Women entrepreneurs in African countries like Ghana, South Africa and Botswana operate in more favourable conditions than their counterparts in Nigeria. This was revealed by global financial services company, Mastercard in its Index for Women Entrepreneurs (MIWE) report.
The report captures the performance indices of women in 58 key economies around the world including African countries like Nigeria, Uganda, Ghana, South Africa, Algeria, Malawi, Egypt, Tunisia etc.
One of the criteria used to determine how well women entrepreneurs performed in 2020 is the entrepreneurial supporting conditions in their countries. The other two factors are knowledge and financial access, and women’s advancement outcomes.
Global ranking of countries
Countries were rated based on the ease of doing business, cultural perceptions of entrepreneurship, quality of governance and entrepreneurial supporting factors.
Global ranking of countries based on all factors continued
Source: Mastercard Index for Women Entrepreneurs report
Botswana has the best entrepreneurship supporting environment in Africa. The country scored a total of 60.8 points in the rankings. South Africa has the next best enabling environment for women entrepreneurs in Africa with a total of 60.4 points while Ghana comes in next with 59.0 points. Tunisia follows with 51.0 points.
Uganda, Malawi and Algeria also provide better conditions and are rated higher than Africa’s most populous country in this area with 50.7, 46.7 and 45.2 points respectively. Nigeria scored a total of 43.4 points and came in 53rd position globally, beating only Egypt, Bangladesh, Ethiopia, Angola and Iran.
Nigeria has a growing startup ecosystem. However, unstable economic conditions make it more difficult for women entrepreneurs to thrive in.
The negative effects of the lockdowns which closed down trade and brought some economic activities to a halt as well as dwindling prices of oil all took their toll on the country’s economy. This also contributed to the unfavourable entrepreneurial conditions for women entrepreneurs in the country.
Nigeria ranks 2nd in Africa in number of women business leaders, professionals and entreprenuership activity
Nigeria emerged 11th overall in the sheer number of women business leaders, professionals, technical workers, labour force participation and entrepreneurial activity rate. The country had 59.8 points, which actually represents a drop of 0.334% from the 60 points it scored in 2019.
This score puts in the 2nd position in Africa behind Botswana with a total of 61.6%. This is a growth of 0.2% from its 61.5% in 2019 and puts it in the 7th position globally.
South Africa is third in Africa and 15th globally with 58.1 points indicating a 3.4% improvement from 56.2 in 2019. Egypt and Algeria ranked lowest in Africa with 24.5 and 23.1 points respectively.
Globally, Columbia, Philippines and Russia are the most dominant countries in this category with 66.2, 65.7 and 64.3 points respectively. Egypt, Bangladesh and Algeria bring up the rear globally.
Nigeria Ranks 8th in Africa for entrepreneurial knowledge and financial assets
Entrepreneurial knowledge and financial assets like digital assets and financial inclusion programs are some of the major determinants of successful businesses. Sadly, Nigeria ranked quite poorly in this regard, coming in at 54th position out of the 58 countries that were rated worldwide.
Among African countries, Nigeria is in 8th position while South Africa is the best-performing African country in this regard. This shows that countries like South Africa, Malawi, Egypt and Uganda all have better provisions for entrepreneurial knowledge for the women entrepreneurs.
According to the MasterCard study, women entrepreneurs in Israel, the United Kingdom and South Korea have better access to more quality knowledge and financial assets after scoring 97.4, 89.7 and 88.1 points respectively.
Generally, African countries fared poorly in knowledge and financial assets section. This could be attributed to the overall marginalisation women suffer in various facets of endeavour like business, politics, education and financial inclusion.
Africa’s highest-ranked country, South Africa ranked 23rd globally with 78.8 points indicating a 6.5% rise from 74 points in 2019. Ghana and Egypt came in the second and third positions in the African index for this section.
The worst-performing African countries in this category are Ethiopia, Algeria and Tunisia. Ethiopia came in 55th position with 61 points, Algeria came in 56th with 59.9 points and Tunisia had 58.8 points. Globally, Algeria, Tunisia and Bangladesh took the last positions as 56th, 57th and 58th position respectively.
Nigeria ranks 5th in amount of progress made in 2020
Nigeria ranks fifth among African country whose women entrepreneurs are considered to have made progress in 2020. The country scored 23.3 on account of the volume of women business owners it has compared to those in other countries like Uganda with 39.6 points.
In this index, three African countries, Uganda, Botswana and Ghana took the lead globally with 39.6, 38.5 and 36.5 points respectively. Malawi came in 4th in Africa with 31.6 points.
The numbers indicate that the countries with a higher rating than Nigeria are more inclined to become entrepreneurs because of factors including favourable cultural perception, positive government policies and ease of doing business.
However, research from MIWE shows that women in Nigeria have a slightly higher inclination to take on entrepreneurship at early ages. This can be attributed to the harsh economic conditions in the country which forces women to become bread-winners at early ages.
Cultural perception is also improving in bits as women are no longer viewed as docile observers of the economic space. With more focus on educating the girl child, it only follows that more women will emerge as competitors in the marketplace.
How African countries performed overall
South Africa scored a total of 64.42 points after being graded on all the indicators and is at 23rd position globally. Coming in next at 31st position globally is Botswana with 62.42 points while Ghana and Uganda followed with 60.18 and 56.05 points respectively at 37th and 44th positions.
Nigeria holds the 46th position with 54.9 points, showing a growth of 0.8% from the 54.5 points it obtained in 2019. The 3 best companies globally are Israel, the United States and Switzerland with 74.7, 74 and 71.5 points respectively. The worst performing countries globally are Egypt, Algeria and Bangladesh with 39, 37.6 and 36.4 points when all the scores from the different criteria were put together.
Boosting women entrepreneurship in Africa
As the figures have shown, a number of factors have to be put in place to encourage more of women entrepreneurship in Africa. Some of the necessary initiatives include giving greater support for SMEs and encouraging a more positive sociocultural mindset. This will go a long way in boosting the morale of women who are entrepreneurs and birth more financial and governmental policies that will aid their businesses.
Fear of failure and lack of motivation are two other factors that deter the growth of women entrepreneurs in Nigeria and Africa. Creating nurturing ecosystems with networking and support groups targeted at women entrepreneurs can help most get over the fear of venturing out because of the risk of failing.
Providing more structures to access funding will solve the challenges most women-led businesses have when trying to scale in Nigeria. The MIWE report pointed at lack of funding as one of the drawbacks for women entrepreneurs globally. As such, creating solutions to it in Africa will drive a lot of women entrepreneurs forward in their ventures.
In summary, although most countries witnessed a growth in the involvement of female entrepreneurship in 2020, tackling the challenges that deter more women from taking this critical step is important in helping the economy recover. Issues like lack of funding for females, fear of failure, gender bias as well as government policies need to be tackled for more contribution from female entrepreneurs.
Featured Image Credit: Afrikan Heroes
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