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- April 8, 2022 at 2:55 pm #17037admin adminKeymaster
By The Arab Women’s Entrepreneurship Program, run by AMIDEAST in Beirut, Lebanon, in
2012. Source: Rita ChemalyDespite the significant increase in women’s educational attainment in the Middle East
and North Africa (MENA) region, the female labour force participation remains the
world’s lowest. The high female unemployment level has resulted in bleak development
outcomes leading to more poverty and income inequality, and less growth. Social and
legal barriers holding back female representation in MENA workforces are costing the
region a staggering $575 billion a year.
Although many countries in the region have directed efforts towards women’s economic
empowerment, female entrepreneurship remains an untapped source of inclusive
growth, employment generation, and innovation in a region that still suffers from the
largest gender gap in the world when it comes to women establishing and owning
businesses, estimated at over 40 percent, according to the Global Entrepreneurship
Monitor (GEM).
Today, there is a growing awareness in the MENA that entrepreneurship is key to
empowering women and accelerating gender equality, while reducing poverty and
building more stable and resilient societies. Governments across the region have
started to acknowledge the fact that advancing female entrepreneurship helps drive
knowledge, increase competitiveness, and develop communities, ultimately leading to
sustainable and inclusive economic growth. As such, many of the Arab countries have
recently launched unprecedented initiatives and strategies to promote women’s active
Source: The Arab Women’s Entrepreneurship Program, run by AMIDEAST in Beirut, Lebanon, in
- Source: Rita Chemaly
Diala Mahfouz and Youmna Cham for LSE MEC
participation in the formal labour market and nurture women entrepreneurial
development.
Set free to establish their own businesses without the permission of their husbands or
male guardians, Saudi women are nowadays active more than ever, accounting for
nearly 40 percent of the total number of entrepreneurs in the Kingdom. The United Arab
Emirates has similarly implemented locally-driven reforms that empowered women in
the world of work; with women now permitted to be heads of households, to work at
night and to enter any industries (including mining, for instance) – the country has
become home to over 23,000 businesses run by Emirati women, with a worth of USD
45–50 Billion. The government of Jordan has followed the trend, developing genderfriendly
policies for women to access credits, register a company, and sign contracts in
exactly the same way as men.
Yet, the overall gender gap remains paradoxically unchanged in the economic sphere,
and women in the region still hold the lowest rates of Total Entrepreneurial Activity
(TEA) at just 4% of the overall population. When starting and growing a business
venture, Arab women continue to face a series of overwhelming constraints. These
predominantly include a gender-discriminatory environment shaped by patriarchal
structures that have long challenged girls and women’s access to economic
opportunities and networks, undermining efforts to increase their participation in the
formal labour market, let alone entrepreneurship.
Every day, Arab women bear the brunt of outdated gender stereotypes that continue to
label men as more entrepreneurial, while placing the former in subordinate positions.
Constrained to fulfilling their roles as mothers, wives and (unpaid) caregivers, women
struggle to reconcile family expectations with employment, with this reported to be the
main reason keeping them outside the labour force. That being said, women tend to
work as contributing family members much more than men do, and are obviously less
likely to be entrepreneurs. Even when self-employed, they mostly happen to run
smaller-sized businesses, and they largely do so out of necessity and not
entrepreneurial endeavours.
Just like discriminatory gender norms, the lack of knowledge, skills and networks to start
a business act as powerful barriers to women’s entrepreneurship in the MENA. Indeed,
only a few female entrepreneurs have ever accessed entrepreneurial skill training
programmes in the region. Moreover, the potential that information and communication
technology (ICT) has in facilitating the upgrade of women’s skills and knowledge,
stimulating new market developments, and driving progress remains largely
unexploited, especially in rural areas. Add to this the difficulties women encounter in
joining established business networks, a key element in fostering the development and
growth of companies.
Similarly, the restricted access of Arab women to financial resources and their low
levels of integration into the formal banking systems keep pulling them back from
starting and sustaining a business, thereby obstructing the productivity of their
Diala Mahfouz and Youmna Cham for LSE MEC.
prospective investments, with the MENA region recording the second highest female
microenterprise finance gaps in the world, estimated at 29% (USD 16 Billion). Genderbiased
financial institutions generally perceiving women as more ‘risky clients’,
unfavourable lending practices that sometimes require women to involve their husbands
as cosigners, unreasonable interest rates, short repayment methods and inadequate
collateral requirements are some of the stubborn challenges facing women
entrepreneurs when trying to secure a loan. Owing to their marginal status in assets
ownership and their lack of a credit history, the only formal loan product women have
access to in the MENA is microcredit, which is insufficient to sustain a business and
drive job creation, and definitely not enough to challenge the prevailing gender
hierarchies and structural inequalities.
As a result, Arab female entrepreneurs remain concentrated in informal and lowproductivity
sectors where avenues for advancement are limited. As such, they are
unable to grow their micro and small enterprises and contribute more fully to their
economies. Moreover, most of the political commitments to support women’s
entrepreneurship activities have so far failed to break through the deep-seated barriers
to female economic empowerment, or to advocate for an adequate legal framework that
takes into consideration the root causes of their business constraints and aspirations. In
this context, public policies and reforms developed together with the private sector and
the civil society have a leading role to play in building entrepreneurial capacity for
women. This calls for genuine efforts into designing and implementing evidence-based,
gender-responsive and intersectional policies and programmes, taking every
opportunity to adequately involve them – mothers, wives, businesswomen, and above
all women – in policy making, treating them as equals. The current inadequate
responses are akin to putting a Band-Aid on stab wounds.
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