Top Countries in Africa for Female Entrepreneurship
Kenya, Tunisia and Egypt are the best countries in Africa for female entrepreneurs. This is according to a study by Grant Thornton International Business Report (IBR).
The top five countries on the continent that have at least 10% of women involved in business are Kenya (17%), Tunisia (15%), Ethiopia (15%), Egypt (14%) and South Africa (13%).
On the other hand, Mauritania is the least promising for women entrepreneurs. Only 3% of female-owned businesses are present in this country.
Even though there has been an increase in female participation in business, there are still certain cultural obstacles that have made it difficult to achieve the same level of success as male entrepreneurs.
The study was conducted in 20 African countries and examined approximately 50 million businesses, over half of which were started or owned by women. The study looked at nearly 40,000 businesses with employees in each country. In all, there were 30 countries that had more than 500 female-owned businesses.
The research was undertaken by Grant Thornton Africa and covered all categories of businesses with employees. This covers businesses in the private sector through to charities, social enterprises, cooperatives and public sector organisations. The research studied organizations regardless of their ownership structure or business model in order to provide a more accurate picture of female entrepreneurship across the continent.
The data showed that in general female entrepreneurs have slightly more than half the number of employees as their male counterparts. The research also indicated an increase in women business owners over time, with data showing a 47% growth from 2012 to 2015.
The report found that the industries and sectors where women are most likely to be involved were wholesale and retail trade (12% of businesses), finance and insurance (9%) and professional, scientific and technical activities (8%).
The industries where women are least likely to be involved were energy, water and construction; manufacturing; agriculture, forestry and fishing.
Research also indicates that the more developed a country is the higher the number of female entrepreneurs. For example, countries in the Sub-Saharan Africa region had a ratio of 4:1 whereas North Africa had 1:2. The report found that women entrepreneurs were particularly active in digital start-ups and business transformation services such as M&A and restructuring deals.
South Africa leads on female participation in business with 13% of all businesses in the country being female-owned.
Key findings from the IBRA include:
– Females account for 16% of all entrepreneurs in Kenya, more than any other African country. These businesses have grown by 70% since 2012 and contribute Kshs10 trillion (USD100 billion) to the economy per year. There is also a high representation of women in tech start-ups, accounting for 20% of the market.
17% of businesses are female-owned in Tunisia – more than any other country on the African continent. In addition, there has been a 30% growth in female entrepreneurs since 2012 and now account for 6% of all Tunisian businesses.
Female-owned businesses in Ethiopia have increased by 20% since 2012. Women account for 15% of all entrepreneurs in the country, which is more than any other African nation and one of the highest ratios on the continent. There has been a considerable increase in women working in professional services such as architecture and legal firms.
– The number of female-owned businesses has increased by 25% in Uganda since 2012. Women entrepreneurs account for 14% of all businesses in the country, which is more than any other African nation and one of the highest ratios on the continent.
Women start-ups accounted for 9.5% of all tech companies in Kenya from 2014 to 2015, an increase from 7.5% in 2014 and 4.2% in 2013.
In South Africa, women account for 19% of businesses and contribute USD9 billion to the economy annually. The total number of female-owned businesses has increased by 62% since 2012, which is the highest growth rate of all African countries surveyed. Women entrepreneurs are notably active in the manufacturing sector, accounting for 24% of businesses.
Kenya ranks highest on female participation in business with 13% of all businesses in the country being female-owned. The United Nations Development Programme (UNDP) has been encouraging more women to start their own businesses through several initiatives including programs that support and train women entrepreneurs using an approach known as social franchise.
In 2013 the UNDP in Kenya launched She Leads Africa, a regional initiative intended to address issues of gender inequality in business using an entrepreneurship development model for women entrepreneurs that focuses on cutting down barriers and reducing risks by connecting women with mentors, training, financing and networking opportunities.
The program is modeled after its success in Afghanistan, where it was able to enable one million women to set up businesses.
The program takes an integrated approach that directly addresses issues of gender inequality by addressing the following three areas:
1) Legal and regulatory environment for business (as female entrepreneurs are often limited by access to land, credit and other necessary resources);
2) Business and entrepreneurship skills training;
3) Access to financing for businesses. She Leads Africa is run in partnership with the UNDP, the Clinton Foundation, SIDA (Swedish International Development Cooperation Agency), DFID (Department for International Development of Great Britain), DFATD (Department for International Development of Australia), the Government of Kenya, the private sector and NGOs.
One beneficiary of the program is Hodari Koech Rigatti, who launched her own digital marketing firm in Nairobi after receiving training from UNDP's She Leads Africa program. Rigatti says that the knowledge she gained as a result of this program has allowed her to help hundreds of women secure jobs. She also explained how difficult it was for women to start their own businesses in Kenya, saying: "In the beginning I couldn't even get a loan from banks... Now with this program I've got my own office and I'm paying my suppliers on time."
Another beneficiary is Hannatu Mwakutuya, who explained how the program has helped her secure a loan to expand her catering business: "I feel empowered. I can now cater for more events and do bigger weddings... My customers are happy with my services."
A similar initiative in Ghana is the Women's Enterprise Program (WEP). WEP was launched by the government of Ghana and the World Bank with a budget of USD16 million to improve women's access to capital and create jobs. The project is being implemented by the Social Entrepreneurship program at Ashesi University, which has helped 4,000 women start businesses in agriculture, food processing, retail and tourism.
The impact of these initiatives can be seen in the increase of female-run businesses. For example, in Ghana, where WEP has been implemented since 2012, female entrepreneurship has grown by 30% compared to a national average of 20%.