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East Africa: Why Investing in Women's Ability to Trade Makes SenseTuesday, October 27, 2015 > 10:25:29
(All Africa By Lisa Karanja)
According to the 2013 Society for International Development report, The Future of Inequality in East Africa, gains from EAC integration could be hampered by the growing inequality gap in the region.
Half of the population of the EAC, representing 71 million people, lives on $1.6 a day. There is evidence that women bear the brunt of poverty but their empowerment is a central precondition for poverty's elimination.
According to the World Trade Organisation, there is a strong correlation between increased international trade and increases in female employment in exports, connection to markets and often higher wages in export-oriented industries. Analyses of several countries have even argued that each country's economic development is "as much female-led as it is export-led."
Supported by the Netherlands government, and presided over by Foreign Affairs Cabinet Secretary Amina Mohammed, TradeMark East Africa on October 15 launched the $4.5 million "Women and Trade Programme" to run till December 2016, with a second five-year phase of an additional $10 million to commence in 2017.
Targeting 25,000 women in its first phase, the programme's goal is to increase incomes and improve livelihoods for women traders and women-owned enterprises by strengthening the enabling environment for women traders, facilitating the removal of the internal impediments to trade faced by women and proactively promoting the "voice" and participation of women in export and trade in East Africa.
In many countries in Africa, the majority of small farmers are women, producing crops such as maize, cassava, cotton and rice. These have enormous potential for increased trade between African countries and the global market.
In 2010, women made up 43 per cent of the agricultural labour force of developing countries and dominated employment in high-value agricultural commodities in sub-Saharan Africa.
Surveys also reveal that informal cross-border trade, conducted largely by women, represents a significant proportion of regional cross-border trade in sub-Saharan Africa. For example, in Uganda, informal exports flowing into its five neighbouring countries were estimated to account for $231.7 million in 2006, corresponding to around 86 per cent of Uganda's official export flows into these countries.
Despite this, East Africa's trade potential is undermined by constraints that women face, including various specific non-tariff barriers that impinge particularly heavily on the trade activities of women and women-owned enterprises, and often push women traders and producers into the informal economy where lack of access to finance, information, and networks jeopardise their capacity to grow and develop their business.
Gender inequality in access to and control of a wide range of assets and resources remains pervasive: Women farmers tend to produce 20 to 30 per cent less than their male counterparts because they have less access to vital inputs such as seeds, fertilisers and tools. Responsive trade policies are needed to provide a level playing field for the effective participation of women in domestic and international trade.
Investing in women's ability to trade and do business makes sense; strategic interventions can result in what has been described in a recent report The Numbers on Women: The World Economic Forum Global Gender Gap Report, 2014 as "an astonishing cascade of positive benefits to whole nations... ."
Increased entrepreneurship and labour force participation additionally leads to income generation, improved social status, wealth creation and slower population growth.
According to the World Bank report Engendering Development, women reinvest up to 90 per cent of their income in the education, health and nutrition of their family and community compared with 30 to 40 per cent for men.
A report by the Food and Agriculture Organisation further notes that if women had the same access to productive resources, they could produce 20 to 30 per cent more food, translating into up to 150 million fewer hungry people.
Some benefits of TMEA's own women and trade programming in Rwanda demonstrate that with increases in revenue, women are now able to afford medical insurance and education costs for their children.
Women play a key role in trade in East Africa and could potentially contribute towards further positioning trade as a key driver of growth, employment and poverty reduction. This is an investment worth making, giving thousands of women the opportunity to not only join, but lead East Africa's growth.
The author is senior director, business competitiveness at TradeMark East Africa.