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In light of recent enthusiasm over African private sector development, the purpose of this paper is to review the business literature on African enterprise development with a view of identifying lacunas in the literature and of developing an analytical framework that may guide future research on this issue.

The paper provides a review of the extant literature on African enterprise development by juxtaposing the traditional pessimistic view of African business performance with more recent, optimistic accounts. Based on the literature review, lacunas in the literature are identified and an integrative framework for analysing African enterprise development is developed. The framework is used to provide an overview of the received literature on African enterprise development, to identify voids and lacunas and to identify new research agendas.

While a growing number of studies suggest profound improvements in the performance of African enterprises, data limitations, conceptual ambiguities and absence of comprehensive studies still cautions against sweeping generalizations. The paper reviews the literature on factors shaping the performance of African enterprises, observing that while much research is focusing on the role of the African business environments for enterprise development, much less attention has been devoted to the role of firm-specific capabilities, strategies and management. The paper concludes by advocating a contingency approach to research on African enterprise development that emphasizes the interplay between firm-specific factors and the specificities of the African business environment.

The paper provides a comprehensive literature review on African enterprise development and presents a novel framework for understanding African enterprise development from a business perspective.

To understand African small and medium-sized enterprise (SME) performance and its antecedents is essential, both from a strategic management and an industrial development perspective. While a substantial literature on African SMEs has emerged in recent years, studies of their performance specifically are few and inconclusive. The purpose of this paper is to address this lacuna in the literature by examining variations in performance of 210 East African SMEs.

The paper employs OLS and logistic regression and Classify k-means test to analyze performance variations in a unique data set of 210 food processing enterprises in Tanzania, Kenya and Zambia.

Three generic types of African SMEs are identified based on performance: laggards, followers and gazelles. The gazelles are typically medium-sized, skill-intensive companies selling relatively differentiated products in niche markets. The laggards are typically small, capital-intensive companies involved in grain milling that adopt a cost differentiation strategy. A key driver of variation in performance is found to be the quality of the external business environment (in particular the quality of intermediary markets), and also capability factors such as the strength of management. Strategy factors such as differentiation and political strategies explain performance variations.

Among the policy implications are that African industrial policy should focus on improving the functioning of intermediary markets, e.g. by reducing the transaction costs of inter-firm collaboration. Moreover, rather than focusing industrial policy on SMEs per se, policymakers should focus on those types of enterprises that are capable of generating high performance, e.g. skill-intensive enterprises with strong managerial capabilities, engaged in differentiation strategies.

The paper integrates the extant literature on African SME performance, develops an analytical framework for studying it and presents novel empirical insights based on one of the most detailed surveys of SME performance in the continent to date. The findings have important and tangible implications for literature, as well as for industrial policy.

This paper aims to review the latest management developments across the globe and pinpoint practical implications from cutting-edge research and case studies.

This briefing is prepared by an independent writer who adds impartial comments and places the articles in context.

Up until recently, you would struggle to hear anyone mentioning business success and African firms in the same sentence. Barriers at institutional, sector and company levels saw to by ensuring performance was invariably below standard. How things have changed. Africa’s economy is expanding fast and its enterprises are becoming ever more competitive. Firms, entrepreneurships and private sector development are all rising in number. Several leading economic institutes are, on record, anticipating an increasingly significant contribution for African commerce on the global stage. The situation has even been compared with the meteoric economic transformation in Asia.

The paper provides strategic insights and practical thinking that have influenced some of the world’s leading organizations.

The briefing saves busy executives and researchers hours of reading time by selecting only the very best and most pertinent information, and by presenting it in a condensed and easy-to-digest format.

Rural farm and non-farm based entrepreneurial activities within Sub-Saharan Africa (SSA) play significant roles in job creation as well as food security for the majority of rural dwelling citizens (UNCTAD, 2018). This chapter examines the policies and strategies for supporting both farm and non-farm entrepreneurial activities within rural communities in SSA. In order to achieve this, the authors have completed a systematic literature review of both conceptual and empirical work on the role of policies and strategies for rural entrepreneurship in selected SSA, namely Ethiopia, Rwanda, Sierra Leone, and the United Republic of Tanzania (URT). This was completed alongside an assessment of the constraints and potential opportunities in order to stimulate linkages between rural entrepreneurship and structural economic transformation including the potential roles of both farm and non-farm based entrepreneurial activities. Key linkages between rural farm and non-farm based entrepreneurial activities are emphasised The chapter also highlights mechanisms through which governments and private sectors can work together for the maximisation of available opportunities and best practices that rural entrepreneurship can offer for job creation among rural communities in SSA.

The study aims to examine the importance of access to finance in firm innovation by using firm-level data from the World Bank enterprise survey (WBES) on selected African countries.

This study utilises firm-level data from the WBES database and computes aggregate innovation index by using multiple correspondent analysis. The authors then apply instrumental variable models (to control for possible endogeneity between innovation and finance) to assess the link between finance and innovation.

The research finds that finance in the form of overdraft overwhelmingly drives innovation in all selected countries – Cameroon, Kenya, Morocco, Nigeria and South Africa. Trade credit enhances innovation among firms in Nigeria, South Africa and Cameroon, while asset finance drives innovation amongst firms in Cameroon, Nigeria and South Africa.

Policy incentives such as tax breaks could be put in place for financial intermediaries that have shown proof of extending loans to financially constraint firms to enable them to innovate. Furthermore, different financial institutions such as microfinance institutions can be supported to increase credit to enterprises. Partnerships with organisations willing to fund firms and support start-ups should be encouraged. One of such support mechanisms could be specialised schemes such as a credit guarantee scheme to encourage and secure lending to enterprises to promote innovation.

This paper provides empirical insights into how finance enhances innovation in African enterprises. It also shows how different finance structures (overdraft, asset finance and trade credit) affect firm innovation in different African countries.

The purpose of this paper is to explore opportunities and challenges of accelerating digital entrepreneurship development in key economic growth sectors in West Africa.

The study uses case illustrations from the media and agriculture sectors to highlight some of the opportunities and challenges that have shaped current business practices in this digital space in West Africa.

Technological infrastructure featured as one of the main challenges for fostering success in the media-tech cases and perhaps linked to the low internet penetration rates. Likewise, infrastructure proved to be a challenge in the agri-tech sector cases.

This study highlights the importance of partnerships within the entrepreneurship ecosystems as a critical condition for ensuring positive benefits for all stakeholders within the entrepreneurial ecosystem taken from the lens of West Africa.

In this study, the authors examine how economic freedom mediates the impact of foreign direct investment (FDI) on economic growth in Africa.

By using data from 41 countries over the period 2000–2017, the authors invoke Seo and Shin's (2016) sample splitting approach while relying on the recently developed Seo et al.'s (2019) computationally robust bootstrap algorithm to achieve the purpose of this study.

The authors find evidence of economic freedom threshold that bifurcates the link between FDI and economic growth in Africa. More precisely, FDI does not improve overall economic growth for African countries whose economic freedom index is below the estimated threshold while significantly spurring growth for African countries with economic freedom above this threshold.

African countries need to strive towards improving their level of economic freedom through the strengthening of rule of law, reducing government size, promoting regulatory efficiency and further opening of the goods and capital markets.

The association between FDI and economic growth has been well documented. While the positive theoretical postulations are almost conclusive, empirical literature on the precise effect of FDI remains contentious and far from being settled. What is missing in the existing literature in Africa is whether countries' level of economic freedom mediates how FDI explains the variations in economic growth across African countries. The authors fill this research gap.

The purpose of this paper is to examine how early-stage entrepreneurs' opportunity motivation impacts their choice of market growth strategies as well as the contingent roles of institutional environments and product market conditions in Africa.

The study employs hierarchical linear modeling to test multilevel models with nested data empirically.

The findings show that African early-stage entrepreneurs who are opportunity-driven and from countries with strong institutional environments have a higher tendency to adopt market exploration strategies. African early-stage entrepreneurs from countries with strong product market conditions have a higher tendency to adopt market penetration strategies. Further interaction tests show that both contingency conditions, namely institutional environments and product market conditions, moderate the effects of opportunity motivation on market growth strategies of African early-stage entrepreneurs.

The study shows that policymakers in Africa need to develop flexible, supportive market-related policies based on entrepreneurs' growth paths, institutional environments and product market conditions.

The study is the first to explore multilevel influences on early-stage entrepreneurs' market growth strategies in Africa. It sheds new insights on the entrepreneurial marketing process of early-stage entrepreneurs in Africa.