned by women. Two of thebusinessw om en stated that their mothers were involved in similar busine ssventures and therefore were role models for their own businesses.

T he b usin ess peop le stud ied w ere relatively well ed ucated , all of themhold ing post O level qualifications with th re e of them holding universityde grees . They w ere successful mem bers of their families bo th in term s ofeducation and wealth, akin to the apwamamba (big man) of Zambia,describe d by Beveridge and Oberschall (1979, 134). The ability to rea d

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and write (particularly in English) enhan ces an individual s pr os pe cts toven ture into busin ess. It exposes an individual to a wide range of bu sinessinformation such as sou rce s of finance. It also en hances o ne s ability toprepare business proposals which are typically presented in English.While num erical literacy may not be an imp ortant factor in th e decision tostart a business, it is definitely an important factor in its success.

AH the b usines s peop le had worked, o r we re still working, for othe rorganisations. One businessman was working for a real estate companywhile running a construction and building supplies company on a part-t ime basis . Another was a universi ty lecturer owning a clothingmanufacturing company. The rest of the business-people had left their

jobs to run their businesses on a full-time basis. The reasons for leaving asecure job to run a bus iness varied. They ranged from th e selfish, such asthe need to make more money and to be o ne s own bo ss, to th e altruisticsuch as the desire to create employment and contribute to nationaldevelopment.

Six of the business-people had busines ses engaged in activities similarto tho se of the organisations th ey had p reviously worked for or w ere stillworking for. Any working experience has two positive impacts onentrepreneurial success. It provides an aspiring business-person with anopportunity to learn and m aster skills and experience that b eco m e valuablein future. It also gives an aspiring bu siness-p erson an o pp ortu nity t o earnand save money to use as start-up capital. All but one of the business-people started their businesses from their own savings.

AVAILABILITY OF CAPITAL

The problem most frequently expressed by indigenous business-peoplewas the shortage of capital. When asked to talk about the problemsaffecting their business activities, all the ten business-people thought thattheir main problem was finance. All the other problems were seen asincidental to, or as a direct result of, the shortage of capital.

While only four business-people believed that the shortage of capitalinhibited entry into busine ss, all ten of them thoug ht tha t th e sh or tag e offinance had a m ore profound effect on business expansion th an on bu sinessstart-up. Perhaps as a way of pushing the point home, one business-person who refused to participate in th e re sea rch had this to say, Ourproblem is money. We do n t have any oth er prob lem . Go and tellGovernment that we need m oney. A businesswo m an confidently sta tedth at . . . give us money and we are just as good as any other bus inessm anin any part of the w orld of any ra ce .

The view that lack of access to finance has been the main inhibiting

factor for the development of viable indigenous businesses has found

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supp or t from th e media (especially the state-owned pre ss), the Governmentand indigenous business pressure groups, in particular the vociferousAffirmative Action Group. This support has often come in the form ofdenunc iation s of priva te com mercial banks and oth er financial institutionsfor sabo taging th e indigenisation pro cess by denying finance to indigenousbusiness-pe ople. At times th e attack ha s been directed at W hites in generalwho are perceived not only to be responsible for the economicsub ord ination of Blacks, bu t are also perceived to be the hidden h an dbehind the banks behaviour.

Two most widely expressed reasons for the lack of access of theindigenous people to financial re source s a re lack of collateral secu rity and institutional racism . The lack of collateral has a historical explanation.For a long time, most indigeno us Zimbabweans have been excluded fromth e ownersh ip of the means of production and from any economic activitiesthat would en able them to m ake any meaningful savings.

Eight of the ten business-p eople indicated th at a t one time or another,they tried to borrow money from a financial institution for businessexpansion or for capital injection. Only half (four) of those who tried toobtain loans from the banks were successful. The most common reasongiven for the denial of loans w as lack of collateral secu rity. Those who hadsucceeded in obtaining loans for business expansion used their houses ascollateral security.

Institutional racism is a term th at has been used by tho se concernedto refer to an alleged tend en cy to deny m em bersh ip of, and benefits from,certain organisations o r institutions on racial groun ds. To pro test this, inJuly 1994 a coalition of indigenisation p re ssur e groups, wh ich included

members of the Indigenous Business Development Centre, AffirmativeAction G roup, Indigenous Business Women s O rganisation and SanganoMunhumutapa organised pr ot es t m arch es in Harare to den oun ceinstitutional racism. The pro tes ts en ded w ith th e handing of strong pro testlette rs to m anagers of comm ercial banks and oth er financial institutions.

Those who allege institutional racism in banks argue that banksdeliberately deny Blacks access to finance by an undue emphasis oncollateral which they know most Blacks do not have. A businessman

complained:Our businesses are ailing because banks are ra c ia l. . . The colour of theperson determines whether or not he or she gets a loan regardless ofhow feasible the project proposal is. Whites get preferential treatmentbecause they control the economy of this country.An other businessm an w ho believed that lack of access to capital was

retarding the growth of his business argued:

Our problem is finance. Where on earth do we get the money if the banksdo not want to give us the money }ust because we are Blacks?

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Another one complained:Our problem as Black business-people is not that we are incapable ofrunning our businesses as is often alleged by our White counterparts.Our problem is money. We have ideas just like the White businessmenbut we need money to translate these ideas into reality.

Besides institutional racism and lack of collateral security, business-people blamed the Government for not doing enough to help them. Otherproblems such as lack of affordable working space and the existence ofrestrictive regulations were also partly attrib ute d to G overn m ent s lack ofsympathy to the plight of Black business-people. This accusation was,

however, exp ressed mostly in relation to availability of finance. A bu siness-woman suggested, The Government should p ut in place a parallel stru cturaladjustment programme for Blacks.

She was suggesting that concurrent with the on-going economicreforms, the Government should come up with a set of policies that areaimed at protecting and nurturing Black-owned businesses. Anotherbusiness-person remarked:

We voted for this Government into power hoping th at th ey w ere going towork towards redressing th e social inequalities left behind by the coloniallegacy. The Government is doing nothing at all.

Another comment was:The reason we fought the war was that we wanted t o control the econom yof our country. Someone somewhere up there has apparently forgottenthis. If the G overnment is going to con tinue with this carefree attitu de wewill continue to be subjugated by Whites for a long time to com e.

Besides th e issue of collateral and institutional racism bu siness -people complained of the high cost of borrowing as a result of highinterest rates.

The lend ing ins t i tu t ions , espec ia l ly commerc ia l banks , haveconsistently denied allegations of institution al racism . Th e issue ofcollateral has been defended by th e banks on th e grou nd s that th ey had tomake sure that the de pos itors money is safe. As custo dian s of in ve storsmoney the banks argue tha t they demand collateral from bo rro w ers as aform of security against the loss of such money and not as a way ofdiscouraging borrowing.

At a conference organised by the Zimbabwe National Chamber ofCommerce and Friedreich-Naumann-Foundation in February 1994,representatives of financial institutions were asked to respond to theallegations by indigenous business-p eop le. Mr. Jaravaza of th e Zim babw eDevelopment Bank, Mr. Wilde, Deputy Governor of the Reserve Bank of

Zimbabwe, Mr. Sanyanga of Stanbic, Mr. Matsaira of Standard CharteredBank and Mr. M waturura of the V enture Capital C ompany of Zim babwe all

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agreed that the only reason why the bankers demanded collateral was tosafeguard the interests of the investors. Th ere was con sensus, among thebanking ex perts, tha t th e other reason for failure to obtain a loan was poorproject proposals. Mwaturura argued that there was a dearth of creativeand viable project ideas. Chetse (1992) identified poor project proposalsas on e of the rea so ns for failure to secu re finance for small bu sinesses. MrSanyanga concluded that the criticisms of banks often came from peoplewho did not understand the requirements of borrowing money. JohnM aposa (1994) of Zimbank s small business division share s th e sameviews.

Demands for collateral security and project proposals that showedpotentia l to be viable may no t in them selv es imply unfairness o r any formof discrimination. This is because as Schartz (1977) and Kennedy (1988)argue, such d em and s a re standard pra ctice w orldwide. All banks have aresponsibility to lend depositors money safely.

To do this, ban kers d o not only dem and collateral and good b usinessproposals, but they also need evidence of reasonably efficient businessoperations, including up-to-date and properly kept accounts, especiallywhen th e money needed by the borrow er is substantial. Also th e interestrates charged by the banks may be determined by forces outside thecontrol of the individual banks. Evidence from this study and studiescarried out elsewhere, seem to suggest that an uncritical acceptance ofinstitutional racism as the prime cause of lack of access to businessfinance by indigenous people would be simp listic.

ECONOMIC FACTORS

Economic factors is used here to refer to all the factors impinging uponthe operations of a business other than the availability of capital and theability of th e bu sinessman himself (Schartz, 1977, 70). These factors includeina de qu ate infrastruc tural development, high rat es of taxation, availabilityand approp ria ten ess of technology, level of prod uc t demand and availabilityof adequate and reliable sources of supplies. Five out of ten business-peo ple indicated th at they were renting th e premises they were operating

from. The business-people complained about the high rentals charged bythe property owners, who included insurance companies such as OldMutual. They indicated th at they were not ab le to build their own premisesalthough they wished to, because they could not obtain loans for thatpu rpo se, and tha t th e profits they m ade were eroded by high rentals andhigh taxation.

The need for the provision of affordable work space is an importantaspect in the drive towards economic indigenisation. The provision of

work space has traditionally largely been the responsibility of local

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authorities. Unfortunately, the local authorities have not been able tosatisfy this need because of lack of financial resources. This has led toover-crowding of the few facilities that have been put up and the illegal

use of residential properties for business purposes.The high rentals charged for business premises developed by some

private organisations can be attributed to the high demand for suchfacilities. This has often resulted in the facilities initially intended for thesmall and medium business s ector, being taken up by big bu sine sses . Th eeconomic logic behind the very high rentals charged b y prop erty ow nersis that scarcity pushes prices up . Also, developers might need a rea son ab lereturn for their capital in the face of high interest rates, a fact that somebusiness-people seem not to und ers tan d. Some business-people, however,allege that their problems were compounded by racial discrimination bythe property ow ners.

Like institutional racism alleged in the provision of finance, theattribution of the shortage of working space to racial discrimination isdifficult to verify. The allegations wer e not accom panied by any ev idence,such as wr i tten comm unica t ions be tw een the par t ies con cern ed .

Furthermore, there was a general reluctance by the business-people toreveal the identities or the ad dre ss es of those con cerned, making it difficultto follow up on the allegations rais ed . As with institutiona l racism , itwould be naive to accept that the problems of working space faced byindigenous business-people can be explained solely in terms of racialdiscrimination. This is not, howev er, to suggest th at th es e allegations areun true . The point being ma de is tha t it is possible, in a racially stratifiedsociety like Zimbabwe, for race to be manipulated to gain access toeconomic resources. Political economists such as Raftopoulos and Moyo(1994, 5) have argued tha t rac e ha s b eco m e a convenient political tool fora minority Black petty-bourgeoisie s accumulation tendencies.

CULTURAL FACTORS

Entrepreneurship, like other human endeavours, takes palce within a

cultural context. This m eans tha t entre pre ne urs c arry ou t their bu sine ssesin a way that is m ore or less defined by o the rs (Jam es, 1987, 90). Culturalfactors do not only affect th e supp ly of ent rep rene ur s in a soc iety but alsothe organisational cultures of organisations existing within tha t socie ty.

W omen in businessThe effects of cultural factors can be discerned on the supply of womenentrepreneurs and the success of their enterprises. Allen and Truman(1993, 15) have argued that the gender division of labour prevalent in

t i ti l d t th t i ti f t i l ti iti

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to those activities they traditionally operated in such as food productionand processing, nutrition and child care.

Evidence from this study see m s to lend sup po rt to the se o bserva tions.Of th e five business-wom en stud ied, four of them ope rated ven tures w hoseactivities w ere related to w om en s traditiona l roles. These activitiesincluded dress-making, cookery, secretarial work, hair dressing and thesale of beer and other foodstuffs. The multiple roles performed by womenand the priority cultures give to their familial responsibilities, also putsevere constraints not only on the radius within which they can functionbu t also on the kind of en trep ren eu rial activity the y can perform.

The role of kinshipRe search findings on th e relations hip be twe en indigenous African bus inesspractice and kinship relations have not been consistent. Some scholars,such as Marris and Somerset (1971) and Garlick (1971), have found thatkinship relations are an obstacle to organizational efficiency and capitalaccumulation. Such findings therefore, seem to point to the suggestionthat in order to achieve economic development, African countries oughtto do away with the extended family. Marris (1988) states that it is oftenargued that the tradition of African family life inhibits individualism andth e accu m ulation of capital, as t h e obligations to kinsmen drain re sou rce sof the incipient entrepreneur.

No sooner does a man rise above his kinsfolk than he is overwhelmed bythe imperative demands which rob him of the profits of his enterprise.He cannot save money to expand his affairs and sooner or later eitherfails or becomes discouraged from further effort. The ambitious and thetalented are ruinously exploited by their less able and vigorous family(Marris, 1968, 19).In Kenya, Marris and S om erse t (1971) found t ha t not only is kinship an

impediment to business life, but the potential advantages of harnessingkinsh ip loyalties and c onv erging family inte rests in th e purs uit of com m ongoals which might in certain situations c oun teract th e negative as pec ts is also lost because in Kenya there is no tradition of families holdingand working economic resources together. People regarded themselvesas inde pen den t of their kinsm en and we re reluctant to accept the authorityof individual relatives.

Garlick (1977) found that in Ghana, the extended family drained thebusinessmen of their capital through the cost of educating their nephews,niece s and youn ger br oth er s, caring for th e aged relatives and contributingtow ards re latives funeral exp en se s. Garlick also found that time, a valuablebusiness resource, was squandered by kinship obligations. Businessmensp en t a lot of time attendin g to ex tende d family de m and s suc h as funeralsand other gatherings at the expense of their businesses.

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The picture presented by th es e writers is, as K ennedy (1988) de scrib esit, one of unrelieved gloom, as kinship relations in business are seen toresult in high costs but yielding few, if any, compensatory benefits.

Moreover, businessmen a re seen to stand co ndem ned bec ause they remainweak and unable to deal with th es e p roblem s.

Contrary to th e abov e findings, Khalaf and Shawyri (1966, 60) in the irstud y in Lebanon, found tha t in times of chan ge, chara cte rise d by flux anduncertainty, kinship relations act as palliatives or stabilising agents tohelp cope with the demands of the changing world. Beveridge andOberschall (1970, 134), in their study in Zambia, found no evidence tosuggest that kinship was a significant factor in the success or failure ofindigenous businesses. Their research found that the extended family wasstill a significant social unit even in th e towns an d tha t kinsh ip o bliga tionsand claims were still extensive . They argue, how ever, th at it is difficult toestablish, quantitatively, the degree of financial drain caused by kinshipobligations.

Kennedy found that in Ghana, the majority of those included in hisresearch sample did respond to kinship claims for money for a variety of

pu rpo ses . He conclud ed, howeve r, tha t kinship obligations did no tcon s t i tu te a major obs ta c le to bus iness d eve lopm ent . He foundbusinessmen to behave in a rational way:

. . . they are aware of the dangers of excessive expenditure, they regulatethe amount they spend and they have a fair idea of what proportion oftheir incomes their kinsmen can justifiably claim over a given amount oftime (Kennedy, 1980, 107).In Nigeria, Nafziger (1969) found th at kinship re la tio ns were beneficial

in the initial stages of the business. The extended family providedappren ticeship training for would-be businessm en as th ey ac quire d skillsthrough working for their relatives. He also found th at th e exten ded familyusually provided initial start-up capital for the aspiring businessmen. Inother words, kinship relations benefited the businessmen by giving themtraining and helping them set up their businesses. As the businessesexpanded, however, Nafziger found that entrepreneurs tended to lose

more than they benefited from the institution of the extended family.Nafziger states that at this stage, although entrepreneurs rarely receivedfunds from the family for expansion of the firm, the family does requireresources for current consumption which might otherwise have beeninvested in the bu siness. He con clud es:

Without further evidence, there is no longer reason to believe that theextended family has, on balance, a negative effect on entrepreneurialactivity (Nafziger, 1969, 33).The discussion about the relationship between kinship relations and

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po lem ic flavour (Khalaf and Shawyri, 1968,59). What might be con tributingto this lack of consensus is, as Kennedy (1980, 119) suggests, that socialstructures that provide obstacles to development in one country maypro ve t o b e useful in ano ther. Seven business-peop le in this stud y indicatedthat t he y as sisted relatives by either offering them jobs or providing themwith m on ey for vario us purp ose s su ch as schoo l fees and funeral expensesThree of them indicated that they did so because they felt culturallyobliged to do so, while the other four believed it was through their ownbenevolence. It is, however, unfair to conclude from such evidence thatindigenous entrepreneurs are prisoners of their own culture as in somecases many have succeeded in extricating themselves from kinshipobligations and prote ct their b usin ess in teres t (Maphosa, 1997, 93; Wild1997, 107). It is also a biased view to look only at the costs incurred byindigenous businesspeople in fulfilling kinship obligations without takinginto account the benefits entrepreneurs derive from kinship relations.Although kinship obligations constitute a cost, the businesses also derivedsome economic benefits form relatives. Relatives were more prepared towork for longer hours and for less pay than non-relatives. The questionmany commentators on indigenous African entrepreneurship have notaske d is : W hy do we still hav e successful en trep ren eu rs in a social con textthat does not allow individual accumulation? The answer can be found inthe con cep t of cultural dissidents .

THE REGULATORY ENVIRONMENT

The political and legal conditions in turn affect the nature of economic

involvement in the country. Prior to independence, the White settlerGovernment pursued racially motivated policies that effectively excludedthe majority of Blacks from the ownership and control of the economy.

The present state of underdevelopment of the indigenous privatesecto r is as much a ttribu tab le to colonial policies as to post-colonial onesEven with the chang e from a comm and to a free market economy, th er e isa general lack of enthusiasm in government circles to deregulate thoseareas that have been constrained by restrictive policies.

In 1991, th e Government establish ed a Deregulation Com mittee toexplore ways of relaxing the various laws and regulations which inhibitth e de velo pm ent of th e small-scale indigenous business se ctor. In 1993, aDeregulation Project Team was set up to identify among other things, alllegislation affecting the entry and growth of businesses in the privatesec tor and to m ake recom m endations to th e Deregulation Com mittee foreither am end m ent, o utright repeal, tightening up or improvement of suc hlegislation. The then Senior Minister, Mr. Joseph Msika, whose ministryw as chairing th e Deregulation Com mittee, rep ort ed t ha t by February 1994

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the Team had identified 28 Acts that p rese nted ob stac les to th e en try ofindigenous business-people into private business.

One of the most oppressive and discriminatory Acts passed by the

colonial Government, and which is often cited as largely responsible forthe underdevelopment of a Black entrepreneurial class in Zimbabwe, isthe Land Apportionment Act of 1930. This Act effectively cr ea ted ch ea plabo urers ou t of the indigenous Blacks by push ing the m into the ecologicallymarginal areas of the country, prohibiting them from owning or leasingproperty in the lucrative European areas and prohibiting them fromowning land in the overpopulated native res erv es (later known as t h eTribal Trust Lands and, after independence, communal areas). Very fewBlacks have acquired title to land in the urban and commercial farmingareas, where private ownership of land is legal. In the communal areasland is still largely under comm unal ten ure. The lack of title de ed s is t h emost important reasons for the lack of access to finance by many small-scale indigenous busine sses.

Besides th e Land Apportionment A ct of 1930, th e Deregulation Projec tTeam identified 13 out of 28 Acts tha t required pr ior ity a ttention. T he se

included, the Companies Act [Chap ter 190], the Factory Act [Chapter 218],the Urban ouncils Act [Chapter 241], th e Rural District Act (No. 8 of 1988),the Regional, Town and Country Planning Act (No. 22 of 1976), the ShopLicensing A ct (No. 40 of 1976), the Liquor Act (No. 9 of 1984), the PublicHealth Act [Chapter 328], the Food and Food Standards Act [Chapter 321),the Traditional Beer Act (No. 25 of 1984), the Second Hand Goods Act[Chap ter 293], the Land Survey Act [Chapter 147], theBankingAct [Chapter188], the Customs and Excise Act [Chapter 117], an d th e Income Tax Act

[Chapter 181]. These pieces of legislation, most of them inh erited fromcolonial adm inistration s 0LO, 1993, 90), en tren ch W hite privileges andmake it difficult for new entrants into business through cumbersomeprocedures for registration of a business and numerous health, safety,licensing and zoning regulations. While some of these Acts were notpassed specifically to regulate the activities of the small business sector,they have often provided impediments to the operations of the smallbusinesses. This is because they have either been deliberately used torestrict the activities of the small businesses or their provisions were sostringent or so complicated as to discourage new entrants into business.

The complex registration procedures required by the Companies Actbefore an undertaking can be registered as a company are an inhibitingfactor against many small-scale businesses registering as companies. TheFactory Act requires a business-person to h ave a license to us e a factory.Stringent standards have to be met before a business-person can beissued w ith the license. Small bu sinesses often fail to m ee t thes e s ta n d ar d s.The regulations of the Public Health Act cover food p repara tion, the w ashing

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of cloth es and m aintenan ce of buildings. Generally the stan dards requ iredby this Act are so high that they help protect the established bus inesses,especially those in the formal sector, while the small businesses aresubject to harassment for failure to meet these standards. The UrbanCouncils and Regional, Town and Country Planning Acts empower localau tho rity regu lations w hich regulate the activities of both the formal andinformal businesses. They also give local authorities control over landuse. These are often used to restrict the activities of small businesses.Since th e 1993 ILO repo rt w hich com m ented that up to November of tha t

year, very little progress had been done about the deregulation of thebu sin ess environm ent, the po sition had no t changed mu ch at th e time ofwriting this article.

THE INDIGENISATION PRESSURE GROUPS

The call for economic indigenisation in Zimbabwe gathered momentumafter the introduction of the Structural Adjustment Programme (ESAP) in

1991. T he introd uc tion of ESAP too k p lace within the con text of an ailingeco no m y ch aracter ised by, among other things, a high and rapidly growingrate of unem ploy ment and poverty. Th e objectives of ESAP were enunc iatedin the reform document as entailing moving away from a highly regulatedeco no m y to one w he re m arket forces are allowed to play a more decisiverole (G overnm ent of Zimbabw e, 1991, 4). Th is prov ided an ideologicajustification for th e governm ent to pro m ote small-scale private en terp riseas a vehicle for employment creation. The environment created by ESAP

also provided an opportunity for the Black middle class (among themve teran busines s-peop le and high salaried bu reaucrats in the private andpublic sectors) to lobby the government to remove the historicallydeterm ined ob stacles t o participation in business. It is this group, w hos ebusiness aspirations have hitherto been frustrated by the inheritedeconomic structures, which is at the forefront of the indigenisationcampaign.

In 1990 the Indigenous Business Development Centre (IBDC) wasformed ostensib ly to pr es s for m ore Black participation and control of theZim babw ean econom y. Making up its executive board w ere various lobbygroups such as Women in Business, Zimbabwe National Framers Unionand Zim babw e T ran sp or t O rganisation. Unlike other business associationssuch as the Zimbabwe National Chamber of Commerce (ZNCC) and theConfederation of Zimbabwe Industries (CZI), the IBDC considered itselfmore of a nationalist pressure group than the usual type of business

association (Wild, 1997, 267). The major thrust of the IBDC towardsindigenisation is the radical change of the ownership structure of the

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into the mainstream of the economy. This approach differs from thattaken by other supp orte rs of indigenisation su ch as interna tional do no rs

NGOs and other business associations. The latter have a particular focuson small and medium-scale enterprises and advocate a market economyapp roach. This appro ach calls for th e creation of an enabling env ironm enthrough the deregulation of the economy which involves, inter alia, theremoval of price, licensing and zoning controls which negatively impacton small-scale entrepreneurs. It also advocates the creation of anti-truslaws to prom ote comp etition and the revision of ba nk s lending policies soas to cater for the small entrep reneu rs most of whom do not h ave collateral

In its advocacy, the IBDC does not make a clear distin ction betw eensmall and large indigenous enterp rises. Most indigenous Black en ter pr ise sfall within the informal to medium scale categories. There are, howeversom e big indigenously owned ente rprises. The IBDC presen ts t hi s collectiveview not for the benefit of all indigenous Black entrepreneurs but itsm em bers through the manipulation of nationalist and rac ist feelings of th eBlack majority (Deve, 1994,10; Wild, 1997, 269). According to Wild it is th e elite of African bu sin ess who stand to benefit as they

. . . hope that once the noise has subsided and the dust has settled theycan grab the debris left behind and piece it together for their owndevices. It is an irresponsible exploitation of the nationalist feelings ofthe African majority and speculation in the erosive effect of nationalistpropaganda on white morale (p. 268).

In its sho rt existence to d ate , th e IBDC expe rienced se rious factionalismwhich saw the organisation split into two groups, one led by ChemistSiziba and th e oth er by Ben M ucheche w ho finally em erged as its pres iden tThe strife was characterised by allegations and counter allegations ofmisuse of power, electoral fraud, and misappropriation of funds.

In 1994 the Affirmative Action Group (AAG) was formed under theleadersh ip of Harare businessm an Phillip Chiyangwa. AAG ca m e in to beingperhaps as a result of the dissatisfaction with the performance of theIBDC, which had been experiencing leadership wrangles for a long timeEarly in 1995, th e United Indigenous P ressure G roup (UIPG) w as form edWith the formation of AAG, a more vociferous and aggressive org an isa tiontha n IBDC, nationalist and racist tac tics b eca m e mo re ap par ent . Soonafter its formation, the AAG called for a consum er bo ycot t of all firmswhich had not entered into joint ventures with Black e nt re pr en eu rs .

Like the IBDC, AGG ha s used nationa list and rac ist p ro pagan da toadvance the interests of its members, who have extensive political andsocial connections, at the expense of the many small indigenous Black

entrepreneurs. For instance Chiyangwa is a close relative of the statePresident an d the late vice pres iden t of AAG, Pe ter Pam ire was chairm an

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co nn ectio ns, as Deve (1994, 10) ha s observed, are . . . deemed necessaryto facilitate the approval of new projects by government.. .

In view of this, one is bound to concur with Raftoupolos and Moyo(1994,17) tha t th e th ru st of the indigenisation groups has been a clearanceopera tion , to open up more avenues of accumulation for the Black elite.

THE ROLE OF THE STATE

Until recently, the position of the state regarding indigenous smallen te rp ris es ha s be en unc lear (Helmsing, 1993, 30; Mumbengegwi, 1993,

149; Raftopoulos an d Moyo, 1994,10). This, according to M umbengegwi, istrue for the colonial period as well as the post-colonial era.The lack of a clear-cut policy on the promotion of small-scale African

bu sin es se s during th e colonial era is attributable largely to racially basedpolicies of colonial gov ernm ents, which provided obstacles to the settingup and operation of such businesses. As Helmsing (1993, 4) points out,government attitudes towards African small-scale enterprises were quitenegative.

Another reason for the lack of interest in small-scale businessesgenerally is the question of control. Small businesses, especially those inthe informal sector, present difficulties to central government and localauthorities on issues like the enforcement of health standards, taxationand planning.

In the early post-independence period up to the early 1990s, this lackof in tere st in the p rom otion of small-scale busine sses persisted. This wasthe case mainly because small private enterprises were not part of thedeve lopm en t stra teg y of a governm ent professing a commitment to Marxistideology (Helmsing, 1993, 30). In con cur renc e, Raftopoulos and Moyoco nten d that th e Gov ernmen t s rhetorical and contradictory comm itmentto socialism has meant a lack of encouragement in policy support termsfor the growth of Black entrepreneurs.

Zim babwean post-independen ce policies of scientific socialism ten dedto view private business as individualistic, exploitative and parasitic.These views created a nonconducive environment for the creation ofsmall private businesses. It is due to these ideological leanings that forover a decade in post-independence Zimbabwe, individually ownedbusinesses had considerable difficulties in qualifying for governmentas sista nc e. Instead, th e Government s attention and energies were directedtowards cooperative enterprises.

At the introduction of ESAP, for the first time the Government wasexplicit about its position regarding small-scale private enterprises. Itsta ted th at the grow th of the small-scale secto r had been inhibited by theavailability and c os t of finance, land and ba sic utilities as well as num erous

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licensing and other regulations. The Government undertook to relax allregulations that inhibited the setting up of small businesses. The

importance of small enterprises was also highlighted in the Second FiveYear National Development Plan (1991-95). On 24 April 1991 a Par liam en tarySelect Committee was set up to examine: the adequacy of necessary and supportive legislation to indigenise the

economy; ownership and review of equ ity stru ctu re in all se cto rs of the econom y; all m at ters per t inent to the successful im ple m en tat io n of an

indigenisation policy; to report its findings to Parliament.

A mem ber of the com m ittee summ ed up its role as tha t of exp loringways and m eans of economically empowering the indigeno us Zim babweansthrough an expansion of their participation in the ec onom y of the co un try(Mangwende, 1994, 2). In 1992, th e Cabinet Task Force on th e ind igenisationof the economy was set up to look into ways to promote indigenisation.The Small Enterprise Development Corporation (SEDCO) was formed.However, SEDCO s lack of political su pp ort, inco m pete nt m anagem entand under-capitalisation bear testimo ny to the gov ern m en t s half-heartedmeasures to promote small and medium scale entrepreneurs (Wild, 1997,259).

CONCLUSION

Despite the long history of marginalisation and sometimes subjugation,Zimbabwean entrepreneurship has continued to survive. The supply andthe success of entrepreneurs in any given society depends to a greatextent on the environment in which the entrepreneurship function isbeing carried out. During the colonial era the dom inan t soc ial force affectingthe supply and suc cess of indigenous Black entre pre ne urs w as ra ce . Theiraccess to capital and finance was res tricted by racially motivated coloniallaws and regulations. After independence in 1980 indigenous Blackentreprene urs continued to experience marginalisation mainly as a resultof the governm ent s professed Marxist ideology. The intro du ctio n of th eEconomic Structural Adjustment Programme has not helped manyindigenous businesses particularly those in the small-scale sector as socialand political connections are the m ost important req uirem ents for bu sin esssuccess. This is exacerbated by the sta te s lack of interest in com ing upwith a clear policy on indigenisation as well as indigen isation p re ss u regroups whose interests are to enrich themselves using nationalist andracist tactics.

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