“Your problem is solved,” with those words Sir Adamjee Dawood, one of Pakistan’s greatest entrepreneurs, saved the country from financial collapse a mere 13 days after its independence. Though many entrepreneurs have played a pivotal role in the country’s creation, their sacrifices have been forgotten and their accomplishments erased from history.
On August 27, 1947, the newly-founded country faced a debilitating financial crisis due to the largest migration in human history. When the queue of waiting migrants became alarmingly long outside the State Bank building in Karachi, Pakistan’s founder Muhammad Ali Jinnah sent a message to Sir Adamjee Dawood.
The finance minister apprised Sir Adamjee about the financial crunch, who turned to his banker before responding to the call of the nation’s founder with those four words – your problem is solved. Without hesitation or demand for sureties, he financed the nation by a blank cheque offer secured against his personal assets.
This was not the first time that Sir Adamjee served the cause of Pakistan. Earlier, he bought The Daily Star of India, a money-losing newspaper, to spread the message of independence. And there were others like him – Mirza Ahmed Ispahani, MA Habib and Sir Abdullah Haroon who supported the movement through difficult times.
If a country does not celebrate and support its entrepreneurs, it ignores an important lesson from history – the success of countries relies on wealth creation and innovation and entrepreneurs are intrinsically linked to both.
A key role in South Korea’s economic development, from a GDP per capita of $329 in 1970 to $17,225 in 2009, is that of entrepreneurs like Chung Ju-yung, who started as an auto mechanic and went on to establish Hyundai Heavy Industries, the world’s largest shipbuilder. According to the Asian Institute of Policy Studies in Seoul, one million people went through the vocational skills training programme of Hyundai Industries between 1972 and 1982. The skills development programme was responsible for upward social mobility of 13% of South Korean households from poor rural to urbanised middle class.
Another example is the US, which owes its economic strength primarily to an environment that celebrates and nurtures entrepreneurship. A glance at the list of “Most Admired Americans of All Times” shows wise politicians, social activists as well as entrepreneurs such as Thomas Edison and Henry Ford.
It is no surprise that its engine of growth is fuelled by entrepreneurs. A recent research by Kaufman Foundation showed that 40 million or two-thirds of the jobs created in the US between 1980 and 2005 were from new ventures, or businesses that were less than five years old.
Contrary to widely held beliefs, Pakistan too has much to celebrate about its entrepreneurs – from the audacity of Sir Adamjee Dawood in staking his personal wealth to bail out an infant nation, to the new generation who are succeeding in spite of daunting economic and security challenges.
One example of this success is when Pakistan Fast Growth 100 entrepreneurs, a ranking of fast-growing private enterprises, competed with those from 14 countries for a position on the AllWorld Arabia 500+Turkey ranking. Pakistan had 70 entrepreneurs represented in the ranking of the fast-growing private enterprises, second only to Turkey, the highest number of women entrepreneurs from any single country including the fastest-growing company managed by a woman entrepreneur. These emerging entrepreneurs of Pakistan receive little support and yet they are the greatest hope for economic progress.
These individuals have tested out and refined the business models that are successful in the local context. Therefore, facilitating their growth will be more effective and sustainable because we are tapping into resources, knowledge and practices that are rooted in local economy rather than conventional development solutions implanted from the outside.
Entrepreneurs are the country’s economic heroes who can play a critical role in meeting the aspirations of the population and, as in the case of South Korea and the US, be the agents for the country’s economic revival.
The writer is the founding director of Pakistan 100 and works for the Abraaj Capital Group.
Published in The Express Tribune, May 14th, 2012.