Promoting North African Women’s Employment through SMEs

Share |

In its latest analysis on North Africa, “Promoting North African Women’s Employment through SMEs”, the African Development Bank points to a host of significant challenges facing women who strive to set up and own SMEs in the region. These include women’s multiple burdens, legal and cultural barriers, lack of access to training and business related support, limited access to property and credit, absence of effective social networks, and problems associated with economic infrastructure.

The Bank underlines in particular, seven major challenges. First, while in North Africa there are no direct laws preventing women from owning businesses and the property rights under marriage are even-handed, many legal rules emanating from tradition or civil and religious codes restrict women’s asset accumulation and economic and financial activity. Second, traditional social and cultural norms and perceptions reinforce the constraints on women’s employment and entrepreneurship. Furthermore, formal education plays a key role in enabling women to seek employment and engage in entrepreneurship. North African countries have had some achievements in this regard, but the educational attainment so far has provided more impetus for women to seek more part-time or full-time employment and engage less in self-employment or firm ownership. In addition, governance deficiencies tend to affect entrepreneurship negatively, much more in the case of SMEs than large firms, especially when the principal owner is a woman. Moreover, government policies and regulations that facilitate flexibility in marketplace and work environment are important for women’s participation. Lack of adequate access to finance and business networks is also a major constraint on North African women’s entrepreneurship, especially with regards to SME formation. Reliance on family and friends networks limits the size of firms generally and acts as a major barrier to the establishment of SMEs by women. Finally, Women’s role as primary family caregivers is a major barrier to their participation in the market as workers and employers. The situation in North Africa is similar to what obtains in other developing countries. Support for maternity and provision of childcare, especially through public channels, could help reduce this burden.

The Bank places emphasis on the need for a supportive ecosystem for female-owned SMEs. Two pillars of such a system are: good governance and infrastructure, which are essential for economic growth, but also have certain positive effects on women’s entrepreneurship; and energizing and establishing communication and coordination among various governmental, non-governmental and international organizations in order to create a synergy between the three and to ensure coherence in their policies and programs.