Encouraging female entrepreneurship can fuel MENA’s socio-economic growth

This need is not just to achieve diversity and inclusion strategies or social responsibility commitments, but to dramatically impact and grow the global economy too. A Boston Consulting Group (BCG) report states that if there was gender parity in the number of entrepreneurs who participate equally in the economy, the global GDP could rise by three to six percent – the world economy could be boosted by nearly $2.5 trillion to $5tr.

Despite the encouraging findings by the same research that highest rates of women’s entrepreneurial intentions are reported in the MENA region at 36.6 percent, the report also shows that if gender inequality is removed for entrepreneurs, the region could achieve $600 billion in economic impact annually, or $2.7tr by 2025.

Thus, entrepreneurship is an important driver of economic progress and a facilitator of empowerment for women worldwide. In fact, the Organisation for Economic Co-operation and Development (OECD) recommendation on gender equality calls on governments to reduce the gender gap in entrepreneurship activity. 

The need for entrepreneurship diversity is becoming increasingly apparent, and the Middle East only stands to gain from it. In the MENA region, women make up a large share of the talent pool in most countries. According to a study by UNESCO, women outnumber men in universities and make up to 57 percent of all science, technology, engineering, and math (STEM) graduates; however, only one in five women are economically active.

The GDP of MENA countries is estimated to increase by 30-40 percent if women are further integrated into the economy. This gives a significant indication that supporting and encouraging women can help build a resilient economy, which is a top priority for all economies around the world post the pandemic.

In the UAE, in particular, with the government’s push to shift away from its dependence on oil towards innovative ways to both support economic growth and create jobs, it is crucial that the government positions significant efforts on supporting innovation and entrepreneurship, as well as building a highly-skilled workforce, including helping women to find and grow their entrepreneurial visions.

Transforming the business ecosystem

A 2018 report by INC and Fast Company that surveyed women entrepreneurs, found that they are more likely to hire women. As seen globally, most organisations, especially the global giants, have male-dominant management, and they lean more towards hiring men in positions of power.

Women-owned organisations, however, give rise to more female representation by hiring the right skills for the right designation. This does not mean that these businesses do not hire men. In fact, diversity is carefully explored which ensures creating a thriving and better secured business ecosystem.

Having a diverse workforce also fosters economic growth among different sections of society, which supports the country’s requirements.

Leadership and employee growth

Sound leadership skills are important to grow any business. It requires the right entrepreneurial spirit, innovative streak, education, empathy and overall visionary qualities to build a business. Research conducted by Harvard Business Review showcased women to have outscored men in most leadership skills; scoring higher in skills such as teamwork, innovation and problem-solving. These are significant mentorship attributes that enables employees and businesses to grow.

Reinvesting in the economy

The Global Wealth Report by Credit Suisse has revealed that women hold about 40 percent of the global wealth and continue to increase their percentage of wealth. Entrepreneurship is a way to invest back in the economy while addressing a service gap.

Encouraging women to pursue their entrepreneurial skills will witness innovative business ideas, solutions to existing market gaps and needs and will effectively contribute towards supporting a healthier economy.

Women have a high potential to build technologically advanced businesses, specifically in the UAE with many parts of the STEM fields. Supporting women to pursue their business ideas by facilitating their access to investors, funds and banks as well as incentivising women-focused financial investments, can be a critical turnaround to economic advancements.

Influencing future generations

Everyone needs role models. From Arianna Huffington of Thrive Global to novelist, film producer and screenwriter J.K. Rowling; Martha Stewart of Martha Stewart Living Omnimedia, to Cher Wang of HTC, a billion-dollar tech organization – these women inspire the current generation and will inspire the future generations to build their own entrepreneurial path.

Their success stories have many lessons that can be learned. The world is increasingly saturated with social media influencers and micro-influencers, but many female influencers have built their businesses and grown them exponentially.

Huda Kattan, of Huda Beauty in the UAE, is one such example. Her brand has become a global sensation, with her net worth rising to $490 million. These women have carved their own space on the global business platform, inspiring millions of women globally.

Creating a nurturing environment, encouraging women to pursue their entrepreneurial spirit, and mentoring them, are key to building a diverse and impactful business ecosystem. The contributions of women economically are far-reaching and will further increase in the next decade. With the urgent need for post-pandemic recovery, women will be significant players in rebuilding economies.

A report by McKinsey predicts women in professional and technical jobs are set to more than double by 2030 through digitalisation, online platforms, and entrepreneurship. Their report identifies tailored education, training, and support for women as necessary to achieve gender parity in the Middle East.

Moreover, educational institutions also play a crucial role in developing an entrepreneurial mindset by providing them with a safe space in dedicated business incubators to explore ideas with the support of academic mentors. 

Shirin Jarrar, global director of MBA Programmes, and associate professor at Edinburgh Business School.