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Does financing benefit African women?

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Does financing benefit African women?

New initiatives to track the gender impact of development funds
From Africa Renewal: 
Das Fotoarchiv / Charlotte Thege
Wood workerFew women in Africa work in regular, formal sector jobs, and even those generally earn too little to escape from poverty.
Photograph: Das Fotoarchive / Charlotte Thege

Decades after the world officially recognized a human right to gender equality, women remain largely excluded from the upper ranks of government and business, earn less than their male co-workers and face an array of customs, traditions and attitudes that limit their opportunities. Are governments, businesses and the international community putting money behind their resolutions calling for women’s advancement? Are international aid budgets, government funds and private sector resources being spent in ways that narrow economic, social and political inequalities between men and women?

The answer, notes Jacinta Muteshi, chair of the Kenyan government’s Commission on Gender and Development, is generally “no.” While there has been some pro­gress in women’s political representation, advances have been limited in the economic realm and for poor women in particular. That is because disadvantages “are often anchored in social institutions, macro-economic policies and development strategies that have not adequately recognized that women are important agents of economic development and poverty reduction,” Ms. Muteshi told Africa Renewal.

The UN Development Fund for Women (UNIFEM), in its 2008 report Progress of the World’s Women, agrees that “progress for many women, particularly the poorest and most marginal, has been far too slow.” In a few countries, including Rwanda and South Africa, there has been an increase in the number of female parliamentarians and other elected and appointed officials. But UNIFEM notes that women will not reach parity with men in legislatures in developing countries until at least 2047 at present rates of increase.

Poverty’s female face

Economic parity is even further away. In employment, the report asserted, gender bias has meant that “women have been more concentrated than men in informal, subsistence and ‘vulnerable’ employment,” that is, self-employment and jobs without salaries in family-owned businesses. According to the International Labour Organization (ILO), more than 67 per cent of African women work in agriculture, mostly as smallholder subsistence farmers. Fewer than 1 in 5 working women in sub-Saharan Africa receive regular wages or salaries, compared to a third of employed African men and almost 93 per cent of women in the developed North.

Growing cassavaGrowing cassava: Donors should direct more aid to farming projects that involve women.
Photograph: UNMIL / Christopher Herwig

Even for the minority who do earn wages, a paying job is unlikely to offer an escape from poverty. Although a lack of data prevents the ILO from calculating the gender gap in earnings between men and women in sub-Saharan Africa (globally women’s pay currently averages 83 per cent of men’s), it does report that over half of all African wage and salary earners make less than $1 per day, the commonly accepted measure of absolute poverty.

The percentage of African wage earners making less than $2 per day exceeded 86 per cent in 2006, a share that is virtually unchanged from a decade ago, despite relatively high growth rates in recent years. In the view of labour economists, the high number of people classified as “working poor” points to considerable income inequality in Africa, as well as the continued failure of African economies to generate good jobs for both men and women.

But the extra obstacles faced by women struggling to work their way out of poverty are suggested by the World Bank. Its latest Enterprise Survey found that in both the public and private sectors, only 1 in 26 salaried African women was employed in a senior management position, compared to 1 in every 6 men. That lack of opportunity at home contributes to a far higher percentage of college-educated African women, nearly 28 per cent, going overseas in search of employment, compared to 17 per cent of educated men.

A stacked economic deck

The UN Development Programme and others estimate that as many as 70 per cent of the world’s poor are women. In almost every respect, Ms. Muteshi argues, the economic deck is stacked against women. Citing UN estimates, she notes that women worldwide account for two thirds of all working hours and produce half the food, but earn just 10 per cent of the world’s income and own less than 1 per cent of the world’s property.

First and foremost, she says, this gap reflects “the absence of women in economic leadership.” African women are only rarely present among senior officials at central banks or ministries of finance, planning or trade. “The same can be said of women’s representation in the private sector.”

A small shop owner in GhanaA small shop owner in Ghana: The greater availability of micro-credit has helped women improve their businesses, but larger loans must also become available.
Photograph: Richard Lord

Economic growth has created employment for women in developing countries in such labour-intensive industries as clothing, shoes and electronics assembly. But these are also industries in which wages and working conditions are notoriously bad.

Employers in labour-intensive businesses often prefer women as they are seen to have fewer economic options than men and are therefore willing to accept poorer wages and working conditions. Women workers are also less likely to be members of trade unions than men.

Following the money

In the 1980s, women’s rights advocates began to scrutinize public budgets to understand how financial flows affected women. Activists initially focused on the area of most importance to women, government spending. By analysing public finance through a process known as “gender budgeting” (see Africa Renewal, April 2002), they hoped to ensure that women benefited fairly from national spending decisions and to improve the budget-making process itself.

In a December 2007 report to the UN Commission on the Status of Women on financing for gender equality, Secretary-General Ban Ki-moon noted that 50 governments around the world, including several in Africa, used gender budgeting methods to help set spending priorities. Morocco has established gender budgeting methods as part of a broader reform of its budgetary spending process.

There also have been efforts to put a price tag on gender inequality. Mr. Ban’s report estimates that the equivalent of between 0.1 and 0.3 per cent of gross domestic product (GDP) is lost every year from failure to “promote gender equality and empower women.” That goal is the third of eight internationally agreed development objectives known as the Millennium Development Goal (MDGs).

The goal includes a specific commitment to eliminate gender disparities in education by 2015. Achieving this in poor countries, the report estimates, would require an increase in annual spending on gender equality programmes from an estimated $8.6 bn in 2006 to nearly $24 bn by 2015. The World Bank estimates the cost of achieving full economic and social equality between the sexes at $83 bn per year by 2015.

Aid and accountability

Recently, UNIFEM and women’s groups have expanded their focus on budgets to include other financial flows, including official development assistance (ODA), loans and international trade. UNIFEM reports some progress on aid, in part because many donors in the industrialized countries’ Organization for Economic Cooperation and Development (OECD) now track financing specific to gender as part of their overall efforts to improve the delivery of aid to developing countries.

Between 2002 and 2006, the OECD reports, aid for programmes designed at least in part to promote gender equality rose from $2.5 bn to $7.2 bn, and the amount of aid screened for its impact on gender rose from $15 bn to $26.8 bn. But the group also reports that such “gendered” aid was overwhelmingly concentrated in the social services. Only $1 out of every $4 in ODA for infrastructure and directly productive activities like mining, manufacturing and farming was spent on projects that included greater gender equality as a goal.

Such broader efforts to improve the effectiveness of aid have created political openings for activists to push for better financing for women’s equality initiatives. But UNIFEM notes that financing for dedicated gender-equality projects represented less than 5 per cent of total OECD aid in 2006.

UNIFEM argues that it is important to also introduce concrete targets and goals into reform plans. That would help policy­makers and civil society groups design programmes that are more responsive to gender concerns.

Governments that receive aid must also do better. In recent years donors have begun to channel a greater percentage of aid to poor countries through general budgetary support, instead of allotting aid for individual projects. A recent study by the OECD’s Network on Gender Equality found that such “programme” funding leaves decision-making with recipients’ finance ministries. “These ministries often are unaware of … gender equality as a development issue, as are many staff on the donor side.”

Liberalization policies

Ms. Muteshi of Kenya thinks the problem goes even deeper. “Current neo-liberal economic structures are disadvantageous to women in general,” she asserts. That is because a narrow emphasis on GDP growth fails to recognize “the gendered nature of our economic lives.” The liberalization theories that influence many development strategies, she notes, tend to push women into “precarious, exploitive, unregulated and temporary forms of work” in the informal sector.

Even increases in donor support for sectors that benefit African women, she notes, such as health and education, are often made without women’s involvement, thus keeping them on the margins economically and politically.

There has been some good news, Ms. Muteshi acknowledges. Women have benefited from microfinance loans, which are now available in most African countries. However, she adds, “the amounts remain small and have rarely been scaled up in ways that truly strengthen women’s economic power. It is time to provide women with credit that moves beyond ‘micro.’”

Ms. Muteshi argues that the greatest problem with donor programmes in Africa is that they generally do not invest in sectors especially important to women. In agriculture, she observes, “African women provide approximately 70 per cent of the workforce and grow about 90 per cent of the food, yet it is a sector that has seen little real investment directed towards women.”

Trading for equality?

Trade is another potentially import source of finance for gender equality, but efforts to assess its impact have been hampered by inadequate information and research. The overall effect, however, appears to be no better than mixed. Access to the US market through that country’s Africa Growth and Opportunity Act helped create jobs for women in the African textile industry in the 1990s. European trade reforms also benefited some African women producers by lowering tariffs on some speciality products.

But following liberalization of the textile trade at the World Trade Organization in 2005, many textile plants relocated to Asia. Meanwhile, European Union barriers to African farm produce, the export sector most important to women, remain formidable.

More broadly, trade liberalization has not succeeded in dramatically expanding opportunities for women. African exports remain heavily concentrated in commodities, particularly energy and minerals, and in a few commercial agricultural products such as coffee and tea. These are sectors in which women are poorly represented.

African women’s efforts to include gender equality and poverty reduction rules in global trade agreements have been largely frustrated by the refusal of many major trading countries to consider human and social rights in trade negotiations. African women have had some success in working with Northern civil society “fair trade” groups to counter specific injustices. UNIFEM cites a case in which Kenyan women growing fresh flowers for shipment to the UK were able to secure higher wages and better working conditions by pressuring buyers with the aid of London-based activists.

Agenda for action

In the struggle for economic equality, UNIFEM asserts, there is mounting evidence that African and other poor women remain “at the margins of formal economies.” Securing the resources women need for equality, the organization says, is “mission critical” to Africa’s development plans. It will require fundamental changes in the way power and wealth are distributed. Such changes include:

  • Empowering women politically, including through the use of quotas for elected and appointed offices
  • Ensuring that commitments to increase development aid are fully achieved, and that such external financing is assessed for its impact on gender equality
  • Making sure that women are at the table when economic priorities are set
  • Accelerating progress towards the MDGs’ gender equality and health and education targets
  • Regulating markets to ensure that women can participate fully and fairly in economic life.

For Ms. Muteshi, a major change is needed in the way the world thinks about women and economics. “Women are almost exclusively responsible for care and reproductive work and the unpaid economic activities in the household,” she concludes. “Under current definitions of labour, this daily work of women has been underestimated or excluded from national accounts.”

Current initiatives for women’s empowerment and gender equality are too narrowly focused, Ms. Muteshi argues. “They do not adequately address the root conditions that produce inequality.” Until the world learns how to value the work women actually do, “we leave women vulnerable to poverty, violence and powerlessness.”