The European Union (EU) has announced €15 million in new funding to support women’s businesses in Afghanistan amid severe Taliban restrictions.
The funding will be disbursed by the UN Development Programme (UNDP) through a joint partnership, the EU Head of Delegation to Afghanistan Raffaella Iodice said in a post on X platform on Tuesday. UNDP affirmed that the partnership will support women-led businesses and young entrepreneurs through Sharia Complaint Savings Group and Microfinance in six provinces of the country, without providing further information.
Earlier this month, the government of Japan also approved nearly $10 million to UNDP to support a total of 1,400 women entrepreneurs as well as 140 women-led small and micro businesses in both rural and urban provinces, including Kunar, Logar, Kandahar, Zabul, Baghlan, Kunduz, and Kapisa. The agency said that the two-year project will also include the construction of 100 facilities to support capacity building and women’s economic empowerment activities.
According to a 2020 survey by the Afghanistan Women’s Chamber of Commerce and Industry, women owned and led 26% of the 2,471 formal/licensed businesses between 2017 and 2020 and as many as 54,000 informal businesses. These businesses created over 130,000 jobs and enabled more than 100,000 women in rural areas to sell their work in the cities.
However, these hard-won gains have severely been halted in over two years since the Taliban regained power. The group has imposed a slew of restrictions on women, including barring them from working with governmental and non-government organizations as well as UN agencies (with a few exceptions in the health sector).
The restrictions on half of the country’s population in the workforce and the overall economy have aggravated the humanitarian situation and increased vulnerabilities, especially in rural areas. Moreover, Afghanistan’s economy has been significantly hampered by a combination of political and economic crises, including the freezing of the country’s central bank assets abroad, the implication of sanctions on the Taliban in the banking sector, and political uncertainty. Taliban’s curbs against women from working immediately cost up to $1 billion, or 5% of GDP, according to a 2021-2022 UNDP report.
While there is no reliable data on the wider economic impact of the Taliban’s ban on women’s employment, it is clear that women have lost most of their jobs among a host of small-to-middle-scale enterprises, from restaurants and cottage businesses to IT and media companies. For example, the Taliban’s ban on women’s beauty salons in July left an estimated 60,000 women unemployed when more than 12,000 beauty businesses were forced to close down within a month. For Marzia Rezaye, owner of a beauty salon and her family’s breadwinner, it cost $18,000 to establish that business.
Additionally, thousands of women have been sacked from government jobs or NGOs and hundreds more from working for UN agencies which have particularly impacted single women and widows. Women-led businesses have been shut down and many have been moved abroad or underground. Some existing businesses that have defied the Taliban’s draconian laws remain at risk of shutting down or fraught with other challenges, particularly a ban on traveling without a mahram—a male chaperone—which restricts women’s mobility to commute to work or meetings. For example, on Monday, October 30, the Taliban ordered over two dozen female tailor shops in Mazar-i-Sharif to move their businesses to a female-only marketplace to avoid contacting men.
Under such a harsh environment, foreign funding like the EU’s and Japan’s could be a lifeline for some women-led businesses and female entrepreneurs to sustain their livelihoods at a time when two two-thirds of the population are on the brink of starvation.
However, it is unclear how efficient these funds could prove for local economic activity or to what extent they reach the right recipients due to a lack of robust mechanisms from UN agencies to implement and monitor the efficiency of such programs. There is also a risk that such programs would fall prey to the Taliban’s intervention in aid delivery. Yet, the bigger question remains how such programs particularly targeted at women’s empowerment could circumvent the Taliban’s policies aiming to erase women from public life.
