About 46.4 percent of businesses in Ghana are owned by women, making the West Africa nation one of the top performing African countries when it comes to women entrepreneurship according to Mastercard Index of Women’s Entrepreneurship (MIWE) released last week.
The latest MIWE report, who’s release coincided with the International Women’s Day, is a weighted index that helps to better understand and identify factors and conditions that are most conducive to closing the gender gap among business owners in any given economy. The three factors include Women’s Advancement Outcomes, Access to Knowledge and Financial Services, and Supporting Entrepreneurial Factors.
The Index examined 57 different economies around the globe, including Botswana, Ethiopia, South Africa and Uganda; with Ghana, Nigeria and Malawi as new additions.
Nigeria and Ghana scored particularly well in terms of advancement outcomes: the women entrepreneurial activity rate was 100 percent, with overall scores in this regard coming in at 62.4 percent and 59.1 percent respectively. African countries also scored highly in women labour force participation – with Malawi at 100 percent, Ghana at 96.1 percent, and Ethiopia at 86.6 percent.
South Africa excelled in sharing knowledge assets with women and providing financial access, with a score of 84.3 percent– coming in 6th out of 57 countries. Botswana followed closely with a score of 73 percent. Botswana and South Africa were the highest scoring African countries in the Index overall with scores of 66.5 percent and 64.2 percent respectively.
When compared to other African markets surveyed, Botswana leads the charge with the highest rate of Supporting Entrepreneurial Conditions, at 68.1 percent, this is an increase of 2 percent from last year, indicating that the country has positive Cultural Perceptions of Women Entrepreneurs and Quality of Governance.
Overall, the continent scored highly in terms of women financial inclusion with South Africa at 98.7 percent, Ghana scoring 84.6 percent, and 77.1 percent in Ethiopia.
The Index results revealed that female entrepreneurs in developing countries are driven by grit and determination, along with a desire to provide for their families. The findings reinforce that women entrepreneurs are the backbone of economic growth and powerful engines of development and financial inclusion, especially in Africa. The Index also showed an interesting contrast: women’s progress and advancement as entrepreneurs is not necessarily aligned to the pace of their own country’s economic growth and wealth. In fact, the highest rates of ownership are seen in developing economies where entrepreneurship is typically necessity-driven.
Women entrepreneurs in Africa and other developing markets have proven to be equally vibrant, resourceful and innovative in finding opportunities to improve their own lives as well as create a better future for their children.
“Botswana, Ghana and Uganda shine as examples of women’s determination to provide for themselves and their families and Africa excels at creating strong women entrepreneurs with the drive to succeed even in the face of financial, regulatory or technical constraints,” says Beatrice Cornacchia, Head of Marketing and Communications, Middle East and Africa, Mastercard.
An interesting outcome of the Index is that cultural perceptions of women entrepreneurs in Africa are predominantly positive – at 69.1 percent in Uganda and 67.2 percent in Nigeria, this is well above their Middle Eastern counterparts.
According to the latest MIWE report, some women’s inclination towards business ownership may be undermined by limited access to education, financial and entrepreneurial opportunities. These are by no means only African – or developing – countries challenges, however. Women entrepreneurs even in developed nations face cultural and gender biases that restrict them from opening or expanding their own businesses.
These constraints are acting as barriers preventing women from starting businesses in the majority of the 57 countries surveyed. In New Zealand, the top ranked country overall for example, results revealed that society is less receptive towards female entrepreneurs because they are not perceived as having the same level of know-how as men. In Portugal, which ranked 6th on the Index with a score of 69.1 percent, women are not only constrained by a lack of cultural acceptance, but difficulties in getting bank loans, insurance, or trade finance. Even Botswana – which emerged as the top ranked African country on the Index at 14 with a score of 66.5 percent – has seen an increasing gender bias that acts as a barrier to women opening businesses.
This indicates that changes need to be implemented not just within society itself, but at economic, financial and political levels. “This requires collective action from public and private sector partners to implement initiatives that provide African women with the necessary education, training and mentorship to develop financial literacy to start and run successful and sustainable businesses,” Cornacchia concludes.
The Mastercard Index of Women Entrepreneurs (MIWE) tracks female entrepreneurs’ ability to capitalize on opportunities granted through various supporting conditions within their local environments and is the weighted sum of three components: 1) Women’s Advancement Outcomes (degree of bias against women as workforce participants, political and business leaders, as well as the financial strength and entrepreneurial inclination of women), 2) Knowledge Assets and Financial Assets (degree of access women have to basic financial services, advanced knowledge assets, and support for small and medium enterprises), and 3) Supporting Entrepreneurial Conditions (overall perceptions on the ease on conducting business locally, quality of local governance, women’s perception of safety levels and cultural perception of women’s household financial influence).
The Index uses 12 indicators and 25 sub-indicators to look at how 57 economies across Asia Pacific, Middle East & Africa, North America, Latin America and Europe, representing 78.6 percent of the world’s female labour force, differ in terms of the level of the three components.
Top 10 markets with the strongest supporting conditions and opportunities for women to thrive as entrepreneurs:
- New Zealand – 74.2
- Sweden – 71.3
- Canada – 70.9
- United States – 70.8
- Singapore – 69.2
- Portugal – 69.1
- Australia – 68.9
- Belgium – 68.7
- Philippines – 68.0
- United Kingdom – 67.9
Top 10 markets – Women business owners as a percentage of all business owners:
- Ghana – 46.4%
- Russia – 34.6%
- Uganda – 33.8%
- New Zealand – 33.0%
- Australia – 32.1%
- Vietnam – 31.3%
- Poland – 30.3%
- Spain – 29.4%
- Romania -28.9%
- Portugal – 28.7%