The Endogenous African Business: Why and How It Is Different, Why It Is Emerging Now and Why It Matters

Abstract

Africa is currently undergoing a transition that is unprecedented in its history. For the first time, the demand of urban populations pulls business development, thus creating economies with higher levels of specialization than before. This essay highlights the phenomenon of the endogenous African businesses that are arising in this process. These businesses tap into the natural resources and the social, economic, and cultural systems that build upon them. These resources and systems make the African business environment different from business environments in other parts of the world. Furthermore, the endogenous businesses have access to knowledge on how to manage modern businesses in the formal sector of the economy. In combination with African resources and systems, such knowledge enables them to create and sustain and competitive advantage in modern dynamic marketplaces. Endogenous African businesses are important because they have the potential to fuel economic growth, to revitalize rural areas, to contribute to food security and healthy diets, and to provide role models of which Africans can be proud. Hence, these businesses deserve our attention in the next two decades of scholarly research and education on African business.