This article is part of our special report Building partnerships: international development and sustainable business.
The issue of how the EU’s External Investment Plan can help empower women and girls dominated the agenda at the European Development Days on Tuesday (5 June), as some panellists voiced concern that it might be marginalised in the final big picture.
The European Commission is set to unveil plans to expand its External Investment Plan (EIP) as part of the next seven-year budget for 2021-2027.
Launched in autumn 2016, and targeted primarily at countries in sub-Saharan Africa, the EIP currently relies on €4.1 billion of guarantees from the EU budget, which the Commission says will generate more than €44 billion of investments by 2020.
But members of the panel urged policymakers to ensure that the programme, which the EU hopes will bring together public and private sector investment, focused on gender equality and women’s economic empowerment.
“Very often growth is not inclusive, and women and girls are not the beneficiaries,” said Anja Langenbucher, Europe Director of the Gates Foundation. “Land rights for women, mobile banking, these are all things that the EIP should address.”
Meanwhile, a number of NGOs and civil society activists have expressed concerns that the programme could end up only providing finance to short-term profit-making projects, limiting its value as a development tool.
“We invest between $60-70bn per year in public-private partnerships,” said Kristalina Georgieva, chief executive of the World Bank and a former EU budget commissioner.
“This money is not going to go far enough unless it addresses the empowerment of women. We must invest in the health and education of girls and mothers…and, in particular, push them towards traditionally-boys subjects such as engineering, mathematics, and heavy-duty agriculture,” she added.
Cristian Danielsson, director-general for European neighbourhood policy in the European Commission, said expectations for EIP were very high, “possibly too high”.
He added the programme would offer women “more opportunities to access finance”.
“Financial inclusion is key to women’s empowerment. We know that the picture is not very positive, women are half as likely to have jobs, and that there is a substantial wage gap. The EIP has substantive elements that will help.”
Coca-Cola Vice-President Beatriz Perez said there were “three key pillars to the EIP: “financing, tools and partnerships”. She pointed to a Coca-Cola programme providing education for Nigerian women and said:
“Of the 21,000 women we reached, 55% have started their own business,” said Perez. “We found that women don’t want a handout but a hand up to thrive.”
Ambroise Fayolle, vice-president of the European Investment Bank, said the bank’s Boost Africa initiative was aimed at “young, particular female entrepreneurship”.
Dorcas Apoore, founder of the Advocacy for Social Inclusion and Girls Education NGO in north-east Ghana, said she saw the EIP “more as a tool for empowering women”.
Apoore told delegates that “an investment of $1,000 allowed me to reach 290 women.”
The programme “should invest in training and grass-roots organisations like mine,” she said, but cautioned that the EIP “can only work if it targets local organisations”.
Langenbucher told the panel that her organisation was likely to be a co-investor to the tune of $50m.
“We’re hoping to crowd in private sector investment,” she said. “A structure like the EIP will work if financers do what they do best,” she said, adding that “there must be a role for grants and a role for blending.”
“Education and health should be an important part of EIP investment,” she said, pointing out that in similar public-private programmes finance tends to go to banking, energy and agriculture projects.
(Investment in) “education, health, nutrition – economic empowerment programmes, human capital sectors – without this there is a limit to how much countries can grow,” said Langenbucher.
Elizabeth Nelson, the vice-president of the European Bank for Reconstruction and development, complained that they faced a “growing problem with getting banks to take risks, and we see the EIP as an ideal platform to scale up”.
“A study we did in Morocco found that 41% of SMEs cater for women,” she said, pointing out that this demonstrated that there were large untapped markets needing finance.
However, it was often difficult for women entrepreneurs to attract capital, she said.
“In Turkey, women tended to be charged high interest rates and asked to produce more collateral. Banks were unconsciously biased,” she said.