Role of entrepreneurship in economic dvelopment.

Entrepreneur An enrepreneur can be regarded as a person who has the initiative skill and motivation to set up a business or enterprice of his own and who always look for high acheivements. He is the catalyst for social change and works for the common good. They looks for opportunities, identifies them and seizes them mainly for economic gains. An action oriented enrepreneur is a highly calculative individual who is always willing to to undertake risks inorder to achieve their goals. Need for Entrepreneurship Development Economic development essentially means a process of upward change whereby the real pr capita income of a country increases over a period of time .Entrepreneurship has an important role to play in the development of a country. It is one of the most important inputs in economic development. The number and competense of entrepreneurs affect the economic growth of the country. The economic history of the presently advanced countries like USA, Russia and japan supports the fact that economic development is the outcome for which entrepreneurship is an inevitable cause. The crucial and significant role played by the entrepreneurs in the economic development of advanced countries has made the people of developing and under developed countries consious of the importance of entrepreneuship for economic development. It is now a widely accepted fact that active and enthusiastic entrepreneurs can only explore the potentials of the countries availability of resourses such as labour, capital and technology. The role of entrepreneurs is not identical in the various economies. Depending on the material resources, industry climate and responsiveness of the political system, it varies from economy to economy. The contribution of entrepreneurs may be more in favourable opportunity conditions than in economies with relatively less favourable opportunity conditions. Entrpreneurship and Economic Development

Entrepreneurship helps in the process of economic development in the following ways :

1) Employment Generation : Growing unemployment particularly educated unemployment is the problem of the nation. The available employment opportunities can cater only 5 to 10 % of the unemployed. Entrepreneurs generate employment both directly and indirectly. Directly, self employment as an entrepreneur and

indirectly by starting many industrial units they offer jobs to millions. Thus entrepreneurship is the best way to fight the evil of unemployment.

2) National Income : National Income consits of the goods and services produced in the country and imported. The goods and services produced are for consumption within the country as well as to meet the demand of exports. The domestic demand increases with increase in population and increase in standard of living. The export demand also increases to meet the needs of growing imports due to various reasons. An increasing number of entrepreneurers are required to meet this increasing demand for goods and services. Thus entrepreneurship increases the national income.

3) Balanced Regional Development : The growth of Industry and business leads to a lot of Public benefits like transport facilities, health, education, entertainment etc. When the industries are concentrated in selected cities, development gets limited to these cities. A rapid development . When the new entrepreneurers grow at a faster rate, in view of increasing competition in and around cities, they are forced to set up their enterprises in the smaller towns away from big cities. This helps in the development of backward regions.

4) Dispersal of economic power : Industrial development normally may lesd to concentration of economic powers in a few hands. This concentration of power in a few hands has its own evils in the form of monopolies. Developing a large number of entrepreneurers helps in dispersing the economic power amongst the population. Thus it helps in weakening the harmful effects of monopoly.

5) Better standards of living : Entrepreneurers play a vital role in achieving a higher rate of economic growth. Entrepreneurers are able to produce goods at lower cost and supply quality goods at lower price to the community according to their requirements.When the price of of the commodies decreases the consumers get the power to buy more goods for their satisfaction. In this way they can increase the standard of living of the people.

6) Creating innovation : An entrepreneur is a person who always look for changes. apart from combining the factors of production, he also introduces new ideas and new combination of factors. He always try to introduce newer and newer technique of production of goods and services. An entrepreneur brings economic development through innovation.

Entrepreneurship also helps in increasing productivity and capital formation of a nation. In short, the development of the entrepreneurship is inevitable in the economic development of the country. The Role played by the entrepreneurship development can be expressed in the following words : " Economic development is the effect for which entrepreneurship is a cause "

Importance of entrepreneurship development programme (EDP): Entrepreneurship plays a very important role in the economic development. Entrepreneurs act as catalytic agents in the process of industrialization and economic growth. Joseph Schumpeter states that the rate of economic progress of a nation depends upon its rate of innovation which in turn depends upon the distribution of entrepreneurial talent in the population. Technological progress alone cannot lead to economic development unless technological breakthroughs are put to economic use by entrepreneurs. It is the entrepreneur who organizes and puts to use capital, labour and technology in the best possible manner for the setting up of his enterprise. Importance of entrepreneurship development programme (EDP) is to enable entrepreneurs initiating and sustaining the process of economic development in the following ways1. Creation of Employment Opportunities : Unemployment is one of the most important problems confronting developing and underdevelopment countries, EDP's enable prospective entrepreneurs in the setting up of their own units, thus enabling them to get self employment. With the setting up of more and more units by entrepreneurs, both on small and large scale, numerous job opportunities are created for the others. Entrepreneur in this way get an opportunity to lead an independent and honorable life and at the same time they enable others in getting gainful employment. Several schemes like Nehru Rozgar Yojna, National Rural Employment Programme (NREP), Integrated Rural Development Programme (IRDP) etc. have been initiated by the government, of India in this direction. The thrust of all these schemes is to eliminate poverty and generate gainful employment opportunities for the unemployed. Thus entrepreneur can play an effective role in reducing the problem of unemployment. 2. Capital Formation : It is not possible to set up an enterprise without adequate funds. Entrepreneur as an organizer of factors of production employs his own as well as borrowed resources for the setting up

of his enterprise. Entrepreneur mobilizes idle savings of the public and put them to productive use. In this way he helps in capital formation which is so essential for the industrial and economic development of a country. Various development banks like ICICI, IFCI, IDBI; SFCs, SIDCs take initiative in promoting entrepreneurship through assistance to various agencies involved in EDP and by providing financial assistance to new entrepreneurs. 3. Balanced Regional Development : Small scale units can be set up in industrially backward and remote areas with limited financial resources. Successful EDP's assist in accelerating the pace of industrialization in the backward areas and reduce the concentration of economic power in the hands of a few, Entrepreneurs feel like taking advantage of the various concessions and subsidies offered by the state and central government. Success story of entrepreneurs set right example for others to follow and this accelerates the pace of industrialization in the backward areas. Setting up of more units leads to more development of backward areas and balanced regional development. 4. Use of Local Resources : In the absence of any initiative local resources are likely to remain unutilized. Proper use of these resources can result in the progress or development of the area and that too at lower cost. Alert entrepreneurs seize the opportunity and exploit it in the best interests of the area and industry. Effective EDPs can help in the proper use of local resources by providing guidance, assistance, education and training to the prospective entrepreneurs. 5. Improvement in per Capital Income : Entrepreneurs are always on the look out for opportunities. They explore and exploit the opportunities. Entrepreneurs take lead in organising various factors of production by putting them into productive use through the setting up of enterprises. More enterprises will lead to more production, employment and generation of wealth in the form of goods and services. It will result in the increase in the overall productivity and per capita income in the country. EDPs play a positive role in the setting of more units and thus help in generation of more employment and income. 6. Improvement in the Standard of Living : Entrepreneurs by adopting latest innovations help in the production of wide variety of goods & services. By making efficient use of the resources, they start producing more of better quality and that too at lower costs. This enable them to ensure easy availability of better quality products at lower prices to the consumers which result in the improvement in the standard of living of the people. EDPs provide the necessary support to entrepreneurs by educating them about the latest innovations and market trends. 7. Economic Independence : Entrepreneurs enable a country to produce wide variety of better quality goods & services and that too at competitive prices. They develop substitutes of the goods being imported and thus prevent over-dependence on foreign countries and at the same time help in the saving of precious foreign exchange. Through sale of their surplus products in foreign market entrepreneurs enable a country to earn foreign exchange, which is so essential for meeting developmental needs of the economy. Export promotion and import substitution thus help in promoting economic independence of the economy. 8. Preventing Industrial Slums : Industrially developed areas are faced with problem of industrial slums, which result in over burdening of civic amenities and adverse impact on the health of people. Dispersal

of industries can help in the overcoming of this grave problem. EDPs can help in preventing spread of industrial slums by providing various incentives, subsidies and infrastructural support to entrepreneurs for setting up their enterprises in industrially backward areas. This will also help in reducing pollution and overtaxing of civic amenities. 9. Reducing Social Tension : Unemployment amongst the young and educated people is emerging as the major cause of social unrest. People are bound to feel frustrated if they fail to get gainful employment after completion of their education. EDPs can help in channelizing the talent of this section of society in the right direction by providing proper guidance, training and assistance for setting up their enterprises. This results in generation of self employment and prevention of social tension, unrest etc. 10. Facilitating Overall Development : An entrepreneur acts as a catalytic agent for change which results in chain reaction. With the setting up of an enterprise the process of industrialization is set in motion. This unit will generate demand for various types of inputs required by it and there will be so many other units which will require the output of this unit. This leads to overall development of an area due to increase in demand and setting up of more and more units there. Moreover success of one entrepreneur sets the right type of example for others to follow. Entrepreneurs, thus, create an environment of enthusiasm and convey a sense of purpose. This gives future impetus to the overall development of that area. Introduction. It is a pleasure to be with you this morning. I consider this an honour and a privilege to be invited to make opening remark at this assemblage of Nigerian hidden capital in Abia state. I would like to thank the organisers for inviting me to chair this session and make opening remarks at this important Zonal Investors Forum. This is an important event, in fact the key event of the year in the state for economic change initiative. The activities will highlight the contributions the state, the Local Government Areas (LGAs), the cities, towns and villages are making to the modernisation of the states economy, the national 7 point agenda and to the challenges facing Abia state in particular and Nigeria in general. The event is more relevant than ever in the context of the current global financial and economic crisis. The theme of this event: Promoting Entrepreneurship and Technological Skills for Socio-Economic Development, could not be more apt in todays globalised knowledge economy. Our expectations are that this forum concentrates its attention on four basic problems namely: 1. Needs and Strategy. 2. Entrepreneurship promotion activities. 3. Technologies for skills and socio-economic development. 4. Perspectives of new policy and strategy for the promotion of entrepreneurship in the zone. Needs and Strategies.

As globalisation creates benefits through advanced technologies and expansion of commerce, it also creates challenges for emerging small business enterprises to effectively compete in an environment characterised by multivariate challenges. Entrepreneurship is the practice of starting new organisations or revitalising mature organisations, particularly new businesses generally in response to identified opportunities. Entrepreneurship forces creative destruction across markets and industries, simultaneously creating new products and business models. Many "high value" entrepreneurial ventures seek venture capital or angle funding in order to raise capital to build the business. Lately more holistic conceptualisations of entrepreneurship as a specific mindset resulting in entrepreneurial initiatives e.g. in the form of social entrepreneurship, political entrepreneurship, or knowledge entrepreneurship emerged while in 2009, a yet newer type of entrepreneurship known as LILO (a little in, a lot out) entrepreneurship came into sight. Entrepreneurship Promotion Activities. As the brains behind this forum, the Abia state ministry of science and technology in collaboration with the raw materials research centre of the federal government of Nigeria, and given entrepreneurship's potential to support economic growth, this fair should come up with policy goal suggestions to the concerned states to develop a culture of entrepreneurial thinking. Global Entrepreneurship Week is a civil-society initiative to promote the entrepreneurial aspirations of young people everywhere. In entrepreneurship, the zonal investors forum should work to catalyse an entrepreneurial society in which job creation, innovation, and the economy flourish. Global partnership could be sought from organisations like Junior Achievement, Entrepreneurs Organization and Youth Business International. Host organisations in each of the participating countries are responsible for recruiting partners, and coordinating national activities. Technologies for Skills and Socio-economic Development. At its core, technology is knowledge made up of two dimensions: 1. Technological knowledge knowledge about what works and how things could be done and 2. Techniques - the application of this knowledge in processes and tools for daily living. From ancient forms, technology has evolved into such devices as the computer or the mobile phone. Technology is so predominant in many of our modern societies and so widespread that its implementation is not limited to any particular field, or linked to any specific sector. Technological knowledge and techniques are moreover constantly evolving and bridging geographical distances (for example with e-learning and e-commerce). Practical advances often lead to broad usage, which in turn lowers the costs of products for the end-users and makes technologies more accessible. Innovation and certain technologies may also have unwanted effects such as pollution and environmental degradation. All the same, in developed countries, access to technology has greatly helped improve productivity. In less developed countries, even low-tech innovations have spawned high-impact reductions in work burdens. For example, in Kenya during the 1960s Mabati movement turned simple tin roofs into rain

water collectors, saving countless hours of water hauling and providing a commodity that could help raise livestock, improve garden yields or be sold to others Today women and men need broad based skills, which can be adapted to rapidly changing economic requirements as well as appropriate basic skills which enable them to benefit from information technology, increasing their ability to overcome barriers of distance and budgetary limitations. Supporting women entrepreneurs to introduce new technologies in their enterprises enhances the potential to increase productivity, create employment, reduce poverty, and promote local development. Women entrepreneurs are increasingly becoming the driving forces of many economies particularly in Africa. Studies show that they account for 50 per cent of small businesses. These businesses are often micro- and small- scale enterprises in the informal economy, and may not offer the same job security, social protection, access to training and career development as the formal economy. But, formal employment, with all its inherent advantages in terms of job quality and quantity, remains an elusive goal for many women. Skills development paves the way by enabling women to create and sustain productive employment. Other key factors include the creation of an enabling environment for sustainable enterprise development, social dialogue and fundamental investments in basic education, health and physical infrastructure. The improvement of human capital will translate in greater managerial capacity on emerging small and medium enterprises (SMES). SMEs that take advantage of advanced technologies will surely be more competitive. Small businesses should be encouraged to adopt information technologies such as electronic and wireless commerce to enhance their competitiveness On-going Entrepreneurship Promotion for Skills and Socio-economic Development. The World Bank and other multilateral development agencies have long recognised the importance of targeted assistance to Small and Medium Enterprises (SMEs) in accelerating growth, promoting economic development and reducing poverty in their interventions in developing countries. Some of the major strategies to facilitate the promotion and the needed technological skills and socio-economic development include the following: Establishment of banks, channelisation of financial assistance, development and encouragement of a new class of professional and technical entrepreneurs, establishment of promotional agencies, banks and cooperatives should discover innovative schemes to catalyse the rural and cottage entrepreneurship, setting up of rural entrepreneurship development centre, upgrading informal apprenticeships. It is hoped that appropriate banks would be established to demonstrate their entrepreneurial behaviour, innovative skills and developmental outlook in future so that Abia could survive in 21st century with great enthusiasm and development programmes in the committee of entrepreneurially advanced states of the world.

This forum should orchestrate the development and encouragement of a new class of professional and technical entrepreneurs in small and medium scale sector and campaign for the promotion of small and medium entrepreneurship to be the major thrust of government policies and the vision 20-2020 plans with a view to translating these ideals into reality through effective schemes and programmes. Creation of an entrepreneurial society through finance, entrepreneurship development and infrastructure development should be its primary motive. It should set up at least one entrepreneurship development centre in each state of this zone. Perspectives of New Policy and Strategy for the Promotion of Entrepreneurship in the Zone. This forum is in a position to recommend relevant perspectives of new policy and strategy for the promotion of entrepreneurship in the zone particularly in the backward local government areas. It can classify the latter into categories for the purpose of distribution of fiscal and financial incentives among viable entrepreneurs who have already set up their industrial, commercial and service ventures in the state and the zone. The forum should come up with suggestions on effective skills development systems including connecting education to technical training, technical training to labour market entry and labour market entry to workplace and lifelong learning; can help women and men benefit from existing and emerging opportunities. In doing this it would be necessary to recognise that contemporary policy targets small firms as a means of achieving and sustaining growth as well as economic and social stability, and what could be the impact of public policies on the localisation of economic activities. Conclusion. As a result of finance being a major constraint of small business in fulfilling its developmental roles, any initiatives by the government and other stakeholders must be geared at improving SMEs access to finance and lowering the cost of finance. Ability to acquire and possess latest technology is determined by SMEs financial capabilities which call for government to improve small businesses access to finance to enhance their competitiveness in a global economic environment which is characterised by intensive competition. Conducive environment for women and youth to venture into small business must be created and supporting policies must be crafted.