An evaluation of entrepreneurial skills needed for emerging black entrepreneurs within the Western Cape

South Africa’s economy is in a phase of transformation. As part of this process, the South African government has identified the development of economic activities amongst previously disadvantaged black communities. However, this noble intent is challenged by a lack of entrepreneurial skills, which are seen as important elements in the economic development effort and necessary to achieve transformation goals and objectives (Smith, 2004). Since the apartheid era, South Africa has seen the emergence of two distinct economic sectors: a first world economy, consisting mostly of white owned and formal businesses, and a third world economy, consisting of mostly black owned and informal businesses. Economic activities of emerging entrepreneurs have been restricted to mostly the black townships and rural areas, whereas first world entrepreneurs have been actively involved in mainstream economic activities. The separation of emerging and first world entrepreneurs has resulted in a wide gap in entrepreneurial and technical skills and knowledge between the two. This imbalance has maintained a situation in which the minority of the population controls more than 80 per cent of the wealth of the country. Upon gaining independence in 1994, the new South African government embarked on the Reconstruction and Development Programme (RDP) to redress the imbalances of the past (GEM, 2001; GEM, 2002). The government has since also adopted the Growth Employment and Redistribution (GEAR) macroeconomic strategy to grow the economy, create employment and redistribute wealth. To accelerate the implementation of GEAR, the government has passed a number of Acts, namely: The National Small Business Promotion Act (102/1996), Skills Development Act (97/1998), Affirmative Procurement Act (5/2000), Mineral and Petroleum Resources Act (28/2002) and, most recently, the Mining Charter (2003), Petroleum Charter (2003), Financial services Charter (2003), and the Information Communications Technology (ICT) Charter (2004). Small business has been seen by government as a vehicle to create employment, promote economic growth and redistribute wealth; as such the promotion of entrepreneurship has been identified as a critical aspect of GEAR. However, despite supportive legislation and programmes, South Africa’s entrepreneurship rating remains below average, as evidenced by the findings of the Global Entrepreneurial Monitor reports (GEM, 2001; GEM, 2002). The wide gap in skills and knowledge between emerging and first world entrepreneurs in South Africa is a contributing factor to the country’s poor rating – and it is expected to widen as the new knowledge economy unfolds, if corrective measures are not taken by the government or private secto