Entrepreneurial Failure and South Africa's Performance in the World Trading Environment

Abstract

In the past four decades, Sub Sahara Africa has been notable in its relative development-performance failure. There exists a growing literature emphasizing the role of the entrepreneur as an essential element in economic development. We argue that the relatively sluggish growth observed in South Africa may be attributed, at least in part, to entrepreneurial failure. Emerging from its Apartheid era with a concomitant embargo on its trade, South Africa has been actively liberalizing its economy, positioning it for integration into the world trading system since the early 1990s. Following several decades of import-substituting efforts, this signals a clear shift toward a liberalizing, export-promoting development strategy on the part of its government. Despite these efforts it has failed to translate its great potential to actual performance. We evaluate the role of entrepreneurial flexibility in South Africa’s trade performance in three major and, to South Africa, critical export markets, those of the United States, Europe and Japan.