Source: International Policy Digest
There is little doubt that Africa will witness rapid yet uneven economic and demographic growth in the next 20 years. Information from multiple sources indicates that its rise can positively affect the global economy by introducing a decisive regional economic force that must be reckoned with. The very steps that will enable this progress such as the Africa Free Trade Area, widespread investments in communications, transportation, and distribution infrastructures, a greater emphasis on advancing agro-industry, and broad changes in education systems to prepare market-ready graduates to fuel the continent’s rise, are lagging.
This is not new. Since the last century, Africans from diverse communities as well as thought leaders have lamented the lack of coherent strategies in individual countries, regional groupings, and Africa at large that address shortcoming identified by governments and multilateral organizations. The wide disparity among African nations, in terms of GDP, PPP, literacy, gender ratios in education, the workforce, and professions, and continuing concerns with inclusion, corruption, social and health services, and rule of law aggravate constraints to continent-wide growth. And one cannot overlook the consequences of hundreds of years of dividing Africa north from south, east from west, and other consequences of its difficult history with outside powers and regional rivalries.
Today, as documented by many data sources, Africa stands unevenly at a decision point – either move proactively to reform and enable broad economic inclusion or face continuing malaise in addressing the needs of the fastest growing population in the world. The World Population Review points out that “There is a high proportion of younger people within the Africa population as a whole, with reports that 41% of the African population is under the age of 15. The life expectancy is also low – less than 50 in many nations and averaging 52 across the continent as a whole. This has reduced considerably over the course of the last twenty years with a widespread HIV and AIDS epidemic taking much of the blame for that statistic.”
Women outnumber men both in the older age groups and those just entering school so investing in girls and women as full partners in the economic future of the continent makes good business sense. Investing in women and girls is a good place to start because it creates multiple returns in enabling and empowering entrepreneurs and enterprises across many sectors rather than largely focusing on high-end technology and programming.
Initiatives that upgrade the health and well-being of Africans is a key goal of the UN Sustainable Development Goals adopted by all of the African countries. And it is critical that the international community work in partnership with countries and communities to combat the debilitating conditions that challenge the continent’s future.
To be clear, again looking at the disparities in education, income level, structure of economies, and other factors that differentiate the university graduates from the semi-literate farm and harvesting people, countries need to expand programs beyond urban areas and services and move aggressively to shore up the agricultural sectors that represent the largest percentage of many national GDPs. There are some significant projects that already exist that can serve as models for other countries. It has been suggested that marrying innovative technology programming skills with applications to agri-business may yield mutual benefits to upskilling both IT and agriculture workers.
The challenges for entrepreneurs and business owners are similar for men and women but are compounded by various norms that disproportionately affect women. The World Bank and the UNDP have worked for several decades to promote women in business through a variety of projects and programs but the problem begins with the legal systems that discriminate against women on social, cultural, and religious grounds. The World Bank has launched an index measuring a country’s legal system vis-à-vis how women in business are impacted.
Sarah Iqbal, Program Manager of the Women, Business and the Law Project at the World Bank noted that “Progress in Sub-Saharan Africa is heartening. Despite the myriad challenges facing the region, many governments are working to rescind laws, often holdovers from the colonial era that discriminate against women. We believe that if you change the law, you change the world and we look forward to recording further progress on women’s economic inclusion in Sub-Saharan Africa.” Her optimism reflects the fact that fully one-third of all reforms carried out globally were in sub-Saharan Africa, a total of 34 reforms with DRC, Kenya, Tanzania, and Zambia among the leaders. The full report and accompanying datasets are available here.
African women in the workforce is a continuing topic among World Bank bloggers. A recent blog put it quite well: “Walk around a major city in Sub-Saharan Africa and you will quickly realize that women are a highly visible part of the economy, selling all manner of products and services. In some ways, women are powering the economies of the continent to a greater degree than anywhere else in the world; Sub-Saharan Africa is the only region where women make up the majority of self-employed individuals.” That bears repeating, women are the majority of small-business owners in Africa…that’s why efforts to promote women in business must be broad-based to be inclusive of their efforts across the economy.
As the blog indicates, “What this fact conceals, however, is that on average women-owned firms have fewer employees, and lower revenues, profits, and productivity. In many cases, women’s businesses contribute little beyond basic subsistence. This limits the potential of women entrepreneurs and hinders economic growth and poverty reduction in Africa.”
This reality can be changed with policies and interventions that support business women through a comprehensive effort that includes literacy, business, and financial skills training, mentoring, tactics for accessing financing, marketing, customer relations, and other inputs to making business succeed. As the author notes, “There is a huge opportunity to unleash women entrepreneurs, boosting economic growth and lifting millions of people out of poverty in the process. While in some cases removing barriers to women entrepreneurs may involve slow-moving policy debates, in other cases relatively simple interventions can make a huge difference.”
In multiple studies, it is clear that despite gender inequality, progress in opening up the business space by empowering and enabling women can be transformational for Africa. According to a posting in Africa.com, some of the unique challenges facing women include limited access to funding, a lack of mentors to provide guidance, stereotypes that block women from being accepted as experts and supervisors, self-limiting factors that discourage self-confidence and innovation, and social norms that continue to support male dominance in economic affairs.
Ironically, studies in micro-finance/credit and banking show that although “Women manage their credit better than men, the former still find it harder to obtain funding than the latter. A study by the African Development Bank finds that the financing gap for women in Sub-Saharan Africa is estimated at the above US $20 billion, and younger women struggle the most. According to the 2014 Findex report, only 30% of women in sub-Saharan Africa have access to bank accounts. This statistic shows the importance of empowering women through financial inclusion.”
This past week, South Africa hosted #sheinnovates, a project of the UN Women’s Initiative Global Innovation Coalition for Change (GICC) launched in 2017 that brings together UN women and key players from the private sector, academia, and the NGO community. “It aims to develop the innovation market to better support women and accelerate the process of gender equality and women’s empowerment by building awareness of the potential of women-developed innovation; identifying key barriers to the advancement of women in the fields of innovation, technology and entrepreneurship; and working collaboratively to identify and address such barriers at an industry-wide level.”
Another noteworthy initiative is the US-funded African Women’s Entrepreneurship Program (AWEP) based on the assumption that the more that women network across borders and within communities, the more capable they will be to innovate, mentor, organize, and empower themselves and others. According to the State Department, “AWEP alumni have created more than 17,000 jobs and established 22 women’s business associations across Sub-Saharan Africa that are transforming societies and spurring economic growth.”
The website states that “In Africa, women are the backbone of communities and the continent’s greatest potential for unlocking economic growth as they provide the majority of labor with the least amount of resources. Reductions in the gender gap in education, health, political participation, and economic inclusion will result in an increase in the continent’s economic competitiveness.”
The program “Seeks to dismantle the obstacles to business opportunities and economic participation that African women face,” by “identifying and building networks of women entrepreneurs (and business owners) sub-Saharan Africa poised to transform their societies by owning, running, and operating small and medium businesses, and by becoming voices for social advocacy in their communities.”
As more and more resources are invested in African women in business, the continent will reap the benefits of empowering the majority of its population!