As curtains came down at the inaugural edition of the Africa Investment Forum in Johannesburg, South Africa, African leaders echoed the African Development Bank’s President Akinwumi Adesina’s call for increased support to women.
South Africa President Cyril Ramaphosa officially opened the forum in November 8th this year saying Africa is not only on the rise but also on the move, referring to the continent as a destination for investments.
“Africa needs to empower its youth; it needs to also empower its women so that they can fuel the growth that we are bound to have on our continent,” President Ramaphosa observed. “It needs to improve governance as well and promote peace and stability,” he added.
In attendance were successful women including Ibukun Awosika, President of First Bank of Nigeria Limited, Hayat Sindi Senior Advisor to the President of the Islamic Development Bank and Daphne Mashile-Nkosi, Executive Chairman of Kalagadi Manganese. Omar Alghabra Parliamentarian Secretary to the Minister of foreign Affairs of Canada was also present.
How to meet this:
There is no doubt that the biggest strategy towards development in Africa is girl’s education. While in the recent past several entities have invested in ensuring that girls get at least basic education, still, there are gaps in education and labor market that needs to be addressed.
In a UNESCO report, about 130 million girls between the age of 6 and 17 are out of school- and 15 million of them of primary school age. Half of these girls in Sub-Saharan Africa will never enter a classroom. Sadly, this has a ripple effect in the global labor market where women share is 27 percentage points lower than for men. Additionally, women’s labor force participation has been on a downward trend since 1990 when it stood at 52 percent compared to 49 percent in 2016.
Women education contributes to national development in different ways. By educating mothers for example, Uwezo initiative found that it helped to increase children’s literacy and numeracy competencies. The five-year East African initiative operates in Kenya, Tanzania, and Uganda and aims to improve literacy and numeracy among children (6-16 years old) in the region.
Furthermore, with more girls and women accessing education, attainment of some of the Sustainable Development Goals like the 2nd one on zero hunger, 3rd one on good health and well being, and 8th on decent work and economic growth is achievable. A World Bank study confirms that every year a girl stays in secondary school is correlated with an 18 percent increase in their future earning power. Additionally, well educated women tend to be healthier, participate in the formal labor market, marry at a later age, have fewer children, and provide better health care and education to their children and their families.
In efforts to promote education among adolescent girls, World Bank is running a five-year initiative launched in 2016. Within the first two years, the project surpassed its initial investment of $2.5 billion by 28 percent three years ahead of schedule.
Expanding women ability to access finance
In addition to enabling girls and women to acquire education, solutions must be created to enable women to access finance to grow their businesses.
Speaking at the Africa Investment Forum, Mr Adesina noted that solutions such as the Affirmative Finance Action for Women in Africa (AFAWA) should “change the financial system to be able to lend more to women and de-risk lending to women businesses through guarantee facilities.” AFAWA is a program run by the African Development Bank aimed at meeting one of AFDB’s High s’- addressing the challenges women face in accessing finance.
His call was echoed by other panelists adding that increased financial empowerment to women-led businesses will strengthen their contribution to the economic development of their communities and help lift the continent out of poverty.
“We need to make women a critical component of our financial system,” said Ms Awosika.
According to information revealed by the panel, women entrepreneurs experience significant funding gap of US$42 billion annually. Conversely, women are more likely to pay back loans compared to their male counterparts. Despite this, they face challenges as banking systems are reluctant to lend to women to start or develop a business.
Some of the challenges that African women entrepreneurs face when it comes to financing include the perceived risk of investing in women led-businesses and gender-related discrimination.
Sharing her experience, Ms Mashile-Nkosi, recalled the time when she was looking for funding to develop her mining business. Despite being deemed worthy of financial support, some banks demanded she quit her position as group CEO before receiving any funding.
“Men see risk when they look at women,” she added.
World Bank findings suggest that only 30 percent of formal small and medium enterprises across the globe are owned and run by women. The reason for this is lack of access to finance.
To tackle this challenge, World Bank’s new Women Entrepreneurs Finance Initiative aims to invest more than $1 billion to support women to start and grow their businesses. By so doing, We-Fi hopes to increase access to finance, markets and networks among women.
A proved way to enhance financial inclusion is the adoption of digital technology. Kenya is a success case study where mobile money has contributed to cutting hurdles previously experienced in the financial sector especially by the unbanked including women. People can now open bank accounts in their names at the comfort of the homes. Today, commercial banks are implementing a number of digital banking strategies including online banking and mobile banking among others.
For three years in a row, Kenya ranked at the top of a Financial and Digital Inclusion Program (FDIP) by Brookings Institution’s Centre for Technology Innovation, a Washington DC based non-profit organization. Mobile and digital technologies are seen to drive Kenya’s success story in narrowing the financial inclusion gap.
Revise laws that hold women back
Last but not least, policies should be put in place to enable women to participate in education and the labor market. In addition to the significant gaps in average wages of both men and women in the formal and informal sectors, to get a job, women in some economies must get consent of their husbands. Additionally, more women than men have to deal with intimidation and coercion at places of work.
Studies show that house chores and taking care of children, the elderly and the sick also keep women from accessing education or jobs. A study Tackling Childcare: The Business Case for Employer-Supported Childcarereport indicates that childcare provision avails parents opportunities to participate in the labor market. Moreover, companies that offer childcare support can reap business benefits. Exposure to early childhood care and education, children acquire language and other skills that are beneficial to their future.
Empowering girls and women through education, knowledge and dismantling bottlenecks associated with access to finance and the labor market will ensure that more women can take part in developing world economies.