WASHINGTON, May 24, 2012 – The World Bank’s Board of Executive Directors today approved a US$50 million credit from the International Development Association (IDA*) for the Women Entrepreneur Development Project to help open doors for female entrepreneurs in Ethiopia and give them access to appropriate skills and employment opportunities to contribute to the country’s economic growth.
The Bank is committed to help in creating equal access to the necessary resources for both female and male entrepreneurs in Ethiopia so that they can develop their business and generate employment in the country” said Guang Z. Chen, Country Director for Ethiopia.
Major obstacles that hinder the role female entrepreneurs can play in Ethiopia’s economy include limited access to vital resources such as finance, land, training, education, and effective business networks. Particularly, the microfinance institutions in Ethiopia have a low coverage for women entrepreneurs and do not provide suitable financing.
In order to alleviate these challenges, the World Bank has created an innovative project specifically targeted to female entrepreneurs in Mekele, Bahir Dar, Hawasa, Adama, Addis Ababa and Dire Dawa.
The project aims to increase the earnings and employment of Micro and Small Enterprises (MSE) owned by female entrepreneurs by improving access to financial services and by providing working capital and investment finance through a dedicated line of credit. It will also improve existing Micro Finance Institutions’ capacity to provide tailored financial products to these female entrepreneurs.
According to recent estimates, in addition to creating employment for women in the economic sectors, reducing gender inequalities in education and the labor market could increase Ethiopia’s annual GDP growth by almost 1.9 percentage points.
In addition to providing financing, the project will build the women entrepreneurs’ skills, facilitate their access to technologies that will help them be more productive, and unleash synergies from clustering.
“The project will give women entrepreneurs the necessary finance, skills, services and support that they are currently lacking to grow their business,” said Yasmin Tayyab, Task team leader for the project. “As a result, this will help to substantially increase their earnings while at the same time creating jobs for Ethiopians.”
* The World Bank’s International Development Association (IDA), established in 1960, helps the world’s poorest countries by providing loans (called “credits”) and grants for projects and programs that boost economic growth, reduce poverty, and improve poor people’s lives. IDA is one of the largest sources of assistance for the world’s 81 poorest countries, 39 of which are in Africa. Resources from IDA bring positive change for 2.5 billion people living on less than $2 a day. Since its inception, IDA has supported activities in 108 countries. Annual commitments have increased steadily and averaged about $15 billion over the last three years, with about 50 percent of commitments going to Africa.