IT STARTS AND ENDS WITH JOBS

Last week the World Bank released their Jobs Report on Uganda. It had some very enlightening findings, many sobering and clearly we cannot continue with business as usual given the potential crisis looming ahead.

"If the management of the economy is about improving the living standards of a population, then you can’t get away from a discussion about jobs – the quantity and quality of jobs....

The current state of jobs flatters to deceive. The report says that 77% of the population aged between 15 and 64 is employed, which is high compared to the average for low income countries, which stands at about 70%.

However, the quality of jobs is falling as people are working longer hours for less pay.

This is not hard to explain as 64% of Ugandans are employed in agriculture. Our agricultural practices are rudimentary, our farm yields are among the lowest on the continent and we then lose almost half of our produce after the harvest.

To add salt to injury, as an economy we are still stuck in the rut, producing raw materials for export. We not only get a fraction of the finished good but it also means we do not control the price that we sell at.

As if that is not enough we are a young population, the second youngest population in the world with a median age of 15.9 years. What this means, that for the next few years or decades there will be more people joining the workforce than leaving it, which means the speed of creating jobs has to be accelerated.

According to the Jobs Report the economy must create up to thrice as many jobs than it did between 1992 and 2006 in order to keep up.

As it is now more than 500,000 people enter the job market annually and this number is expected to double again within a decade or so.

It doesn’t take a genius to work out that millions of youth without a job or incomes, will be forced into crime and other anti-social behavior, and it is not a stretch of imagination to see that national stability will come under threat.

So what to do?

The World Bank has some recommendations.

For starters they counsel that macroeconomic fundamentals have to be just right.  Galloping inflation, lack of economic growth and an exchange rate out of control will not allow for any of the initiatives needed to tackle the problem to take root....

Develop agro-processing industries and facilitate their exports, promote Foreign Direct Investment (FDI), create an environment that will encourage more investment by big firms and support domestic firms to transition to medium and larger entities. 

Given these, it makes sense that any real transformation will have to start with the agriculture value chain, seeing as seven in every ten Ugandans derives a livelihood form the land. Not only should we increase farm yields, but can we also improve marketing, incentives the set up of agro processing firms and promote exports abroad.

At the bare minimum farm gate prices will rise but also employment will be created when the value chains are better developed.

However, I think the real game changer would be to facilitate small companies to grow into larger entities...

The world over the biggest employers in any economy are the small and medium enterprises. 

However, the biggest case of business failure comes from these same sectors. On closer scrutiny its not that there are no markets for their products or they have run out of raw materials or the Ugandan economy is a particularly harsh environment to do business, most business failure is because the people running the business don’t have the capacity to run a business.

The promoters of these failed business, don’t know how to raise capital, don’t know how or neglect to do market research, fail to forge the relationships that will grow and sustain the business, don’t or can’t be bothered to strategise for their business.

Doing business is a skill that is learnt over time, however we can help our businessmen with training and other capacity building initiatives to help them along. We are the most entrepreneurial country in the world, which means that in our case there is a necessity for most of us to start a business. Well-tailored training will ensure we can go beyond the initial excitement for business and build bigger businesses.

Indigenous business owners are more beneficial to local economies than businesses taking orders from far off headquarters. Out of a responsibility to their local communities they are more likely to find ways to make the business work than hack the payroll and they give more back to the community in social causes.

It follows therefore that bigger indigenous concerns will magnify these benefits.

The government programs to dish out money to the youth are more a hit or miss operation, based on the flawed analysis that our entrepreneurs biggest challenge is lack of finance.

A more systematic attempt to build our entrepreneurs’ business skills, some hand holding to ensure they grow beyond the teething pains and a proactive program to create market access for them home and abroad are urgently needed.

I put little faith in the already bigger firms hiring more and more people, as our current circumstances demand. After all the bigger firms are becoming more automated and therefore not hiring as fast as we want.

The SME sector’s growth will more likely create the needed jobs.

THE FATE OF PEARL DAIRY AND WHAT IT SAYS ABOUT THE EAST AFRICAN COMMUNITY

It can be frustrating even down right infuriating when you are in the midst of a historic movement. Progress or regression doesn’t happen in a straight line. You take two steps forward and one step back. Sometimes it’s worse, you take two steps forward and four steps back.

I have heard it said that we will take the class until we learn the lesson. And may I add, even if you think you have skipped the class and gone on, invariably one day you will come all the way back to take the class, so you can learn the lesson.

At the time of writing this the Presidents of Uganda and Rwanda are getting set for a border meeting at Katuna, which we all hope will lead to the reopening of the border and the free movement of goods and people.

Rwanda shut down the border a year ago ostensibly over the maltreatment of its people in Uganda.

"When our grandchildren will be reading history this border closure may occupy only a line in the greater scheme of things. Hopefully it will not have scuttled the greater goal of creating a single regional market....

There are more disturbing movements that affect Ugandan progress but also don’t bode well for the future of the EAC.

Ugandan sugar is having to jump through hoops to find its way into the Kenyan and Tanzanian markets. We are the only country in the community that is producing a surplus. Three decades of rehabilitation and expansion of our sugar firms has brought us to this happy situation.

In our eastern neighbour the sugar industry is all but dead, with the major sugar producing regions in western Kenya, brought to its knees by a combination of bad policy and the growing strength of sugar importing cartels. Uganda’s sugar industry, I fear is under attack from similar forces.

Our neighbours cannot believe that we can produce so much sugar as we are exporting to them. They have sent delegations (per diems all around) here to verify our capacity to produce. They have not found any foul play but have gone back and kept quiet allowing the charade to continue.

Our grain is being shipped across the border raw. Attempts to export maize flour have suffered uncalled for speed bumps and roadblocks. The message is clear, send us your raw materials but not your finished products. And we all know who benefits from such an arrangement.

More recently our milk producers, Pearl Dairies, the maker s of Lato milk, came up against some strange “official” resistance to their exports to Kenya. Their warehouses were raided and their stock impounded at the end of last year. Kenyan authorities unofficially charged that they were counterfeit supplies, strange because Pearl Diaries were not the ones complaining. But maybe that was because it was their milk.

But one can see what has happened. Last year Uganda exported in excess of 110 million liters of milk to Kenya, which helped for the first time since anyone remembers, to turn the balance of trade in our favour. This was particularly surprising because the previous year we had only exported about 20 million liters to our eastern cousins.

In the space of two and half years, by the end of last year, Pearl Dairy controlled about a quarter of the Kenyan milk market. That must have rustled a few feathers, especially that Pearl Dairies with their 800,000-liter day processing capacity in Ntungamo was not about to let up.

Then the stories begun again. Uganda is getting milk from Australia landing it in Kinshasa, trucking it through South Sudan before it comes to Kampala for reconstitution (adding water) and shipped to Kenya. If milk can go through that convoluted journey and still price competitively in the Kenyan market, then the Kenyan dairy industry has only themselves to blame.

Strangely, or not, other exporters of milk to Kenya from Uganda are not suffering such inconveniences or whisper campaigns.

We should be concerned.

One of the biggest selling points of the EAC on paper, is that investors can come and locate their plants wherever they choose in the region and have unfettered access to a 200 million people market.

The way it seems that’s for everybody else except Uganda.

If you have $50m to invest, like Pearl Dairies has done and want to invest in Uganda to exploit the EAC market, don’t bother.

Which is sad.

It does not take a stretch of imagination to workout that in order to fulfill its 84 million litre exports to Kenya, like they did last year, there must be hundreds of farmers in the Ntungamo area and hence thousands of their dependents in whose best interests it is to have the plant there working at full capacity. At the height of production last they inject at least sh12b into the local economy every moth.

Beyond that there are transporters, retailers, people up and down the value chain that want, no, need Pearl Dairy to remain in production.

But maybe we shouldn’t be surprised. It is no myth that Uganda’s agricultural potential is unmatched in the region. Our benign weather and arable soils mean that we are potentially the lowest cost producer of anything agricultural.

"Kenyan industry, which took advantage of the chaos of the 1970s and 80s, kept us a captive market for everything from toilet paper to sauce pans are fast waking up to an uncomfortable reality....

The lesson of the EAC obviously is that government needs to investigate in its negotiating capacity.  It can’t be for individual companies to be negotiating for market access, this is the business and role of governments.

Especially in our case where we have been the foremost champions of the creation of the EAC.

BUSINESSES NEED TO FOCUS ON THE VISION THING

Last week American car company Tesla saw its share price hit $500, a record for the company. With that price the company’s market valuation rose to about $100b (more than three times the size of the Ugandan economy).

The 30 percent jump in share price since the beginning of the year, means Tesla is now bigger than establishment companies Ford or GM, which were the biggest car makers in the US. Tesla will be 17 years old this year.

These are impressive figures by any measure.

The company wins a lot of attention thanks in no small measure to founder South African born American businessman Elon Musk, who is not averse to getting his foot in his mouth every so often.

It was created with a desire to bring an electric high performance vehicle to market. Up to that point car manufacturers struggled with the low capacity of available batteries, which would not allow high mileages.

After many missed targets, Tesla it seems, has found its groove and is set to take advantage of the first mover advantage – sort of, to dominate this new sector.

But what is it that drives entrepreneurs like Musk, to take on establishment companies, disrupt the status quo and come out the other side triumphant?

Last week we serialized the book , “Double your money” the very engaging memoirs of our very own Aga Sekalala Snr. As a businessman, he is unique in that his enterprises have not only survived, but thrived over the last four decades and sometimes under very harrowing circumstances...

When he first went into business for himself with a fuel station off parliament avenue, there were hundreds or even thousands of other businessmen who started with him. Most have left no impression on our lives or memories.

To endure like he has, has not been easy. I think the book understates Sekalala’s struggle, but its possibly a function of the old man’s mentality to not dwell on the past, but to get on with the job at hand. My impression was that the simplicity and unpretentiousness of the man belie a spirit, which while ready to adapt to changing times is encased in an iron will determined to bend circumstance to his bidding. So how did he do it?

The problem when we come in contact with these giants of commerce and industry is to see only the finished product. But the physical is the manifestation of the intangible – the vision, the strategy, the discipline of execution, the company culture.

I think everything starts with the vision. The vision of the founder or managers of an enterprise will determine how big the endeavour can be.

In the first half of the last century a small boy determined to go to school, because he liked how smart the teachers looked. He thought he would be a teacher. Then his ambition grew when he saw the county chief who in addition to being smart, rode a bicycle. The only bicycle for miles around his village. Then he decided he had to go to university, because the one university student he had seen was not only smart, but had an air of confidence and worldliness he wanted for himself.

His contemporaries who didn’t upgrade their ambitions or the vision of where they saw themselves in the future, ended up reaching their limits quickly and falling by the way side.

From the analogy a vision not only has to be bigger than the individual or company but also has to speak to the emotion of the holder. It’s the emotion that welds the vision to the psyche, taking over the owner’s life and driving achievement as if by magic...

Under such circumstances the subconscious can hold the dream long after the individual thinks he has forgotten about it.

That is why you can visit a company and it is humming along like a fine tune race car, but there is no evidence of a vision or mission or values statements pinned up on the wall. But the vision can be discerned from the work ethic, what values the company lives by and the achievements over time.

A deep dive into the mind of the founder or the company’s boss may help.

And this is at the root of why we are one of the most entrepreneurial countries but not one of the biggest economies of the world.

We are predominantly necessity entrepreneurs, setting up business to sustain our families. This is not a crime but it limits how big the business can grow, how much it can produce, how many jobs it can create, how much tax it can pay. Because they stay small the first shock – economic, family or otherwise, they experience lives the little chance of survival.

To start a business to feed yourself is not a crime. Most companies start that way. The trick to the creation of long term value for the owners and the communities in which they operate is to make the transition to opportunity entrepreneurs.

As opposed to the necessity entrepreneurs these are driven by opportunities they can take advantage of, are keen to build systems in order to scale up and maximize the chosen opportunity.

"It is near impossible to grow without systems and structure. But to invest in building these requires a long term perspective that does not reside in a necessity entrepreneur...

Elon Musk’s dreams were driven by science fiction and his determination to explore space. His vision is bigger than electric cars, but in the process he is drugging the automobile industry kicking and screaming to places it did not envisage.

Many years ago when Mzee Sekalala was exploring getting into fish farming, and narrating the challenges he was encountering, I wondered why he was even bothering there was still plenty of growth in the lines he was pursuing – poultry, vanilla and animal feeds.

His response, “If I hadn’t gone into chicken which chicken would you be eating today?”

Enough said!

DISCIPLINE IS ESSENTIAL, CRITICAL FOR UGANDA ECONOMY

The concept of third party endorsement is a powerful one.

If you go out singing your praises, people will dismiss you as a braggart and send you on your way, shoes aimed at the back of your head. But if someone more respectable snatches the trumpet and blows for you, people are more likely to believe them than you.

Last week Absa Bank released its Africa Financial Markets Index 2019 as well as Uganda Economic Forum.

"Their Africa Financial Markets index, which is in its third year of publication, ranks 20 countries on the continent according to their suitability as investment destinations, using their financial markets as an indicator of this...

The countries chosen all had their own stock exchanges except Ethiopia, which despite being one of the strongest growing economies in Africa, was last on the Index.

Uganda was tenth, unchanged from last year, though its score on the index rose to 52 from 50 in 2018. Uganda fell to fourth in EAC, from second last year behind Kenya. Rwanda and Tanzania went from being outside to inside the top ten.

This is an important index and long in coming.  It provides an outsider’s view of the markets to potential investors. Investors outside the continent often see the continent as one country, they can’t be bothered to dig deeper, the smallness of our individual markets don’t justify the effort.

It is therefore useful to have such an index, previously fronted by Barclay Bank, to at least afford the continent a second look, by some of the biggest global fund managers, for who testing the waters may be a few tens of millions of dollars’ worth of investment.

The index used market depth, access to foreign currency, market transparency, capacity of local investors, macroeconomic opportunity and the legal framework, as the criteria to judge the countries.

 It’s clear from the index that countries, which ranked high on the transparency of their markets – South Africa and Mauritius are also the ones with not only the biggest inflows, but also have the biggest local investor interest in their own markets...

They say capital is a coward. It doesn’t like risk. One of the keys to mitigate risk is information or knowledge. The more access to information the more comfortable capital is.

So this index, on one hand, helps to allay investors’ fear and at the same time serve as a useful tool for countries to improve their environment for investment.

Absa’s economic outlook told us a few things we knew. They confirmed that Uganda’s economy is expected to continue growing, but they thought at a slower speed – 5% in 2020, than official figures suggest.

They said due to lower agricultural output and weaker demand at the end of 2019 they have been forced to lower their own projections for last year. This stickiness will continue into this year they think. Nevertheless, Absa expects that agriculture, continued infrastructure investment and election related spending will drive the economy this year.

They worry though that the twin deficits in trade – due to projected import increases to support public investments and the budget – forcing increase contracting of debt, can cause major discomfort were investors to judge our situation too risky.

"Common sense dictates, that with these twin deficits hanging over our head, government needs to be more disciplined in how it spends and contracts debt. Any economic shock down the line, will mean the pain will be much greater, given our high import bill, low revenue mobilization and ambitious spending plans....

A surprising revelation, or maybe not, was that Uganda’s exports to the EAC, as a percentage of total exports fell back to under 30% in 2019 from 40% four years previously. The continued insecurity in South Sudan and the closure of the southern border for most of last year must have been the reason.

Taking the two reports together, the major take home has to be the inadequacy of our local resource mobilization.

It means we are not collecting enough taxes, which supports the urgency to widen the tax base. We have huge deficits in human capital and infrastructure which cannot be bridged if we do not collect more tax. Not only does it limit what we can pay for ourselves, but also how much we can borrow to close those same gaps.

Low revenue collections put a real cap on our development ambitions.

But just as important, if we cannot mobilise savings to participate meaningfully in our own markets why do we think we can attract credible investors? The best advertisement for foreign direct investment is a credible pool of local players who can either be partnered with or bought out all together or provide real market research independent of official statistics.

The Absa reports should serve to reinforce concerns about this economy. We are not a basket case but we are balancing delicately on the edge. We should recognize that and act accordingly.

MADNESS: DOING THE SAME THING REPEATEDLY HOPING FOR A DIFFERENT OUTCOME

The voices calling for government to go back into business are growing louder.

They argue that there are key investments that need to be made that the private sector has failed to take up and government should. They explain that this is another way for government to create jobs. 

And they conclude by saying that monetary gain is not the only reason to start business, so even if the companies make losses the businesses will have served a greater good of absorbing farmer produce, create jobs and put new products on the shelf.

Who can argue with that logic. No one. Except that it is based on a wrong premise and bound to fail.

Let us take the three arguments in order.

"The reason private sector does not invest in a place is because the viability of a project is suspect. Either there are not enough inputs or there is no identifiable market or the eventual product cannot be competitive in the open market....

In Uganda today there is a concentration of economic activity along a “growth corridor” that stretches from Tororo, passes through Jinja and Kampala and onto Mbarara. With the activity come jobs and higher incomes. It is not a coincidence that along this belt is Uganda’s most travelled highway, a railway line and almost the full extent of Uganda’s power transmission lines, which convey industrial energy.

This last part is important because if you do not have the 132kva or 220 kva transmission lines, the power you have is good for only lighting and not industry.

It explains why the cement factories in Tororo ferry their lime from Karamoja. By some estimates it takes two tons of lime to make one ton of cement. It would be much cheaper to set up a factory in Moroto and truck packed bags of cement out. The reason they don’t build a factory in Moroto is because they do not have industrial grade energy.

So even if government says it wants to start a cement factory there, it will be doomed to failure – after spending billions of tax payer money to build a factory, because Moroto is not serviced by industrial grade energy.

"Looking at that logic you can see how the second goal of creating jobs falls by the wayside. No working factory no jobs. Unless for the security guards who will be manning the redundant hulk...

And finally they argue that profitability need not be an end of all enterprises. There are other “strategic” objectives that a business can serve. They are right and wrong.

They are right because business are created to provide a good or service and profit is a byproduct of that effort. So while the businessman wants to see a return on his investment, he has to focus on providing a good or service in a cost effective way before he can see profit.

They are wrong because without profit the sustainability of the company is compromised and the chances of collapse are improved. Non-profit making enterprises will be supported by our taxes, which would be better used improving social services and opening up other parts of the country to investment by laying infrastructure.

The building of roads, railways and some of the bigger infrastructure investments, which will facilitate investment should be government’s business.

Why can’t governments, not only the Uganda government, not do business?

From day one a government’s key mission is to maintain itself in power. The tendency to people state owned enterprises with their supporters, regardless of competence, to destroy markets by giving their own companies favourable status and to subsidise their losses indiscriminately, while shoring up their political support, doom these companies to mediocrity or even worse, total collapse.

 This mission comes in direct conflict with the profit motive. Profit as stated above is critical to an enterprises sustainability.

It is no wonder that the politically appointed task force to investigate the viability of the Uganda airlines are the same people who became its managers.

If government is really sincere about creating jobs it can do so in a cost efficient way by investing in understanding how business works. Not so they can go into business for themselves, but so they can facilitate businesses to thrive and provide the much needed good and services the economy needs.

Beyond infrastructure investors may need additional concessions, which government should be able to assess and negotiate.

This takes a little more intelligence than rushing around like a mad bull starting fruit factories or airlines or beef abattoirs, which have less than even chance of succeeding because of the clumsiness of their inception....

Believe it or not, government had a fish factory by Lake Victoria and it collapsed!

This country does not have infinite resources. Such circumstances demand that we apply a little more brain than brawn to get the intended outcomes. A return to the state enterprise in circumstances of scarce resources is to throw good money after bad.

We give the champions of this policy reversal the benefit of doubt, to believe they know not what they are doing.  But the truth maybe even more sinister.

CELEBRATING THE NRM

On Sunday Uganda will be commemorating 34 years since the National Resistance Movement (NRM) came to power.

In the recent trek through the Luwero triangle we were reminded, informed, if we did not know, of the great sacrifice it took for the National Resistance Army (NRA) to march on and eventually capture Kampala on January 26^th 1986.

Love them or hate them the enormity of the task, the extent of the sacrifice, the NRA made cannot be discounted. It helps of course, that they were the victors, because victors are the ones who write history.

"The young, hardy and idealistic soldiers that emerged from the bush three decades ago are now older, rounder around the middle and more realistic, some would say jaded...

They found out very quickly that running a state, especially in the context of poverty, disease and war, is not as easy as it seems.  They have found that there is no place for fixed positions in the exercise of power, that while principle is important, the context in which you operate has a lot to say about how you go about your work. And now they are shocked to find that, not only is their bush war forgotten, but the achievements of the last three decades are being trivialised.

Those are the hazards of the passing of time.

In Europe to the horror of the World War II generation there is a resurgence of Nazism. In America a more isolationist policy, a throwback to the country’s pre-world war II, is gaining popularity. And in South Africa, believe it or not, there are people who hanker for the “good old days” of apartheid, and they are not all white.

President Yoweri Museveni often recounts the parable from Nkole folklore about the woman with two daughters. One was her step daughter, the more beautiful of the two. The woman trying to marry off her daughter covered the step daughter in mud, but beautified her daughter and dressed her in the finest gowns.

To the woman’s shock suitors saw beyond the grime and dirt covering the step daughter and picked her all the time.

So the NRM has laboured under the myth that they will be known by their good deeds and there is no need to communicate them. What they have done is there for all to see, self-explanatory.

However, nature abhors a vacuum and in communication, this vacuum is often filled to your detriment.

"When eight in ten Ugandans were not around in 1986, stories of sugar, paraffin and cooking oil shortages are just old women’s tales; stories of gun shots going off like popcorn every night in Kampala are seen as an attempt to make little children behave after dark; stories of how it took six 

hours to drive from Kampala to Masaka are dismissed as propaganda....

No lesser a person than Lee Kuan Yew, the legendary Singaporean president, did not give Uganda a chance. Speaking in the 1980s he thought it would take Uganda a hundred years to dig itself out of the hole it had sunk itself in with the mismanagement of the 1970s and 1980s.

There is still a lot of work to do. We need better, health care, education, security and less corruption. We need more jobs, roads and power.

But now our demands are from a higher base than the population was used to in 1986. The NRM is now a victim of its own success. 

Where we were glad to have power in our homes – even in Kampala, now we are ready to burn Umeme over a 30-minute outage; Where we were glad to be first in line at the LC’s house to get our weekly quota of sugar, now we walk to work when the price of sugar doubles; Where we were glad to be home before dark now there is traffic after dark.

Longevity is good for achieving long term programs. But

longevity comes with the danger that the fickleness of the human mind will not give credit for the foundations of the success.

Happy NRM day!

UGANDA ON THE RIGHT TRACK WITH WOMEN

At the end of last year credit card company, Mastercard released its Index of Women Entrepreneurs survey (MIWE), which showed Uganda had the highest proportion of women business owners of the countries surveyed.

Ghana came a close second, just ahead of Botswana. The United States of America and New Zealand rounded off the top five.

In the report on the survey Mastercard made the point that, economies where women were more economically active, by the traditional measure, are more likely to grow. But women are only economically active in an environment that allows and empowers them to do so.

Maybe this finding about Uganda should not come as surprise. Numerous surveys over the last two decades have shown that we are among the most entrepreneurial countries, if not the most entrepreneurial country in the world.

The participation of women in business is often hampered or obstructed altogether by cultural or religious traditions surrounding working and property ownership. In Uganda a lot still has to be done in making workplaces more women friendly and streamlining women’s property ownership in the family context. That being said, women can own property or businesses and are increasingly breaking through the glass ceilings in corporate Uganda.

This is progress that should be actively encouraged in a poor country like Uganda.

In order to fulfill our development ambitions we cannot afford to relegate half the population to second class citizens. While we are richly endowed by nature, we have done little to unlock the full potential within our borders. In the absence of this the smart thing to do is to develop the human resource. All hands have to be on deck.

Progressive policies in education and politics, where the most visible affirmative action initiatives were taken, have begun to show dividends.

This year more women than men graduated from Makerere University. According to official figures 50.5% of the 13,509 graduands were women....

A 30-year-old policy to award every A-level girl 1.5 points towards their university admission is clearly showing results.

In politics every one of the 134 (I think) districts is entitled to a woman’s representative. In addition to the women who win in the constituencies, they make up at least a third of the 450 seat house.

These initiatives have proven to be more than just political posturing. To uplift disadvantaged populations there is no stronger tool than the power of example. There are now thousands, if not hundreds of thousands, of young ladies and girls who see political position, higher education and career advancement within the realm of possibility. We take it for granted now, but that has not always been the case.

That is why it is a good start that already more and more women are going into business. According to the Mastercard survey 38% of business in Uganda are owned by women. They are exploding the myth, for younger ladies, that business is male domain.

It is a good start because just like the global picture of Uganda’s entrepreneurship, most women are necessity not opportunity entrepreneurs. The difference is significant.

Necessity entrepreneurs are those who go into business because, often times they have no choice, no other source of income. They go into business to sustain themselves and their families. Opportunity entrepreneurs on the other hand go into business to exploit a gap in the market and are set on growing their business beyond their own needs.

As a result businesses started by necessity entrepreneurs tend to remain informal, are not robust and are responsible for the high attrition statistics – barely five in a hundred businesses get to their fifth birthday.

On other hand businesses with opportunity entrepreneurs are set up for growth, employ more people and on average survive longer.

"The trick is to shift more of our entrepreneurs towards opportunity investment. The shift is more mental than anything else. More than lack of capital or our taxation system....

With one fell sweep in 1972 we wiped out an entire commercial class, the Asians, who through their mentorship would have transferred enough of their business skills over time that our businessmen would be more opportunity entrepreneurs. Proof of this is that, even today our most enduring businessmen are those who were mentored by the Asian community.

In the absence of that, small business training and incubator programs, which help business people reorient their thinking will have to do.

We are a step ahead of most, because entrepreneurship is second nature to us. This is a hangover from the total collapse of the economy in the 1970s and 1980s where having a side income, which became your main income, was not a luxury but a necessity. The tradition has carried on.

I think it is easier to reorient the business people we already have, than it would be to try and encourage people to go into business in the first place.

And while more women in business may be a sad reflection of their men not carrying their weight, the unintended outcome of that, may very well be that we will have a stronger society as a result of more educated and healthier kids.