WOMEN: ADDING VALUE TO VALUE CHAINS

Ethiopia is projected to become a middle-income country by 2025 and women are an important building block to achieve this ambitious goal based on an economic transformation process. However, although women have a great potential in accelerating the country’s economic growth, their role is often undervalued. Unleashing the potential of Ethiopian women in the economic sector – particularly reducing gender inequalities in education and labour market – could increase the annual GDP growth by around 1.9 percentage points (World Bank, 2008).

“What I say to Ethiopian women is: this is your time, make use of it. There are opportunities out there.

Yes, there are challenges too, but they can be beaten and you

can make it happen.” (Sara Yirga, Woman Entrepreneur)

It is estimated that 65 % of employed women work in the agriculture sector and more than 60 % of micro and small-size businesses in Ethiopia are food proces-sing enterprises run by women entre-preneurs. Women owned enterprises are steadily growing in Ethiopia and play an important role in the country economy, not only generating income but also creating employment, with an immedia-te impact on food security and poverty reduction.

Enterprises led by women, in fact, should develop further and contribute to ad-vancing a climate-smart competitive ag-ribusiness sector which will create more jobs and raise incomes. It is essential to offer women the same opportunities than men’s, with a special focus on business value chain, from inception to end mar-ket consumers.

Successful women entrepreneurs, espe-cially in medium and large enterprises, are less than men due to the number of challenges they face, among the others: greater household responsibilities, limited access to finances, lack of knowledge and poor managerial skills. These women entrepreneurs remain a minority and generally enterprises owned by women are considerably smaller and less well represented in capital-intensive sectors.

Enhancing access to both financial and business development services to women entrepreneurs can aid the review of the system and bring new possibilities as well as drive inclusive economic growth.

On the basis of the information collected through primary and secondary sources and considering selected women-led enterprises, an in-depth survey was carried out to understand the whole framework within which these women have matured their entrepreneurial path.

In-depth face-to-face interviews were conducted with 12 women entrepreneurs owning an agro-food firm. A profile for each woman was compiled showing the entrepreneurs’ differences and simila-rities, the approaches to overcome dif-ficulties and the entrepreneurial process followed, which is often closely related to their personal history.

These women, strong-minded, resolu-te and competent, proved however to have common denominators in terms of challenges faced, of capacities to react to problems and overcome obstacles, of abilities to improve themselves and enhance the surrounding environment. The survey is not statistically significant due to the small sample size but it shows a cross-section of the business reality in which women act.

Most of the twelve women entrepreneurs interviewed indicate the lack of reliable networking and the lack of information as the two main constraints hampering their business. These two limitations are strictly linked to each other because by promoting meetings and experience sharing, women are able to acquire know-ledge that would otherwise be difficult to obtain.

UNIDO has launched a study to investigate this segment of entrepreneurs in order to:

1) analyze the reasons that often force women entre-preneurs to sit on sidelines of the production system

2) address the business-level constraints faced by women agro-processors

3) define actions encouraging women who owned enter-prises to enter, grow and be sound actors in a business context

Women‘s associations, whether they are established under the auspices of the government or promoted by private individuals, can play a significant function and are considered by all the women as a strength. Not only because they allow to share experiences, build relationships, exchange knowledge, provide assistance and training, but also because they can represent the different needs of women in an organized and effective way by creating a more supportive environment.

“How many are exposed to information and technology and access to skills? That determines if a woman can be

productive or not, she needs appropriate information and technical skills and access to wherever resources

there are. If we don’t do that, we cannot talk about em-powering women” (Sara Yirga, Woman Entrepreneur)

“When you create a network you know you talk with so-meone, somebody who knows about and you know the programme, the ideas and the information expand. So that’s why this kind of associations are very important. Because, otherwise, we wouldn’t get the information.”

(Rahel Moges, Woman Entrepreneur)

Connected to the above mentioned issues is evident the third problem: the limit imposed by cultural stereotypes. These do not help the inclusion of women in the business world and wo-men often find difficult to be “heard“ and „considered“ in a men dominated environment. There has to be a cultural change.

“Missing collective mind, knowledge is missing. One of the biggest constrain for the woman is that

many decisions in Ethiopia are still made in the informal decision making process.”

(Mitslal Kifleyesus-Matschie, Woman Entrepreneur)

If women really want to broaden their horizons, including the entrepreneurial ones, they should look for new opportunities for trade and growth without being stifled by social impositions and without family duties having priority over personal and professi-onal needs. And here it comes the forth problem: lack of time. Men are not required to use their time as it is for the women.

“A woman can do anything; a woman can do what a man can do… She cannot carry big stones,

but we do not need it.” (Hadia M. Gondji, Woman Entrepreneur)

“This is a men’s world. They have dominated the business before; now the women have started to work hard and struggle to achieve their success... When you

are a woman no one trusts you to give help and that is the main challenge. Now things are getting

better; the sky, the limit… It is good now”(Almaz Ayele, Woman Entrepreneur)

In particular, the interviewees complain that, while men have more social opportunities to build their professional path, wo-men, in contrast, face many limitations in creating from zero, or in improving, their own pathway, since most of the time shall deal with social and family obligations.

“The woman. She has everything but, she’s not exposed. She’s not used to go to some offices, and talk, and

explain and convince. The men have many places to meet and to discuss business. They go to the bar freely, they discuss, they deal. Yeah, they convince each other.

But for a woman to do this, lack of experience, all this holds you back, you know?“

(Abeba Tesfaye, Woman Entrepreneur)

“They were not listening to me because I am a woman.” (Emebet Mekonnen, Woman Entrepreneur)

But even if women overcome all these barriers, a fifth, even bigger problem, might occur: lack of capital. Women often do not have that real estate (collaterals) necessary in Ethiopia to apply for a loan and in case the husband co-owns a property it is very rare that he will risk it for his wife initiative. Even when working capital is needed to expand the activity, it must be guaranteed by collaterals, and especially women entrepreneurs suffer of this restriction. Most of the assets are registered to men and, in some cases, women show resistance in using family collaterals.

Women entrepreneurs “add value to value chain” as they help to spur income and employment, stimulate demand for agricul-tural products and services, increase investment throughout all the value chains, provide the rural population with processed products, push towards competitiveness.

Finally, women entrepreneurs act as a strong stimulus in acti-vating socio-cultural changes since they continuously confront and question culturally static aspects of their society, making benefit the whole community. They can be adopted as role models to breakthrough some of the challenges women face, to positively influence the environment and to add value in business.

The lack of capital resulted to be one of the main obstacles to the setting up and expansion of their companies and that has direct fallout on three other problems: lack of space, poor qua-lified technical skills and lack of equipment and technology.

In many cases, although all twelve women entrepreneurs had proven skills in business, they did not get the support needed to grow their business activity and had to look for alternative solutions. Women entrepreneurs emphasized that, even if they got some training through the Government or other institu-tions, to solve the problems related to working places, technical skills and to introduce new technologies, in order to enhance quality and production as well as to open new markets, a way is getting the involvement in the activity of a foreign investor.

These women are pioneers of a system that still needs to fully develop; things are changing and the Government is suppor-tive, but a long way has yet to be covered and the Government policies have to be tailored aiming to help women entrepre-

neurs to overcome all these barriers, since production is shaped by positive business-environmental factors.

All the women surveyed hope that things will improve and have great confidence that the Government will do the right steps to ease and favor the entry and growth of women owned enter-prises, as they have a direct and significant impact on poverty reduction improving the welfare of both the rural and urban population. Their contribution is critical to enhancing people’s livelihood, especially because of their tendency in hiring other women, whenever possible, with a positive consequent effect on families and child care.

“To be in business and to respect family chores? It’s very scheduled… It’s just about time management…

Women are busy and have family responsibilities. They don’t have time. You have to be in a position to understand what women face like a challenge,

like time challenge.”(Sara Yirga, Woman Entrepreneur)

“To start I borrowed some money from relatives. The bank wanted collaterals. I had one house,

but I didn’t want… at that time it was my first time to start a business. It was risky.”

(Aster Mengesha, Woman Entrepreneur)

“As a woman, it’s not only the money that makes you happy; rather it’s the chance that you are giving for

women to work.” (Almaz Ayele, Woman Entrepreneur)

“My success story would be a training, a teaching for the young girls, as well.., it must be step by step,

and she will be successful.” (Hadia M. Gondji, Woman Entrepreneur)

“My ultimate goal is to have an investor… my success will be

fast, because not only they bring finance, they bring knowledge, they bring markets knowledge.”

(Rahel Moges, Woman Entrepreneur)

WOMEN: ADDING VALUE TO VALUE CHAINS

15th October 2015, EXPO Milan

To follow a few recommendations to improve the working and business environment for women entrepreneurs:

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More emphasis should be given to enhance the compe-titiveness and to protect enterprises led by women by economic shocks, encouraging women entrepreneurs to be part of clusters, enabling knowledge flow, services sharing and risk management.

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Women indicate poor managerial skills and availability of skilled staff as major difficulties hindering the growing of their businesses and consider the strengthening of Women’s and sectoral associations pivotal to face these constraints, as well as to share information and experien-ces, to create bargaining power, management capacity, to solve market access and efficiency problems.

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Access to market information and exposure are among the key needs expressed by the women entrepreneurs, enabling them to adapt their businesses to the evolving markets conditions.

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Concrete actions should be set up for the use of new technologies and management practices to improve the quality and quantity of food produced by women-owned enterprises, enhancing the chances to export.

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Women entrepreneurs perceive access to credit as one of the main obstacles, hence, it is important to assist them in obtaining bank loans, even in the absence of collaterals, and dedicated units should be established within commercial banks and other financial institutions.

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Policies targeting women’s entrepreneurs in a more systematic and coherent approach should be enforced according to the specific sectors, stimulating innovation and private investment.

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To have a clear picture of the Ethiopian entrepreneurial environment, the data collection system regarding enter-prises – with a special consideration to gender disaggre-gated data – should be improved.

For more information please contact: expo2015@unido.org For more information on UNIDO: www.unido.org/ituyouth

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