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Colombian Entrepreneurial Ecosystem - Essay Example

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The Colombian armed conflict of 1964 is one of the memorable conflicts which started after the Colombian war. The conflict was between the government and guerrilla groups mainly made up of peasants who formed revolutionary armed forces…
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Colombian Entrepreneurial Ecosystem
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Download file to see previous pages The armed conflict in Columbia had drastic effects on all sides: the government forces, the guerillas, and even the civilians. A large number of people, approximately 90,000, lost their lives with millions of people being forcibly displaced. Several other people were kidnapped with many being disabled by landmines and explosion of bombs. Properties such as buildings, roads, and other infrastructures were destroyed in the process of the soaring conflict, hence leading to massive physical destructions. The armed conflict started because of protest for the rights of the poor Columbians with the desire to be protected by government against social injustices and unequal distribution of resources including land and wealth, which made the people of Columbia dissatisfied. Out of these, there came up strategic protests to forcefully demand these rights by taking over governance by force and violence (Acs &Szerb 113).
This struggle was undertaken by different groups at regional and subdivision levels through conflicts. Their anger was directed to state utilities, infrastructure and regions perceived to be beneficiaries of public resources, such as those in strategic routes of transportation of weapons, drugs and food. Other areas attacked are those seen to harbor state forces or those which provide them with resources. This Columbian conflict had far-reaching effects on the business sector in Columbia and its environments. It affected the entrepreneurial performance, which includes the regulatory framework, access to capital, access to R&D technology, entrepreneurial capabilities, market conditions and culture. By affecting these determinants, the conflict changed and determined how entrepreneurship is carried out in Columbia. Entrepreneurs were affected both directly and indirectly by the conflicts in Columbia. Entrepreneurs faced high transactional cost because of the unfavorable business climate resulting from the conflicts. Merchandizing was spoiled due to the disrupted network and infrastructure since goods and services relying on them could not reach their destination. Businesspersons also lost international partners because the conditions were unfavorable for business. This led to loss of business opportunities, which made many companies close their business. Entrepreneurs could not invest freely for fear of being victimized and kidnapped, extorted or attacked. The room for expansion was limited by competition for territory, which was managed by guerilla groups. With high insecurity, finance meant to be used in business was invested to cover for security and insurance of their investments. Huge amounts of finances were spent in efforts to control conflicts with development projects and peace initiatives started in Columbia. This strained businesses and even led to closure of some. The entrepreneurship culture was eradicated and individuals were stopped from investing because of insecurity in the market. Prices of natural and industrial goods increased because of decreased production as demand increased; the low production was witnessed as a result of insecurity and instability in the country during the war. Regulatory Framework in Colombia Whereas laws have been enhanced, the implementation approaches in Colombia are weak because of mainly the idea that defense spending is exploiting the civilian economy and entrepreneurial growth. During the 1990s, defense budget averaged 1.36% of the total GDP. Even up to early 2000s, the ...Download file to see next pagesRead More
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