Lessons on entrepreneurship and innovation from Brazil

Yesterday’s Sunday Standard had an article written by Prof. Anyang’ Nyong’o, Minister for Medical Services on why Kenya needs a science and technology driven economy to thrive. Coming at the back drop of Brazilian President Lula da Silva’s visit to Kenya, the article raises several points for why Brazil is a major emerging economy,  and which Prof. Nyong’o posits is due to the Brazilian government prioritising innovation as a major development concern. In turn he states that policies regarding technology as well as scientific societies need to be mainstreamed into Kenya’s national development.

However probably as a result of column space, a reader could maybe assume that making the public sector friendlier to technology change is all that is required. That ensuring adequate public resources are directed into science and technology will firmly put Kenya on the trajectory to become the middle income economy envisaged in Vision 2030. But that ignores the human aspect.

Brazil has placed emphasis on it's SME sector which accounts, just like Kenya for the majority of jobs and businesses in the economy. Indeed, according to an article on the Kaufman Institute for Entrepreneurship’s website titled Brazil’s Entrepreneurship Boom, the increase in new companies in Brazil has been linked with the country’s developing entrepreneurial culture and mindset. Each year this has been demonstrated by the number of participants in Global Entrepreneurship Week which increased from 1.5 million entrepreneurs in 2008 to 5.3 million in 2009.

And even though the country’s listing on the ease of doing business index has recorded similar challenges as Kenya in terms of high tax rates; as well as having structural impediments such as an education system that does not engender financial literacy, Brazil’s entrepreneurship development policy is strikingly different in that it focuses on promoting high-growth ventures as opposed to Kenya’s policy of just creating enterprises with the hopes that they will one day be able to create jobs.

This has meant that Brazil’s high impact intervention has brought about more immediate impacts on the economy, than the more laid back approach of just creating ventures with little regard for growth.

Similar to Kenya where according to the Ministry of Youth Affairs and Sports, there are 2.5 million unemployed youth and barely 125,000 are absorbed into the formal sector annually; young people in Brazil aged between 18 and 24 years account for 36% of the country’s unemployed. Nevertheless, lessons learned on Brazil’s focus on innovation as well as the promotion of an entrepreneurial spirit does give hope that indeed Kenya could just be on a positive path to Vision 2030, come the 2014 World Cup in Brazil.