Women are a driving force behind Africa’s economy, running an estimated 48% of small and medium-sized businesses and growing 80% of the food.
Although women's work is a major engine of economic growth in Africa, they face significant barriers when it comes to gaining an education, owning property and accessing credit and financial services.
Economic opportunities, especially for women, are essential for African families to build a pathway out of poverty and for countries to generate the revenue they need to become self-sufficient. When women have access to higher education, are able to own land and property and manage their own financial assets, economies thrive. And the benefits of economic growth are also more likely to reach entire families when women are engaged - women invest 90% of their earnings into the health, education and well-being of their families, compared with 30-40% for men.
Economic growth for countries is driven by trade and investment, but the world’s poorest people are focused less on economic policy and more on the opportunities that will provide them and their families with a pathway out of poverty. To seize these opportunities, African women need access to secondary school and skills training for future jobs. African farmers and small business owners, the majority of whom are women, also need access to capital and financial services to expand their businesses and invest in new ventures. To sell their goods across different markets, business owners also need fair trade laws, simple customs procedures, good roads, reliable electricity and access to technology such as cell phones and the internet.
Doing business in Rwanda
Sisters Janet Nkubana and Joy Ndunguste never dreamed they’d be doing business with Macy’s.
When they started their basket business under a tree in the remote village of Gitarama, they had just 27 weavers. They bought materials with the winnings from a World Bank business plan contest and opened a small showroom in Kigali after selling a piece of property, something Rwandan women couldn’t do until 1999.
Then their peace baskets – woven by both Hutu and Tutsi women – hit the pages of Marie Claire magazine. Over 1,000 orders were placed. Oprah magazine soon followed. And after the business received support from USAID to participate in a New York trade show, the baskets went global. The sisters signed a contract with the US department store Macy’s, partnered up with a US marketing and trade company and, before they knew it, their peace baskets were sitting in American family homes all across the country.
"I have survivors, I have widows, I have women whose husbands are in prison,” says Janet. “To see them sitting under one roof weaving and doing business together is a huge achievement … these women are now together, earning an income. It is amazing."
Janet and Joy’s company Gahaya Links now employs over 4,000 women, and in 2007 the business produced 35,000 baskets with annual sales of $300,000. In fact, Gahaya Links is now the leading exporter of Rwanda’s one-of-a-kind baskets under the African Growth and Opportunity Act (which allows Rwandan exports duty-free entry into the US market).
But the business hasn’t just changed Joy’s and Janet’s lives – it’s also meant a brighter future for thousands of underprivileged mothers, daughters and sisters all across Rwanda. Women employed by Gahaya Links have learned new skills as part of the company’s rigorous training programme. Proceeds from the baskets have helped over 18,000 children go to school. The group has started a communal bank. And women say they’re now being treated with more respect in their communities.
This doesn’t mean that the sisters’ days are challenge-free. Shipping costs are still high and it can take months to get the organic dye and shipping materials from countries right next door. But they’ve already expanded into new products – jewellery and textiles – and they’re hoping to open in new markets: Europe and Canada. Janet and Joy are working to employ their community and country for the long term.
and it can take months to get the organic dye and shipping materials from countries right next door. But they’ve already expanded into new products – jewellery and textiles – and they’re hoping to open in new markets: Europe and Canada. Janet and Joy are working to employ their community and country for the long term.
– Story adapted from the International Finance Corporation and the World Bank “Doing Business Women in Africa” 2008 report.
Economic growth can help to fuel development and poverty reduction. Ensuring that this growth helps the poorest people lift themselves out of poverty will require investments and policy changes from all development partners. In 2010 and beyond, development partners should collaborate towards the following goals:
Expand access to financial services and technology: Access to reliable and affordable financial services is critical for families and businesses to invest in new opportunities and to protect themselves against unexpected shocks. Women especially should be targeted with these services and the technology to take advantage of them, such as mobile phones. Support for micro-businesses can spark economic productivity, but even more critical is support for small and medium-sized enterprises, which make up the majority of African businesses and are often headed by women.
Strengthen infrastructure: Trade within African countries as well as with other African and international trading partners requires a means to transfer information and goods. A strengthened transportation, communication and energy infrastructure would enhance the feasibility and profitability of regional and international trade. Developed countries can help support economic growth through investments in institutions such as the African Development Bank, which supports the growth of regional “economic corridors” through improvements in infrastructure.
Encourage investment: Private investment opportunities are growing across Africa in emerging sectors such as renewable energy sources and telecommunications. Developed and developing countries should use international opportunities, such as the UN High-Level Review of the MDGs and the G20 Summits, as a platform to increase awareness of investment opportunities in Africa and to incentivise investment in the continent. To boost livelihoods in rural areas (where nearly 75% of Africans live and work), development partners should in particular encourage public and private investments in agricultural productivity and agribusiness.
Prioritise agreement of global trade policies that support development: Developing countries face barriers in accessing global markets (often because of duties or quotas), overcoming the impact of agricultural subsidies and addressing supply-side constraints. Global partners have been deliberating a Doha Development Round of trade talks through the WTO for nearly ten years, but have yet to come to agreement on any of these priority policy areas that could truly benefit the poorest people.