KABUL, AFGHANISTAN – The UN says that female entrepreneurs in Afghanistan have faced numerous obstacles and encountered high operational costs while conducting business over the past three years.
In its new report released on Wednesday, April 17, the UN Development Programme (UNDP) said that despite facing challenges, women-owned and women-led businesses in Afghanistan continue to demonstrate remarkable resilience.
Although the Taliban have tried to erase women from public life, certain margins of the economic market have remained accessible to them. Despite giving women some degree of independence and agency, economic activities that have distanced themselves from socio-political causes have managed to weather the regime’s onslaught on women’s rights.
According to the report’s findings, gender-based discrimination, security, travel restrictions, a weakened financial system, and limited access to domestic and international markets are among the key challenges faced by women entrepreneurs.
The study reveals that 41% of the surveyed 3,100 Afghan women entrepreneurs had to take a loan. However, just 5% of them were able to get these loans from banks or micro-finance institutions, and most of them relied on money borrowed from friends and family.
“Sources for women-led businesses loans included family (61%), friends (45%), loans from other businesses (21%), formal banks (5%) or remittances from abroad (5%), microfinance institutions (2%), community savings groups (2%), and hawalas (0.31%).”
The Taliban’s return to power has swiftly reversed two decades of internationally supported efforts to boost economic opportunities for women through women empowerment programs. During this period, donors poured hundreds of millions of dollars into such initiatives.
The regime has not formally banned women from work but have barred many Afghan female aid workers, shuttered beauty salons, which employed tens of thousands of women, and limited women’s movement and work in many local and international institutions.
The report highlighted that due to Taliban restrictions on women’s movement, 73% of them were unable to go to local markets without a male escort. However, it noted that women are actively seeking solutions to confront these obstacles.
With the Taliban’s return, all businesses experienced significant setbacks, but for women-owned businesses, the challenges were exacerbated due to the regime’s imposition of restrictions on their fundamental rights, such as work, movement, and many others.
“32% of women-led MSMEs believed gender discrimination presented challenges in market access for their businesses, with 28% citing difficulties in procuring supplies and 19% citing challenges in securing both formal and informal loans,” the report said.
According to the report, the ban on women’s employment costs the country’s crumbling economy nearly $1 billion. “UNDP model-based estimates suggest that restrictions on women’s employment could lead to an annual 3 to 5 percent reduction in GDP, translating to an economic impact of USD 600 million to USD 1 billion.”
The UN agency says Afghanistan is home to talented and resilient women who possess tremendous potential to drive economic growth and effect positive change in their communities. However, the policies of the Taliban towards women have intensified their challenges, including bureaucratic, economic, and cultural constraints, alongside gender-based discrimination.
The report also highlights that despite a sharp decline in female employment rates to 6%, Afghan female entrepreneurs serve “as vital pillars of economic stability and hope amidst adversity” in a country battling a severe food shortage that has affected 15.8 million people.
“Entrepreneurship has surfaced as a lifeline for women and their families. The survey shows that 80% of women-led enterprises rely on their business revenues as their primary source of income. Women-run businesses also create much-needed job opportunities for other women,” part of the report reads.
Kanni Wignaraja, UNDP’s Regional Director for Asia and the Pacific, was quoted in a statement saying, “Women entrepreneurs have demonstrated incredible grit, boldness, and resourcefulness under the most dire of conditions,”
The report claims that the “UNDP and its international and national NGO partners have supported 75,000 micro and small businesses, which together have created employment opportunities for more than 900,000 people who in turn provide support to their families.”
Stephen Rodrigues, UNDP’s Afghanistan Resident Representative, said, “Women have long been the driving force behind the welfare of households in Afghanistan and play a crucial role in sustaining local economies. They need international support … the future of Afghanistan depends on them.”
