Entrepreneurship among women and the crucial role this plays in the economic growth and development of the region is widely understood and encouraged by governments of the Gulf Cooperation Council (GCC) states.
The increased rate of entrepreneurial and business activity among women and their influential role in the economies of GCC states is exemplified in a new report by Al Masah Capital, a leading asset management and advisory firm in the region.
The report titled, ‘GCC Women – Entrepreneurs in a New Economy’ shows that small and medium enterprises (SME) led by women manage assets worth US$ 385 billion. Government policies aimed at reducing dependence on foreign labor, changing cultural mores, increasing levels of literacy and educational opportunities are encouraging women entrepreneurs to play an increasing role in the economic transformation of the region.
The availability of diverse employment opportunities, technological advances and the democratization of information are also motivating many women to start their own businesses. According to the report the gender gap in entrepreneurial intentions has significantly reduced in recent years. With the percentage of women entrepreneurs going up from 4 percent in 2011 to 10 percent in 2014, the next wave of female entrepreneurships in the region could help push through gender parity in this field.
This has spurred regional governments to collaborate with non-governmental bodies to identify and develop programs to support women entrepreneurial intentions and activities. Although so far the success rate is hovering at around 40 percent, this is rapidly increasing as formal entrepreneurial education and training gathers pace and helps women to bring their ideas to fruition and successfully own and manage established businesses.
The report notes that high unemployment rates, limited access to formal finance, regulatory and social constraints, striking a work-life balance, inadequate training and access to information, and lack of female-friendly entrepreneurship policies are some of the main barriers and challenges faced by women entrepreneurs in the region.
Recognizing this many GCC governments have amplified their efforts towards addressing existing challenges by introducing a range of empowerment measures across the political, business and educational arenas such as marked regulatory improvements, lower entry and exit barriers, increased representation in chambers of commerce, and improved female literacy rates.
Meanwhile, the report found that improvement in social conditions driven by changing demographic patterns and gender diversity in the private sector were some of the key growth drivers of women participation in the workforce. As a result, adult female (25+) participation in the GCC’s labor force in 2015 increased to 32 percent, growing at 6.8 percent CAGR in the last decade. Female literacy rate in the GCC is also at par or above the developing nations across the world; nearly 100 percent among 15-24 year olds and almost 90 percent on average among adult females (age 25-64).
Corroborating the growing interest of GCC women in business, the '2015 Forbes List of The 100 Most Powerful Arab Business Women in the Middle East' featured nearly 50 percent of women from the GCC. Women in the GCC are taking leadership roles in private and family-owned businesses, while also participating in politics and government affairs. The report states that these women have a high preference for roles in the private sector with the banking, investment and finance sector leading the way with 18 percent.
Meanwhile, many female achievers said that while great strides have been made in promoting gender diversity, the oil and gas industry, which is the prime provider of employment in many GCC states, is still struggling with exceptionally low female-to-male ratios. However, as the energy sector becomes more competitive under global market pressures, it is expected that gender balance will increasingly emerge as a definitive factor in the success of organization and this could trigger rapid transformation of the industry.