Women Can Add Nearly $300 Billion to E-Commerce in Southeast Asia and Africa: IFC Research
by International Finance Corporation (IFC) | 26 May 2021
Washington DC, May 26, 2021 —The e-commerce markets in Southeast Asia and Africa could grow by over $280 billion and $14.5 billion respectively between 2025 and 2030, according to two IFC reports published today. This can be achieved by increasing the number of women selling on online platforms and by providing them with better training and financial support.
The reports, Women and E-commerce in Southeast Asia, and Women and E-commerce in Africa found that COVID-19 has accelerated the growth of e-commerce and digital entrepreneurship in the regions and that more women have embraced digital business. However, it also noted that more can be done to promote women's entrepreneurship and help women overcome e-commerce challenges.
"E-commerce in Southeast Asia and in Africa is thriving. However, widespread differences between men and women in digital and financial inclusion continue to hold back women entrepreneurs," said Makhtar Diop, IFC's Managing Director. "E-commerce firms are well-positioned to reverse this trend and create more business and leadership opportunities for women."
For example, e-commerce marketplace platforms are well-positioned to target women-owned businesses with training, and to encourage women's participation in higher-value segments such as electronics. Women could also strengthen their businesses by taking advantage of emerging fintech offerings, such as in-platform loans, which women currently access at much lower rates than men. The reports leveraged data from Jumia, in Africa, and Lazada, in Southeast Asia—as well as surveys of vendors in Côte d'Ivoire, Indonesia, Kenya, Nigeria, and the Philippines.
The reports show that in some countries, women comprise half of all active e-commerce vendors, although they tend to run smaller-scale businesses and feature prominently in high-competition, low-value segments. On the Lazada platform, about a third of businesses in Indonesia and two-thirds of businesses in the Philippines are women-owned.
Supporting women entrepreneurs has taken on renewed urgency since the outbreak of COVID-19. Since the pandemic started, women-owned businesses in the three African countries covered by the study experienced a 7 percent drop in sales, compared to a 7 percent rise in sales for men-owned businesses. In the Philippines, the sales numbers of women-owned businesses had been higher than those of their male counterparts but fell to 79 percent of those of men because of the impact of COVID-19.
"In Southeast Asia, e-commerce became a lifeline for individuals' daily essentials as well as a natural business strategy pivot for vendors and brands when offline operations were affected by Covid-19 safety measures," says Chun Li, Chief Executive Officer of Lazada Group and Lazada Indonesia. "With the exponential growth opportunities available in the region, we are committed to providing women entrepreneurs with easy access to knowledge and tools to embrace and benefit from the digital economy."
Juliet Anammah, Chairwoman of Jumia Nigeria and Group Head of Institutional Affairs, said, "It is absolutely essential for women to be factored in, given the future of e-commerce. Africa is just at the start of its e-commerce growth trajectory. Now is the time to ensure women entrepreneurs are the leaders of Africa's digital journey."
The research was undertaken under Digital2Equal, an IFC-led initiative conducted in partnership with the European Commission which brought together 17 leading technology companies operating across the online marketplace to boost opportunities for women in emerging markets. Additional funding was provided by the Umbrella Fund for Gender Equality. The research was carried out by IFC in partnership with global evidence and advisory firm Kantar Public.
IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2020, we invested $22 billion in private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity. For more information, visit www.ifc.org