immigrants and french speaking refugees

Immigrants can be described as a community of foreign –born people living in a particular country or a local unit.  An immigrant community is characterized by the degree of ethnic concentration, the size and the ethnic group. Immigrants have over the years acted as a significant source of capital and development of entrepreneurship in the countries they settle. What is evident from many research findings is that, the rate of self employment among many immigrant groups is quite higher than the natives of the country. A number of studies have tried to evaluate the reasons behind these particular phenomena. A variety of reasons have been raised, however the findings have not been very conclusive because immigrants come from different societies and have different backgrounds and culture. It is against this backdrop that this particular study will evaluate  the various factors influencing French speaking refugees and immigrants decision to start-up their own business. The scope of the analysis will be grounded on evaluating a variety of literatures that review the concept of immigrant business ownership. The paper will also evaluate the key factors that influence the decision of French speaking refugees and immigrants to start-up their own business.

 Chapter 1

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Literature Review

According to the federation of small businesses (2010), every year, over 500,000 people in the United Kingdom start their own business. Furthermore with increased economic coordination among EU states, entrepreneurship ventures by immigrants from EU nations such as France have tremendously expanded. Klapper (2006) highlights that in the previous decade, European urban economies have experienced an influx of immigrants, a phenomenon that is spearheaded by the EU dispensation. With the increasing number of immigrant entrepreneurs, large cities within Europe have presently acquired a more multi-ethnic outlook whereby they have turned out to be dynamic multicultural economies. In actual fact, such ethnic economies are viewed as elements of a solution to the structural labour market problems as they make a disproportionate contribution to a large number of business activities in the UK (Levie 2010).


A more recent study undertaken by Kalantardis and Bika (2006) revealed that some immigrant entrepreneurs in many regions of the UK were three times more likely to be operating either a medium or large firms as compared to the locally born entrepreneurs, and are almost twice as likely to take part in innovative activity as compared to the locally born entrepreneurs. More than half of the immigrant entrepreneurs sell into national as well as the international markets as compared to one-third of the locally born entrepreneurs. According to Baycan-Levent (2005), recent research on immigrant entrepreneurs has been able to find analytical but not conclusive evidence regarding quick sales as well as employment growth among the immigrant entrepreneurs.

Empirical and theoretical research has suggested that immigrants in many nations opt for entrepreneurship as an effective strategy of survival in a foreign country (Prescott 2002).  Prescott (2002) further highlights that immigrants embody an important source of human capital, which is basically a   fundamental component of advancing the entrepreneurship  base of any particular country.  Klapper (2006) highlights that according to conventional wisdom immigrants are in most cases forced to self employment or setting up their own business. Although there is reality in this particular assertion, there is also an equal probability that the aspect of entrepreneurial spirit and drive is exhibited by people when they live their country or their homeland.  This is why most studies reveal that immigrants are in most cases an entrepreneurial as opposed to the natives of a particular country (Klapper 2006).

Early literature proposed that one of the dominant explanations for the dominant rates of business ownership by immigrants is the aspect of blocked mobility (Giles, etal 2002).It has frequently been argued that immigrants who are in most cases the ethnic minority are faced with the challenge of discrimination by employers in the salary and wage sector, as a result they turn to self employment as a strategy of surviving in the isolated labour market. For instance a study conducted by Wong and Ng (2002), revealed that Korean entrepreneurs in Canada opted to start their own business due to the segregated employment market.  The study also revealed that   another leading notion to explain the logics behind immigrant’s decision to start-up their own business is due to ethnic concentration. Ethnic concentration gives immigrants the opportunity to access capital through pulling their resources together as a result starting self owned ventures becomes an easier option (Giles, etal 2002).

Cooper (1993) suggested that conditions of the environment and the culture of the immigrants’ as essential factors that spearhead self business ownership. On the other hand Giles, etal (2002) highlights that Immigrant-owned ventures in the United Kingdom can be viewed in terms of structural economic perspectives and the aspect of culture. Cooper (1993) proposes that the decision of immigrants to start their own ventures is a notion that is multifaceted, which is frequently influenced by the immigrants themselves and the country they have settled in.


Chapter 2

Factors Influencing French refugees and immigrants decision to start-up their own business

French speaking refugee and immigrants residing in the U.K come from regions such as France, Africa and parts of Asia. The U.K has over the years experienced a speedy growth of immigrant and refugee populations since the early 1990.Furthermore; as stated in the review section , the advancement of economic coordination among E.U nations has also increased the influx of French speaking immigrants into the U.K since the year 2000.

A great number of immigrant entrepreneurs mention a wide range of both pull and push factors as to reasons why they start their own businesses (Guzy & the European Microfinance Network, 2006). Some of the major outlined reasons by French speaking refugees and immigrants as basis for starting their own business include: supportive regulatory environments of entrepreneurship, cultural and personal dispositions, availability of viable business ideas, access to starting capital and other employment options (OECD, 2010).  These factors have had various implications for the French speaking refugees and immigrants decisions to start-up their own businesses.

Difficulties in the Labour Market

For a large number of French refugees and immigrants in the UK, entrepreneurship is viewed as an option that is spearheaded by the exclusion from the UK labour market. Although UK enormously faces the challenge of increased unemployment rates, for immigrants, the unemployment situation is typically worse. Most studies reveal that immigrants are generally known to have low employment rates, labour-force participation and even earn lower wages as compared to the natives (OECD, 2010).

A research carried out in Coventry and Warwickshire, for instance, indicated that only 24% of refugees were employed, 60% unemployed and 16% remained economically inactive.  The study also revealed that immigrant waged labour is more often low skilled, with an overrepresentation in “3D” jobs (dirty, difficult and dangerous), short term or part time.

According to Guzy & European Microfinance Network (2006), the problem of unemployment among French speaking immigrants and refugees in the UK is mainly attributed to poor language skills, regulations that restrict entrance to certain professions, racial stereotyping, and levels of qualifications that are either unrecognized or too low. In addition, the inability of various employers to recognize the foreigners’ credentials also brings about a great challenge. In particular, young and female immigrants face extra difficulties in accessing employment opportunities. It is without doubt therefore that unemployment seems to be a key triggering factor that increases their readiness to become self-employed.

Guzy & European Microfinance Network (2006) also conducted a study which revealed that unemployed French speaking immigrants and refugees are twice more likely to consider engaging in business than employed immigrants and refugees. The study further revealed that immigrants and refugees are motivated to start their own businesses not so often out of obligation but out of dissatisfaction with their professional situation or the threat of unemployment. In addition, their decisions are normally strongly related to the will to enhance their situations. Unanimous views from the study also brought to light the fact that self-employment was the best way to make more money. However, a large number of immigrants wished to make better use of the qualifications already obtained, and money was therefore not essentially the main motivator. According to Rath & Oliveria, (2008) French speaking refugees and immigrants have therefore been able to escape the obstacles of unemployment with the only alternative being starting their own businesses (Rath & Oliveria, 2008).

Entrepreneurial Culture

Cultural predisposition appears to be a significant factor that plays an important role in determining whether individuals decide to become entrepreneurs. Culture is able to influence risk evasion as well as the ability to trust others, each critical towards their decisions to embark on any entrepreneurial activity. According to Guzy & the European Microfinance Network (2006), there is a higher tendency among a large number of refugees and immigrants to start their own businesses compared to majority of the native population. Guzy & the European Microfinance Network (2006) argues that a great number of French speaking refugees and immigrants view self employment and entrepreneurship as a natural option either due to previous personal experience, or due to the fact that their families were already involved in a business.


Another essential element of culture that spearheads self business ownership among French speaking refugees is the aspect of shared values .Kalantardis and Zografia (2006) highlight that the French speaking refugees in the UK consists of a community that has often been built upon shared values of its members. The shared values include common cultural practices, beliefs and linguistic traditions. Besides, their entrepreneurship culture has also come out from their shared history, for instance, to become a successful entrepreneur, low levels of risk evasion and business knowledge is inherited from parents. Having parents who owned business considerably enhances the likelihood of being self-employed (Kalantardis and Zografia, 2006). Guzy & the European Microfinance Network (2006) argues that a large number of French refugees and immigrants who join training, seek advice or ask for microfinance loans have some past business experience. Moreover, if a refugee is from a community that has more of an entrepreneurial culture, there is a high possibility that they will be motivated to start their own business.  For instance in the service sector it is common to find refugees venture in businesses such as tailoring, shoemaking and hairdressing which are  areas they  had worked in before.


Ardagna and Light & Bhachu (2004) highlight that certain cultures set up their entrepreneurial ambitions in the host country.  A large number of the refugees may also include foreign students and labour immigrants who left their native countries in pursuit of better economic opportunities .As a result, they exhibit attributes of being ambitious, independent in addition to being less risk averse as compared to their counterparts who remained in their respective native countries.

Also the French refugees may have encountered difficulties within the labour markets in their native countries therefore pursuing entrepreneurship acts as an alternative option, a factor attributed to some of the French refugees and immigrants in the UK (Light, & Bhachu 2004).

In general, majority of French speaking immigrants have relatively similar cultural backgrounds. It may be that certain cultures bring in their entrepreneurial ambitions or that some groups go through more difficulties within their host nation therefore pursuing entrepreneurship as an alternative. This may therefore be explained by the cultures under which particular refugees migrated from.  Consequently, by embracing their cultural traditions, pursuing entrepreneurship becomes a suitable alternative (Light, & Bhachu 2004).

Ethnic Resources /Social Networks

According to Guzy & the European Microfinance Network (2006), a large number of refugees and immigrant communities have their own ethnic economy based on solidarity and trust. These networks have always provided French speaking refugees and immigrant entrepreneurs with manpower, clients, and most of all, funding. Access to a solid social network therefore tends to spur entrepreneurships among these immigrant and refugees population. This enables them to raise initial capital, despite of the fact that their risks profiles are viewed as insecure by banks, and they usually go through difficulties in acquiring loans.

Social networks have also enhanced business relationships as well as encouraging trade among French refugees. French speaking refugees are however faced by difficulties that are associated with acquiring credit as well as financing their respective businesses (Light & Bhachu, 2004). In addition, they are as well faced with difficulties associated with having essential managerial as well as the technical experience that is required to facilitate success of their businesses (Waldinger & Alrich, 1990). As a result, French immigrants and refugees have been known to form social networks based on ethnicity. Other than this, they are also known to form enclaves of entrepreneurial activities that are normally based on trust relations, family cohesion, similar language, culture, and life habits. This has been able to facilitate entrepreneurial activities by providing the necessary requirements for starting business such as capital, knowledge, support, in addition to customer base (Dana, 2007).


Dana (2007) further reveals that social networks have been able to play a significant role in the decision of French refugees, and immigrants to start their own businesses. The networks have been useful in providing immigrant entrepreneurs with a number of business contacts, advice, training as well as the capital loaned by the informal financial markets. What is evident is that these entrepreneurial networks have assisted immigrant populations in terms of bringing more resources closer to them. Tesfom (2006) argues however that there is a direct relationship between social networks and entrepreneurship and not the vice versa.


Solid social network have also facilitated mentoring and adequate customer bases which are also known to play a significant roles in the decisions of immigrant to carry out entrepreneurial attempts (Light & Bhachu, 2004). Additionally, these networks have also assisted immigrants in terms of the understanding the local business environment,   regulations and cultures that the natives often have (OECD, 2010). According to Rams and Jones (2008), any community’s business progress is influenced not just by their social capital networks but also determined by the surrounding business environment. Rams and Jones (2008), further argue that immigrant business outcomes will strongly be shaped by the wider economic as well as the institutional context into which the immigrants are inexorably inserted.


Restrictive Legislations Relative to Refugees and Immigrants

Authorization to be self-employed is particularly difficult when settling in a new country. In many nations, access to particular professions may be denied. The nature of regulation within the country hosting refugees and immigrants therefore greatly influences their decision to start their own businesses.  In addition regulations determine how flourishing their businesses are going to be.  For instance changes by the U.K government regarding work permit policy may direct more immigrants to establish their own business, for example in 2007 the U.K government denied work permits extensions for oversees workers, 75% of the renewals were rejected (Jamima, 2011).The implication of such a regulation is that many immigrants would enter the entrepreneurship world without adequate initial capital; in addition the flooding of more individually owned business may create a lot of competition for the already existing ones.


Klapper (2006), highlight that the success of entrepreneurship is mostly determined by various institutional regulations. These regulations inflict higher costs towards starting a business. These costs are in most cases higher for refugees and immigrants who are unfamiliar with the various laws as well as regulations within their host countries. As a result this may play a significant role in their decisions to start their own businesses.


The UK is presently free from restrictions barring minority entry on the labour market and currently presents a frivolously regulated post-entry regime. Moreover, the controls themselves are not only few but majority of those in place are mostly weakly enforced. Apparently, this regime has resulted into a totally predictable outcome of a large number as well as rapid growth of immigrant businesses in the UK (Ram & Jones 2008).


According to Ram and Jones (2008), the United Kingdom had created about a quarter million firms contributing not less than €19 billion to the United Kingdom economy and representing 11% of new business set-ups. All these is presumed to support the expected connection between government regulations and minority self-employment, implying that neo-liberal economic policies are indeed the key to opening up the entrepreneurship potentials of these minority groups such as the French speaking refugees and immigrants in the UK.


The OECD Product Market Regulation Indicators which were lastly updated during the year 2008 quantified the level of regulations that include barriers such as regulatory costs for starting a given business (Klapper, 2006).This highlights further that a number of European Union countries have relaxed their regulatory burdens since the beginning of 1998[1].  Ardagna and Lusardi (2008) also support the fact that regulatory barriers acts as key determinants of refugees and immigrants decision to start-up their own business. This is due to the fact that regulation determines the refugees and immigrants’ ease of entering a particular market, contract enforcement as well as accessing capital. Each of these has normally, a weighty effect on the various decisions to start a particular business, sometimes dominating the entrepreneurial individual characteristics. Regulatory barriers on entry and contract enforcements may be particularly burdensome to refugees and immigrants therefore creating the fear of failure (Ardagna &Lusardi 2008).


Access to Finance/Capital

According to Guzy & the European Microfinance Network (2006), access to capital is normally the first priority in terms of an entrepreneurs needs. Guzy & the European Microfinance Network (2006) further highlights that studies reveal that refugees and immigrant entrepreneurs normally have less access to normal banking and public financial support schemes.

Access to capital therefore acts as a significant factor that determines to a great extent the starting as well as growing of a business. According to Rath and Oliveria (2008), refugees and immigrants are normally known to have poor language skills. Besides, they are normally an ethnic or racial minority who go through additional constraint when it comes to acquiring capital within the long-established credit markets.  Research indicates that foreign entrepreneurs are twice as likely to have their loan or credit applications rejected when compared to the native entrepreneurs’ .They are also less likely to apply for credit with statistics showing that just 29% of immigrants or refugee entrepreneurs compared to 40% of the native entrepreneurs receive credit they’ve applied for (Oliveira & Rath, 2008).

OECD (2010) revealed that a large number of French speaking refugees and immigrants who start new businesses get their starting capital from their personal savings. This is different from native entrepreneurs who are able to receive capital from angel investors who normally provide capital to relatives or close friends (OECD, 2010). On the other hand, immigrants do not always have the same access to angel investors since their extended family members live in their respective home country and may therefore be having less wealth to enable them start their own businesses (Oliveira& Rath 2008).

In case of new refugees or immigrants have had success in acquiring employment within the labour market, their smaller stock of savings may provide the only alternative to starting a business (OECD, 2010). A reliance on various social networks has also enabled them overcome some of the difficulties they face in securing capital required to start their own businesses and facilitate expansion (Rath and Oliveria, 2008).

Education Attainment

Another significant factor that has had a great influence on French speaking refugees and immigrants decision to start-up their own business is their educational attainment. This has always acted as a key determinant towards self-employment. This can first be explained by the fact that education has the capability to furnish an individuals knowledge and seemingly enhance their managerial abilities in the process, therefore enhancing their chances of starting their own businesses. Alternatively, education also empowers   a person with certain skills that are suitable for a given professional job, which discourages the possibility of business ownership (Dana, 2007).

According to Nguyen (2010), most studies confirm a positive relationship between the probability of starting a business and education amongst refugees and immigrants. Just like the natives, there are refugees or immigrants who see an opportunity that can be brought to fruition given their respective skills and knowledge that acquired through education.  As a result in order to make this happen, immigrants take the option of   managing their own enterprises. This implies that an individual having management knowledge, good education as well as work experience is motivated to start up their own business.

On the other hand, education has acted as a limiting factor for immigrants which further influence their decision to set up their own businesses. Majority of French speaking refugees and immigrants often have lower education levels while their children show evidence of higher rates of dropouts. As a result, they often take up unskilled or simple jobs. Their unemployment rates are therefore higher, combined with lower average incomes as compared to the natives. As a result the aspect limited education qualifications therefore leads many French immigrants to self business ownership (Dana, 2007).


Phillimore and Craig (2006), previous research carried out by the Learning and Skills Councils in UK, revealed that despite having various skills ,qualifications, many French speaking refugees and immigrants,  experience high rates of unemployment or under-employment . They therefore experience an unfortunate situation given the fact that employment is well-thought out to be a major factor in the integration of immigrants into a given society.

It is therefore without a doubt that the decision of the French speaking immigrants to start their own businesses is based on lack of employment opportunities. In general, they are pushed into self-employment due to the problem of unemployment as well as the blocked opportunities. Dana (2007) argues that the few refugees and immigrants who are working find it much easier adjusting to the host society as compared to their unemployed counterparts. Given this fact, high levels of unemployment would result into the formation of new firms. Unemployment among many French speaking refugees and immigrants therefore seems to have major consequences for the valuation of entrepreneurial initiatives that are formed due to demand.

2.8 Marginal Social Position

Marginal social status has always acted as a driving force towards immigrant decisions of starting their own businesses. French speaking refugees and immigrants frequently find it difficult to adapt to the social system such as ethnic and immigrant marginal groups. Starting their own businesses in this case does not only act as a means through which they are able to earn a living, but also a way through which they are able to gain some recognition as well as social acceptance within the society. The argument that minority groups such as the French speaking refugees and immigrants have a probability of starting their own businesses or turning out to be entrepreneurs as compared to the native people can be related to the theory of marginalization (Garcia, et al 2007).

According to the theory, the starting of a new business is not normally as a result of a deliberate or an intentional action. The choice to open individually owned businesses is not always as a result of a premeditated act but a culmination of a coherent process of analysis as well as decision making. A large number of immigrants are therefore forced to shatter their earlier life patterns as they find themselves caught in insecure situations.  By being caught in insecure situations like marginalization, the immigrants begin playing around with the notion of starting a business for themselves. However,  Eurofound (2010), studies on immigrant entrepreneurship have more often  than not  tackled the subject from various viewpoints with some findings  arguing that immigrant entrepreneurship is a reaction to blocked opportunities within a particular market as opposed to marginalization as a result, the increasing number of immigrant entrepreneurs is not necessarily a sign of success.

To a certain extent, the decision of immigrants to start their own businesses is seen as an economic dead-end for a large number of immigrant entrepreneurs. Long hours of working, voluntary family labour as well as low incomes are among signs supporting the dead-end hypothesis. Eurofound (2010) argues that if the dead-end hypothesis was true, then the number of immigrant entrepreneurs would have increased dramatically during the periods of economic decline.  In actual fact, however, the number grew up during the periods of economic prosperity. On the other hand, Eurofound (2010) argues that immigrant entrepreneurship is viewed by a great number of immigrant entrepreneurs as a positive aspect in addition to being a realistic route towards upward social mobility.

The marginal social status among majority French speaking immigrants in the UK has therefore acted as another significant factor as well as a driving force towards their decision to become entrepreneurs or start their own businesses. Starting their own businesses in this case does not act as a means of obtaining a living but also social gains and recognition. According to Garcia, (2007), recent experiential investigations have confirmed that the marginal social position is a key factor in determining the decision of minority groups such as the French speaking immigrants towards enterprise creation.

2.9 Opportunities Presented

The entry of French speaking refugees and immigrants into the UK and into the business environment has also been determined mainly by the opportunities existing to them. Opportunities are frequently created by the various characteristics of a given market. From the demand perspective, market conditions in the UK have been very significant towards the decision of immigrants to start their own businesses. Waldinger and Alrich (1990) observes that the initial market created for  refugees and immigrant entrepreneurs crops up within the refugees and the immigrant communities themselves, given the fact that certain needs as well as preferences are best served by members of that particular community.

Opportunities for these minority business establishments are frequently influenced by various market factors.  Waldinger and Alrich (1990), highlight that immigrants have special needs as well as preferences that native owned businesses cannot fulfill. As a result, it leads to the emergence of protected markets. The immigrant businesses therefore find a place in the general market as it is able to satisfy the demand for various exotic goods. These immigrants are in most cases the only entrepreneurs who are capable of providing the exotic goods or still be able to provide them to the markets in a seemingly reliable condition and at relatively fair prices. This implies that the demand for certain ethnic consumer goods provide the primary niche for refugees and immigrant entrepreneurs. This may include products such as clothes or jewelry and food of a certain origin. Opportunities for these products normally come up when customers develop different wants or needs as a result of their increasing levels of income or fast technological advancements. Both effects ensure there is more room as well as opportunity for potential entrepreneurs (Galbraith & Stiles 2006).


On the other hand, refugees and immigrant markets cannot stay limited to their own markets since they can turn out to be too small with the rising competition, new entrants and low purchasing power among the native community. Fairlie and Meyer (1996) reveal that refugees and immigrant businesses can only thrive when they branch out .According to Dana (2007), entrepreneurial opportunities cannot only be found in the labour market but also within the political as well as the regulatory frameworks. By this, Dana (2007) implies that for the migrants business to flourish, they have to get vacancies within the entrepreneurial market and no restrictions within the host nation regulatory regime. The UK is an environment that has to a great extent provided entrepreneurship opportunities for French immigrants.

Success rates

Another significant factor that has had a great influence on majority French speaking immigrant entrepreneurship decisions in the UK is the success rates. An important question is normally whether they are able to be successful entrepreneurs. Low-skilled French speaking refugees and immigrants have frequently faced a number of challenges due to lack of appropriate language skills as well as the familiarity with the local laws and markets (Jong & Rizvi 2008).As a result, a number of them who start their own businesses find it very difficult adjusting and therefore get frustrated with the regulations as well as taxes, and at last they may end up closing their businesses. This contrary happens to French speaking refugees and immigrants who are highly-skilled. The highly-skilled immigrants face few challenges and therefore they have high chances of succeeding in starting their own business (Jong & Rizvi 2008).


OECD (2010) reveals that when it comes to taking advantage of various foreign markets, immigrants normally have an advantage. OECD (2010), further highlights that immigrants are better prepared to prevail over a number of obstacles which include lack of access to adequate finances, lack of knowledge on foreign business opportunities and lack of knowledge as regards foreign markets. According to a 2008 OECD report on barriers to internationalization of SMEs, the primary constraints that face immigrants include few overseas contacts as well as the ability to communicate with the clients. Majority of the French speaking immigrants in the UK prevail over a number of obstacles since they normally have the contacts as well as understanding of the various markets. Much of their remarkable success has been attributed to their abilities to take advantage of opportunities within the foreign markets quickly.


Chapter 3

 Factors are most significant to refugees and immigrants’ decision making to start their own business

3.1 Regulation in host country

It is without a doubt that entrepreneurship acts as significant engine towards economic growth. Government regulations, in turn, have a great influence on the institutional environment through which entrepreneurial decisions are made. Government regulations have therefore had a significant influence on refugees and immigrant entrepreneurship. Government policies form institutional structures that influence various entrepreneurial actions, promoting some activities while discouraging others. It is therefore obvious that government regulations have a great influence on the entrepreneurial activities of French immigrants.

According to Minniti (2008), a continuing claim within the entrepreneurship field is that entrepreneurial activities enhance economic growth as well as development. This insight has, in turn, resulted to a significant amount of interest in the way government regulations or policies are influential in promoting entrepreneurial activities. Minniti (2008) stresses the significant role that immigrant entrepreneurship plays in development as well as innovation.  As a result, the UK government has in the last decade paid increasing attention towards immigrant entrepreneurship by implementing policies that foster business expansion (Minniti, 2008).


The UK government has made several attempts to initiate policies that encourage financial assistance to immigrant entrepreneurs. For instance, the UK government reduced financial restrictions facing immigrant entrepreneurs by introducing mutual credit guarantees and microfinance schemes. Another useful incentive is the Joint credit guarantee which assists business people in the reduction of business operation costs. On the other hand, microfinance schemes have been useful to immigrants through expanding their sources of capital. These incentives have been very useful to many refugees and immigrants living in UK (Minniti 2008).



Ram and Jones (2008) highlight that; businesses operated by minority groups including immigrants have in the recent past grown rapidly in the United Kingdom. Ram and Jones (2008)  report   that  the number can now be approximated to more than 250,000.This population is described as one of the key contributors to the Country’s small business population. This remarkable growth has been attributed to a deregulated economic policy regime as well as a rising range of support initiatives coming from the UK government.  As highlighted earlier the government has been able to address various barriers that face immigrant business people such as access to finance.

3.2 Social Networks

It is clear that a large number of refugees and immigrants rely a lot on their families and friends, and other social connections within their communities, when settling in a new nation and also when starting up businesses. Social networks consist of one of the most significant ethnic-related aspect that may possibly offer a prospective comparative advantage when it comes to carrying out a new economic venture.

According to Dana (2007), immigrant entrepreneurs normally discover a niche within their community and start up their own businesses within an ethically-defined market. This allows them to offer typical products as well as services. This enclave economy is believed to positively influence the immigrant’s entrepreneurs’ perspective.  French speaking refugees and immigrants in UK, have been able to come up with strong entrepreneurial groups .This particular endeavor has brought economic significance through the creation of jobs and other opportunities.


Dana (2007) also argues that capital is more easily obtained by immigrant entrepreneurs using the informal way. Moreover, within the social network, immigrants become more used to informal ways of carrying out business as well as exchanging information. This is due to the fact that there is mutual trust within this particular setting. For these reason, the success of minority businesses such as those of French speaking immigrants is linked to access to social resources which include rotating credits, labour and a well-protected market. The use of social networks has also acted as a major bridge into mainstream business development. Through the development of strong social networks that are composed of relatives, co-ethnics as well as co-nationals, new firms have had the privilege of easy access to information, capital and even labour, which has expanded their operations to mainstream levels.


3.3 Access to Capital

There is no doubt that access to capital amongst immigrants plays a significant role towards their decision to start their own businesses. Whereas a large number of immigrants are motivated to start their own businesses, they go through various difficulties. The major problem that faced majority of French speaking immigrants in the UK and which may serve as a hindrance to their aspiring to start their own businesses is the aspect of access to capital(BusinessandEntrepreneurs 2000).  However as highlighted earlier changing policies and support given to immigrants has increased their participation in business ownership .The UK government has come out to support a large number of immigrants through its policies that promote finance offerings. It has also been able to reduce financial restrictions that have in the past hindered various entrepreneurial undertakings by immigrants. Other than these, the UK government has also been able to make available various grants that have been of great support to entrepreneurs. These sources of capital have enabled many immigrant businesses to become established through assisting them in terms of business development costs (BusinessandEntrepreneurs 2000).



Chapter 4


Minniti (2008) agrees that there is a continuing claim within the field of entrepreneurship that immigrant entrepreneurial activities enhance economic growth as well as development. This insight has, in turn, resulted into a significant amount of interest in the way government regulations or policies can be influential in promoting entrepreneurial activities. These policies should target the promotion of immigrant entrepreneurship by focusing on the immigrant entrepreneurs themselves and the opportunity structure. Minniti,(2008) therefore proposes  that business policies intended to assist immigrant entrepreneurs  will most likely succeed when they are complemented with other policies that promote as well as strengthen community organizations (Minniti, 2008).


Another proposal is that measures focusing on motivating entrepreneurs should be concentrated on enhancing their skills, knowledge and their abilities; improving their business network; or making easy their access to various financial sources and services. In addition, there ought to be measures focusing on the environment that include the elimination of barriers for various immigrant entrepreneurs, dealing with discriminatory practices targeting immigrant entrepreneurs and as well creating additional facilities for immigrant entrepreneurs so as to  promote equal opportunities for all of them (Jaegers 2008).


In general, most of these measures should aim at providing various services to immigrant entrepreneurs while at the same time raising awareness on self-employment among these populations. Making easy access to financial sources, promoting social networks and education on various local laws as well as regulations improve the probability of success of such businesses. More thriving entrepreneurship may also be achieved from the migration policy. This may be achieved through encouraging the migration of a more skilled labour or by encouraging certain kinds of temporary immigrants to changeover to permanent residency (Keister 2005).

For instance, a large number of foreign students tend to be among innovative as well as entrepreneurial individuals in the UK, yet most of them leave immediately after graduation. There is therefore a need to change their immigration policy too so as to encourage those studying particular fields, mostly science or engineering, to stay beyond graduation. These students with expertise in such fields normally have the potential to become successful entrepreneurs within the fast-growing areas of the service industry (Keister 2005).



The UK needs more entrepreneurs and a favourable climate that promotes entrepreneurship .For entrepreneurship to be promoted; all groups within the society ought to be involved. A large part of its population, especially those living within the cities have a migration background, meaning, they migrated from their own countries of residence (mostly from outside Europe) or are descendants of immigrants. The immigrant population is a growing representation of a significant group of entrepreneurs. Starting one’s own business is more popular among immigrants as compared to the average population. The available statistical data clearly demonstrates that self-employment among the immigrant communities is higher when compared to the national averages. As a result it is vital to develop a suitable environment to sustain immigrant entrepreneurs.


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