Need to foster entrepreneurship ecosystem for women to overcome barriers

The COVID-19 pandemic has continued to disrupt economic activities all over the world with the informal sector and Small and Medium Enterprises (SMEs) at the centre of the crises. With the high level of female participation in entrepreneurship which the Organisation for Economic Co-operation and Development, OECD, in 2019 put at 58 percent against 45 percent for male, there is no doubt that COVID-19 crisis will hinder the progress so far made in advancing women’s entrepreneurship development globally.

Unfortunately, while many countries around the world are witnessing expansion in women’s entrepreneurial activities, Nigeria, the largest economy in Africa, lags seriously behind. This situation needs to be changed by supporting women to overcome barriers to occupying key positions in the SME value chain.

Research findings by the International Finance Corporation (IFC) indicate that in Nigeria, at the micro segment, the number of women-owned businesses is almost equal to men-owned businesses. However, in the SMEs segment, there is a significant drop in female participation to less than 25 percent which suggests that women are either dropping off or not growing as quickly as their male counterparts.

The third edition of the Mastercard Index of Women Entrepreneurs (MIWE) ranked Uganda, Ghana and Botswana as the top three countries with the highest percentages of women-owned businesses across the 58 markets evaluated around the world. The report was based on publicly available data from the International Labour Organisation, UNESCO and the Global Entrepreneurship Monitor.

With rising problems of poverty and unemployment across Nigeria there is growing interest in fostering entrepreneurial activities. The interest rests on the belief that entrepreneurship stimulates economic growth and development.

Consequently, upon this assumption, women entrepreneurship has emerged as an important area of economic growth with governments and researchers in both developed and developing countries giving it a great deal of attention. Whether they are involved in small or medium scale production activities, or in the informal sectors, women entrepreneurial activities are not only a means for economic survival but also have positive social benefits for both women and the social environment.

Entrepreneurial activities make women more independent and allow them to effectively balance their role as wives and mothers. Consequently, developing women’s entrepreneurial capacity would go a long way in harnessing their ability to identify and capitalise on entrepreneurial opportunities within their environment and also empower them economically and socially.

In-spite of the significant role they play in economic and industrial development of Nigeria, women entrepreneurs operate in an unfavourable business environment, characterised by various challenges ranging from infrastructural deficiencies, corruption, low access and high cost of finance and weak institutions. Not only that, women entrepreneurs are not afforded the same opportunities as their male counterparts, due in part to deep rooted discriminatory socio-cultural norms which perceive them as wives and mothers.

Women also lack human and external resources for starting and developing their own business ranging from government policies, infrastructure and technological factors, lack of assets, lack of information, competition, tax burdens, motivation, social-cultural factors and family responsibility. The business environment for women, which reflects a complex interplay of differential factors as stated above ultimately results in the disadvantaged status of women in our society.

While it is imperative that concerted efforts are made to link women to the value chains of large corporations in order to empower them, in building and nurturing women-owned businesses, it is important to adopt a holistic approach that focuses on the four fundamentals of finance, information, market and technology. Capacity building must go beyond training in the development of women-owned businesses. Women are fast and adaptive learners but must also be given the support of mentoring and hand-holding to reach their highest potential.

From our experience with Ebola, COVID-19 and other epidemics, the economic impacts of a health crisis will have a disproportionate impact on women which will widen the gender inequality gap. As a country we must, therefore, articulate organised ways to tackle these expectations and lay the right building blocks for posterity.