The development finance institutions of the G7 have agreed to mobilise US$3 billion by 2020 to advance living and working conditions for women around the world.
Part of the United Nations’ 2X Challenge: Financing for Women, the commitment is a focused attempt to make female economic empowerment a large-scale collective goal among development agencies with mandates to catalyse private investment in the poorest countries.
Development finance institutions that made the pledge include the newly established FinDev Canada, the UK’s CDC Group, the US Overseas Private Investment Corporation, Italy’s Cassa depositi e presiti, Proparco of France, and Japan’s JBIC and JICA with support from the German’s agency DEG.
Paul Lamontagne, FinDev Canada’s managing director, said: “Investments that improve the lives of women and girls have been shown to have an impact not only on the individual, but on their families, their communities, their local economies and, as a consequence, countries along with them.”
The total capital sum will be used for investments of equity and debt as well as in risk-sharing tools such as blended finance. The aim is to advance female entrepreneurship as well as products and services that include women in the economic systems of their countries. This means giving more women access to bank accounts, for which the global access gap currently measures 58 to 65 percent in favour of men. Investments are also expected to go towards increasing the presence of women on management boards at firms and to secure decent work for female employees.
At present, women constitute 43 percent of the agricultural labour force worldwide and around half of the workforce across sub-Saharan African. A 2015 study by the World Bank however shows productivity among female agricultural workers in Malawi falls almost a quarter behind that of their male counterparts. In Northern Nigeria, the female share appears as low as 4 percent.
An earlier 2011 paper by the Food and Agriculture Organisation (FAO) of the UN however states that the disparity is linked to unpaid household labour, including the gathering of water and fuel, almost 90 percent of which is done by women. Single female households across Africa meanwhile have risen to 26 percent of the total over the last 20 years, and now comprise a fifth of the entire African population. In addition, adolescent girls in sub-Saharan Africa remain in low attendance at schools and are forced into child marriages and teen pregnancies that result in a lack of basic skills to enter work.
Experiments involving cash transfers to adolescent women in rural Malawi have been shown to stall early marriage, childbirth, and even reduce cases of HIV infection. When such programmes are withdrawn, a corresponding rise in cases of all three are shown to occur. In addition, the tests show children born to women who are covered by the programme throughout pregnancy grow to be above-average height in their age group.
“Initiatives dedicated to women’s empowerment such as microfinance or education have demonstrated their economic and social benefits for society at large,” commented Gregory Clemente, CEO of Proparco.
In March 2016, The Stanford Social Innovation Review forecast more than double worldwide GDP growth by 2025, positing a leap from US$12 trillion to US$28 trillion, based on closure of the overall gender gap.