Figure IV.1: Women Economic Opportunities and Access to Finance in Selected African Countries (2010

Figure IV.1: Women Economic Opportunities and Access to Finance in Selected African Countries (2010)

100 90 80 70 60 50 40 30 20 10 0 Best ScoreMauritiusSouth AfricaTunisiaNamibiaEgyptBotswanaMoroccoTanzaniaGhanaBeninKenyaAlgeriaSenegalMalawiZambiaUgandaNigeria MadagascarBurkina FasoCameroonEthiopiaTogo Cote d'IvoireChad Sudan (lowest) Overall Score Source: Economist Intelligence Unit (2010). Access to Finance

Interestingly, data from the WBES suggest that the gender-related funding gap is less acute for formal businesses. Indeed, the share of surveyed firms identifying access to finance as a major or very severe obstacle is comparable for both groups: 47% for women-owned businesses versus 44% for men-owned businesses (Figure IV.2). However, these figures conceal strong variations across African countries. While the 2007 Africa Competiveness Report shows that access to finance is a more binding constraint for male business owners in Mauritania relative to female owners, data from Egypt suggest that women face higher hurdles to access finance (Nasr, 2010). Interestingly, differences in business size do not explain this pattern as female and male businesses were found to have similar sizes (World Bank, 2008). According to the same report on Egypt, only about 20 percent of female entrepreneurs apply for bank credit and those who apply face higher rejection rates (Nasr, 2010). This is consistent with the higher rejection rate reported in Figure IV.2 for female-owned businesses. This result contrasts with findings in a recent United Nations report showing that “In Africa, women are a better credit-risk than men and more responsible managers of meager resources”.1

Figure IV.2 shows also similarities in the share of firms holding a checking or a saving account and those holding a loan or a line of credit from a financial institution, even though women owned-businesses are less likely to have an account or a loan. These results support findings reported in Aterido et al. (2011) who found comparable levels of formal services use for male and female owned business and conclude that lower levels of financial inclusion for women in Africa mainly reflect income, education and formality status effects rather than discrimination within the financial sector against women. In other words, women are less likely to use formal