Global Entrepreneurship Week kicks off today, with contributions from more than 160 countries and countless organisations. This year’s event takes place amid a worldwide ‘refugee crisis’, prompting discussions at all levels. It is therefore the perfect time to look at what refugees can bring to host communities: especially entrepreneurial spirit, write PhD Fellows Katrin Marchand and Ortrun Merkle.
We all have a mental imagine of what a classical entrepreneur is, someone who has an innovative idea, establishes a business, takes all the risks and hopefully reaps the rewards. However, especially in developing and conflict-affected countries entrepreneurs are not only registered business founders, but also informal and small-scale enterprise owners. What they all have in common is their ability to perceive and create new business opportunities and innovative ideas; they act as agents of change and can own traditional business as well as social enterprises. Promoting entrepreneurship is an important goal in many areas and has also been recognised as one path to achieving the SDGs.
One specific group of entrepreneurs is what we call refugee entrepreneurs. This encompasses anybody displaced outside their home country and operating some kind of business activity. This can take many different forms such as running a restaurant or a daycare as well as a community newspaper. To show the variety of ideas and entrepreneurial spirit we recommend looking at some of the portraits collected in different projects. The UN Refugee Agency, UNHCR, has portrayed innovative businesses established by refugees around the world, while Dr. Dijkhuizen of the Maastricht School of Management has collected portraits of female entrepreneurs in a refugee camp in Lebanon for her project Selling Strength (in Dutch).
The environment faced by entrepreneurial refugees, both in and outside of refugee camps, makes their experiences substantially different from other entrepreneurs. What we see in many refugee camps is the so-called refugee warehousing, whereby refugees are kept trapped without adequate access to basic rights, including employment, mobility and education, over a long period of time. Access to work opportunities is also often limited in urban settings and refugee status and lack of proof of education can make regular employment very difficult. Additionally, in camps as well as urban settings, financial resources for refugees are limited and never enough to take care of all needs. One way out of these pitfalls is entrepreneurship.
A refugee entrepreneur, like any entrepreneur, brings many potential benefits to their host community, whether in a camp or urban setting. First of all, an entrepreneur creates at least one job for her-/himself. In addition they can employ other refugees and/or host country nationals. The kind of businesses opened by refugees often reflect innovative solutions to local problems and are therefore more effective at addressing the needs of specific target groups than large, donor-driven programmes.
Refugee entrepreneurs often manage to make the best of the little resources they may have. In the words of Ernest Hemingway, “Now is no time to think of what you do not have. Think of what you can do with what there is.” Having a (social) enterprise can also help to create normality in a difficult surrounding. Providing familiar food or wedding dresses not only brings employment, but also ways to unite communities, preserve traditions and a sense of normality. Overall, it can be said that entrepreneurship improves the psychological well-being of individuals and the overall atmosphere in refugee camps and communities.
Becoming an entrepreneur is always a challenge and often not the most obvious choice for a refugee. One of the main obstacles they face is a lack of funding and credit as well as resources (e.g., production materials). In addition, there may be administrative hurdles in place, and there is usually no supportive infrastructure or business environment. Divides between the refugee and host communities may be a further hindrance, perpetuating the lack of a supporting network. On a personal level, psychological and physical scars/wounds and family responsibilities often influence motivation and abilities to take the entrepreneurial risk.
Addressing these obstacles is one way to support and facilitate refugee entrepreneurship. Most important is to create a business-friendly infrastructure and legal opportunities for business creation. Funding is also key for any entrepreneur and especially for refugees, who usually don’t have access to traditional means such as banks, associations and credit unions. Therefore there is a need for NGOs and international organisations to take over the creditor role. A background paper for the World Migration Report 2015, recently put forward six ways to support immigrant entrepreneurs:
- Information provision
- Networking (with both other refugees/migrants and members of the host community)
- Investment and Funding
All of these are equally relevant in the refugee context. Not every refugee can or wants to be an entrepreneur, but we should do our best to support ideas, foster exchange and assist initiatives that build both livelihoods and a sense of normality.