Why Investing in African Business Women Can Bring Economic Growth for All

by Joseph Omoniyi
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In recent years, the narrative surrounding Africa’s economic potential has shifted. Increasingly, the focus is on the critical role that women, particularly businesswomen, play in driving economic growth across the continent. Investing in African businesswomen is not just a path to individual prosperity; it’s a catalyst for broader economic growth and development across the continent. Perhaps, as some africans and global stakeholders are trying to reconnect with their roots, they might want to seek to invest in Africa, focusing on empowering women in business. This can have a multiplier effect, driving positive social and economic change. By channeling resources into education, career advancement, and financial strategies tailored to African businesswomen, investors can contribute to the continent’s vision of an integrated, prosperous, and peaceful Africa, where all Africans are equal partners in development. There are unique opportunities and strategies for investing in African women entrepreneurs, and these investments can benefit both individuals and the continent as a whole.

Arguably, African women are the most progressively active and innovative agents working to strengthen the economic empowerment of poor and marginalized people across the continent. They do this in a manner that, in the aggregate, stabilizes the informal sector and is a major contributor to broader recovery during times of crisis. Women exchange what they make for goods that help other people survive and thrive. They have proven themselves to be formidable players in various sectors, showcasing remarkable creativity, and innovation. In agriculture, for example, women make up a significant portion of the workforce, with estimates suggesting that they contribute up to 60-80% of the labor force in some African countries. Despite facing challenges such as limited access to land, finance, and technology, these women have leveraged their skills and knowledge to drive productivity and contribute to food security.

In the technology sector, African women are increasingly making their mark, with a growing number of female entrepreneurs and professionals driving innovation and creating impactful solutions. For instance, in Nigeria, the fintech sector has seen a rise in female-led startups, such as fintech platform PiggyVest and payment solutions provider Paystack, which have attracted significant investment and are driving financial inclusion.

In finance, African women are breaking barriers and shattering stereotypes. Women-led microfinance institutions, such as Uganda’s FINCA Uganda and Kenya’s Faulu Kenya, are providing vital financial services to underserved communities, empowering women economically and driving financial inclusion.

In healthcare, African women are at the forefront of delivering healthcare services and driving innovation. Women make up a significant portion of the healthcare workforce, with many serving as frontline healthcare workers, community health workers, and entrepreneurs. These women play a crucial role in improving access to healthcare services and addressing key health challenges on the continent.

Investing in African businesswomen is not just about supporting individuals; it’s about tapping into a vast pool of talent and expertise that is driving sustainable economic growth across the continent. These women are not only creating businesses; they are also creating jobs, driving innovation, and contributing to the overall development of their communities and countries.

However, women are still denied the chance to use their full economic power. Imperative, economic empowerment is vital for the future of Africa. Advances in living standards are slowing down, and a series of gender and other inequalities keep the continent stiff and unproductive.

Contrary to the view held by some, African businesswomen lead activities that ripple through their economies in a way profound enough to change and historically disrupt systems based on regressive economic structures and inequalities. According to the most recent edition of the African Women Economic Empowerment Report compiled by the Kenya Association of Women Business Owners, women give back mainly to their families, from which the benefits spread to society at large. On average, 90% of their income goes to household expenses. Of these women, 60% state that their expenses are spent on food, followed by bills (22%) and education (15%). Girls pay back.

Once women have disposable income, not only do families have higher household per capita incomes, but infant mortality rates also decrease, school enrollment increases and women’s investment in family well-being also improves. For young women, the disparities in education, especially concerning access to technology and basic care, i.e. menstrual hygiene care, continue to prop up conditions of economic inequality.

Aside from the challenges that are specific to African businesswomen, the escalating threat and inherent disadvantages and challenges facing African small and micro-entrepreneurs are considerably more challenging than those threats and challenges that their counterparts in the developed world encounter. Africa’s 54 countries each have their own regulatory frameworks, making it crucial for investors to navigate varying laws and regulations. Women entrepreneurs often struggle with limited access to finance due to factors like gender bias and lack of collateral. Infrastructure challenges, including poor transportation and unreliable power, hinder business growth. Cultural norms and gender bias also create barriers, affecting access to education and ownership of assets. Market access is vital for growth, and technology plays a key role in enhancing competitiveness. By addressing these challenges

Investing in African businesswomen requires a deep understanding of the unique challenges and opportunities they face. By tailoring investment strategies to address these nuances, investors can not only support the growth of women-owned businesses but also contribute to sustainable economic development across the continent. Here are some specific strategies for investing in African businesswomen:

Targeted Financial Products: Develop financial products tailored to the needs of African women entrepreneurs, such as microloans, leasing options, and venture capital funds. These products should consider the unique challenges women face in accessing traditional financing and provide flexible terms and conditions.

Capacity Building and Training: Provide training and capacity-building programs to help women entrepreneurs develop the skills they need to succeed in business. This could include training in financial management, marketing, and business planning.

Access to Markets: Facilitate access to local and international markets by providing networking opportunities, trade missions, and access to online marketplaces. This can help women entrepreneurs expand their customer base and increase their revenue streams.

Technology and Innovation: Support women entrepreneurs in adopting technology and innovative solutions to improve their business operations. This could include providing access to digital tools, training in digital skills, and support for developing innovative products and services.

Networking and Mentorship: Create networking and mentorship programs that connect women entrepreneurs with experienced business leaders and industry experts. This can provide women with valuable guidance, advice, and support as they navigate the challenges of entrepreneurship.

Policy Advocacy: Advocate for policies that support women entrepreneurs, such as gender-responsive legal frameworks, access to property rights, and financial inclusion initiatives. Engage with policymakers and stakeholders to create an enabling environment for women-led businesses to thrive.

Partnerships and Collaborations: Collaborate with other stakeholders, such as government agencies, NGOs, and private sector organizations, to leverage resources and expertise in supporting women entrepreneurs. By working together, we can amplify the impact of our efforts and drive meaningful change.

Impact Measurement and Evaluation: Develop robust impact measurement and evaluation frameworks to assess the effectiveness of investments in women entrepreneurs. This can help identify successful strategies and areas for improvement, ensuring that investments are targeted and impactful.

By implementing these strategies, investors can support African women entrepreneurs in realizing their full potential, driving economic growth, and creating positive social impact across the continent.

Despite facing numerous challenges, many African businesswomen have yet demonstrated they can rise and thrive above their limitations, as successful business owners. Add their sheer determination, innovation, natural entrepreneurial spirit, adaptability, community support, access to information and technology, government and NGO support, these women can create more collective success stories, inspirational and motivational pathways for all of us across the continent. Cheers!

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