De Sousa dos Santos reports in the 2015 World Economic Forum that the strong growth of many economies in Africa can be attributed to the boom in small and medium-sized enterprises (SMEs). Furthermore, SMEs are well-suited to the informal and rural sectors and require lower time and financial resources than large businesses. There may also be lower risks involved in SME ownership, where business failure is likely to have a smaller impact on income and savings than more formal and significant business commitments. These features of SMEs make them an ideal mechanism for women’s economic empowerment, as they reduce the very same burdens that women face; namely, resources, capital, time and financial risks.
Given this, the NEPAD Spanish Fund (NSF) supported numerous successful projects that promoted the engagement of women entrepreneurs in small and medium-sized enterprises to the benefit of more than 40,000 African women.
These projects, amongst others, facilitated training for women in entrepreneurial skills and business plan development, marketing and access and invested in infrastructure that provided women with services to support the sustainability of their small and micro enterprises created. Many of the projects improved the success rate of these SMEs by providing technical and financial support, assisting with access to microfinance at low interest rates, and creating linkages between formal lending institutions and women involved in informal trade.
The NEPAD Spanish Fund, therefore, helped to promote an entrepreneurial culture amongst women, as well as develop their existing capacities. The extra income that female SME initiatives brought to households was invested in priority areas, often neglected by their spouses, such as education, healthcare and savings to attend to future needs. These initiatives have ameliorated the economic pressures on many poor, disadvantaged African women. The initiatives support the African Union’s Agenda 2063 aspirations to achieve prosperity in Africa through inclusive growth and sustainable development, by unlocking the potential of women and the youth.
Key lessons learned from projects:
- Ensure community support as well as the backing of community leaders for SME projects
- Obtain continuous feedback from participants and partners during SME advocacy and consultative forums to improve similar interventions in future
- If SME development includes production of goods, make sure that there is a market for the produce and that marketing initiatives are undertaken to stimulate demand for the produce
- Address cultural and religious dynamics with respect to financing SME projects for women
Ensure community support as well as the backing of community leaders for SME projects
The Women of Uganda Network (WOUGNET) project learnt that community buy-in and support for SME projects for women, along with the backing of community leaders, provided greater assurance of a positive outcome of the project. Involving the community was especially beneficial in the planning of project activities as it developed a sense of ownership and allowed the members of the community to understand and support the SME project. The Jewels of Faith Academy (JOFA) further realised that it is vital to establish the needs of the target community prior to the SME project’s commencement to ensure that the women of the community are empowered, and their livelihoods improved.
Obtain continues feedback from participants and partners during SME advocacy and consultative forums to improve similar interventions in future
The Centre for African Women Economic Empowerment (CAWEE) found that the feedback given by participants and partners during the advocacy and consultative forums they convened to address the challenges that Ethiopian women entrepreneurs faced, would help to improve similar interventions in future. An example that was cited was that, through feedback, CAWEE learned to better mobilise key note speakers, guests of honour, moderators and the participants.
If SME development includes production of goods, make sure that there is a market for the produce and that marketing initiatives are undertaken to stimulate demand for the produce
Feasibility studies should be done before commencement of a SME project to see whether there is a market for the goods that the SME will produce. For example, The Gambian Women’s Bureau found that it was important to formulate and initiate a marketing plan to support the increased production of vegetables that arose from the funding of 31 female run vegetable gardens. They suggest that any such project should research and use opportunities that already exist in the country. For example, in the Republic of Gambia there is a potential demand from hotels that need fresh vegetables. They further found it valuable to explore possibilities of linking up with other agro-processing companies either for direct processing or for exporting purposes.
Address cultural and religious dynamics with respect to financing SME projects for women
The Women’s Rights Awareness Program (WRAP) found it pertinent to address cultural and religious dynamics with respect to issues of loan savings and bank interest in Kenya. For example, WRAP held question and answer sessions to address concerns that Muslim communities had, as they believed that ‘earning savings’ from interest was an unjust earning.