Women are as good as men in agribusiness

The African Green Revolution Forum 2018 has just ended in Kigali Rwanda. And befitting of the progress the country has made in gender equality and women’s empowerment – a day before the event  the country held parliamentary elections and the proportion of womenelected to parliament rose from 64 per cent to 67 per cent - a group of organizations came together to put a spotlight on women in agribusiness.

At the meeting, I told the story of three women, Charity, Loise and Jane. In 2012, they founded Exotic EPZ Limited a company which processes macadamia nuts for export. When they decided to go into business together, nobody took them seriously. The banks said that as women with no property or land for collateral, they were too big a risk for a loan.

Women can do better

The farmers they contacted were skeptical about womensurviving in international trade, a business where “even men had failed”. But they were determined. They pulled together their savings, borrowed from friends and family. They started with 7.5 tonnes of shelled nuts each month. They have now doubled that capacity and currently employ over 100 people, most of them women, and have created a market for thousands of smallholder macadamia farmers.

The story of Charity, Loise and Jane is a story of the huge opportunity that women agribusinesses present, but it is also a story of the challenges and gender barriers that women still face.

Across the continent, 68 per cent of economically active women are in the agricultural sector.  The continent has the largest proportion of women entrepreneurs.

However, no country in Africa has achieved parity in business ownership. Ghana has the highest proportion at 46.4 per cent of total businesses owned by women, followed by Uganda at 33.8 per cent and Botswana at 24.5 per cent. And women still face numerous challenges in growing their agribusinesses. Despite expansion of microfinance organizations that are now reaching millions of women, research shows that the financing gap for women-owned small and medium enterprises is about $20 billion.

Women are still less likely to have bank accounts. In Zambia for example, only a quarter of women farmers have a bank account, compared to nearly half of men.

And even when women apply for loans, they are less likely to be successful than men. SCORE, a nonprofit association dedicated to helping small businesses get off the ground, grow and achieve their goals through education and mentorship released a study on womenowned businesses that showed that while nearly three-quarters of businesses owned by women would like financing, only 25 per cent sought the finance. And of those 25 per cent, only a third were successful.

What to do?

What are the actions that we can take to grow women businesses?

First, we need to recognize that financial inclusion interventions are not gender neutral and the uptake and usage gaps would be reduced if products and services suited women’s needs and priorities. A lot of effort has been put into trying to make women bankable, training them, organizing them into groups among other interventions. We need a paradigm shift.

We now need to make financial institutions women-able. Financial institutions usually have products that have population-wide benefits (aimed at lifting all boats). And women have benefited from these. But faced with gender barriers, there is need for innovations that meet the specific needs and priorities of women.

Second, recognizing the multiple needs of womenowned businesses beyond financial inclusion and bundling services that they need. Combining financial services, skills such as financial literacy, linking to business support services and mentoring can help women owned business thrive and grow.

What we learn from research

Research that we have been funding at the United States International University in Kenya has shown that when you only offer skills training to business owners, the likelihood that their businesses will be successful is more than half. This increases to 93 per cent when you combine training, mentoring and business support services.

Third, integrating women in national and global supply chains, integrating them as suppliers of raw materials, as aggregators and as processors is key to enabling women to thrive. In Kenya and Uganda for example, over 20,000 women smallholder farmers are supplying beans to a company that is doing industrial precooking of beans.

The factory produces the beans and supplies to supermarkets and institutions. Women producers get a market for their beans, act as aggregators using ICTs and get improved seeds and inputs to increase their productivity.

And finally, recognizing that women are not homogenous, we need to understand entrepreneurship barriers for different types of women to have interventions that work for them. Addressing the child care needs of young women for example can increase their participation in employment and agribusiness.

In the informal settlements in Kenya, providing child care services to young women has increased their rate of employment and rate of starting business away from their homes.

Ms Njuki is a senior program specialist at Canada’s International Development Research.