RESEARCH ARTICLES

 

Exploring the Entrepreneurship policy-making and outcomes undertaken by public institutions involved in Entrepreneurship Development in Malawi

 

 

NN Ndala^I; T Pelser^II

^IUniversity of KwaZulu-Natal, Graduate School of Business & Leadership nanteleza70@gmail.com
^IIUniversity of KwaZulu-Natal, Graduate School of Business & Leadership Pelser@ukzn.ac.za ORCID NR: https://orcid.org/0000-0001-5935-0185

 

 

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ABSTRACT

The article aims to assess the entrepreneurship policy-making processes and outcomes undertaken by public institutions involved in entrepreneurship development in Malawi. The specific objectives of the article were to identify the gaps in the entrepreneurship policy-making process currently being used in Malawi and to assess the effectiveness of the implementation of the entrepreneurship policy in the country. A total of eight organisations were purposively sampled and only two accepted to provide an in-depth interview. These public organisations were SMEDI and TEVETA which are involved in entrepreneurship policy initiation and implementation. The interviewees were the management team members of the respective organisations. The study used content analysis and thematic analysis to analyse the interview results as it was qualitative in nature. The findings indicate that the policy process on entrepreneurship is still under review in Malawi and entrepreneurship development is not prioritised by authorities. Entrepreneurship development goals are regarded as secondary goals to national goals. To this day, there has not been much done to improve entrepreneurship education and training and (Small Medium Enterprise) SME development on the ground and this is dating back to 2008 in Malawi. There is no collaboration and coordination among the institutions involved in entrepreneurship development in Malawi. The collaboration and coordination are 'ad-hoc' and 'event-driven' which can be regarded as ineffective. The overall custodian of the SME policy is the Ministry of Industry and Trade (MoIT). The other quasi-governmental departments only oversee or undertake policy implementation on behalf of the MoIT. Efforts to interview the Director of SMEs in the MoIT yielded no result.

Key phrases: Entrepreneurship development; entrepreneurship education & training; entrepreneurship policy and small and medium enterprises

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1. INTRODUCTION

Entrepreneurship is an instrument for economic growth, social mobility and job creation in developing and developed countries. It is for this reason that governments have put the stimulation of entrepreneurship high on their agendas. The fundamental question dominating entrepreneurship research and policy mechanisms 'is why only some people see new business opportunities and only some people take actions to exploit the opportunities they do see by getting involved in entrepreneurship actions?' (Thi Thu & Le Hieu 2017). Malawi is a least developed country and its population barely survives on less than a dollar per day. Mkandawire and Duan (2016) observe that Malawi is a poverty ridden country which has households that are unable to meet their daily requirements and that this poverty is associated with households that lack adequate income, employment opportunities, entrepreneurship spirit and credit opportunities. Arguably, the number of people living on less than $1.25 a day in the Sub-Saharan Africa including Malawi remains the highest in the world (The Food and Agriculture Organisation of the United Nations 2015).

Recently there have been attempts by the Malawi government to develop the entrepreneurial mindset of the population through the revamping and restructuring of public organisations entrusted with national entrepreneurship development such as Technical Education, Vocational and Entrepreneurial Training Authority (TEVETA), Small and Medium Enterprise Development Institute (SMEDI) and Malawi Rural Development and Enterprise Fund (MARDEF). There has been also a proliferation of Higher Education Institutions (HEIs) both public and private that are offering entrepreneurship education and training which are registered by the National Council for Higher Education (NCHE) with the sole purpose of spurring entrepreneurship development in the country through the provision of entrepreneurship education and training (EET) (Delaney, Harrington & Toker 2019).

According to the MoIT (2016) across the country, a broad range of support programmes targeting SMEs are being provided by different government departments and institutions as well as the private sector but the level of access to support by SMEs is unsatisfactory with most businesses not aware of the support provided. This results in SMEs not benefiting as much as they could from the available support. One of the main reasons why this is the case is that, despite concerted efforts by various support agencies to communicate their offerings to SMEs, there is lack of a single source of information of all available support institutions and on how to access them MoIT (2016).

In Malawi, for example, while the number of HEIs offering EET has increased and the restructuring and repositioning of the public institutions involved in entrepreneurship development has taken place, the economic growth rates have stagnated around 6.1% (2013), 6.3(2014) and 5.8%(2015) 5.8% (2015) and 5.1% (2016/2017) per annum and the unemployment rates have been estimated to soar to over 35% in the past five years (MidYear Economic Report 2018). In addition, according to Malawi Government Secretary for Labour, Youth & Manpower Development, youth unemployment is estimated to be 70% thereby reaching "alarming levels in the country" (Ntchindi 2016). This situation could be attributed to the lack of a clear and effective entrepreneurship policy to guide the development of entrepreneurship and small businesses in the country. Accordingly, in Malawi, small and medium enterprises have been considered as significant contributors towards job creation, development and economic growth (Chetama, Dzanja, Gondwe & Maliro 2016).

 

2. RESEARCH PROBLEM

The Global Entrepreneurship Monitor (GEM) Report (2013) shows that on average 78.9% individuals in Malawi often perceive good opportunities to start new business, 66.7% have entrepreneurial intentions with 15.1% having a limited fear of failure when it comes to starting a business and that 89.5% believe that they have the skills, knowledge and experience to start a small business. According to the National Statistical Office (2017) a total of 92% of the Malawian population is involved in the small and medium-sized enterprise sector in the form of self-employment, family or individual businesses (Mtsitsi, Dzanja, Gondwe & Kamwana 2016). The assessment of success rates among the self-employed entrepreneurs in developing countries including Malawi found that only 7% were successful (Baluku, Kikooma & Kibanja 2016). Hyder and Lussier (2016) also indicate that the rate of failure of SMEs is high globally. Phonthanukitithaworn, Ketkaew & Naruetharadhol (2019) state that only 10% of the small businesses started by entrepreneurs survive, it is for this reason that it is of utmost importance to determine the factors of success. Dzomonda and Fatoki (2019) concur that despite the active role the SMEs play, they seriously experience a slow growth rate and premature death, and that many small businesses, especially in Africa, do not have growth prospects to become large firms.

If the reasons why entrepreneurs fail is better understood it should be possible to increase the success-failure ratio through having an effective entrepreneurship policy (Hyder & Lussier 2016).

The aim of the article is;

a. To identify the gaps in the entrepreneurship policy-making process currently being used in Malawi.

b. To assess the effectiveness of the implementation of the entrepreneurship policy in the country.

The gaps in the entrepreneurship policy-making process in use in Malawi were highlighted through the review of the relevant literature while the assessment of the policy-making process and outcomes undertaken by public institutions involved in entrepreneurship development in Malawi was undertaken through in-depth interviews conducted with personnel involved in entrepreneurship development in the country. It should be noted that there have not been studies on entrepreneurship policy-making process and assessment of its effectiveness in recent years in Malawi.

 

3. LITERATURE REVIEW

Brea-Solis, Casdesus-Masanell and Grifell-Tatje (2015) argue that an organisation's business model can be decomposed into two fundamental elements comprising of choices such as policies and the consequences of such choices. The causal link between choices and consequences assist in explaining the logic of how organisations create and capture value for the stakeholders. David and David (2015) determine policy as referring to "specific guideline, methods, procedures, rules, forms and administrative practices established to support and encourage work toward stated goals". Policies are instruments for strategy implementation and they set boundaries, constraints and limits on the kinds of administrative actions that can be taken to reward and sanction behaviours; they clarify what can and cannot be done in pursuit of organisational objectives (David & David 2015). Abioro and Adefeso (2016) argue that public policy refers to the actions of the government and the intentions that determine those actions and that public policy is the study of policy making by the governments. It is the "sum of government activities whether acting directly or through its agencies to influence the lives of the citizens usually containing decisions of the government's resolutions on what it will and what it will not do, consisting of the political decisions that go in line with the political will and implementation of the programmes to achieve societal goals" (Abioro & Adefeso 2016). In other words, public policy focuses on public problems that require actions as the output produces the type of the governance in a country.

In the case of entrepreneurship policy as well as other policy areas in that political decision makers are elected and not re-elected, policies are changed and reforms are implemented (Nielsen 2016). Mann and Shideler (2015) argue that government policies must be designed to spur entrepreneurship and must not characterise entrepreneurship as a "one size fits all" if they are to have the necessary impact. They state that government policies must be devised to encourage entrepreneurship and that as economies mature entrepreneurship levels decline. The reality is that government policies and programmes targeting economic growth may in fact only increase the number of business rather than spur innovation (Mann & Shideler 2015). They conclude that technical assistance programmes should aim to aid innovators through formulating business plans, securing funding and providing legal help to protect innovators intellectual property as well as lower the risk and start-up costs of noninnovative entrepreneurs thereby creating firms which grow the local economy (Mann & Shideler 2015). In developing entrepreneurship, government policy has a big influence in order to establish an environment and create infrastructure that supports entrepreneurship (Mirzanti, Simatupang & Larso 2015). Heller and Stephenson (2015) argue that policies conducive to entrepreneurship are related to economic outcomes. Entrepreneurship policy is policy measures taken to stimulate entrepreneurship aimed at the pre-start, start-up and early post-start phase of the entrepreneurial process (Mirzanti, Simatupang & Larso 2015). The author suggests that these policies need to change with the changing environment. Ibrahim and Ibrahim (2015) concur by stating that policy changes should be regarded as an evolutionary process in which the government programmes are repeatedly reformed and redefined because of the consequences of the competition among the advocacy coalitions comprising the policy system. Ibrahim and Ibrahim (2015) further argue that policy changing has two characteristics which are stability and changing:

a. Stability: This covers a number of public policies which are more incremental referring to the past.

b. Policy changing: This is minor and marginal. Policy changing is defined as major and minor changes on the subsystem of the policy or government program. The major change refers to the changes in the core aspects while minor changes refer to the changes in the secondary aspects of government policies and programmes.

Abioro and Adefeso (2016) caution that there exists a sharp disconnect between the government and the governed which has resulted into policy formulation that fails to meet the needs of the people. They concur that public policy decision making is the actions taken within the governmental setting to formulate, adopt, implement and evaluate the change (Abioro & Adefeso 2016).

According to Abioro and Adefeso (2016), the development of a public policy starts with the public recognition that a problem exists and that there are three pre-public development stages namely: problem definition or issues formation, policy demand, and agenda formation. The next stage from the pre-policy stages in the development of a public policy is deliberation and policy adoption. Thus, from the policy agenda, the decision makers helped by the input of several groups, policy experts and constituents' debate and bargain over alternative policy formulations, settling on an alternative or a combination of alternatives to respond to the problem (Abioro & Adefeso 2016). After this, decisions are made, policies are formulated and policy statements are issued taking the form of orders, regulations and laws.

Mirzanti, Simatupang and Larso (2015) argue that much as in developing entrepreneurship government policy has a big influence in establishing an environment and creating the infrastructure that supports entrepreneurship, the challenge in developing an entrepreneurship policy being that one policy applied in certain areas cannot be applied in other areas automatically. They add that entrepreneurship has emerged as a focus of public policy and that in implementing the entrepreneurship policy, "one size does not fit all" and in the long run the government should provide a conducive environment for the emergence of productive entrepreneurship rather than unproductive entrepreneurship (Mirzanti, Simatupang & Larso 2015).

Daniell, Morton and Insua (2015) add that policy analysis should be taken as a framework for thinking about policy problems and making choices which should comprise typical stages in decision making processes such as establishing the problem context, determining the alternative policy options, predicting their consequences, assessing their outcomes and recommending a policy choice. Within the policy process, the critical issues in public decision-making are determining the criteria used for evaluating the policies and determining who is able to influence such choice. Williams (2015) determines whether informal entrepreneurs should be included when formulating public policy on entrepreneurship and argues for four possible policy options available to policy makers regarding informal entrepreneurship as follows: take no action at all, pursue the eradication of informal entrepreneurship, move formal entrepreneurship into the formal economy and transform the informal entrepreneurship into formal entrepreneurship.

Nielsen (2016) asserts that collaboration in the support system could play a vital role in the success of entrepreneurship support systems as it ensures information sharing and joint problem solving.

Mtsitsi et al. (2016) state that small and medium enterprises are regarded as one of the drivers of sustainable economic development in Malawi and that by improving their financial performance it is guaranteed there are improved returns from the business translating into improved livelihood for the business owners. Zidana (2016) also points out that findings in Malawi show that 1, 050,320 people were employed by 41% of the country's small and medium-sized enterprises which attests to the pivotal role of small and medium-sized enterprises in the Malawi economy. Edoho (2015) argues that policy makers need to embrace an entrepreneurship paradigm as a strategy for the economic recovery of Africa and the multilateral agencies should redirect their foreign aid programmes towards promoting entrepreneurship and small and medium enterprise development. Edoho (2015) agrees that entrepreneurship and micro small and medium enterprises (MSMEs) have driven innovation that has stimulated economic growth, created wealth and generated high-skilled jobs in industrialised and emerging economies and that the vast opportunities in Africa require an entrepreneurial strategy to exploit. Thus, in order to be successful, entrepreneurship policy should involve the entire process of entrepreneurship including opportunity identification, idea evaluation and action which is business implementation (Mirzanti, Simatupang & Larso 2015).

3.1 Entrepreneurship Policy Interventions

Policies within areas such as opportunity, capital, ability, incentives and motivation across different target groups may be implemented at different levels to foster entrepreneurial activity (Nielsen 2016). In entrepreneurship policy, the importance of fitting policies and programs to the context in which there are implemented is critical (Nielsen 2016).

Schulz, Urbig and Procher (2016) caution that in order to design an efficient and well-targeted entrepreneurship policy and program, policy makers should consider the relevant heterogeneity in response to the public measures. Wright, Roper, Hart and Carter (2015) add that an important strand of the government policy on small and medium-sized enterprises seem adept at recovering from recession in their potential to play a significant role in driving the future. They argue that entrepreneurship policy intervention could target innovation, exporting finance, leadership and management development in supporting MSMEs growth. Some of the bottlenecks to finance access can be addressed by supply-side policies aimed at promoting the provision of credit and equity finance, access to information and advice about alternative sources of finance.

On the contrary, Nielsen (2016) argues that the business development agencies, incubator schools and education institutions, private advisory services and others are each responsible for their part of entrepreneurship support or promotion but also working together for the common purpose of implementing the entrepreneurship policy. Acs, Astebro, Audretsch & Robinson (2016) state that entrepreneurship-friendly policies are those which in some way make it easier or cheaper for a person to start a new business, may or may not be conditional on that they have developed a new business idea or invented something. Such policies range from subsidised lending or other business cost subsidies, reduced taxes on equity investments, reduced hiring costs, provision of information or other market-making mechanisms, location-specific or industry-specific subsidies to start business in a given location or.

The creation of a business environment, appropriate conditions and the protection of the interests of small entrepreneurs should be encouraged by the state economic policy which should include the taking of measures for the adoption of a proper entrepreneurship policy (Erkomaishvili 2016). The following are the measures that must be priorities of the state support for the development of small entrepreneurs: tax preferences, allowances, preferential bank loans, small enterprise development programs adoption and protection of appropriate legislation. Coad, Frankish, Roberts and Storey (2016) observe that governments are continually faced with the choice of using tax payers' funds to support and stimulate start-ups or instead to delay the support until the performance indicators become clear. On the other hand, Ibrahim and Masud (2016) argue that the governments in developing countries see entrepreneurship as a solution for the many economic and social vices and its benefits encourage the countries to come up with many policies and programmes that enhance entrepreneurship especially among the teeming youths.

Okumagba and Okinono (2016) point out that the countries in developing nations have not been able to achieve much success in sustainable entrepreneurship development because most of the programmes initiated are politically motivated for personal benefits and at the same time as a weapon to witch-hunt their political opponents; there is no autonomy of project execution by the agencies , the agencies are mainly concerned with project supervision but denied access to funds allocated for the project implementation. This indicates there is a lack of coordination in the organisational structures and activities of the development agencies and most of the development programmes are initiated without community inputs rendering them unsustainable (Okumagba & Okinono 2016).

3.2 Policy Implementation and Collaboration

Stankevice and Matijosaitiene (2015) argue that the contemporary environment requires policy makers to act responsibly by ensuring that there is institutional coordination as this plays a central role in fostering rates of innovation and competitiveness and that a dynamic economy necessitates efficient institutional cooperation and coordination in the form of close cooperation between ministries as well as between national authorities and local stakeholders. The coordination in policy making and programme implementation has been widely acknowledged as an important pre-condition for the strengthening of knowledge management and innovation capacities at both national and regional levels (Stankevice & Matijosaitiene 2015).

Stankevice and Matijosaitiene (2015) further advise that efficient institutional cooperation and coordination can only be attained by having clear purposeful and consistent guidelines. Nielsen (2016) argues that collaboration in the support system has been proved to play an important role in the success of entrepreneurial support systems and the government need to support and encourage entrepreneurship as it is a source of innovation, growth and job creation. The entrepreneurship policy support structures must fit with the changing political situations in which different prioritisation and reforms constantly shape the environment (Nielsen, 2016) In other words, according to the strategic choice theory, the entrepreneurial orientation of the government affects the configuration of the structures delivering the policy (Nielsen 2016).

Johnson, Whittngton, Scholes, Angwin and Regner (2017) define an organisation's configuration as consisting of the structures, processes and relationships through which the organisation operates and argue that by configuring the organisation so that all the above elements fit together and with key strategic challenges helps in promoting organisational success. Nielsen (2016) further states that collaboration represents the organisational configuration of the policy delivery structures which are made up of different organisations, institutions and individuals. The government and network actors rely on the conducive collaboration mechanisms between the actors and steer the structure in the right direction (Nielson 2016).

3.3 Micro, Small and Medium Enterprise (MSME) Policy in Malawi

Dzomonda and Fatoki (2019) indicate that there is no universally acceptable definition for SMEs and that one of the reasons why it is difficult to define an SME is the fact that each and every country has its own definition. The size limit is one of the most common definitions in developing countries. Mafundu and Mafini (2019) agree that small to medium enterprises are defined in various ways, common definitions being based on either turnover thresholds or the number of employees per enterprise size category. The Malawi (MSME) Policy (2012) draft provides the definition of SMEs where they are categorised based on the number of employees, annual turnover and maximum assets as in Table 1.

The common barriers to the development and growth of MSMEs in Malawi include weak institutional and regulatory framework, high cost of doing business, weak value chain integration, lack of specific policies aimed at women and the youth, limited access to credit and business development policies, lack of a coherent and organised MSME voice to represent the sector and an inability to meet production standards and few opportunities to export. Specifically, the MSME Policy in Malawi aims to increase the contribution of small businesses to economic growth, employment creation and poverty alleviation in Malawi. It aims to improve the coherence in policies that impact on MSMEs with measurable outcomes and robust monitoring and evaluation. It seeks to ensure the better functioning of value chains and create incentives for the private sector to change behaviour and become more inclusive. It strengthens the MSME business support infrastructure by developing a coherent, integrated and practical framework to guide stakeholders engaged in MSME development in Malawi. Finally, it offers differentiated approaches for strategies for micro, small and medium enterprises, as these types of businesses have different needs, aspirations and expectations.

 

4. METHOD

Mason (2010) notes that the smallest sample used in qualitative studies is a single participant which might be expected due to the in-depth and detailed nature of the approach. Boddy (2016) also noted that findings from single case studies can have findings which can be generalised from and implications which are global in importance. In total eight (8) organisations involved in entrepreneurship development were purposively sampled and only two (2) accepted to provide an interview to the researcher. These public organisations were SMEDI (Interviewee 1) and TEVETA (Interviewee 2). Both interviewees were management team members of the respective organisations. The data from the interviews was analysed using content analysis and thematic analysis. Mason (2010) found that the overall range of the numbers of participants used in qualitative studies was from 95 to 1. It was not possible to interview the other six (6) participants because despite making several appointments to interview them they were excusing themselves that they did not have the time for the exercise.

 

5. RESULTS

The section presents the results of the in-depth interviews conducted with the study participants on the policy making processes and implementation undertaken by public organisations involved in promoting entrepreneurship development in Malawi. The questions and responses from the interviewees are tabulated as below.

 

 

 

5.1 Theme One - Entrepreneurship Policy Making/Updating

The question sought information on whether the SME policy has been updated in the country to reflect the current demands from small businesses in the country and deal with the factors that affect the development of SMEs in Malawi. Interviewee 1 asserts that there is a current review of the SME policy which is almost adopted while Interviewee 2 responded in the negative. The response from Interviewee 1 is not specific and precise. It indicates some doubt as to whether there is a current SME policy in operation in the country or not. If the SME policy were drafted it would have been obvious and available for implementation.

5.2 Theme Two - Entrepreneurship Development and EET Improvement

The question sought information on whether entrepreneurship development and entrepreneurship education & training are prioritised over other national goals in Malawi. This would be evidenced by the full involvement of the MoIT and tertiary education institutions in entrepreneurship. Surprisingly, both interviewees indicated a negative response to the question. The question thus sought to establish the effectiveness of the present EET offered in Malawi in developing entrepreneurial qualities in the students as potential entrepreneurs.

5.3 Theme Three - Main Entrepreneurial/SME Development Policy-making Achievements in Malawi since 2008

The question was aimed at assessing whether changes in the entrepreneurship policy have taken place in the past five years and establishes the national impact of the SME policy. Interviewee 1 only provided three impacts which at a national level it can be argued that the impact has been minimal. On the other hand, Interviewee 2 indicated that entrepreneurship is now being carried out at TEVET and its technical colleges. Also, the response attests to the minimal impact of the current SME policy in Malawi.

5.4 Theme Four- Partnership/Collaboration between National Institutions Involved in Entrepreneurship and SME Development

The question wanted to establish the cause of the ineffectiveness of the SME policy in Malawi. From the responses of Interviewee 1 there are no partnerships and collaboration among the players in the entrepreneurship development in Malawi. If there is any collaboration it is "ad-hoc and event-driven". In this regard, the SME policy cannot be expected to be effective without the participation of all institutions involved in entrepreneurship development in Malawi.

5.5 Theme Five - Entrepreneurship/SME Development Policy Responsibilities

The question was intended to clarify the chain of responsibilities as regards to the formulation and implementation of entrepreneurship/SME development policy. Both interviewees were unanimous in their responses that it is the MoIT which is responsible for initiating the policy review and overseeing the policy implementation.

 

6. DISCUSSION

The section discusses the results of the study presented above.

6.1 Entrepreneurship Development and EET Improvement

According to Khalid, Ahmed, Tundikbayeva and Ahmed (2019), entrepreneurial training is an important function that can help develop entrepreneurial competitive skills in employees for responsive performance and employee outcomes. The entrepreneurial training in organisations can turn out to be an effective growth strategy to achieve competitive advantage (Khalid, Ahmed, Tundikbayeva & Ahmed 2019). It is recognised as an important tool for changing the attitude and the transferring of skills to people with entrepreneurial traits ((Khalid, Ahmed, Tundikbayeva & Ahmed 2019). Hagg and Kurczewska (2019) argue that the development of entrepreneurship is closely related to governmental interventions and that in line with this governmental intervention, the higher education throughout the world has been assigned the task of stimulating and increasing entrepreneurialism among the population. Wach and Wojciechowski (2016) state that policy makers are responsible for the creation of appropriate entrepreneurship support systems including its important element which is entrepreneurship education whose main task is to develop appropriate entrepreneurial attitudes.

The interview sought information on whether entrepreneurship development and entrepreneurship education and training are prioritised over other national goals in Malawi. This would be evidenced by the full involvement of the MoIT and tertiary education institutions in entrepreneurship. Surprisingly, Interviewees 1 & 2 both indicated a negative response to the question. The Malawi Country Overview Report (2016) indicates that Malawi is ranked 130th in the world and 27th in its region in terms of entrepreneurial activity and that the GEM Report (2013) estimates that 28% the total adult population (18--64 years) is engaged in entrepreneurial activity. It highlights the importance of entrepreneurship to the country by stating that Malawi being one of the least developed nations in the world desperately needs entrepreneurs as they are the drivers of economic development. Malawi needs to develop entrepreneurs to push it out of the agriculturally based economy into a more diversified economy that will provide more skilled jobs that pay better than those in the agricultural sector. Iit should be noted that entrepreneurship education can play an important role in an uncertain environment because it can develop the insights required to discover and create opportunities for entrepreneurs and gain the ability to successfully start and manage their own businesses (Byun, Sung, Park & Choi 2018). Ganzin, Islam and Suddaby (2019) add that entrepreneurs cope with high risk and uncertainty in running their small businesses by being futuristic in their thinking about how the world works, link the past and the future, and persuasively articulate their visions to key stakeholders.

There is a need to recognise the efforts being undertaken by the Malawi government through its broad Business Enabling Environment Programme (BEEP) which aims to create an environment in which businesses, big and small, can flourish. The Small and Medium Enterprise Development Institute (SMEDI) was created through the BEEP policy to promote the development of Micro, Small and Medium Enterprises (MSMEs) in the country thereby demonstrating the government's commitment to SME development. Ubong (2017) acknowledges the role that entrepreneurship development institutions play which include, among others, training, retraining, provision of support facilities including finance, marketing, transport and other logistics, mentoring, and making the legal framework easier to navigate.

Edoho (2015) recognises that in recent years, policymakers have embraced the entrepreneurship paradigm as an effective strategy for the economic development in Africa. The policy shift towards entrepreneurship and heightening interest in the MSMEs in Africa has garnered broad support by the international development community. Multilateral agencies, such as the IBRD/World Bank and IMF, have proposed entrepreneurship and MSMEs as critical anchors for the economic growth in Africa. These multilateral entities have financed a number of entrepreneurship and MSME development programmes. Utilising their international development agencies, Sweden (SIDA), Germany (GTZ), Great Britain (DFID), and the U.S. (USAID) have redirected their foreign aid programs towards promoting entrepreneurship and MSME development in Africa. The UN agencies, such as ILO, UNCTAD, UNIDO, and UNDP have implemented various programmes to support entrepreneurship and MSME development in the region. Africa needs to mobilise entrepreneurial talents to exploit its natural resources to drive regenerative growth.

According to Hunter and Lean (2018) higher education institutions (HEIs) have a mandate to design a curriculum addressing the needs of the economy and fulfilling learners' potential and entrepreneurship education is part of the general business discipline in a context where the competencies required to operate in the global marketplace are rapidly evolving.

6.2 Entrepreneurship/SME Development Policy Responsibilities

The question was intended to clarify the chain of responsibilities with regards to the formulation and implementation of entrepreneurship/SME development policy. Both interviewees were unanimous in their responses that it is the MoIT which is responsible for initiating the policy review and overseeing the policy implementation. United Nations Development Programme (2017) also observes that the Malawi government's SME policy articulation is operationalised by entities such as the Small and Medium Enterprises Development Institute (SMEDI), the Technological Development Institute, the Malawi Bureau of Standards (MBS) and the Malawi Investment and Trade Centre (MITC). Brown and Hanlon (2019) contend that higher education and a wide range of economic support agencies have responded with a proliferation of entrepreneurship programs aimed at increasing the supply of entrepreneurs and that there is no acceptable paradigm for teaching entrepreneurship.

Chiunda (2015) acknowledges that while the MoIT has made significant strides in MSME development specifically in facilitating access to finance and value chain development, MSMEs continue to face various challenges. The MSME policy (2012) formulated by the MoIT emphasises limited information on MSME support institutions as one of the shortfalls on MSME development in the country. The level of access to support by MSMEs is unsatisfactory with most small businesses not being aware of the support providers. This results in the MSMEs not benefiting as much as they could from the available support. One of the main reasons why this is so is that, despite concerted efforts by various support agencies to communicate their offerings to the MSMEs, there is the lack of a single source of information of all available support institutions and on how to access them.

The MoIT Strategic Plan emphasises that an important responsibility of the ministry is the empowering of Malawians, including small and medium enterprises (SMEs) and cooperatives, to participate in economic activities through the provision of training and business support services to the SMEs. The Strategic Plan indicates the following MoIT responsibilities:

a. To ensure vibrant local entrepreneurship and indigenous small business development as well as to promote effective integration and growth of indigenous small businesses in the country

b. The promotion of an entrepreneurial culture and the development of new small businesses,

c. Increasing technical and business management skills of MSMEs

d. Facilitation of the graduation of businesses from small to medium and larger businesses and the promotion of broader MSME representation in business associations.

Through the various SME bodies, the MoIT provides support to individual or groups of SMEs in the form of training in business management, accounting and marketing, as well as in technical skills. The training is supplemented by business advisory services including the preparation of bankable business plans, advice on the organisation of production, as well as management and marketing. The participation of the SMEs in relevant fairs is promoted and facilitated. It is felt that a particular promising way to promote the SME development is to link the SMEs with larger buyers, including supermarkets, agro-processing, hotels and also exporters. According to Khalid, Ahmed, Tundikbayeva and Ahmed (2019) government funding is very crucial especially for entrepreneurial activities as this funding helps in motivating entrepreneurial initiatives and activities.

According to Mkandawire and Duan (2016) since 1994 there has been a reported increase in the number of the MSEs due to the removal of various government restrictive policies. To support the MSEs, the Malawi government adopted the MSE policy in 1998 and special attention had also been shown by handing the management and responsibility of the MSEs in the country to the ministry responsible for Industry, Trade and Private Sector Development, now the MoIT. Guo (2018) has argued for the enrichment of the curriculum, promotion of the close combination of the teaching, scientific research and practice, breaking through the weak links of the talent training, and the enhancement of the policy guidance of students' innovation spirit, entrepreneurship consciousness and innovation and entrepreneurship ability in HEIs. On the other hand, Fellnhofer (2019) has identified two elements for defining entrepreneurship development: one is a wider concept that comprises the development of the personal qualities, attitudes, and skills crucial for entrepreneurship and the other is dedicated to specific training to set up the entrepreneurial venture. Wei, Ye and Wei (2019) conclude that the government is influential on SMEs within the emerging economies, so the success of entrepreneurship is related to the government's relationship with both institutions and entrepreneurs.

The implication of the study for managers in public sector organisations involved in entrepreneurship development and HIE managers is that it reveals that more needs to be done to make entrepreneurship a reality in the country. There is need for regular review of the SME policy currently in use so that it remains relevant and effective in promoting entrepreneurship in the country. There is a need for proper and effective collaboration among all institutions involved in entrepreneurship development in the country. It is expected that with the review of the SME policy and improved collaboration among the institutions involved in entrepreneurship development, SME owners would benefit from new information on support services and product or service markets available in the country, information on SME financing and an understanding of the role HEIs in entrepreneurship development.

 

7. CONCLUSION

The study concludes that a more specific and hands-on entrepreneurship policy needs to be developed and implemented in Malawi. The MoIT needs to continue to provide leadership in the entrepreneurship policy making process and that there is also a need for effective and committed coordination on this. The policy implementation needs to be devolved to the local authorities which are in touch with the SMEs. This should help in dealing with real problems that small business owners encounter on the ground. There is a need for involving practicing entrepreneurs in the education and training of future entrepreneurs.

 

8. LIMITATIONS

The major limitation of the study was the non-availability for the in-depth interviews by study participants when visited by the researcher and time constraints. The reason for the nonavailability of the study participant was due to their busy schedules as most of them were executives or senior managers in their organisations. There was also a challenge of participants being skeptical of participating in the study for unknown reasons.

 

9. FURTHER RESEARCH

The article recommends further studies on the policy making processes and policy outcomes manifesting through MoIT in Malawi. More time should be invested in reaching and interviewing all the senior managers involved in the entrepreneurship development in the country.

 

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