REPORT: Why investing in gender equality in Uganda is smart economics

Lady mechanic at Wabigabo garage in Namuwongo, a suburb in Kampala (PHOTO /Rachel Mabala/World bank)

KAMPALA – Uganda’s economic recovery will be faster, stronger, and more sustainable if it brings more women into the center of profitable economic activity, according to the18th edition of the Uganda Economic Update (UEU).

Uganda Economic Update: Putting Women at the Center of Uganda’s Economic Revival, which projects the country’s economic growth to be between 3.5% and 4.0% in FY22 and about 5.5% in FY23, also delves into a special topic on women’s economic empowerment, with an emphasis on putting women at the center of Uganda’s economic revival.

Uganda continues to face gender inequality in economic empowerment and economic outcomes, despite closing gender gaps in rates of labor force participation and entrepreneurial activity. Women earn less than men, and according to the UEU, increasing women’s earnings to match men’s would boost national wealth by 11.8% (USD $1,619 per capita).

The COVID-19 pandemic expanded gender gaps in paid work and business ownership, and the 2020 lockdown set off a wave of work stoppages and business closures that affected women more than men, while job losses and school closures have resulted in a greater share of unpaid care work for women, who already shoulder a disproportionate amount of household responsibilities.

While the Government of Uganda has successfully helped women start small businesses through initiatives such as the Uganda Women Entrepreneurship Program, more female entrepreneurs need to move into the larger business space to drive Uganda’s economic recovery and industrial transition.

To measurably close gender gaps in economic empowerment and economic outcomes, policy actions in three key areas will be critical:

Help meet women entrepreneurs’ demand to lead growth-oriented enterprises. When given the opportunity, Ugandan women are eager to lead larger, more profitable businesses than micro- enterprises. Lack of access to sufficiently large loans is among the several constraints they face, and this could be eased by legislative improvements that specifically prohibit gender discrimination in access to credit. In addition, legislation is needed to guarantee gender equality in rights to inherit land and increase rates of women’s ownership rights over land, which is the main form of collateral required to secure larger loans from formal financial institutions.

Address women’s time poverty so that they can complete their education, acquire marketable skills, and work for pay outside the household. A common factor to making all three possible is easing the care burden that women and older girls disproportionately carry in households. In addition to expanding access to early childhood education programs, the government could start by considering which models of childcare provision are appropriate.

A government agency to spearhead re-orientation of government employment programs so that they move women from the subsistence-level to more growth-oriented sectors and jobs. Government policies and programs need to better consider the diversity of skills and strengths that women bring to the economy. National strategies should have clear targets and guidelines for women’s participation, and could include a high-level champion to guide these efforts.

The benefits of investing in women’s marketable job skills and growth-oriented entrepreneurship will accrue not only to women, but to their households and, by extension, the whole of Ugandan society.

The UEU also reveals that even before the COVID-19 shock, Uganda already had lost an estimated USD $61 billion due to gender inequality. In addition, not investing in women deprives households and the economy of the contributions they would make and slows its transition out of agriculture

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