Publication

Where are the entrepreneurs?

13 October 2016
Executive Education INCAE

María Andrea and Mónica are two entrepreneurs who live in Costa Rica. The first is working on the creation of the first gastronomic market in San José, while the second is part of a project of a multilevel animal food company.

Monica's project belongs to the Zrii company and is based on a business model, which consists of building a network of consumers from which they subsequently recommend both the product and the business opportunity to third parties.

Container City will be the first gastronomic market in the Costa Rican capital, project that belongs to María Andrea, of Colombian origin, who points out that the main obstacle she faced was bureaucracy.

This situation is one of the barriers that women must face when undertaking entrepreneurship in the region. However, there is a big difference between the two projects: the reason for their creation.

Monica's is out of necessity, because she needs the resources to pay off the debt she contracted for her academic studies. That of María Andrea was born as an opportunity because in Costa Rica there is no offer of a gastronomic space for the public, which is why her project is new and innovative.

Most of the enterprises in the isthmus made by women and men arise out of the need for subsistence, according to him Diagnosis on the situation of entrepreneurship in Central America, carried out by the Central American Bank for Economic Integration (CABEI) and the German government.

Women lead, but ...

"With 49% of the population in Central America, women have a high participation in micro, small and medium enterprises", indicates Carmen Gisela Vergara, head of the Central American Economic Integration Secretariat (Sieca).

For the region as a whole, 57% of micro-businesses are run by women, according to the study General employment trends for women in Central America. However, women still have a low participation in production processes.

The Secretary General of La Sieca says that 64% of small and medium-sized enterprises (SMEs) in El Salvador were in the hands of women in 2011; however, only 14% of the entities were owned by a woman.

The Economic Commission for Latin America and the Caribbean (ECLAC) in its study Women Entrepreneurs in Latin America and the Caribbean: Realities, Obstacles and Challenges, reveals that "The incorporation of women into productive activities is conditioned by complex regulations, lack of access to credit, family responsibilities and few incentives from the environment where they operate."

Lack of time, being the head of the family, is one of the reasons why women cannot undertake. If an economy of care were established for children, the sick and the elderly, the economy of each Central American country would grow at least 2 more points in its GDP, explains the director of the subregional headquarters in Mexico of ECLAC, Hugo Beteta .

For Mónica Gutiérrez, the lack of approval of the projects by the banks is an obstacle at the moment of undertaking. Banks are risky. To lower this risk, they ask for guarantees, but historically the properties are assigned to the sons and not to the daughters. So a woman with a great idea can go to the bank to ask for a loan and as she does not have an asset, she is rejected.

Nonetheless, 59.9% of the clients of the Central American Microfinance Network are women, which speaks of a fairly equitable situation in the allocation of regional credit.

“Only in Guatemala, 84% of the microcredits have been granted to women, taking into consideration, in addition, that 75.8% of the credit portfolio in the country is destined to rural areas in activities of commerce, small industry and the agricultural and forestry sector. ”Says the report The importance of the microfinance sector in Central America, prepared by Sieca.

Director INCAE Entrepreneurship Center, Ryan Schil, points out that women have a great interest in entrepreneurship. Approximately 65% ​​of those who study entrepreneurship in the INCAE They seek to own their business.

Despite the impetus of women to undertake, a problem they face is the lack of technological educational training, which can lead to a little interest in areas such as engineering or robotics.

CABEI has a greater interest in dynamic entrepreneurship, its main challenge is to create 60 companies with a high level of expansion oriented to technology and innovation.

The goal is established and oriented towards women, since CABEI has a fund of 48 million dollars for the region, which are not reimbursable.

Excerpt from the article published by the magazine Forbes Central America, in its July 2016 edition.

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