NEW YORK — Women entrepreneurs need to access capital and grow the economy. If more women were included in the labor force with substantial income and managed more prosperous businesses, developing countries would likely witness an impact on GDP growth equal or better than fully developed countries.
The Goldman Sachs Foundation and World Bank aim to reach 100,000 women in developing countries with the Women Entrepreneurs Opportunity Facility.
In 2008, the Goldman Sachs Foundation’s 10,000 Women program was dedicated to finding women in emerging countries to advance their businesses. Across 43 countries, a network of 90 nonprofit and academic partners helped the program reach its goal in 2013.
From this program, a manager of an automotive business in Lebanon made a million dollar turnover. Chantal Jaoudes graduated from the 10,000 Women program with the ambition to excel in an industry mostly dominated by men.
Gircilene Gilca de Castro is a more recent beneficiary of 10,000 Women whose loans and investments are paying off. Her revenue has increased by 900 percent and she now manages 45 employees.
At least 82 percent of graduates from the 10,000 Women program are increasing their revenue, and 71 percent are creating jobs and doubling their workforce. They spread the word of their success by guiding other women toward their goals and passing on their business skills.
Today, 70 percent of the globe’s women-owned businesses lack accessibility to financial services. The 10,000 Women program gave Castro the education and resources she needed so she could make a profit. However, there are still women in leadership positions who need financial support in the developing world.
In late July at the Global Entrepreneurship Summit in Kenya, President Barack Obama discussed a new initiative that is partnering the Overseas Private Investment Corporation (OPIC) with the Goldman Sachs Foundation’s 10,000 Women program and IFC.
The goal of the partnership is to grow global economies through a $100 million investment approved in 2014 for new projects for women entrepreneurs. This partnership is called Women Entrepreneurs Opportunity Facility (WEOF).
In 2014, the WEOF was initiated by Lloyd C. Blankfein, the CEO of the Goldman Sachs Foundation, and Jim Yong Kim, the president of World Bank.
This is a joint program aiming to benefit 100,000 women. The WEOF aims to enhance women’s ability to take out loans for their small and medium enterprises (SMEs) and have a chance to access capital.
The WEOF is expected to raise $600 million in capital, with a $50 million contribution from Wall Street and a $100 million contribution from World Bank. The objective is to engage public and private investors.
This initiative will affect the 70 percent of women in developing nations who are unserved by local financial facilities. There is a $285 billion credit gap because women entrepreneurs are ignored. So far, 25,000 women are benefiting from nine agreements with countries through the WEOF.
Fixing the gap is the most important step to be achieved by 2020. In doing so, the world’s income per capita is expected to be 12 percent higher by 2030. Achieving this goal can increase income per capita in places like Brazil and Vietnam by 25 to 28 percent.
The WEOF plans to address local banks in developing countries to include women’s opportunities in their agendas and to help entrepreneurs achieve capital, better income, and job creation.
The Goldman Sachs Foundation has funded $32 million to help advance accessibility measures to capital. Another $18 million was donated with $11 million of that fund helping IFC’s support of women’s loans.
Redefining banking strategies will benefit potential leaders. WEOF is addressing the gap that is sustaining low GDP growth in developing nations. Addressing the needs of women closes this gap and the gender divide.
– Katie Groe