How entrepreneurship can break the chain of poverty

Poverty exists in different parts of the world, but entrepreneurship can help solve it.

According to The Tide, jobs can offset poverty. However, if there are no available vacancies, the problems snowball from there. The right to live a decent life is often robbed from those living below the poverty line. Experts are pointing in one direction to help solve this issue: entrepreneurship.

By starting a business, jobs can be created, which can work both ways for the employee and employers. The economy receives a boost from the activities, and wealth can be created. Countries also learn a crucial factor in entrepreneurship: self-sufficiency. While handouts still exist and are crucial for the everyday survival of the unprivileged, one cannot rely on it forever.

The Tide cited Reuben Abraham’s 2012 CNN article, where he wrote that developed countries today were able to transform due to the support their governments exerted to spur entrepreneurship. He cited China as one of them, which helped an estimated 600 million people get out of poverty by promoting market reforms in the 1970s. South Korea has also helped increase its per capita income from $291 to $20,000.

“One can only redistribute wealth, and to redistribute it, you have to create the wealth first. And the only agent of society that can create wealth is entrepreneurship. Clearly then, more needs to be done to promote entrepreneurship as an agent of economic development,” he added.

On the other hand, a 2017 Forbes article reported that Oxfam is banking on social entrepreneurship to help reduce the poverty rate. Social entrepreneurs are different because their goal is to solve issues that matter such as poverty, homelessness and climate change. For them, helping one another leads to a much bigger impact. Aiding those in greater need will also improve the other parts of the community.

Developing nations and disadvantaged people need the support of social entrepreneurs. In this case, innovation and “thinking outside the box” matter. “By developing new models that cut across and blend the assets of various sectors without being stuck in orthodoxies about what each sector can or should do, social entrepreneurship opens up new possibilities to solve stubborn, seemingly insurmountable challenges,” REDF CEO Carla Javits explains.

Ideas do not have to be grand, but entrepreneurs must be sensitive enough to see what needs to be prioritized. This includes starting businesses involving edible insects, solar-powered lanterns and toilets that convert human waste to fertilizers. Other areas could feature sanitation, water treatment or even basic access to water.

However, things are easier said than done. When social entrepreneurs start their idea, the government of the country they are helping is not always supportive and receptive to changes. For them, all entrepreneurs and businesses are alike, leading social entrepreneurs to turn their focus on how to get the private sector to act.

“I think the big question here is: How do we channel the private sector? That’s really where the money is—in the private sector—and the long term sustainable solution is vibrant economic systems and economies that work,” Rotary International’s John Hewko suggested.

The road away from poverty is arduous and filled with challenges, but for people pushing for genuine change, it is all worth it in the end.