Indonesian Women Entrepreneurs are catalyst for economic growth

Indonesian women entrepreneurs are catalyst for the country’s economic growth, not only they are decision makers among Indonesian families, the government itself has taken action to improve the business environment for women entrepreneurs.

As noted by international organisations reports and academic researches through the years, inequality between women and men affects women’s contribution to the economy and, as a consequence, negatively impacts the economic growth of a country[1]. With reference to Indonesia, the achievement of gender equality is still a work in progress: the 2013 Global Gender Gap Index, which measures gaps between women and men in four areas, ranks Indonesia 95thout of 136 countries.

Indonesian Women Entrepreneurs are catalyst for economic growth 1

By 2015, Indonesia based on the new report is now ranked 92nd, a slight improvement yet more can be done and should be done sooner. To understand further on the gender inequality, please read the country report below or access 2015 full report here.

Today, Indonesia has its fair share of women having top managerial levels as well as women in politics, real examples would be our minister of maritime affairs and fisheries, Susi Pudjiastuti and Dian Siswarini, CEO of XL Axiata. A growing list of Indonesian women in technology is also on the rise starting with Aulia Halimatussadiah whom started several tech ventures, Catherine Sutjahyo, co-founder of Zalora, Cynthia Tenggara of Berrykitchen, Diajeng Lestari of Hijup, Nabilah Alsagoff with Doku and many more.

There are stories behind these strong women that started jump started their career as either an entrepreneur or professionals, yet Indonesia needs more stories on women in business, we need new breed of business women and Indonesia still needs to work in order to ensure the full development of Indonesian women’s economic potential.

A challenging business environment

In this perspective, the Indonesian government has recently focused on the promotion of women entrepreneurship, recognising the great contribution of women-owned businesses to the national economy. The Indonesia SMEs account for more than half of the national GDP and women owned business contribute for more than one third of it. On the one hand, the number of women’s owned SMEs is growing quickly at 8% annually; on the other hand, their growth is potentially hindered by specific challenges. Evaluating the Business Environment in Indonesia, reports access to credit as the main challenge for women entrepreneurs, because of complicated loan paperwork and high interest rates. Gender-specific constraints such as childcare responsibilities are another issue that women entrepreneurs need to deal with in running their businesses: the study states that 66% of women owners are primarily responsible for their children, compared to 3% of men owners (a study by Asia Foundation ~ 2013).

On a brighter note, the research reports also stated that Indonesian women owners benefit more than men from networking; 55% vs 30% of men belongs to business associations; women are also more likely to use computers to improve their business performance: 74% vs 60% of men. And, Indonesian women entrepreneurs are more likely to employ women in their business, thus contributing to a greater inclusion of women in the Indonesian economy.

Opportunities to Improving the business environment

The Indonesian government is working to support women entrepreneurs in overcoming obstacles to the development of their potential: in early 2014, during a National Entrepreneurship Movement event held in Senayan, Jakarta, the Indonesian Minister of Cooperatives and SMEs announced the intention to take action with the Ministry of Women’s Empowerment to support women entrepreneurs by improving their marketing network and by expanding their access to financial services through an array of tools such as revolving funds, micro credit, and funding from business groups.

Such initiatives show a heightened attention and commitment from the government to a greater inclusion of Indonesian women entrepreneurs in the economic system. As an inclusive economy (and society) is positively correlated to economic growth, developing women’s economic potential is not only a matter of equality and social justice, but is also a smart move that minimises high social and economic costs in the long run. The initiative has given Unjukin Ventures one area of focus; by providing assistance to women entrepreneurs an equal access to financial, technology and education. To find out more, do drop us a line.

[1] According to the Council of Europe Gender equality means: “an equal visibility, empowerment and participation of both sexes in all spheres of public and private life. It requires the acceptance and appreciation of the complementarity of women and men and their diverse roles in society.” (in http://hub.coe.int/what-we-do/democracy/gender-equality)


~ Originally published at Medium on February 10, 2016. Photo by The New York Times

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