To what extent are women becoming entrepreneurs in Asian developing countries? This paper focuses on women entrepreneurs in small and medium enterprises (SMEs). It finds that the representation of women entrepreneurs is still relatively low, and most women entrepreneurs in SMEs are ‘forced entrepreneurs’ seeking better family incomes.
SMEs are very important in Asia, as they account, on average per country, for more than 95 per cent of all firms in all sectors. SMEs provide livelihoods for over 90 per cent of the workforce, especially women and the young.
However, key issues are the constraints that women face in becoming entrepreneurs and in sustaining or expanding their businesses:
- Women entrepreneurs are mainly found in microenterprises (MIEs) that are traditional and low income generating activities. They choose MIEs because this economic activity is characterised by easy entry and exit, low capital, skills, and simple technology requirements.
- Indonesian data indicate that the rate of women entrepreneurs tends to decline by size: in small enterprises (SEs) the rate is higher than that in medium enterprises (MEs).
- Becoming an entrepreneur, especially in larger, modern and more complex businesses in Asian developing countries is still dominantly part of male culture.
- The majority of women entrepreneurs in the region become entrepreneurs from push factors such as poverty, unemployment, the need to have more cash income to support the family daily expenditures, and precautionary motives (for example against a husband’s redundancy or other emergency needs).
- This could suggest that when women in the region are better educated and have greater well-paid employment opportunities, their participation in SMEs may decline.
The relatively low representation of women entrepreneurs can be attributed to many factors, and the most important ones among them are:
- Low level of education and lack of training opportunities that make women severely disadvantaged in both the economy and society.
- Time spent on household chores.
- Legal, traditional, cultural or religious constraints on the extent to which women can open their own businesses.
- Lack of access to formal credit and other facilities.