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Female entrepreneurs lead Africa’s small-business boom

• Published on 21 May 2014 • Category : Africa • Tags : africa entrepreneur women

As Africa continues its economic transformation, prosperity will come on the shoulders of small-business owners. In many African nations, small businesses account for over 50 percent of GDP and are responsible for the majority of employment. As the continent continues to create technical jobs and value chains based on her mighty natural resources, nations will continue to rely on these grassroots businesses. 

Africa’s entrepreneurship explosion reflects both the ambition and confidence of its citizens as well as the opportunities that make starting a business in Africa such a tempting option. However, in all the impressive advances, one aspect in particular stands out: The percentage of females contributing to the entrepreneurial boom.

According to the Global Entrepreneurship Monitor’s annual report, the continent leads the world in number of women starting their own businesses. Some countries, like Ghana, Nigeria and Zambia have more women business owners than men. 

The numbers are startling, especially when compared to developed nations. Some 40.7 of women in Nigeria and Zambia had started their own business, compared with the United States (10.4 percent) and the United Kingdom (5.5 percent).

Despite these encouraging statistics, many African small businesses do not survive the early-phase entrepreneurial activity. This means that jobs are not being created or, if they are, they are eliminated when the business shutters. The experts at GEM chalk much of these early demises to, among other deficiencies, a lack of funding necessary to see businesses through rough spots.

The International Finance Corporation (IFC) has partnered with Coca-Cola on a $100 million initiative to help 5 million female entrepreneurs across Africa and Eurasia. Bank of America put $10 million into the Calvert Foundation’s to aid women business owners in developing countries. 

There is also a crucial lack of education and access to research among African business owners. Initiatives like the African Women’s Entrepreneurship Programme (AWEP) started by Hillary Clinton in 2010, which annually brings 30 women business leaders from sub-Saharan Africa to the United States to network, learn and discuss common challenges, can help with this dearth of education. As of last week, the program expanded into Mozambique.

These efforts are small but meaningful building blocks to greater African prosperity. In that same study from Global Entrepreneurship Monitor, researchers found that African entrepreneurs were more confident and had far lower “fear of failure” when it came to starting a business than other geographic regions. If those ambitious and motivated business leaders were provided the same education, access to research and funding as the advanced world, there’s no telling how far the continent can climb economically.

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