The Future of Africa: Women Entrepreneurship

A revered leader on the African continent and former candidate for the World Bank presidency, Dr. Ngozi Okonjo-Iweala is a strong advocate for the empowerment of women, especially for female entrepreneurs. Her speech at a TED conference in which she encouraged investors to "help [African] women to stand on their own feet" and argued that "some of the best people to invest in on the continent are women" has begun to resonate throughout Africa.  As a female entrepreneur who has spent the past decade working with women-owned enterprises, as well as running my own business initiatives and having personally seen the accelerated and exponential payback that women deliver, I concur with Dr. Okonjo-Iweala. Investing in women-owned enterprises is no longer a nice thing to do; it has become an economic imperative for both the public and private sectors as there is increasingly solid evidence that shows that "Women's economic empowerment is a prerequisite for sustainable development."

Now more than ever before, African governments, as well as local and international investors, are increasingly directing their monetary and non-monetary efforts toward supporting women-owned enterprises. In the hope that this newly defined trajectory is fully embedded across Africa, I offer – especially to the organizations that have not yet embraced this new philosophy of procuring their services and goods, and/or investing in, women-owned enterprises – five key reasons why women entrepreneurs are the future of Africa. But first, allow me to summarize the evolution and historical context of female entrepreneurship in Africa, so that we may more fully explore where it is heading.

Contextualization of Women Entrepreneurship in Africa in the 20th Century

During the 20th century, Africa experienced its highest number of conflicts, amongst which were in the DRC, Nigeria, Liberia, Sierra Leone, Cote d' Ivoire, and 1994 genocide in Rwanda. It is recorded that most men who participate in conflict never returned home. Women were left with no option but to run African households. In addition to their responsibilities of being child bearers and nurturers of families, these women had to provide financially for their immediate and extended families to ensure that they did not go hungry, had access to healthcare, and obtained an education. In some instances, young girls who lost their parents during the wars had to grow quickly into the role of heads of households to care for their siblings. This was the reality women faced in Africa, a dark reality that no one had prepared them for.

These women were expected to start running a marathon of sorts, without being given proper running shoes to wear. In other words, although they were not provided with the skills and support to build sustainable households and communities, they had to engineer creative ways to be financially independent. Despite these tough circumstances, the resilience, focus and drive of African women to come out of poverty led them to set up informal ventures to generate income for their families.

Post-20th Century African Leadership Opens Space for Entrepreneurship

Today, whilst many African women may still be bearing the scars of political and tribal conflicts that run through their countries and economies, the emergence of a new type of leadership in the 21st century in Africa has brought with it much hope. This new generation of African leaders started to place a strong emphasis on peace-building, poverty alleviation, foreign direct investment and economic growth, like in Rwanda and Liberia.

In Rwanda, President Paul Kagame's Vision 2020 has started to bear fruits. This vision aims at ensuring that by 2020 Rwanda becomes a middle-income country, and it centers around six main pillars namely, "good governance and efficient State, skilled human capital, vibrant private sector, world -class physical infrastructure and modern agriculture and livestock, all geared toward national, regional and global markets." Despite the genocide that occurred 20 years ago, the country has been growing steadily. It is expected that the Rwandan economy will grow by 6.6% by the end of this year and as high as 10% by 2018. Additionally, the poverty rate dropped from 59% in 2001 to 45% in 2011. A remarkable achievement by President Paul Kagame is the composition of the country's judges of which half are women and the supreme court being led by a woman.  Increasingly, huge responsibilities are being given to these women to work with the government in order to realize the national priority targets.

Since Ellen Johnson Sirleaf took the reins of Liberia on January 16, 2006, notable reforms have been implemented in the country to boost the economy. Liberian external debt of USD 4.9 billion is almost non-existent today, as the government met the Heavily Indebted Poor Countries (HIPC) requirements which led its debt to be cancelled. Its GDP has grown from 4.6% in 2009 to 7.7% by the end of 2013 as forecast by the African Development Bank. Moreover, Liberia has become a peaceful country since Sirleaf's leadership.

Although these leaders have attempted to address the national priorities of developing a robust infrastructure, creating an adequate healthcare system, providing education, and delivering access to potable water, the speed of implementation remains a key concern. For these priorities to be realized, African governments need to work with the private sector, specifically in the areas of private sector development and SMME growth, which have shown to have a great impact on job creation and poverty alleviation. Entrepreneurship as a key driver for economic growth and poverty alleviation is a must for all stakeholders involved.

Women Entrepreneurs as the Driving Force behind Africa's Socio-Economic Development

Cognizant of the impact strong entrepreneurial ventures can have on their economies, African governments are increasingly creating and enabling an environment for entrepreneurs to thrive. A case in point has been the economic and trade reforms implemented in several African countries, including Botswana, Malawi, DRC, Rwanda and Cameroon – just to name a few. Today, it is a lot easier to set up a business in these countries than it was a decade ago. Whilst these positive developments have been taking place in most parts of Africa, the inclusion of and focus on women entrepreneurship on the continent still remains a burning issue which must be resolved for Africa to achieve its highest economic potential.

Whilst there may be many reasons that make the business case for investing in women-owned enterprises strong, I will focus on three foundational facts that support the argument that investing in women will fast-track Africa's economic development, enable job creation, and address socio-economic development challenges that have up to now, hindered Africa's development. These reasons are:

1. Women have greater influence over household purchasing decisions. Globally, women control "US$20 trillion in consumer spending and that number is predicted to rise to US$28 trillion by 2014." Moreover, it has been shown that "where, the family's health, nutrition, and education improve at a faster rate because less money is spent outside the household." Adding to the impact of that fact, is that in Africa, women represent a slighter larger portion of the adult population (51% women against 49% male), and a slightly greater portion of the youth population, creating a present and future on the continent wherein women manage and make the household purchasing decisions.
2. Throughout the world, more women are graduating with university degrees than men. In more developed countries such as the U.S., women represent 51% of the nation's PhDs, 51% of business school applicants, and 67% of college graduates.  In Rwanda, half of its college graduates are women.
3. Women embrace the triple bottom line philosophy to not just generate profits, but also reinvest those profits into their communities and environment. "Women invest 90 percent of their income in households, as opposed to men's 30-40 percent." This greater reinvestment of profits allows for the seeding, nurturing, and growth of communities and the environment for an exponentially brighter future.

As African countries move forward in their historical evolution and seek to create more jobs and alleviate poverty, women must be part of the continental economic equation – particularly women entrepreneurs – if we are to achieve our greatest potential.

Dr. Nathalie Chinje, the South Africa Executive Director of WEConnect International, is the founder and director of UPbeat Marketing.

Photo attributed to World Economic Forum.