Africa’s regional economy is at an inflection point as the African Continental Free Trade Area (AfCFTA) is expected to formalise sectors and expand the economic possibilities of Africa by enabling intra-regional trade and opening a consumer market of over 1.3 billion people with a GDP of $3.4 trillion. The AfCFTA will unleash regional interaction at a hitherto unseen level thereby enabling manufacturing, creating and extending regional value chains, and boosting production within the continent.
Indeed, the AfCFTA presents an opportunity for a redefinition and long-term systemic changes grounded in inclusion. For example, the agreement is positioned to revolutionise Africa’s agricultural and manufacturing sectors – where women are more likely to be found across the value chain as informal producers of raw material, distributors and consumers. However, in this redefining, it is crucial that the place of African women is ensured by using gender-lens to create, protect and extend opportunities for women to participate equally while challenging structural biases in the system. The complicated intersection of gendered labour and historic issues of ownership, control, access to means of production (including land, finance, and other capital) has affected women’s ability to position themselves within the production value chain and to move beyond the informal market into the formal markets with its many advantages.
Informal trade in Africa accounts for the major source of income for African women where they bridge access to essential products and services for the consumer market and enable production. In Africa’s mining sector, for example, women reportedly make up about 50% of people in the artisanal and small-scale mining (ASM) sector where they work asmanual labourers engaged in informal, low capital and labour-intensive operations – sometimes with their children. Similarly, women have a significant presence in the agriculture sector as smallholder farmers. This informality stretches into cross-border trade where women in informal cross-border trade (WICBT) facilitate the movement of goods: estimates show that, for example, 70-90% of traders engaged in cross-border trade along the Abidjan-Lagos corridor are women; and about 70% informal cross border traders across the continent are women.
However, the informal sector where women are more likely to be found is beset with cultural and structural problems, arising from conscious and unconscious biases – such as gender-based violence, excessive cost of transaction, border delays, insecurity, access to material resources – that could be described as gendered and underreported as it disproportionately affects female entrepreneurs. Appreciating the existing opportunities in the informal sectors using a gender-lens to maximise, repair and address structural challenges could spur women’s economic productivity leading to further development and shared economic prosperity for all.
Thus, what is needed and what must be urgently considered as an economic imperative, is the nexus between trade, sustainable finance, gender inequality and formalisation. This is to say that political economic, trade and finance decision making in Africa should be approached with a gender-lens to ensure inclusive economic growth for everyone because when women progress, the economy progresses. Gender exclusion born of bias is costly, regressive, and a barrier to full economic development. As studies – such as this McKinsey report – have shown, leaning into the power of parity, could boost the collective GDP of African countries by 10% ($316billion), further making the clear case that gender equality is, indeed, smart economics. Thus, it must be acknowledged that what is good for African women is good for Africa; and to unleash Africa’s full potential, systemic changes must take place to address the gendered and unequal access to means of economic production, distribution of capital, and economic opportunities.
As the long overdue process of trade liberalisation begins to take place across the continent, policy makers and investors must adopt a gender-lens perspective in decision making by recognising gendered division of labour in the economy and households, and pre-existing gender inequalities present in the economic system which has persisting implication for ownership, access to, and control of economic and social resources. Considering the strategic importance of women as producers and consumers, regional integration framework must be formulated and executed through a gender lens, and investors should conceptualise the strategic role of women in the economy as an opportunity for multi-fold return on investment: superior financial returns for all stakeholders and social impact. Furthermore, women-led businesses, like Jetstream Africa (an Alitheia IDF portfolio company), are emerging as critical players in this integrated economy, and are posed to facilitate regional supply chain management and trade by leveraging technology in cross-border trade. Jetstream has a central role to play in Africa’s trade revolution by facilitating the easy movement of goods and services within and outside the continent using technology.
Integral to this also is the presence of women where decisions are made and executed. African women must be at the forefront of these developments, represented across the economic spectrum and business value chains: from the upstream through to the downstream, from the boardroom to the factory floor, from policy making to implementation. All aspects of the economy must be developed and maintained with a gender-lens, designed for sustainability, fortified to precipitate long-term, shared prosperity. Today on International Women’s Day, we invite all stakeholders – from policy makers to investors – to #BreakTheBias and address the structural issues preventing full gender inclusion, recognising gender equality as an opportunity to generate shared prosperity for all Africans.