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Everything you wanted to know about ethnic entrepreneurship in the Bijlmer, but were afraid to ask

Just across the railroad tracks from Holland’s fastest growing economic zone is one of the nation’s most visible failures in urban planning. The contrast between these two sections of southeast Amsterdam could not be clearer. On one side, tall modern office buildings along ArenA Boulevard are the home of thriving multinational corporations, and on the other side of the tracks, just hundreds of meters apart, grim apartment high-rises in the Bijlmer neighborhood are the home of many of the Netherlands’ poorest and most disadvantaged immigrants.

Once described as the “city of the future,” city planners in the 1960s envisioned the Bijlmer as a suburb within the city’s limits: a sprawling complex of apartments, built for middle-class families, but without the narrow streets, loud nightlife and inconveniences of old Amsterdam. Unlike the city center, the Bijlmer has highways instead of street cars, large open parks instead of canals and alleyways, and quiet residential buildings instead of mixed-use industrial, commercial and residential space.

But when the city tried to rent the first Bijlmer apartments in 1968, nobody moved in. That is, except for the businesses next door. In the three decades since the development of southeast Amsterdam, the business district on the west side of the railroad tracks has become, as one community leader said, the Netherlands’ “Silicon Valley,” whereas the Bijlmer on the east side, is the closest approximation of an American ghetto in Holland.

Mark van der Horst, a representative of the Southeast (Zuid-Oost) City District Council (Stadsdeelraad), explains that “the Bijlmer was built to live in, but then developers forgot about everything else.” Indeed, the Bijlmer is a complex of apartments, and not much else. Planners did not leave space for restaurants, bars, schools, playing fields, movie theatres or office buildings in the original plans. There is no central meeting point in the Bijlmer, no squares, and no shops – just flats, parks, highways and garages.

In retrospect, it is no surprise that few middle-class Hollanders moved into the “city of the future.” The only people who the government was able to attract to the Bijlmer were new immigrants, mainly from Surinam and West Africa, who moved there mostly because they had no real choice. Even before final construction in the Bijlmer was finished, the neighborhood was stereotyped as an immigrant-only community.

Today, about 50,000 people live in the Bijlmer, about 80 percent of whom are of non-Dutch descent – though both numbers likely underestimate the large numbers of illegal immigrants who also live in the area. Over 100 nationalities are represented in the Bijlmer. Disproportionate numbers of the Bijlmer’s residents are unemployed and on welfare, a stark contrast from the booming economic businesses across the rail lines. Many are unfamiliar with local customs, and some, especially West Africans, do not even know Dutch. Crime rates are higher than the national average, and educational achievement is lower. 

Summing up the efforts of government and developers, Mr. van der Horst describes the planning of the “city of the future” as “disastrous” for the social and economic health of the Bijlmer and its inhabitants.

'The Multiplying Factor': Obstacles to Ethnic Entrepreneurship

Walking through the Bijlmer, it is quickly apparent that there are few ethnic owned businesses. Although four-fifths of the Bijlmer’s residents are ethnic minorities, just a small number of enterprises are actually owned by minorities.

Rudi Speear, a community leader, Stadsdeelraad representative and Surinamese immigrant, estimates that just five to seven percent of all enterprises in the Bijlmer are owned by minorities. And while there are no official statistics to confirm these numbers, a quick glance around the neighborhood suggests that Mr. Speear is correct. In the area’s largest concentration of stores, the Amsterdamse Poort shopping center, nearly every store is a large Dutch or multinational shop. For every independent store in the complex, such as Pico Records or The Diner, there are half a dozen corporate giants in the mall.

Speaking to local citizens, entrepreneurs, and government officials, it is widely agreed that there are three main obstacles to ethnic businesses in the Bijlmer: lack of finance, lack of space, and lack of knowledge. In many ways, these barriers exist for all new entrepreneurs in Holland, but they are especially overwhelming in the Bijlmer. These entrepreneurs are both minorities and Bijlmer residents – their obstacles are ‘multiplied’ by the color of their skin and the place they live.

“If you have money in Holland, you achieve everything,” says Mr. Speear. But if you are an ethnic minority in the Bijlmer, he explains, “They don’t give you a fair chance.” As an immigrant, elected representative and business owner, Mr. Speear has first-hand experience of the difficulties of ethnic entrepreneurship. Mr. Speear runs Liberty, a local club that is located in the heart of the Hoptille housing complex. To finance the opening of Liberty, Mr. Speear did not turn to a bank, from which he says he could not get a loan, but instead went to Germany to work and save.

Mr. Speear’s experience is no different than most other minority entrepreneurs in the Bijlmer. Most business owners say that they started their businesses with their own money, and most say that is because they could not find a bank to finance their business plan.

Chandra Bhairosing, director of Ondernemershuis, a local agency that helps small-business entrepreneurs in southeast Amsterdam, says, “it is well known that the banks are not very giving. If you are ethnic, you have to prove yourself six times over.”

Bank representatives disagree. Jochem van de Laarschot, a spokesman for ABN Amro, says that official bank policy mandates that “there is no discrimination whatsoever in the way we look at loans.” Nevertheless, none of the business owners interviewed in this article received bank financing to start their company, nor did any of the 18 new businesses opened this year under the supervision of Ondernemershuis.

There is no hard evidence to show that banks actively discriminate against minorities, but there are many reasons that suggest why minorities in the Bijlmer are less likely to get bank financing. “A bank is a white male dominated institute,” says Mr. van der Horst, who is white and ethnic Dutch. “Bank employees cannot relate to their black customers very well. They live in different worlds.”

Haroon Saad, the official in charge of economic development in Zuid-Oost, describes the problem as a lack of vision from the banks. “Banks are hopeless at risk-capital,” he says. “They are always conservative.” He thinks that banks avoid Bijlmer applicants because of the relatively high levels of poverty in the area and the inexperience of entrepreneurs. They are too high a risk for financing, he says. If immigrant entrepreneurs fail, they have few assets for the bank to collect.

“Some might call our policy conservative,” says Mr. van de Laarschot of ABN Amro, but quickly adds, “I like to call it careful.” The financing gap is a combination of all these factors: ethnic minorities in the Bijlmer tend to be new immigrants, with no savings, no network of capital and no experience in the Dutch economy. They often do not speak Dutch well, and do not have a full grasp of Dutch business regulations. In Mr. van der Horst’s opinion, this leads to a communication gap between ethnic applicants and loan officers. And because of the high levels of poverty among local residents, who are the target customers, banks tend to avoid a Bijlmer investment.

Without proper financing, entrepreneurs face tough obstacles to realize their business plans. This problem is especially acute in the Bijlmer because of high rents for new stores and offices and because of a general lack of space, especially for small-businesses.

“There definitely is a gap between supply and demand of space for business purposes,” says Mr. van der Horst. The most obvious reason for this problem is that Bijlmer developers simply did not build commercial space in the original plans. Unlike other neighborhoods in Amsterdam that are characterized by ethnic restaurants and shops lining canals and alleyways, the Bijlmer is a collection of apartment buildings and parks, with no space set aside for stores or cafes. For this reason, most businesses that are in the Bijlmer are clustered in new shopping centers simply because there were no shopping streets or mixed-use buildings planned by developers. To this day, zoning plans still prevent much of the Bijlmer from being used for new businesses.

According to Ondernemershuis, most minority entrepreneurs in the Bijlmer want to start businesses like tokos (import-export companies), ethnic grocery stores, restaurants, or service enterprises, such as hair salons and travel agencies. But few can afford to rent space in shopping centers or in the business district west of Bijlmer because those locations are too large, too expensive per square meter and involve too long a lease.

“Our economy is booming, and it is easy to sell or rent out office space,” says Mr. van der Horst. “Real estate developers would rather do it the easy way by renting out or selling office space in large units.” This is often a prohibitive problem for new entrepreneurs in the Bijlmer, who only need a small amount of space for their company – and space that is cheap.

The best evidence of the space shortage in Bijlmer is that illegal businesses have sprung up all across Bijlmer, in apartment complexes and car garages, to meet the demand for small businesses. Many of these illegal businesses are in the services industry, where only a small amount of space is necessary. For example, there are tens – if not hundreds – of hair salons in Bijlmer apartments. More curious, there are also large numbers of illegal bars and restaurants in Bijlmer flats. These bars are well known among the Bijlmer residents, and are full-service bars, just as one might find in the heart of central Amsterdam. Some even become discos on weekend evenings. The informal economy is “a part of life here,” according to Michel Belgrave, a local entrepreneur. Few of these businesses are illegal in the criminal sense of the word; most exist simply because ethnic entrepreneurs have had limited opportunities to find usable space, adequate financing or good advice to run their business as legitimate companies.

Despite the pervasiveness of illegal businesses, there is still an evident gap between supply and demand for business space. Not only is there a near absence of the night-time entertainment, restaurant and bar industries in Bijlmer, but there is also a shortage of other important businesses like daycare, according to Ondernemershuis. In their literature, the agency writes that 44 percent of their clients are women, many of whom are dissuaded from opening a new business because daycare is so hard to find in the area. With one of the nation’s largest concentrations of single mothers, the lack of adequate space for daycare facilities is another obstacle to local entrepreneurship.

The third major obstacle to ethnic business in the Bijlmer is the knowledge and experience gap of its residents. Because so many are unfamiliar with Dutch language and the regulations for businesses in Holland, many qualified entrepreneurs fail to secure loans, get government permits or take advantage of incentives for entrepreneurs. Taxes and social laws can be very complicated in the Netherlands, and differences in educational requirements are confusing to immigrants.

One common problem is discrepancies between local education in home countries and regulatory requirements in Holland. Barbers, for example, need to take a 2-year course in the Netherlands just to receive their license to cut hair. Immigrants must comply with this law, regardless of their professional experience or education in their own country – even if they have a diploma or permit from their country of origin. It is not too surprising, then, that most of the hairdressers in the Bijlmer shopping centers are white and Dutch, while there are large numbers of illegal minority barbers inside the local apartments.

Opportunities: Is there a Future for Ethnic Entrepreneurship in the Bijlmer?

The barriers to successful entrepreneurship are high for ethnic minorities in the Bijlmer, and are higher than they are for Dutchmen of similar capabilities – or even than those of other minorities who live in more traditional neighborhoods of Amsterdam.

Nevertheless, there are still opportunities for successful ethnic enterprise in the Bijlmer. The near absence of certain types of markets in the Bijlmer, the entrepreneurial spirit of the Bijlmer residents and the competitive advantage of local business all are compelling reasons why there is promise for ethnic businesses in southeast Amsterdam.

In an interview, Mrs. Bhairosing of Ondernemershuis said that she believes that there is no need to revise the Bijlmer’s zoning plans to add spaces for businesses like restaurants, bars and cafes. That market, she says, is already “saturated.”

Yet a walk along one of the Bijlmer’s central thoroughfares on any weekend evening reveals, in Mr. Saad’s words, a “huge underground economy” of illegal bars and restaurants. Even on weeknights, cafes and bars operate out of anonymous-looking flats and garages. Similarly, zoning officials believe that there is no room for new hair salons in the Bijlmer. Yet every Bijlmer resident interviewed for this article spoke of the large number of barbers working out of their own apartment complexes.

The scope of the informal economy in the Bijlmer is enormous. There are illegal cleaners, illegal caterers and illegal bars. After a night out in the Bijlmer, there are even illegal taxis waiting to take residents home. The market for illegal bars is so strong that Mr. Speear, who runs a legal bar, jokes that the owners of illegal bars “do not have cars big enough to carry in all the alcohol.”

Though just a small percentage of legal businesses in the Bijlmer are owned by minorities, ethnic entrepreneurship is vibrant in the black market economy. Nearly every illegal business in the Bijlmer is ethnic-run and supported by ethnic clients. There are bars and cafes for Surinamese, Ghanaians, Antilleans, Nigerians and nearly every ethnic group that lives in the area. And while most hairdressers in the area’s shopping centers are white, the barbers who work illegally are mostly ethnic. The market for new businesses in the Bijlmer exists, and is so far from ‘saturated’ that legal proprietors, like Mr. Speear, do not feel threatened by the presence of illegal competitors. Mr. Speear even occasionally frequents informal bars.

Mr. Saad, who heads economic development in Southeast, says that despite the absence of legal ethnic enterprises in the Bijlmer, “all the research shows that there is a higher interest among minorities in starting a business.” Not only does the scale of the informal economy seem to confirm this thinking, but there is also evidence that there remains much potential for economic entrepreneurship among ethnic minorities.

Many of the Bijlmer’s residents are economic migrants, who are young, motivated and full of the entrepreneurial spirit. Among minorities, “there is a stronger business culture,” says Mr. Saad. Last year, in just its first year of operation, 391 residents of Southeast came to Ondernemershuis to explore the possibility of starting a new business – and almost 600 others came to seek some sort of business advice. Nearly 90 percent of these potential entrepreneurs were ethnic minorities.

If the market exists for ethnic business, and minorities in the Bijlmer are interested in entrepreneurship, is it sensible for the banks to continue turning a blind eye to business in the Bijlmer?

Business owners like Michel Belgrave prove that there is an advantage to local entrepreneurship in the Bijlmer, and that banks ought to take a second look at minorities’ business plans. 

Mr. Belgrave, an ethnic Surinamese, left his position at a multinational technology firm 12 years ago to begin his own small business. Within six months, Mr. Belgrave had four employees, and not much later, had landed a contract large enough to hire five more workers. Almost six years ago, Mr. Belgrave chose to relocate from the technology district behind Central Station to a shopping center in Southeast, on the wrong side of the railroad tracks. 

“This is a very good location,” he explains. “We are in Southeast, near the Metro station. We attract a lot of people who don’t speak Dutch, but want to learn information technology.” In addition to his business in software design, Mr. Belgrave has tapped a wide market for non-Dutch language training; he says that his company is the only business that offers certain types of advanced technology training in English – which is ideal for many West Africans and other immigrants who have a better grasp of English than Dutch. What better place, then, to locate than in the Bijlmer, with its large numbers of non-Dutch speaking immigrants? 

Similarly, an ethnic shopkeeper named Mario, also from Surinam, has become a successful businessman specializing in foods and goods native to Surinam and the Caribbean. In 18 years of business in Holland, Mario now operates three or four stands in local Bijlmer markets, a toko store on Ganzenhoef street and a greenhouse in the countryside. In better times, Mario says he owned even more stores. Holding a fistful of thousand guilder notes, Mario said that he “doesn’t think [he] could do better elsewhere in the city.”

Both businessmen have shown that local entrepreneurs have a competitive advantage because they know their customers best. Mario says that most of his customers are from the Caribbean, and of the 37 trainees in Mr. Belgrave’s workshops today, more than 90 percent are minorities. Both are successful because they have found a niche in the Bijlmer’s ethnic marketplace.

Solutions: Local Government Initiatives

What stake does government have in stimulating ethnic entrepreneurship in the Bijlmer, and what can they do to help grow minority businesses?

It makes sense for government to care about the fate of ethnic businesses in the Bijlmer. Local and national government lose millions of guilders each year in tax revenues – not only from the black market economy, but also from the untapped potential for new businesses in the Bijlmer. And if government does want to attract new middle-class residents to the Bijlmer, encouraging the growth of desirable local business is crucial to making the Bijlmer an attractive place to live.

In 1992, the government initiated an ambitious program to revive Southeast Amsterdam by bringing new companies into the business district and redeveloping the Bijlmer’s physical stock. Financed by both the European Union and national government, the redevelopment in the Bijlmer was aimed at tearing down the large high-rises of the neighborhood and replacing them with smaller, lower-level housing. Once again, the government is trying to make the Southeast a mixed-income neighborhood.

Several years into the redevelopment, local government officials began lobbying for an integrated approach to redevelopment; they considered economic renewal as important as physical redevelopment for the future of the Bijlmer. From this effort, local government has taken steps to stimulate ethnic entrepreneurship in the Bijlmer under the direction of the Southeast City District Council (Stadsdeelraad).

The Stadsdeelraad sums up government’s economic philosophy: “Starting entrepreneurs will be stimulated by making affordable business space. There will be more attention directed towards the mediation of employment and the counsel for the unemployed.” With this strategy, the Stadsdeelraad has begun attacking the problems of knowledge, space and financing that ethnic entrepreneurs face in Southeast.

The most visible example of government action to stimulate ethnic business is the creation of Ondernemershuis in early 2000. Roughly translated as the “Institute for Small and Medium Enterprise,” Ondernemershuis is a consulting agency located in the Bijlmer, designed to help aspiring entrepreneurs in Southeast learn how to begin a new business. They offer a full range of expertise from helping write business plans to helping entrepreneurs navigate the often confusing web of Dutch business law and regulations. Chandra Bhairosing, director of Ondernemershuis, describes the agency’s goals as to “give advice, give information, give supervision to entrepreneurs, to help get them on their way, and to teach them how to compete.”

Although Ondernemershuis is available for all residents of Southeast, it is tailored to meet the special needs of ethnic minorities. The consultants speak 10 different languages, and make special efforts to reach out to the minority community. The agency is funded by government, but is independent in its authority and advice. For this reason, Ondernemershuis is able to reach out to illegal businessmen in the Bijlmer. An outreach advertisement for the center asks: “Are you aware of the benefits of having your business officially registered?” While government itself is unable to reach the informal entrepreneurs of the Bijlmer, Ondernemershuis is able to take a more grassroots approach. 18 businesses were successfully started under the guidance of Ondernemershuis in its pilot year.

Addressing the problem of space, the Stadsdeelraad and national government have begun redeveloping local garages in Southeast into commercial space and creating business space on the first floor of some buildings in the Bijlmer. And in another pilot program, the government financed the redevelopment of large commercial space in a Kraaiennest shopping center into smaller units more suitable for small-business minority entrepreneurship. There are now five small stores in the shopping center, with businesses as diverse as the people who own the new shops: a mobile phone provider, a hair salon, an African clothing store and even an employment bureau are all succeeding in the new space. By making affordable, reasonably-sized office space available in the community, the Stadsdeelraad has shown that ethnic businesses can thrive when government helps break down the barriers specific to the Bijlmer.

Government is taking two approaches to help solve the financing gap for minorities in the Bijlmer. On a policy level, Ondernemershuis and Stadsdeelraad are proposing to create a revolving loan fund next year for ethnic entrepreneurs. The fund would offer loans for new businessmen in the Bijlmer, and would be supported by the profits of the ethnic enterprises that succeed.

On a practical level, local government is pushing an ‘un-bureaucratic’ solution to the financial gap. Mr. van der Horst, who is the Stadsdeelraad representative responsible for economic affairs in Southeast, emphasizes that government’s policy “has to be to react to our market here.” He is trying, in unconventional ways, to bridge the economic divide for ethnic entrepreneurs: Mr. van der Horst is brokering discussions between Stadsdeelraad and national banks like ABN Amro and Rabobank to sensitize the banks to the specific problems that minorities in Southeast face. He is also urging local tax collectors in the Bijlmer to take a lax stand on tax law enforcement in the Bijlmer in cases when a thorough application of the law might destroy the chances of an ethnic business’ survival. “I am not so concerned with what is allowed and what is not as long as we are helping people.” Mr. van der Horst admitted. “That is sometimes difficult. But if we do not take this position, however, we will never be able to really help ethnic entrepreneurs.”

City of the Future?

The Stadsdeelraad promises a new Southeast. In their literature, they describe the ‘future prospect’ as “an enduringly green and safe residential environment, new patterns of housing and progressive social and cultural provisions in combination with sound enterprise and increased job opportunities.”

But are these local government initiatives enough? On the surface, the prospects of local policies like Ondernemershuis seem encouraging, as do the possibilities of a loan fund for minorities and redeveloped commercial space.

But there is a mismatch between the efforts of government and the scope of the problems that minorities must overcome. The most serious obstacle to ethnic entrepreneurship in the Bijlmer is finance capital, yet government has not taken a serious approach to tackling this problem. Many community leaders, including Mr. Saad, point out that the revolving fund is flawed as currently envisioned. Bolder measures, like government guarantees of minority loans, are probably needed to bridge the economic divide. Today’s financial policies are helpful on a small scale, but fail to meet the root of the problems that prevent thousands of hopeful entrepreneurs from realizing their potential.

The government’s approach to opening commercial space in the Bijlmer is unique and innovative. By redeveloping existing structures, local government has found a relatively quick, cheap and easy solution to create new space for entrepreneurs. But without building larger, more central spaces for commercial development or revamping zoning plans, the opportunity for ethnic businesses in Southeast will likely be unfulfilled. No current plans will help pull illegal businesses out of the Bijlmer apartments and into the legal economy without tackling the need for smaller, affordable and appropriate commercial space in the Bijlmer.

And though Ondernemershuis is a bright spot in government’s economic renewal strategy, only a limited number of entrepreneurs will be able to start new businesses unless the more fundamental problems of money and space are solved. It is telling that no Ondernemershuis businesses have received any loans from a bank, and that of the 18 businesses started under Ondernemershuis’ direction, none were bars, restaurants or hair salons – the most common illegal businesses in the Bijlmer.

Real entrepreneurship is impossible in the Bijlmer without addressing the big picture. Local government is taking important steps towards helping ethnic enterprises in the Bijlmer, but more fundamental measures are necessary. With tens of millions of dollars already invested in the redevelopment of Southeast, government ought to recognize that the success of Southeast is tied to the success of ethnic entrepreneurship. To realize the ‘city of the future,’ government will need to provide bold initiatives and leadership to secure the future of ethnic enterprises in the Bijlmer.



Michel Belgrave, Director of Multisys
Chandra Bhairosing, Director of Ondernemershuis
Mark van der Horst, Stadsdeelraad representative
Mario, Bijlmer shopkeeper
Haroon Saad, Director for the Bureau of Social-Economic Renewal, Southeast
Rudi Speear, Stadsdeelraad representative and community leader
Jochen van de Laarschot, spokesman for ABN Amro


2000 Year Report, Ondernemershuis Zuid-Oost. BA Group, De Haag, 2000.
Newsletter for customers of Ondernemershuis. Ondernemershuis, Amsterdam. February 2001.



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