The consultancy firm Roland Berger carried out, at the request of the Women in Africa (WIA) platform, its annual study on female entrepreneurship. The 2020 edition, « Accelerating the entrepreneurial dynamic of women in Africa – Improving access to finance to support the entrepreneurial dynamic », confirms the trend: if women are the backbone of the African economy, female entrepreneurship remains an obstacle course in particular concerning access to financing.
By Laurent Benarousse *
Africa is fertile ground for female entrepreneurship: the continent has the highest rate of entrepreneurial activity in the world for women: 24% of African women entrepreneurs vs. 11% of women in South East Asia Pacific, 9% of women in the Middle East, 6% of women in Europe and Central Asia. Yet very strong disparities between men and women remain. Three main factors lie at the source of the financing difficulties of African women:
- Structural conditions unfavorable to women: a lower level of education and a lower endowment of assets.
- Difficulties in accessing financing: failure to complete the conditions for obtaining loans and self-exclusion.
- Mainly subsistence entrepreneurship: small businesses, with modest financing needs and an economic model that gives investors few guarantees of solidity.
Women’s entrepreneurship in Africa: plural realities on the continent
We have established a segmentation of countries according to the « Women entrepreneurship readiness » index which identifies four types of countries: « locomotives », « challengers », « next emerging » and « reborn ».
THESE FOUR GROUPS OF COUNTRIES ARE DEFINED AS FOLLOWS:
- 9 « locomotive » countries characterized by political stability, high levels of gender equality, a regulatory system promoting parity, mature financial ecosystems. South Africa, Botswana, Ghana, Kenya, Malawi, Namibia, Nigeria, Uganda and Zambia
- 4 « challenger » countries with better economic development and financial ecosystems than other African countries, but modest rates of participation of women in entrepreneurship. Algeria, Egypt, Morocco and Tunisia
- 12 “next emerging countries” defined as a group of heterogeneous and median countries regarding female entrepreneurship, due to limited access to finance and the maintenance of a high level of gender inequalities. Benin, Burundi, Cameroon, Ivory Coast, Ethiopia, Gambia, Liberia, Mozambique, Rwanda, Senegal, Sierra Leone and Tanzania
- 7 “resurgent” countries characterized by limited economic development, strong gender inequalities, high political instability, poor banking access for the populations and a poorly developed financial system. Angola, Burkina Faso, Gabon, Libya, Mali, Mauritania and Chad.
Women Entrepreneurship in Africa: Differentiations on the continent
Access to finance: a key link in entrepreneurial success
The difficulties of access to financing for African women vary according to the sources of financing and the country: if microcredit is distributed equitably among the women of the continent, the other sources of financing show significant differences between men and women.
At the source of the financing difficulties:
Women entrepreneurs in touch with cultural practices and current legislation
* Senior partner, member of the Supervisory Board, Roland Berger law firm
To consult the study: https://www.rolandberger.com/publications/publication_pdf/Etude-RB_WIA_Accelerer_la_dynamique_entrepreneuriale_des_femmes_en_Afrique.pdf
