Women’s Employment and Entrepreneurship in the Middle East and North Africa* _________________ Ms Nicola Ehlermann-Cache Head, MENA-OECD Investment Programme OECD, Global Relations Secretariat *: Algeria, Bahrain, Djibouti, Egypt, Iraq, Jordan, Kuwait, Lebanon, Libya, Mauritania, Morocco, Oman Palestinian Authority, Qatar, Saudi Arabia, Tunisia, United Arab Emirates, Yemen

2 Part 1: A Statistical Portrait from Available Datasets

3 Major achievements in women’s education: Towards the elimination of gender inequality Female-to-Male Enrolment Ratios: MENA Countries (2011) Source: World Bank WDI. The data give the average values of the ratios for each available year of the period.

4 A remaining pronounced gender gap in women’s labour force participation and unemployment Increase in female participation to the labour force especially in North Africa (from 14% in 1992 to 21% in 2012) Women’s labour market engagement lags behind the rest of the world Source: World Bank Gender dataset based on ILO Key Indicators of the Labour Market. Male and Female Labour Force Participation Rate, selected regions, 2011 Unemployment rate of women in the MENA region: 18% – compared to 6% worldwide 83% of women are not working or unemployed – compared to 50% worldwide – the lowest rate of female employment in the world

5 Entrepreneurship (SMEs and MSMEs): a reservoir for women’s employment, an economic opportunity in a region deprived of entrepreneurs Entrepreneurship is attractive to women, but the survival rate of businesses in which women are involved is lower than for men  Women come from lower income households and have less employment experience  Women’s businesses are concentrated in consumer-oriented and lower-technology production activities Exceptionally small proportion of women-owned or -managed large enterprises  7% of incorporated firms have any women among owners – 37% worldwide  1% have top female manager – compared to 18% worldwide Activity rateEarly stage (nascent & new ventures) (TEA) Established business stage (> 3.5 years) Total Female Male Entrepreneurial activity rates by gender, MENA region, share of adult population (%) Source: Reynolds forthcoming, based on GEM data for 10 countries (all 2009 except Egypt 2008).

Unemployment is high for young women and older women drop out of the labour force Young women face particularly high unemployment rates in many MENA countries : close to 50% in Algeria, Egypt, Jordan, Palestinian Authority, and › 30% in Bahrain and Tunisia Overall drop-out of labour force grows significantly with age Female labour force participation rate by age, MENA countries Source: calculated from ILOSTAT

7 Part 2: Access to Finance for Women Entrepreneurs in MENA

Women’s Access to Finance in MENA -SMEs represent 90% of MENA businesses – ensuring access to finance is crucial for growth -Banks report that women entrepreneurs represent a potential market, but of those who lend to women, less than 10% of their loans are to women -Women-led businesses represent a growing market, and they are substantially under-banked -The OECD has conducted a survey into banks’ financing practices with regard to women, in cooperation with UAB. 8

Supply-side issues Little evidence of banks targeting women Banks report they have little information on women’s specific issues in order to target products “Gender-neutral” lending policies often inhibit women’s access by failing to take account of their special needs (e.g. women possess less collateral, less work experience, etc) Banks are unaware of the cultural barriers women face (e.g. mobility, higher demands on their time) MENA Banks generally more risk-averse, a further impediment to women who possess less collateral 9 Women’s Access to Finance in MENA

Demand-side issues: Women lack the business skills and knowledge required to successfully approach banks, and often do not know what sources of funding are out there or how to access them. Women often unaware of the business development services available to them There is a perception that loan application processes are over-complex 10

Key Recommendations MENA Governments and Policy: Further data collection enabling banks to design and implement a strategy to attract and segment women entrepreneurs in the SME sector. Promote international good practices in extending access to financial products and services to meet the financing needs of women entrepreneurs and the growth strategy of banks. To address the issue of risk aversion amongst lenders, Guarantee Schemes should be explored with Banks and Women Business Associations Develop gender sensitivity training programmes to be delivered to banks and financial literacy training to women entrepreneurs. 11

Banks and financial institutions in the MENA region: Sponsor the development, the capacity-building and the training of “bank readiness”, in cooperation with UAB members and partner financial institutions. Investigate expanding the use of internet, social media and phone banking as channels to market and distribute to women Adapt current non-credit bank services (such as coaching and financial planning advice) to women 12 Key Recommendations

Women Business Associations & Women Entrepreneurs: Appreciate the importance of risk calculations in the bank decision-making process, Understand that business plans should include detailed financial statements with projections over the short to medium-term, and key benchmarks. The goal is to emphasize the profitability of the business and the existence of a sound strategy to enhance this. 13 Key Recommendations

Thank you for your attention. Contact: Ms Nicola Ehlermann-Cache Head of the MENA-OECD Investment Programme