Invest in women for a prosperous tomorrow

First published in the Business Daily on March 14, 2024

“Investing in women is not only the right thing to do. It is the smartest thing to do.”

This has been a statement repeated to us many times. But how far are we willing to live up to this?

The global annual deficit in spending on women's empowerment and gender equality is a staggering USD 360 billion, as reported by the UN Women's Gender Snapshot 2023. Bringing it closer home, the African Development Bank estimates that African women entrepreneurs face a USD 42 billion gender financing gap across business value chains, including USD 15.6 billion in agriculture alone.?

This means that if the trend is left unaddressed, more than 342 million women and girls will live below the poverty line by 2030, underscoring the urgent need for immediate action. We can reverse the trend by closing the gender pay gap, supporting women-owned businesses, and providing equal opportunities to create a more robust and dynamic economy.?

In sub-Saharan Africa, the need to invest in women is now more crucial than ever. Women constitute 50.2 percent of the population and have a remarkable potential to contribute to the continent's development. We must live up to the theme that is set by the United Nations - calling for Investing in Women by Accelerating progress. Time is running out, yet gender equality remains elusive in our society.

And although some sectors have undoubtedly improved, women still face institutional barriers when it comes to financing - barely 20% of them have access to any formal form of funding.

Now is the time to deepen our investments – both in time and money to support women’s small and medium-sector businesses with new ideas and solutions to improve their enterprises and achieve equality for women in the sector.

Worth noting, SMEs empower women and fortify livelihoods across diverse dimensions - from individual prosperity to the cohesion of communities. Another smart thing to do is for Governments, businesses, and individuals to prioritize investments that empower women in economic opportunities. Accelerating progress requires comprehensive and concerted efforts to break systemic barriers and create a world where women can fully realize their potential.??

When women are equipped with the tools to succeed, entire communities and nations reap the benefits. Studies consistently show that women typically reinvest up to 90 percent of their income in their family and community's health, nutrition, and education - compared to 40 percent for men.

Investing in women can transform societies and can be a smart strategy for sustainable economic growth. Moreover, investing in women means dismantling barriers that perpetuate discrimination and injustice. It means challenging societal norms that limit opportunities based on gender.??

For the past few years, the Africa Enterprise Challenge Fund (AECF) has been doing its part by investing in women. Our USD 34 million Investing in Women (IIW) programmes are devised from our understanding of the gender financing gap and from an eagerness for women businesses to be empowered and fairly rated from a creditworthiness perspective.?

We are working across five geographies, designing interventions that enhance not only the opportunities for women to meaningfully participate but also increase their incomes, and access to finance and productive assets.

This kind of support for women is phenomenal and inspiring — and we know that investing in them will pay massive social and economic dividends. We have seen promising results already.

Through the Investing in Women in the Blue Economy in Kenya programme, Rio Fish, a woman-owned enterprise based in the Lake Victoria region, is now raising further capital beyond project financing. Their model enhances production capacity by having more women own fish cages, allowing them to access training in best practices for optimal production while creating a ready market for their products.

We need to have this repeated - and at scale. By so doing, we can realize the dream of increased productivity and income. We are elevating women beyond training, and it starts with their access to financing and expanding their knowledge through capacity-building programmes.

As we journey towards gender equality, let us embrace the potential of women and invest in their dreams, realizing that their success is intricately linked to the success of Africa as a whole.? While many only pay lip service to investing in women, few are willing to embrace the challenges and uncertainties accompanying it. It takes more effort and can take longer, but do we have a choice?