• Saturday, May 25, 2024
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BusinessDay

Unleashing Africa’s economic engine

Africa: The misunderstood boom and bust cycle

Africa is on the rise. Economies are booming, innovation is thriving, and a vibrant entrepreneurial spirit is taking root. Yet, a significant portion of the continent’s potential remains untapped: the talent, ingenuity, and leadership of its women.

My work connecting executives and business owners exposed me directly to the specific challenges faced by women working in Africa’s business world. Access to capital remains a major obstacle. Traditional financial institutions often view women-led businesses as higher-risk, making it difficult to secure loans and investments. Societal bias further hinders their progress, with women entrepreneurs often battling prejudice and a lack of access to mentorship opportunities. For instance, women entrepreneurs may have difficulty securing loan collateral due to limited property rights. Additionally, societal expectations often place the burden of childcare and household duties on women, limiting their time for networking, a crucial element for building business relationships. These biases can also lead to an underestimation of their capabilities and limit their bargaining power in negotiations. Women entrepreneurs often face unconscious bias and a lack of access to mentorship opportunities, making these challenges even worse.

Q: “Getting access to financial services is a crucial first step. Business leaders can work with banks to create loan guarantee programmes specifically designed for businesses run by women.”

A blueprint for Africa’s economic growth:

These challenges translate to a lost opportunity for Africa’s economic development. Studies by the McKinsey Global Institute show that if all countries matched the progress of the fastest-improving region in terms of gender equality, global GDP could increase by as much as $12 trillion annually by 2025. This represents a significant portion of the potential $28 trillion GDP increase achievable with full gender parity in the workplace.

So, how can we make this possibility a reality and help women business owners in Africa thrive?

To reach Africa’s full economic growth, we need to remove the obstacles that hold back women entrepreneurs. Getting access to financial services is a crucial first step. Business leaders can work with banks to create loan guarantee programmes specifically designed for businesses run by women. This can help reduce the risk that lenders see and encourage them to provide much-needed funding. Supporting microfinance initiatives is another key strategy. These programmes offer smaller, easier-to-handle loans that can be the starting point for a woman entrepreneur’s venture. Additionally, business leaders can be active by establishing or contributing to networks of investors who provide funding for startups focused on high-potential female entrepreneurs. This can provide crucial funding and mentorship opportunities for women looking to grow their businesses.

Giving women entrepreneurs the tools they need to succeed is equally important. Businesses can play an important role by setting up mentorship programs. These programmes pair women who are starting businesses with experienced executives who can give them valuable advice and support and connect them with their business contacts. Additionally, sponsoring leadership development workshops designed for the specific needs of women entrepreneurs can help them learn more in areas where they need it most. These workshops can focus on important areas like business strategy, negotiation, and fundraising. Equally important, knowledge-sharing platforms like Wennovation Hub can bridge the gap between women entrepreneurs and valuable resources, connecting them with industry experts and encouraging a collaborative learning environment.

Unconscious bias can prevent fair evaluation, so getting rid of these barriers is very important. Businesses can train their employees to recognise these hidden assumptions. This training helps people identify and address their own biases, making sure women are judged based on their strengths. Furthermore, using review processes where people don’t know who did the work removes the possibility of bias from the decision-making process. Last but not least, celebrating the achievements of successful women entrepreneurs through your networks and industry publications inspires others and breaks down outdated ideas about women in business. It also shows positive examples for others to follow.

How African women entrepreneurs are breaking barriers

Let us celebrate success stories. Take Kiki Kamanu, a designer who mixes influences from around the world to create unique, high-fashion clothes. Her story shows the challenges and victories faced by women entrepreneurs in Africa. Even though she’s well-known internationally, her path probably wasn’t easy. She likely faced challenges getting funding and working in her industry. Jihan Abass, a Kenyan entrepreneur, is another great example. She’s the founder and CEO of Lami Insurance Technology, a company that’s making it much easier for people in Africa to get insurance. Before that, Jihan was a successful sugar trader in London. She used her financial knowledge to create a platform that connects businesses directly with consumers to simplify buying insurance. We can break down stereotypes and inspire a new generation of female leaders by celebrating these women and many others like them.

Africa’s economic potential is clearly vast, and empowering its female entrepreneurs is the key to unlocking its full success. We can unlock Africa’s full potential for growth and innovation by removing the barriers that hold them back. We should work together to build a business landscape where women can thrive and where Africa can truly reach its full potential.

Ota Akhigbe is a passionate advocate for women’s empowerment in Africa, she leverages her extensive experience in leadership, strategic development, and partnership building to help women entrepreneurs across the continent thrive.