Success factors of entrepreneurial activity in the Overberg region of Western Cape, South Africa

Abstract

Entrepreneurial activities around the world accounted for about 70% of the global GDP on average. However, in South Africa entrepreneurial activities only share 40% of the country’s GDP. With an unemployment rate of approximately 25%, accelerating entrepreneurial activity becomes crucial in a developing country like South Africa. A recent study executed in the Overberg rural district has shown vast opportunity for new endeavors in this direction. Entrepreneurial activity is mostly centered on large-scale agricultural practices. This district is the largest apple producer in the country and the second largest pear producer. However, unemployment in this region has increased in recent years due to the nature of fruit farming which is seasonal. Off-season farmers employ only up to 9% of the district farm workers which leaves 11.1% workers without employment for the rest of the year. Though this area is affluent with natural resources; scarcity of skills, poor infrastructure and lack of technology result in slow economic growth. Further, the absenteeism of entrepreneurial success factors makes it impossible for the many survivalist businesses in the informal sector to be sustainable and to show any form of growth. This paper will analyze the success factors or lack thereof and make recommendations towards opportunities that will help to advance the Overberg region’s entrepreneurial activity.