New Business Center Supports Women Entrepreneurs in Mongolia
September 21, 2016
At first glance, Mongolia appears to be a shining star globally in the realm of women’s empowerment, and in many ways, it is. For example, according to the UN’s Gender Development Index (GDI), women in Mongolia have a longer life expectancy than men (70.2 compared to 63.1), and outnumber men in school attendance across all ages. Women can be seen in high numbers in various professional sectors including the medical field, as well as in management roles in the government. However, if you scratch beneath the surface, the inequality that exists becomes more evident.
Although women are present in the economic, political, and social landscapes of Mongolia on some levels, one look at high-level political representation shows that women are not in the driver’s seat of decision-making. On the economic front, while women’s economic participation is high, women workers are concentrated in a narrow set of occupations including retail, catering, and teaching, rather than higher-paying sectors such as mining, transportation, and energy, where prospects for advancement are greater. Women also take on the most significant burden of household work and compromise a large segment of the informal economy.
Findings from The Asia Foundation’s recent internal project analysis, which surveyed 150 new and current women entrepreneurs in addition to government officials, bankers, and NGO representatives, reiterated the variety of challenges women face in starting and growing their businesses. The survey identified limited access to capital and insufficient collateral as the biggest hurdle in obtaining a loan. Interaction with government is also a challenge with complicated bureaucracy, poor service, and lack of policy-level support mentioned as key challenges. Women also said that they lacked the networking opportunities enjoyed by their male peers and instead of accessing professional services tended to turn to family members for business guidance.
Not only do such restraints keep women from reaching their own potential, the country’s economy—hit hard by the global commodities slump and now in a state of crisis—is being held back from reaching its potential, too. Bringing women into the formal sector is a critical part of diversifying its income portfolio to buffer the volatile commodities market, as they are well educated and play a significant role in the participation of socio-economic and political activities. By supporting business development and addressing key constraints facing women entrepreneurs, Mongolia has an opportunity to unlock women’s active and full participation, build a more stable economy, and increase job creation.
The Asia Foundation, with support from the Korean government (KOICA), and working alongside the Municipality of Ulaanbaatar, local NGOs, and government partners, recently opened a new women’s business center in the capital.
The center fills a critical demand from female entrepreneurs for specialized support services such as mentoring and training and is designed to fill a niche market by complementing a training schedule with low-cost consulting services and a co-working space that provides facilities such as computers, printers, high-speed Wi-Fi, sound absorbent meeting rooms, a kitchen, and a children’s play area. During the training days at the center, we are helping to nurture our client’s entrepreneurial mindset, by teaching them to think outside of the box and see problems as opportunities.
In the first two months of operation, a total of 721 services were provided. One client who owns a small business that sells baked goods said the center was “inclusive, modern, and essential” while another expressed that before coming to the center, “I couldn’t outgrow my problems but the training has given me new ideas and helped me to work more productively. Now my business is improving.” Another client who runs a company specializing in handicrafts explained that before attending the center, she designed her products without listening to her customers. After participating in a training day at the center, she understood that the customer’s needs are crucial to improve product design. During the training, she said she met many new women entrepreneurs and gained three more business partners.
As Mongolia develops, many gender disparities remain. The continuation of corrective programs that empower women will yield considerable development payoffs and improve development outcomes for the next generation. The center provides a critical first step—the next step is for the city of Ulaanbaatar to take the concept forward and use the model to provide services for women outside of the capital city. By advocating for the city to focus more on women’s economic participation in the economy, the project helps to set a direct path toward inclusive economic growth, poverty eradication, and gender equality in Mongolia.
Diana Fernandez is The Asia Foundation’s deputy country representative in Mongolia, Enkhjin Bayarkhuu is a project manager, and Ashleigh Griffiths is a project officer there. The views and opinions expressed here are those of the individual authors and not those of The Asia Foundation or its funders.
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