Marrakech, 13 December 2023 – The ECA Office for North Africa and Oxford Economics Africa unveiled their latest joint report on Wednesday 13 October at the 2023 Arab SMEs Summitin Marrakech (Morocco).
The report, titled “Gender-Smart Investing for Inclusive Growth in North Africa” sheds light on major challenges women-led and owned firms face in North Africa and how gender-smart investment can help alleviate these issues. It presents governments and development actors with a range of recommendations for a successful implementation in the subregion. These include the need for an increased policy focus on female entrepreneurship and SMEs, improving policy alignment, leveraging support from a broader range of stakeholders, adopting a more holistic approach to gender-lens investing, and increased support and participations from development finance institutions, the private sector, and investors across North Africa and internationally.
Oxford Economics Africa quote:
As also highlighted in the report and its findings, it is important to understand that gender-smart investing does not only entail monetary investments, but also broader support in terms of skills and knowledge transfer, assisting women-owned businesses with gaining access to new markets, as well as guidance related to functions such as financial management, sales, marketing and sourcing.
Importantly, the benefits associated with gender-smart investing can be expanded significantly through conducive policy and business environments and increased participation from development finance institutions, multilaterals as well as the public sector. The private sector can also boost interventions in support of female-owned businesses and entrepreneurs. According to Cobus de Hart, Lead Economist at Oxford Economics Africa, a value-chain approach often works well in this regard by sourcing from female-owned businesses and providing financial and broader support mechanisms in the form of support from government and multilaterals, as well as incentive structures locally and abroad.
Economics Commission for Africa quote:
“Empowering women economically and socially not only uplifts entire family units but often catalyses positive, community-wide developmental outcomes. The report shows for example that smaller, women-owned SMEs tend to hire more workers relative to similarly-sized male-owned firms, thus contributing to a reduction of unemployment both for women and for men. It also indicates that women tend to reinvest a greater portion of their income in education, health and community welfare compared to men,” said Amal El Beshbishi, Economist at the ECA office for North Africa.
Gender smart investing is an investment strategy that addresses gender disparities and better informs investment decisions with the aim of making development more equitable, and strengthening women’s participation in the labour market both in terms of quantity and quality. Gender smart investing ultimately contributes to accelerated economic growth, development and job creation while helping reduce social disparities.
This approach positively impacts not only SDG 5 (Gender Equality) but also SDG 1 (No Poverty), SDG 2 (Zero Hunger), SDG 3 (Good Health and Well-being), SDG 4 (Quality Education), SDG 8 (Decent Work and Economic Growth), and SDG 10 (Reduced Inequality). It has been gaining interest from investors, development actors, and equity advocates globally.
Note to editors:
Key takeaways from the Report on “Gender-Smart Investing for Inclusive Growth in North Africa”:
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The report investigates the entrepreneurial and SME landscapes in North Africa with a focus on women’s contributions. Currently, less than 20 percent of North Africa’s employed working-age population is female, compared to a global average of just above 40 percent.
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Recent research has shown that SMEs and entrepreneurship are positively linked to faster economic growth and job creation for both women and men. Many North African countries have begun to recognize the social and economic role of SMEs and entrepreneurs and have taken steps to support them.
However, this study shows that in North Africa, businesses with majority female ownership still lag far behind those owned by men. Majority female ownership is also significantly more prevalent in SMEs than in bigger entities. This suggests that female entrepreneurs face unique challenges in starting businesses and scaling up operations compared to their male counterparts. Encouragingly, this also indicates that policies and investments supporting female-owned SMEs could have a substantial multiplier effect on national economies.
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Literature shows that finance is a crucial determinant of entrepreneurial and SME success. In North Africa, however, access to finance is unequal across both company size and gender lines with women’s access to finance remaining disproportionately low. Women in North Africa also fare worse than men across several financial inclusion metrics, including account ownership and borrowing from financial institutions and other service providers.
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Gender-smart investing has a key role to play in addressing these issues and can intervene at multiple levels: 1) increasing investments in female-owned firms ; 2) improving women’s access to capital; 3) addressing workplace equity throughout the value chain; 4) promoting products and services that benefit women.
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Decision makers can support this process by designing policies tailored to support female entrepreneurship and female-owned businesses and by explicitly including women entrepreneurs in their SME strategies, targets, and action plans. They can also ensure that policy and regulatory environments are aligned with national objectives and set cross-cutting strategies and action plans across different public sector spheres. Governments can further facilitate a shift in social perceptions of women’s role as they are currently limiting female economic activity.
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In coordination with governments, development finance institutions (DFIs), international finance institutions (IFIs), multilateral organisations, the private sector and impact funds can expand government interventions by helping bridge the gender gap in finance and investment in North Africa, particularly in countries such as Algeria, Egypt, Mauritania, Morocco and Tunisia.
Pleasevisit the Oxford Economics Africa and the Economic Commission for Africa websites to download your full report.
You can also click here to access previous ECA – OEA reports:
Best practises in job creation : lessons from Africa
Human Capital and Productive Employment Creation: Addressing Africa's Skills Gap
Issued by:
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Economic Commission for Africa
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Addis Ababa
Ethiopia
Tel: +251 11 551 5826
E-mail: eca-info@un.org