the role of women micro and small enterprenuers in poverty reduction

THE ROLE OF WOMEN MICRO AND SMALL ENTERPRENUERS IN POVERTY REDUCTION

(A CASE STUDY IN ARBAMINCH TOWN)

A SENIOR ESSAY PAPER SUBMITTED TO THE DEPARTMENT OF

ECONOMICS FOR THE PARTIAL FULLFILMENT FOR THE REQUARMENT OF BACHELOR OF ART DEGREE IN ECONOMICS

BY GISHU MOHAMMED

ADVISOR: ABDULAZIZ ABDULSEMED

ARBAMINCH UNIVERSITY

COLLEGE OF BUSINESS AND ECONOMICS

DEPARTMENT OF ECONOMICS

MAY, 2012

ARBAMINCH, ETHIOPIA

CERTIFICATE OF EVALUATION

This is to certify that Gishu Mohammed student ID. No

RBE/042/02 has conducted his senior essay research paper,

titled The Role Of Women Micro and Small Entrepreneurs. (Arba Minch

TOWN).This work is completed with satisfactory evaluation of

the advisor and the examiners as per the requirement of the

university. Advisor: Mr.Adbulaziz Signature: ___________

Examinees:

Name

1. _____________________ Signature: __________

2. _____________________ Signature: ___________

Acknowledgment

Charity, help, mercy, grace, kindness, and forgiveness of ALLAH have a great value in my life. ALLAH is the most gracious and the most merciful for all I have achieved.

I would like to express my deepest appreciation and thanks to my advisor Ato Abdulaziz Abdulsemed for his fruit full guidance, and assistance.

Oh how can I express my feeling to thank my father Mohammed and my mother Hawa as well as my brothers and sister shortly I went to say ‘jaza kumula keyhran’.

Lastly I want to thank my friend especially Sara for her help in writing this paper and all my relatives as well as all people who help me in all I achieved.

Table content

Title page

Acknowledgment………………………………………………………………………………….i

Abstract ……………………………………………………………………………………………….ii

Table of content …………………………………………………………………………………..iii

List of table …………………………………………………………………………………………..iv

Acronym ………………………………………………………………………………………………...v

CHAPTER ONE

1 Introduction……………………………………………………………………………….

1.1 Back ground of the study ………………………………………………..

1.1.1Profile of women MSEs……………………………………………

1.2 Statement of the problem………………………………………………………

1.3 Objective of the study……………………………………………………

1.3.1 General objective.............................................

1.3.2 Specific objective............................................

1.4 Research methodology.......................................................

1.4.1 Data types and sources..................................................

1.4.2 Sampling technique and size.............................................................

1.4.3 Method of data analysis......................................................................

1.5 Scope of the study................................................................................................

1.6 Significance of the study.....................................................................................

1.7 Organization of the paper......................................................................................

CHAPTER TWO..........................................................................................................

Review of related literature .....................................................................................

2.1Definition ................................................................................................

2.1.1 Definition of micro and small entrepreneurs.............................

2.1.2 Definition of poverty...........................................................

2.2 Poverty as a cause of poverty...............................................................

2.2.1 Economic factors......................................................................

2.2.2 Non-economic factors ..............................................................

2.3 The roles of women ...............................................................................

2.3.1 Women as consumer......................................................................

2.3.2 Women as producers..........................................................................

2.3.3 Women as wage labourers.......................................................................

2.3.4Women as workers in the formal and informal sector.............................

2.4 Women and poverty...............................................................................................

2.5 Micro and small entrepreneurs and women.............................................................

2.5.1 Significance of the MSE sectors for developing countries..........................

2.5.2 Significance of the MSE sectors for women.............................................

2.6 Women and MSEs in Ethiopia.........................................................

2.7 Women Empowerment..................................................................................

2.8 Rational behind organizing women MSEs...................................................

2.9 Developed countries experience of women role in poverty reduction............

2.9.1Indonesia .............................................................................

2.9.2 Tanzania .............................................................................

CHAPTER THREE................................................................................

Discussion and analysis ......................................................................

3.1 Introduction .................................................................................................

3.2 The demographic or characteristics of the respondent.....................................

3.2.1 Distribution of respondent by age .................................................

3.2.2 Distribution of respondent by marital status..............................................

3.2.3 Distribution of respondent by educational status.....................................

3.2.4 Distribution of respondent by religions..............................................

3.2.5 Distribution of respondent by previous job status ....................................

3.3 Reason for venture...........................................................................................

3.4 Sources of income (finance) to start the business................................................

3.5 The role of MSE in creating employment opportunity..................................

3.6 Women engaged business activity................................................................

3.7 Women MSEs and poverty reduction.................................................................

3.7.1 Improvement in living standard ...........................................................

3.7.2 Increase in the level of income................................................................

3.7.3 Increase in saving capacity........................................................................

3.8 Performance of women MSEs .....................................................................

3.8.1 Growth capacity of WMSEs...........................................................

3.8.2 Profitability of WMSEs.......................................................................

3.9 Problems of WMSEs

3.10 Experience of women in growing business

CHAPTER FOUR

Conclusion and recommendation

4.1 Conclusion

4.2 Recommendation

List of table

Content

Distribution of respondent by age.....................................................

Distribution of respondent by marital status............................................

Distribution of respondent by educational status...........................................

Distribution of respondent by religions............................................................

Distribution of respondent by job status...........................................................

Reason for venture.............................................................................................

Source of income in starting the business............................................................

Employment creation...........................................................................................

Types of business activity that women engage in.....................................................

Improvement in living standard (a and b)...................................................................

Increase in the level of income per month..................................................................

Increase in saving capacity........................................................................................

Growth capacity of WMSEs.......................................................................................

Profitability of WMSEs..................................................................................................

Problems of WMSEs...................................................................................................

Acronyms

DPI---Development initiative project

ILO—International labour organization

MFI—micro finance institution

SNNPRS—South nations nationalities peoples regional state

SSEs—small scale enterprise

UN----- United nation

WMSEs—women micro and small entrepreneurs

Abstract

This research takes its case study on roles of WMSE on poverty reduction in Arbaminch town. For this purpose stratified random sampling that includes 65 of the WMSEs operators in the town and also purposive sampling method was used for official. This institution has been taken to explore the role of the sector especially in employment creation and income improvement and to assess the major problems that women face when they are in the sector. The problems like lack of adequate financial, market problem, raw material problem, and also there is other problem which a woman’s working in MSEs in the study area face.

Both primary and secondary data from the operators or owners of the business and from MSEs Bureau of Arbaminch town respectively replenish the information needed by the researcher for the completion of the study.

Interview questionnaire is the dominant data collection tools used for the study in this research.

Conclusion and recommendation are suggested that indicate the role of the sector in poverty reduction, and the problem that the women in the sector face.

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CHAPTER ONE

INTRODUCTION

1.1 Back ground of the study

The study has under taken in Arbaminch town which is the capital city of Gamo GofaZone.

Arbaminch is found about 500 km south of AddisAbaba which is capital city of Ethiopia .The

economy of the town, like other part of the country is based on agriculture, small scale

trade and services.

Women are animportant human resource, and vehicle of development not only in Ethiopia

but also in Africa, and other part of the world .In developing nation’s women represents

slightly more than half of the population, and in fact contributing more to the economic

development than usual society. Women accounted about 20% of production in the

developing would, andeven in Africa which is also in Ethiopia .They have also role in

industrial labour force which they account about 1/4 of the labour. (Roy, Blood gult, 1994)

Women leaving whether in urban or rural, whether they are poor or reach families they

carry out three important roles in the society. The first is that productive roles which

includes service labour force. The next is there production roles which includes producing

goods and services as part of the work force, and the third is there rule in community

management which consist of all the activities that are essential for the maintenance of the

society relations (Roy, Blood gult, 1994)

Women are wage earner or small scale Entrepreneur, This means women are mothers,

home workers and of course they are also citizens of the states. Women are particularly

affected; because they are faced with socio economic biases which made them even more

vulnerable .women are as industrial workers receive lower wages than men, women who

regularly perform agricultural tasks are not accounted. Women as citizen they are less able

than men to exercise theireconomic and social rights. (Krishna 1982)

In Africa, particularly in Ethiopia womenrepresents nearly half of the total population, but

play less in economic development for multiple reason including underestimation of women

in socio economic and cultural and political aspects. Small scale enterprise (SSEs) represents

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an importantmeansof earning income for womenin thedeveloping countries .SSEs typically

contribute a significant sector of the economy in such countries, and women play a major

role within SSEs. (Maryanne Dulalsey, 1990)

There are several causes of poverty in developing countries including Ethiopia ,which

includes lack of assets ,and income toget basic needs ,sense of noiselessness and

powerlessness in the institution of state and society .The rate at which growthtranslates in

to the loweredpoverty depends on initial level of inequality and distribution of income ,and

how that distribution changes over time . Growthand itseffectiveness and

reducingpovertyalso depend on sound governance. Absences of role of low, lack of civility

and predictabilities, intervention with public officials entire place a large burden on poor

people.

The poor lives and farms with uncertain rainfall .they leave in crowded urban settlement,

whereheavy rain can wipe out there homes. They are at higher risk of diseases such as

Malaria and Tuberculosis.They are at risk of local authority ,which means full

womenparticularly risk of being socially excluded ,and victim of being violent and crime .The

risk that poor face as a result of theircircumstance is cause of their vernal ability.womean

and girls are constitute about 3/5th of the would .(World book)

1.1.1 Profile of women MSEs

The transitional government of Ethiopiaissued national policy on Ethiopian womenin

1993.This has been reinforce by other subsequent factors like education, health, culture,

social welfare population environmental and regional policy integration provisionsof

convection declaration by UN and other international organization about women. The

Ethiopian constitution of 1995 has interceded their rights.(Birhanu Nega,2001)

In this regard, structure have been set up the national level in it.Ministers and Commission

of women’s affairs bureau at regional and zonelevel, among which the S/N/N/P/R women

affairs is one of it. The focus areas are organizing women by making gender equality in all

areas of development setting up women organization in MSE and networking. To meet the

goal such as women micro and small entrepreneurs (WMSEs) and women development

initiative project (DIP).(Befekadu Degafa, 2002)

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SNNPR women (MSEs) have been established in year 1998 with the initiative of small

women who have been engaged in business activities. This is mainly to help women in hand

crafts,service,trade and other business activities and help the development of women

owned business through the provision of information and business networking

opportunities to help women MSEs in specific sectors to start,develop or expand their

business.(Brusher,2000)

The objective of the women SMEs is to operationalize the country, objective of poverty

reduction in general and to improve the status by strengthening their capacity targeting

women in poor district and to encourage them to join and remain in the association to

undertake productive activities. Women MSEs Association also taken into account women

empowerment, improving the financial and operational capacity of on-going women owned

business.

1.2 STATEMENT OF THE PROBLEM

People working in the development field have long concerned with how the benefit of

development are distributed. However, recently concern with distributional issues has

incorporated differences in income and economic power between men and women. Both

men and women play different roles in society which subject them to different constraint

and opportunities, leads them being different in poverty reduction measurement. Women

are constrained by socio-economic and culturally imposed limitation, which denied their

rights to have access and to control productive resources such as land as fixed capital.

Understanding the role that play gender in development can makea substantial difference

as to whether the growth oriented projects succeed or fail, which leads to the question of

how men and women define their roles, or have influence in all aspects of development

process.

In this aspect Ethiopia ranked 142 in gender related development index with the income

earning of 38% female and 72% men. The fact that all poverty indicators for Ethiopia

aggregate the gender differences and particularly the level of poverty to which the women

are subject. (Abebe Shimelis, 1999)

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Therefore, it is important to search for alternative mechanism which initiates the

contribution of women for economic development out of the formal sector by all poverty

interventionprograms such as women in women MSEs and empowering them.

1.3 OBJECTIVE OF THE STUDY

1.3.1 General Objective of the study

The general objective of the study is to assess the role of women micro and small

entrepreneurs in poverty reduction by engaging them in association and by participating in

small scale enterprise as well as other income generating activities by using local resources,

low and medium capital and abundant labour.

1.3.1 Specific Objectives of the study

To identify the basic problems of women micro and small entrepreneurs (WMSEs).

To know the role of MSEs in creating employment opportunity for women.

To know the role of MSEs in improving the living standard of women.

To find out the role of gender consideration in development process.

To know the performance of women micro and small entrepreneurs (WMSEs).

To identify the basic problems of WMSEs.

To create awareness of policy makers about the role of women in povertyReduction.

To learn from women who are success full in their business

1.4 RESEARCH METHODOLOGY

This section presents the source and types of data, sampling techniques and

methods of data analysis so as to achieve the objective of the study.

1.4.1 Data types and sources

The study is based on both primary and secondary sources of data which are used to

achieve the objective of this study. Secondary data are obtained from the available

documents of the organization, newspapers, brushers and some national report,

while primary data are collected from a sample of 65 respondents.

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1.4.2 Sampling

The population of study consist of 693 women who work in five sectors of MSEs

.these are construction (102),manufacturing (106),service (197),trade (178) and

urban farming (110).The estimated sample size was 65 out of 693 women’s. The

sample technique employed will be stratified random sampling in order to obtain a

representative sample the women’s engaged in different kinds of business and also

purposive sampling method was used to top officials of institutions were purposely

taken and interviewed, since the researcher believed that they know the condition

better than others because of their day to day contact with women MSEs.

1.4.3 Methods of data analysis

The data which are collected from primary and secondary sources can be analyse

1.5 SCOPE OF THE STUDY

As far as the scope of the study will be concerned, it is only limited to women MSEs

in Arbaminch town which includes women business association and program to

promote, improve and help the development of women business. The study is

mainly focus on the impact of gender sensitive intervention through empowering

and makes access to the women towards the productive assets. It also intends to

cover the type of business in which they involve, level of their participation and in

group business, problems they encountered in the business, their attention on their

future business and changes in their living standard.

1.6 SIGNIFICANCE OF THE STUDY

This study is step in the direction and will stimulate farther efforts by others in the

development community. The need to redress the failure to consider systematically

,and coherently the different roles of women as they engage in and are affected by

the development activities require more than adhoc attention. It is essential

institutionalize successful initiatives in providing the necessary analytical and

methodological skill for assessing the significance of gender differences in

development process.Therefore,these study is significant for the contribution of

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some relevant information to the policy makers ,to incorporate women in any

development program targeting povertyreduction. The study can also serve as the

starting point for further study and detailed investigation by others in this particular

area.

1.7 ORGANIZATION OF THE PAPER

The research constitutes about four chapters. The first chapter is introductory part,

the second chapter contains the review of related literatures, the third chapter deals

with data presentation and analysis, and the last chapter is about the study’s

conclusion and recommendation.

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CHAPTER TWO

REVIEW OF RELATED LITERATURE

2.1 DEFINITION

2.1.1 Definition of Micro and Small entrepreneurs

The definition of micro and small entrepreneurs varies from country to country. All over the

world numbers of employees or capital investment or both have been used as the basis for

defining micro and small enterpreneurs.Based on the numbers of employers:-

Micro or very small which consist of less than 20 workers.

Small enterprise which consist 20-100 workers. (Hailay,2003)

On the other hand micro and small entrepreneurs defined on the investment paid up

criteria. Based on this criteria micro entrepreneurs are those enterprises with paid up

capital of not greater than 20,000 birr. Small entrepreneurs are those business enterprises

with paid up capital of above 500,000 birr.(Hailay,2003)

2.1.2 Definition of poverty

Poverty is relativeterm; therefore, it is difficult to define it by using one word or sentences

since it has been defined by different people differently based on the existing social,

political and economic condition. The world development report defines poverty as the

inability to attain the minimum standard of loving which is measured by the basic

consumption needs or income required satisfying them. (HenneryBernsteinHazeJonson).

Poverty is a condition where people’s basic needs for food, Clothing and shelter are not

being met, (WWW.business dictionarty.com)

Poverty is a world-wide, but empirical studies of poverty, income distribution and low

income aid programme for citizens have these far been more. (WWW.ps commons

.org/ggp/aims)

The causal interlink among low saving ,low investment, low capital formation and low

income finally resulted in what we call poverty.Todaro depends on two variables to study

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the magnitude and extent of poverty in any country .The average level of national income

and the degree of inequality of income distribution. According to him, for any given level of

national income per capital the more unequal distribution and the greater the incidence of

poverty. (Michael Todaro, 2001)

2.2 POVERITY AS CAUSE OF POVERTY

There are two major factors that make particular economy to be underdeveloped. These

are:-Economic and non-economic factors.

2.2.1 Economic factors

Economic factors are the variables that prevent the economic development from the inside

of the economy itself. These are:-

1. Lack of entrepreneurship

2. Capital deficiency

3. Difficulty in adoption of modern technology

4. Low agricultural productivity

5. Market in imperfection

In closed economy the case that no international trade is allowed national income is

divided into consumption and saving .consumption operates in supply side of the

Economy and saving operates in the demand side .the following diagrams show the

operation of various circle of poverty in both demand and supply side .(prof

Nurkse,1985)

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Operation on supply side

Low saving

Poverty (low level of income)low investment

Low productivity low capital formation

(Prof Nurkse, 1985)

Operation on demand side

Low purchasing power

Poverty (low level of income) Low investment

Low capital formation

Low productivity

(Prof Nurkse, 1985)

2.2 Non- economic factor

Non-economic factor includes about undeveloped human resource, social, cultural

and political instability which leads to poverty.

1. Undeveloped human resource: - This includes uneducated, unskilled and technically non

trained human resource.

2. Socio -culturalobstacles: - This may rise because of there is no

Sharp desire for material betterment

Willingness to work hard

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Awareness of future benefits of present sacrifice

Preparation for industrial revolution

3. Political instability

Future become uncertain

No project can be executed properly if there is any change in political power

.(Prof.Nurkse,1985)

2.3 THE ROLE OF WOMEN

Ecological ways of knowing natures are necessarily participatory. Natureherself is the

experiment and women as sylviculturalist and water resource managers. The traditional

natural scientists, their knowledge is ecological and plural reflecting both the diversity of

natural ecosystem and the diversityin cultures that nature based living gives rise. (Rodda,

1989)

2.3.1 Women as consumers

One of the major contribution that we all make to the economy is through buying things

.women role as care givers has meant that women play especially prominent role in buying

things that provide sustenance for home and family .Studies shows that women are

responsible for buying 80% of house hold goods . Although it is often played down it is clear

that women have a great deal of influence in the economy asconsumers. In other words

they have a lot of spending power. As consumers, women live under a good deal of

pressure. Many women must fire ways to feed their families on limited budget. They search

for balance between affordability, nutrition and availability, countered with the personal

presence of their families. Women are also often responsible for closing themselves and

their families and are faced with similar demands in these tasks.(WWW.UnPac .ca/economy

/consumer)

2.3.2 Women as producers

Women’s as producers exposed to work exploitation and occupational hazards .they can be

involved in sustainable management of the environment or in its degradation .women

farmer’s work to produce basic good and crops for export and therefore their role is crucial

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to the sustainable use the land .other women workers in the formal and informal sectors are

oftenengaged in production process which has animpact on the environment. (WWW. PP

Pr/economy/producers)

2.3.3 Women as wage labourers

Overall, the increased use of land for commercial agriculture in the international agro-

business has led to an increase in land lessens causing more women to sack work as paid

agricultural labour.In Latin-American countries female labour is widely used for labour

intensive tasks such as coffee picking, and the selection of and storing of beans. In India,

transplanting rice is done almost entirely by women, who work consciously from 10:30am-

6:30am for statuary minimum wage working as tea leaf puckers, rubber trapper or causal

workers. Women plantation workers are generally employed in the lowest paid jobs, such as

weeding, spraying and harvesting. This can involve tiring and heavy work and in the case of

spraying the danger of exposure to harmful chemicals. In Ethiopia life for women

particularly those from villages is an endless round of grain grinding, water carrying, fire

wood collection, infant care, vegetable gardening and child birth.(ILO report,2000)

2.3.4 W0men as workers in the formal and informal sectors

I. Food processing and cottage Industries

Food processing in many forms is wide spread and is natural extension of women’s work as

food producers. Although much of the produce is for family use some will be sold in the

market or in strait. Preparation of basic food, such as husking and polishing rise, is mainly

done as unpaid labour, and therefore women who perform their tasks commercially will

earn only avery low wage in order to be competitive. In Lima Peru, hand crafts and cottage

industries are important activities of women. Local materials especially those from the

forest are used to make the product such as baskets and mats .Women as home based

producers are involved in making closes ,small items of furniture’s ,foot wears lace and bee

dies (a kind of cheroot).(Vikki Mc lean, action aid Winter 1989)

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II) The construction Industry

In many developing countries women work in the construction industry and this work often

has a link to the environment .for example, buildingdams. Internationallabour organization

(ILO) programme involves the implementation of labour intensive work schemes to promote

employment and rural development. Many women are also employed through food work

projects; women are generally more interested than men in working for food which

provides benefits those women can control money. In India and Bangladesh from 50 to 90%

of the worker in the world food programme assisted food for work projects are women

.many of them are land less peasants who unable to find other employment during slack

season.(Annabel Rodda, 1991)

2.4 WOMEN AND POVERTY

A substantial majority of the world poor is made up of women. If we consider life of

inhabitants of the of the poorest community across the developing world ,we would

discover there are virtually everywhere women and children experience the harshest

deprivation .The prevalence of female headed house hold ,the lower earning capacity of

women and limited control over their spouse income or contribute to this disturbing

phenomena .in addition to women have less access to education,formalsector employment

,social accuracy and government employment programs. This entire factor combine to

insure that poor women’s financial resources are meagre and unstable relative men’s

(Todaro, 1994)

The income disparity between man and female headed households can be explained by

their large earning deferential between men and women .In urban areas women are much

less likely to obtain formal employment in private companies or public agencies are usually

forced to participate illegal low productivity jobs. In the same way rural women have less

accesses to the resources necessary to generate stable income and potential in most least

developed countries legislation often prevents women from owning properties, significant

financial contracts without the husbands signature and women are typically in a negligible

for institutionally provided resource such as credit and government employment and

income earning programs which are accessible exclusives to the men. (Todaro, 1994)

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The rule of women in controlling house hold income and resource is limited for a number of

reason of primary importance the fact that relatively large portion of the work carried out

by women in unremunerated such as collecting faire wood,cookingand maybe even

intangible as the task of mother . women’s control over the house holds resource may also

constrained by the fact that many women from poor households are not paid for the work

that they perform in family, agriculture or business activity, it is common for the Male head

householdsto control all funds from cash crops or family business, even though significant

portion of the labour inputs is provided by his spouse. Besides in many cultures it is

perceived socially unacceptable for women to contribute significantly to the house hold

income and hence women’s performance may remain concealed or unrecognized. These all

factors to gather perpetuate the low economic status of women and can lead to the limited

role of women in controlling over the house hold property. Development policies that

increase the gap of productivity between man and women are likely to worsen the earning

disparities as well as farther erode the women’s economic status within the house hold.

Since the government programmes to elevate poverty usually works almost exclusively with

men, training program the earning potential in formal sector employment generally limited

to men, agricultural exertion programs promote male dominated crops and frequently at

the expense of women’s vegetables plots.

The consequence of decline in women relations or absolute economic status has ethical and

long term economic implication.Any process of growth that fails to improve the welfare of

the people experiencingthe greatest hardship ,broadly recognized to be women has failed to

accomplish one of the principal goals of development. In the long run the low status of

women is likely to translate into slower rate of economic growth.This is true because the

educational attainment of and future fanatical status of children are much more likely to

reflect those of mothers than fathers .thus ,the benefits of current investment in human

capital are more likely to be passed on to the future generation if women are

successfullyintegrated in to the growth process and considering that human capital is

perhaps the most important requirement for growth ,education and economic status for

crucial to meeting the long run objectives for list developed worlds .(Todaro pp,175-176).

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2.5 MICRO AND SMALL ENTERPRENUERS AND WOMEN

Small and micro entrepreneurs represent important means of earning income in developing

countries like Ethiopia .MSEs typically constitute a significant sector of the economy in

developing countries and women play an important role in MSEs.

2.5.1 Significance of the MSEs Sectors for Developing countries

MSEs Sector is important to the economy of the developing countries. It provides

employment and income for many people while supplying needed products and services.

The sector has become important as experience has proven large scale enterprise in capable

of providing large shares of employment. In developing countries as employment in

agriculture declines and as migration from the country side swells urban population.

Agriculture is of per amount important to economic development and to women. Non-farm

income also places a critical role. Within economic growth agriculture inevitably comes to

represent smaller part of total output. Income and employment entrepreneurs unlike

agricultural production, accounts for an increasingly large share, untiloutput, incomeand

employment from non-farm enterprises surpass those drive from farming. (Maryanne

Dulansey, 1990)

2.5.2 Significance of MSE Sectors for Women

Micro and small enterprise are particularly important for women who need to earn income.

They are more flexible and less restrictive than employments in large enterprises ,each may

require education, training and experience that women lacks such job may also require that

work be done at times and in places that culturally un acceptable or difficult for women with

family responsibilities .Although women’s economic activities in both agricultural and non-

agricultural production are undoubtedly unreported data compiled from the New York of

labour statistics for 1970,1974 show that for Latin America and Asia, the percentage of

economically active population that is higher in non- agricultural production that in

agriculture, in the middle east it is equal and in A Africa it is lower. A world bank study

indicate ‘’a sharp increase in the proportion of women urban migrants ‘’.Small scale

enterprise is difficult for people newly arrived in the city. However it provides greater access

for women than other sectors, which of them require educational qualifications beyond

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those held by women. In several countries of Africa, Asia and Latin America come to a

general conclusion that such projects mostly assist women. (James Austain, 1987)

2.6 WOMEN AND MICRO AND SMALL ENTERPRISES IN ETHIOPIA

Ethiopia is better known as symbol of poverty over the world. Women in Ethiopia make up

substantial majority of poor people. If we compare the lives of in habitant of the poorest

communities across nation we would discover that virtually every women and children

experienced harshest deprivation in Ethiopia. According to the national report micro finance

and micro small industries show a substantial development after the national economic

reform of 1992/93. In this regard women participation in micro and small enterprise shows

a rapid expansion mainly under the major world donors support .In spite of this situation

the result of development in micro and small enterprise sector and benefits women’s obtain

from this sector is very low may be for the reason that the case of harsh and chronic poverty

in the country as well as the great illiteracy and low experience about the performance and

benefits of participating in micro and small enterprise socio-cultural factors are also

obstacles for the active participation of women in such sector. This means the sense of

women’s believe d as dependent on men and lack of confidence by women is a crucial

factor to this end.(World book)

2.7 WOMEN EMPOWERMENT

Empowerment is concerned with the processes by which people become aware of the

interest of others in order to participate in to the position of greater strength in decision

making and being an agent to influence such decisions.the decision given by the united

Nation decade for women continues to have positive effect on the legislation and

structure’s which enable women to contribute more fully in the economic and political areas

of their societies .Never the less it is more than possible that the effect of the world

economic crisis on women’s role as citizen will be a negative one particularly among the

poor groups. (Deng, 1998).

By providing women with skill information and get support from the concerned bodies

(institutions) they are equipped with tool of identifying and articulating law involve

providing space and support the women micro and small entrepreneurs (WMSEs) to come

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together to share knowledge and experience to facilitate conditions when they ask

questions learn strategy not only with women but also with more experienced women’s

rights advocacy.Secondly,women themselves can contribute to analysis on issue which

affects them, which is only possible through empowerment. The process of implementing

policies foreseen by the United Nations decade for women has to take into account all

parties in economic and social decision making and all levels at which public actions take

place. This means strong involvement of women in labour union, trade association and

economic institutions. This can be especially valuable when one is dealing with rural women

in the context of the kinds of programme, investments and infrastructure necessary for

improving their ability to raise food and generate income. (Deng, 1998)

The concept of empowerment depends on three measures. These are: - skill development,

provision of credit and provision of micro small enterprise. These special skill development

and provision of credit is very important for the ordinary African people to participate in the

productive activities of their national economy and to improve their condition of life.

Accordinglyempowerment of women needs to work more to improve women’svoices and

access to the resources by increasing their decision making on their physical assets, financial

and human capital. Moreover women need more equitable access to credit and productivity

enhancing services. Some studies of the effects of networking schemes such as group based

micro credit, suggest that, these schemes have many potential for the eradication of

poverty. (Deng, 1998)

UNICEF sees women as active agents in programme delivery as organized groups playing

significant roles in managing community resources and making decision, governing resource

allocation and as individuals securing the community as health and nutrition agents, water

and sanitation monitors, adult literacy trainers and family motivators. Education is seen as

pre requisite and key factor in raising women’s awareness and empowering them to

become active participant in the national development process.Prioirty of concern should

be given to ensure the integration of women as participants and beneficiaries in all

development programmes and projects, not only because women are significant

contributors to economic and social development, but also from the conviction that

sustainable development is possible only if women are more effectively

involved.(Deng,1998)

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2.8 RATIONAL BEHIND ORGANIZING WMSEs

Considering the deep rooted culture, economic and institutional condition of the under

developed countries, the existing facilities are specifically against women, because women

are as active for economic development. The absence of organized pressure groups to high

light women’s issue and direct the attention of policy makers to them hand caps women

even more.(Usha Jamanl, 1987)

Organizing the women under a group in the case of WMSEs is very necessary step in the

whole process of assisting them to reap their own potential. The economic activities are the

necessary bases for organizing the women. The group of women that engage in such

activities will feel a sense of solidarity when they perceive real improvement in their

income.as the women entrepreneur’s gains more and more strength in terms of awareness,

capital accumulation and experience about income generating economic activities, the

negative consideration towards an inherent nature of women will decline. The issue of

women as they engage in income generating activities will get their due attention and force

to diverge natural resources towards the need of women.as the credibility of

women’sentrepreneur’sincreases, the kind of skill required for the women also increases.

The women will learn to perform income generating economic activities to manage their

business, to know their role in community as well as in the household to deal with the

officials at every level regarding their opportunities, to analyse their own problems and

present them convincingly to the agencies concerned.in this respect there are several

objective of organizing women under WMSEs;- among this identifying the problems of

women enterprenuers,stablishing consultant advisory services to assist member of young

women to achieve their dream.Their identities as women ,as an individual their own rights

,as part of society, their role in economic development, as the labour force will also develop

in addition to their identity as a member of family.(Usha Jamanl,1987)

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2.9 DEVELOPING COUNTRIES OF WOMEN ROLE IN POVERTY REDUCTION

2.9.1 INDONESIA (Women and Credit project in Indonesia)

In Java women’s rights are generally the same as those of men with respect to marriage,

divorce, in heritance and poverty rights. They have considerable degree of economic

independence and initiative. Women exercise significant social power and not subordinate.

Although women enjoy high status they do not share equally in opportunities in the

development process. Higher percentage of women are economically active in rural than in

cities. The main employment for rural women is agriculture either on the families land or as

hired lobour.the other major source of income for rural women is an elementary processing

food and drink processing.

Ann Carter, visiting Indonesia and Java for a long period of time stated that an alternative

employment opportunities and source of income for women are severely limited. Hand

crafts and cottage industries have limited economic benefits since village women are UN

organized and cannot compete with manufactured products in terms of either cost or

quality. Javanese women tend to work longer hours and earn less for their labour than men.

Poor women put in longer hours than their wealthier parts since they cannot afford to hire

anyone to assist them with the heavy burden of domestic work (example food preparation

and water fetching).Both male and females technically have the same access to credit. In

reality men receives from formal lending agencies and women depend on informal sources.

Tittle to property is held in the men’s name and this is the greatest constraint for women’s

gaining access to credit, since land is required as collateral.

2.9.2 TANZANIA (The Arusha planning and village development project)

In early 1981, the Arusha planning and development project program with the cooperation

of USAID carried out a short investigation to determine how rural women were being

involved in the project.

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THE ECONOMIC ROLES OF WOMEN IN THE PROJECT

Agricultural crops and livestock

Women in Tanzania provide on average 60% of all the required farm labour. Harvesting is a

task done by elsewhere both by men and women in Tanzania. Women and men agree that

livestock is the business of men and they make any decision that are require regarding

where cattle should be grazed when cattle should be dipped, the purchase and sale of the

routine tasks including milking ,caring for caves. One of men of Tanzania said that ‘’If

women owned cattle there would be corruption’’.

Income generating activities

Women in all areas involved in petty production which earns them independent income.

The most wide spread production is the bear making from which a women may earn

income. Women also derive income from hand craft production. Women in some areas

produce mats and baskets for sale. Some women earn an income from producing cloth

items such as Muslim hats, table clothes etc. Other sells milk and vegetables in the markets.

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CHAPTER THREE

DISCUSSION AND ANALYSIS

3.1 Introduction

This chapter of the study deal to present ,interpreted and analyse the data collected from

different sources through questionnairedistributed, interview conducted, observation made

and secondary data collected form document of the MSEs in the town . Theintended sample

size was 65 and the data would analyse based on this sample size.

3.2 THE DEMOGRAPHIC OR CARACTERSTICS OF THE RESPONDANT

The respondents were from women MSEs which are in Arbamench town. Their

characteristics are described below.

3.2.1 Distribution of respondent by age

Table 3.1 distribution of respondent by age

Age group No of respondent Percentage

Below 2o 9 13.85

20-30 21 32.30

31-40 19 29.23

41-50 14 21.54

51-60 2 3.08

Total 65 100

Source: filedsurvey, 2012

The above table shows that 13.85 (9) of the respondent lie in less than 20 years, 32.20 %

(21) of respondents lie in the age range of 20-30 ,29.23% (19)of respondent lie in the age

range of 31-40 ,21.54% (14) lie in age range of 41-50,and only 3.08% (2) of respondents are

above 50 years old. From this age structure we can understand that more than 75% of the

respondents are lie in the age rang which is economically active labour force. This group can

perform well to contribute more to improve their economic wellbeing and to the country

development .the left 25%of the respondent are above 40 years old and the survey

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indicates that even this rest group is above 40 years old they can still the productive labour

force.

3.2.2 The distribution of respondents by marital statues

Table 3.2 distribution of by marital status

Marital status Number of respondent Percentage

Married 33 50.77

Single 12 18.46

Divorced 7 10.77

Widowed 13 20

Total 65 100

Source; field survey, 2012

One can observe from the table above that 50% of the respondents which constitute more

than half are married, 18.46%of the respondents are un married or single,10.77%(present)

of respondents which is the least are divorced and 20%ofthe respondents are widowed.

From this we can drive the argument that the importance of organizing women into MSEs, is

mainly to improve the lives of those women most of whom depend on their husbands

income for every of their life shares MSEs is also useful for the other group (widowed) who

even do not have their men spouse to depend on many except their family and relatives.

Organizing under SMEs also helpful for those who are single in providing productive assets

which help to create and strengthen their potential in development process.

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3.2.3 Distribution of respondents by educational status

Table 3.2 Distribution of respondent by educational status

Educational status No of respondent Percentage

Read and write only 28 43.08

Primary school 13 20

Secondary school 11 16.92

Postsecondary certificate 9 13.85

Diploma and above 4 6.15

Total 65 100

Source: field survey, 2012

The survey result presented in the table above indicates that 28 respondents or 43.08 % out

of 100% and it constitute an important majority are can only read and write. They even do

not have the basic educational level. According to the table above 13or 20 % of the

respondents have the basic education level (primary school).11 or 16.92% of the respondent

are those who attend their secondary education school, 9 or 13.85 of the respondents have

post-secondary certificate and only 4or 6.15 % of the respondents have diploma and above.

The result shows that the majority of women MSEs, group didn’t attend any formal

education, which may make it difficult to run their business in a better way.

3.2.4 Distribution of respondent by religions

Table 3.4 distribution of respondent by religions

Religion No of respondent Present

Orthodox 17 26.16

Muslim 12 18.46

Protestant 30 46.15

Other 6 9.23

Total 65 100

Source:survey ield, 2012

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The Above table indicates that 17 or 26.16 % of respondents are orthodox, 12or18.46%is

Muslim, 30 or 46.15 % are protestant and 6 or 9.23% of the respondents are followers of

her religion. From this we can conclude that any religion cannot oppose peoples to work

and in prove their life.

3.2.5 Distribution of respondents by previous job status

The members of associations formed under the micro and small enterprises are not only

those who don’t have jobs but there are some members of the association which quite their

previous job and join he women MSEs .Respect to this variables the respondents response is

shown below.

Table 3.5 Distribution of respondents by previous job status.

Have you had a job before

you start up this kind of

business

No of respondents Percentage

Yes 14 21.54

No 51 78.46

Total 65 100

Source:field survey, 2012

As the above table shows, the member of associations organized under women MSEs are

also form two sources, those who had not have job are the major ones and they account

about 78.46 % of the sample respondents. The remaining 21 .54 % of the respondent have

had a job before they joined this line of business by expecting, better income form the

business.

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3.3 REASON FOR VENTURE

The association and their members have their own reason for the start-up of this business

and run MSEs.The following table shows about the reason to start the business.

Table 3.6 Reason for venture

Reasonfor start the business Number of respondent Percentage

To create job 34 52.31

Demand for the business 8 12.31

Better profit 17 26.15

Because of no other

alternative

6 9.23

Total 65 100


We can see from the above table there are many reasons for the member to participate in

MSEs. The major reason for most of the respondent are job creation which constitute about

34 out of 65 or 52.31% and the other respondents start the business because of demand for

that business product which constitute 8 out of 65 or 12.31%and 17 out of 65 or26.15%of

the respondent start the business because of better profit. There are also responding who

have started this business only because they don’t have other alternative, this group

constitute about 9.23%0f the respondent

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3.4 SOURCE OF INCOME TO START THE BUSINESS

Women in MSEs may get finance from different sources and start their business to fulfil

their interest and help themselves as well as others. The table below shows about this.

Table 3.7 source of income in starting the business

Source of income Number of respondent Percentage

Credit from MFIs 34 52.30

Credit from bank 8 12.30

Support from NGOs 12 18.46

0wn saving 6 9.23

Credit from friend or family 3 4.64

Credit from private many

lender

2 3.07

Total 65 100


The above table illustrate that 34 out of 65 respondent start their business by the money

that they get from MFIs and this constitute about 52.30%.the other respondent replied that

they have an access to some other formal institutions and also support from NGOs, some

respondent also start the business by their small saving while the rest of the members have

access to other financial sources such as informal money lender. From this we conclude that

MFIs are the most important source of financial for women.

3.5 THE ROLE OF MSEs SECTOR IN CREATING EMPLOYMENT FOR

OPPORTUNITY WOMEN

The beginnings of formation of MSEs were aimed at creating employment opportunities and

engage individuals into the sectors. In Ethiopia population living in urban areas are

estimated at about 15% and the remaining 85% confined to rural areas that are the

breeding ground for women MSE development. (Todaaro, 1993)

MSEs are labour intensive and it requires capital saving which helps to solve unemployment

problem and they also use unskilled labour force which is advantages especially for women.

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Table 3. 8 The trend of selected MSEs in creating job opportunity for women

The selected sector Number of employment Percentage

Construction sector 102 14.72

Service sector 197 28.43

Trade sector 178 25.89

Manufacturing sector 106 15.29

Urban farming sector 110 15.87

Total 693 100

Source; Arbaminch town, WMSEs

The above table shows that different sectors of MSEs create different level of employment

opportunity for women’s. The sectors are construction sector, service sector, trade,

manufacturing and urban sector. The total employment creation by each sector is 14.72%,

28.43%, 25.89%, 15.29% and 15.87% respectively. From the above information provided it is

possible to conclude that service is the major sector in creating job opportunity for women,

this is because of service is the sector that doesn’t require high force and its suitability for

women. In addition to this trade is the important sector that creates job opportunity for

women .construction also creating job opportunity for women even if it constitute small

present than other sector. This is because of most of the employees who are in this sector

are men than women which result from difficult of the work. Generally MSEs are the most

important sector for women in creating employment opportunity.

3.6 WOMEN ENGAGED BUSINESS ACTIVITY

The Arbaminch town WMSE are engaged in a number of activities that are vital for growth

of the town, economical income and as lively hood of each individual. This may include hotel

and tourism, hand crafts, beauty salon, restaurant, food production, construction, selling

consumer commodities and goods, engaging in informal home-made food, producing labour

saving stove, selling fruit and fruit products, secretary service etc. Such activities are

classified and summarized below.

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Table 3.9 types of business activities that women engaged in

Types of business Number of respondent Percentage

Petty of small trading 18 27.69

Restaurant 14 21.54

Hand craft 6 9.23

Processing and selling of

food and beverages

12 18.46

Beauty salon 8 12.31

Clearing the town 3 4.61

Selling of culture clothes 2 3.08

Other business activities 2 3.08

Total 65 100


As we can see from the above table most of the women in MSEs are engaged in small

trading which constitute 27.69% of the respondents. This indicate that majority of WMSE

are from the lower income group. Restaurant is also the main activity that women engaged

in and it constitute 21.54% next to small trading. The rest of the women’s are engaged in

activities like hand craft, processing and selling of beverages, beauty salon and also other

activities.

3.7 WMSEs AND POVERTY REDUCTION

It is widely acceptable that MSEs play a vital role in socio-economic development of country

as well as generating income and for sustainable development. Poverty is a multi-

dimensional concept and phenomenon. Generally there is debt among scholars about

poverty being conceived and defined as absolute or relative. Absolute poverty implies lack

of access to objectively determined, reasonably adequate quantity of goods and services, to

satisfy his/her material and non-material wants which are basic needs. On the other hand

relative poverty implies that a person access of life is relatively lower as compared to some

reference group of people.

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Poverty generally refers to lack of employment hence income, adequate health care,

nutrition and with respect to these variablesthe MSEs are improving the living standard of

the women working in the sector.

3.7.1 Improvement in living standard

Table 3.10 Improvement in living standard (a)

Is your living standard as a

result of engage in MSEs

improved?

Number of respondent Percentage

Yes 56 86.15

No 9 13.85

Total 65 100


As the above table shows major or about 86.15% of the sample respondent living standard

is improved. The remaining 13.85% of the respondent living standard is not much improved.

This is because of they are not getting that much better than before and they are also those

who have joined the business by quitting what they had before.

Table 3.10 Improvement in living standard (b)

In what terms your living

standard improved?


Increased family income 11 16.92

Increased consumption

expenditure

19 29.23

Increased health care 8 12.31

Employment opportunity 20 30.77

Self-dependence 7 10.77

Total 65 100


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As the above table shows MSEs are playing a vital role in poverty alleviation. The

participants in the MSEs have got different benefits by participating. Majority of the

participants (women) have got increased or better consumption expenditure and

employment opportunity. These two benefits are cited by 19 and 20out of 65 respondents

respectively. The other major benefits are increased family income and increased health

care expenditure. There are also individuals who have got self-dependence and freedom

from dependence on their husband. The major feature of poverty is low income that is the

cause of un employment. On this respect the income that individuals are getting shows an

increase in income.

3.7.2 Increased in the level of income

Table 3.11 Increased in the level of income per month

Average

income

before

engagement

in this

business

Number of

respondent

percentage Average

income after

engagement

in the

business

Number of

respondent

Percentage

0-150 42 64.62 150-300 17 26.15

150-300 13 20 300-450 21 32.31

300-450 7 10.77 450-600 15 23.08

450-600 3 4.61 600-950 and

above

12 18.46

Total 65 100 65 100

Source; survey, 2012

As shown in the above table 26.15% of the total sample respondents were the previously

low income earners and they all have come to earn a minimum of 150ETB. In all income

groups after their engagement in the business shows an increase in their average monthly

income. Previously the maximum average monthly income was 600ETB, but after their

engagement currently they earn the maximum income of 950ETB and above, which shows

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increase in income level. Those who have no income source or the unemployed have

secured a minimum of 150ETB.

3.7.3 Increased in saving capacity

Women are being known by saving from what they earn as profit. The following table

illustrate about this.

Table 3.12 Increase in saving capacity

Did you have saving account

and save your money


Yes 53 81.54

No 12 18.46

Total 65 100


The above table illustrate that women’s capacity to save is high which constitute about

81.54% of the respondent. These play a vital role in poverty reduction and increase their

dream in the future to change or improve their living standard. The rest 18.46% of the

respondent have no saving account. This is because of their entrance into the association

later on and paying the money they borrow from different sources.

3.8 PERFORMANCE OF WMSEs

The performance of the industrial sector can possibly be measured by gross value of output

which refers to the total output. (Haile, 1995)

To measure specific firm’s performance we can use its profitability, capacity utilization,

debt-equity ratio and other measures. In this study the researcher used the growth capacity

and profitability.

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3.8.1 Growth capacity of WMSEs

Table 3.13 growth capacity of WMSEs

Did you made any

expansionary work to your

business?


Yes 41 63.08

No 24 36.93

Total 65 100


As the above table shows 63.08% of the total respondents have made some kind of

expansion to their business. These entrepreneurs are from service sector like; hotel, beauty

salon and from trade sector and also from construction sector. This shows us that they have

some kind of growth potential. On the other hand 36.93% of the respondent does not

expand their business; this may be because of demand for the product and lack of financial.

3.8.2 Profitability of WMSEs

Table 3.14 Profitability of WMSEs

How much is your business

success full?


Profitable 46 70.77

Stagnant 19 29.23

Total 65 100


As we can see from the above table out of 65 respondent 46 were profitable whether the

profit is small or large, which account about 70.77%. The remaining is not generating profit,

but they are in the market to sustain their life. From this we can conclude that women

working in MSEs are not making loose rather they sustain their life and get profit from the

business.

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3.9 PROBLEMS OF WMSEs

Small scale industries have been able to constitute or contribute substantially as needed to

the economic development particularly because of financial, production and market

problems. These problems are still major hand caps to their development. Lack of adequate

finance and credit has always been a major problem of WMSEs in Ethiopia. The problems of

WMSEs in Arbaminch town are not that much different from those prevailing in the country

generally, but on the basis of their severity the WMSEs rank problems in the following ways.

Table 3.15 problems of WMSEs

Problems Number of respondent Percentage

Lack of adequate finance 20 30.77

Shortage of raw materials 12 18.46

Competitions 10 15.38

Market problem 9 13.85

Taxation 5 7.69

Attitude of people to wards

WMSEs

5 7.69

High interest rate 4 6.15

Total 65 100


As the above table shows the major problem of WMSEs is lack of adequate finance which

was cited as 20 out of 65 respondents and account about 30.77%. The other major problem

sited by the respondent is shortage of raw materials, including machines and appropriate

technology. This hindered the women’s from using their potential capacity for production

and running the business, which is major problems for 12 respondents out of 65 and

accounts about 13.85%. Market is the other problems that the WMSEs face. This is because

these women’s failed to get enough customers and the people do not have good attitude

towards them, by expecting low quality product from them and also the customers are loyal

to their previous client, lack of adequate market information are also problems that WMSEs

face. The problems that WMSEs face are not only these, they also face fierce competition

from already established firms and somewhat taxation is also a problems.

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3.10 EXPERIENCE OF WOMEN IN GROWING BUSINESS

In order to draw some lesson from WMSEs development and better illustrate the

experience of women in growing business is important. When the researchers collect the

data from women who work in MSEs the researcher try to present one of the success

women.

Alem Alula – KibiyeView cafe and Restaurant

Alem was born and raised in Arbaminch town. She is 40 years old and have diploma by

public management. Her parents were relatively well to do family and good attitude

towards any job. She married her husband in 1978 and lives by peace with him up to now

and she have two children.

She begin her business with the assistance of her relatives and selling one of her asset which

is house and also by her small saving she start her business. She begins her business by the

total capital 215000ETB. Out of this she borrows 72000ETB in material form. At the begging

time this business creates employment opportunity for five peoples including her and her

husband. She said that ‘’I have no kitchen house worker but I cook every things by myself

and at that time there is no permanent paid employment but, when I am too busy

sometimes I bring temporary employment’’. The main reason for starting this business

besides job creation for her is about the quality of the hotels. She said that ‘’ I like some

something which is pure and clean but, this is reverse for the hotels. She remember that

‘’one day when I go to hotels to eat my lunch, I see some bad thing in the food and I don’t

eat my lunch, after that day the idea of hotel business come into my mind’’.

Alem is active women and expand her business by the profit she earns and also return

72000 ETB , which she borrow before in the form of materials like furniture, firing and

coffee machine. Her total asset she estimate is no about 695000ETB. She said that although

she wants to expand the business more, lack of finance makes it difficult. She runs the

business by ploughing back the profit, but cannot borrow from banks because she cannot

offer suitable collateral. Space is also a problem and limits any expansion plans. Because she

uses part of the premises as residence for herself and also 7 (seven) house hold members

that she supports and also rent of house which she pays now around 6000ETB per month.

The other reason is that lack of skilled labour. This means it is not difficult to say there is no

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labour which skilled by hotel management in Arbaminch town and this create one idea in

her mind. She said that ‘’I design project for the future to open training centre of hotel

management and now I get training for six months and additionally reads some books and

for the future I will teach the one who have interest in learning hotel management’’.

Currently she has 26 employees and from this 16 are womens.The minimum salary for

worker is 250ETB and the highest is around 1600 ETB. From women worker the researcher

tried to get one of them and ask some question about Alem and her business. Her name is

Tadalech; she is 21 years old and paid monthly salary about 1580ETB. She works in this

business for six years. She said that ‘’when Income from rural area before seven years I have

no anything, but now already my living standard is changed and I have saving account and

also I help my parents’’. She also remember that ‘’I have no skill of working in hotel before

six years, but Alem herself teach me and I begin the work’’. Lastly she said that ‘’I have no

words to express how Alem is good and I learn from her how women’s are strong and

develop themselves.

She manages the business and happy with the work, because she have diploma in public

management and have ten years’ experience in MSEs Working. She said that ‘’I see my

mother as role model for my life and because of I lost her by death I change my restrauent

name from Alem to Kibiye which is my mother name’’. Alem emphasised the importance of

women being organized to overcome the problems that impinge up on their efforts to play a

full part in the development of their country or reduce the existing poverty.

She support idea that the government and society in general has responsibility to provide an

enabling environment for WMSEs, who regardless of all the odds are trying to be self-

employed and support themselves and their families. She stated that young women in

Arbaminch town as well as in the country should try to run their own business and they

should not shy away, because they have start small and from scratch. She feels that it is only

if they make efforts to positively change themselves that WMSEs will change the perception

of the society towards women.

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CHAPTER FOUR

CONCLUSION AND RECOMMENDATION

4.1 CONCLUSION

Women are an important resource and vehicle of development by accounting 20% of

production in developing countries. MSEs Development program is based on the

intention to eradicate unemployment and poverty in short period in different urban

Ethiopia’s. Further WMSEs play a vital role in job creation, generating income,

increasing saving and improve living standard of the women who are part of the

society.

MSEs is the largest source of employment next to agriculture requiring a relatively

limited amount of capital and less skill labour which benefits especially women who

are un skilled.

According to this study majority of women engaged in MSEs activities because of

they have no work before and MSEs activities require small capital for restarting and

they get this capital from different sources which include MFI and support form

NGO.

The highestpercentages of WMSEs wereresponding that they are beneficiary from

MSEs activities. i;e they can able to cover house expense ,purchase durable goods

and able to save their income .this initiate them to work in MSEs and attract other

unemployment women to become a member of WMSEs .

Despite of these this roles the study also identify sum measure constraints and

problems of the women in the sector during start up and operation activities.

according to this study majority of women in the sector faced problem like lack of

educate finance ,shortage of row materials ,compaction from other sector ,market

problem ,taxation, high interest rate and attitude of people towards the product

that produced by women and their attitude towards MSEs sector.

WMSE operators where respond that additional they have constrained with that

problem related to MFI that obstacle to perform their activities as they need. These

problems are high collateral requirement of creditors, short period loan payment

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which are difficult for women to bring and return loan with short period, even can’t

earn an income to service during start up.

In general based on WMSE administrative responses women work MSEs reduce

moderately different aspects of societal problems like unemployment, dependent on

husband and lack of perchingnecessary good as they need .How ever measures were

taken by government to encouragewomen to work in MSEs sectors still they are cons

rind by lack of working place of production and sales, lack of experience in working,

lack of working capital and lack of market both during start up and operation

activities.

4.2 RECOMENDATION

The preceding chapter have discussed the role of WMSE in poverty reduction in

Arbamench town. After analysing all the prevailing conditions and facts at hand, the

researcher recommends the following points for the better performance of the

sector and the contribution of women to the overall economic development of the

study area largely the nation.

WMSE bureaushould arrange conditions for the supply of raw materials more than

the current efforts and make effort to improve the market condition for the

women’s.

The production or areas of business on which the women are engaged should be

directed words the demand of the people .production should be demand oriented

differentiated on the bases of market research.

There should be change in the attitude of the sociality towards their products and

the society must have awareness towards the women, that they are productive as

men.

There must be proper interconnection or interrelation between each MWMSEs and

other sector it can be men’s MSES .this will create inopportunity for the enterprise to

share experiences and for improved performance of the sector as whole.

To overcome one of the bottle neck of WMSEs operators problem related to finance

the government should play an active role in establishing better micro finance

institution n with minimum loaning procedure and long period of payment .

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Lastly the researcher recommended the concerned organization should undertake,

follow up and continues guidance for WMSEs because of there vital role in poverty

reduction of Arbaminch town and as whole nation.

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BIBLOGRAPHY

Abebe shimels, 1999. Addressing the problem of poverty in and policy option,

economic focus.

Befekadu Degefa and Brahanu 20001/2002. Annual report on the Ethiopian

economy.

Dulansey,1990 importance of MSEs in developing countries

Deng, 1998 importance of women empowerment

Hailay ,2003 Micro and small scaleenterprise are work with small capital

Johnson H , concept of poverty and its measurement

Krishna ,1982 women’s right and development

Rodda A,1991 women and the environment

Roy ,1994 women and poverty

Vickers J 1991 women and the world economic crisis

Todaro 1993 economic development can be achieved through integrated effort

World book, the national policy on Ethiopian women

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APPENDIX INTRODUCTION

Questionnaires for women Micro and small entrepreneurs (WMSE)

Questionaries’ survey on the role of WMSE in poverty reduction with particularemphasis women MSEs in Arbamench town. This Town and it is contribution to job creation, increase the saving capacity and improve the level of standard, which means roles in poverty reduction as well as the men constraint that hinder women to start up and run business activities

Dear women micro and small entrepreneur’s (WMSEs)

You are kindly requested t go through all questions and give your answers for all a questions and concerning you and your business activities.

Thank for your assistance and for spent your precise time!!

1 General information A. Age in years, select please one of the following

1. Below 20 2. 20-30 3. 31-40 4. 41-50 5. 51-60 6. Above 60

B. Marital status

Martial status Before starting business Currently Married Single Divorced Widowed

C. level of education, select one of the following

1. Read and write only

2. Primary school

3. Secondary school

4. Post-secondary certificate

5. Diploma and above

D. Religion, select one of the following

1. orthodox 2. Muslim 3. protestant

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4. others

2. What where you doing before starting this business? Select

A. student B. employed C. house wife D. unemployed E. work in another business F. others

3. What is the legal status of business?

A. Partnership B.Cooperative C. Others

4. When was the business establish

5. Main products /services of the business

When the business started Currently 1 1 2 2 3 3

6 in which sector do you do your business?

Types of business When the business started Currently Small retailing activities Beauty salon Hotel and restaurant Processing and selling food and beverages

Others 7. Please indicate the approximate number of people working in this business (including owner’s regular working for the business when it stated and now)

Types of employment

When the business start Now

Women Men Women Men Paid family member

Un paid family member

Temporary

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8. How did you finance your business at the start-up time and how did you finance it now? (Select one of the following)

Source At started time Now Credit from MFIs Credit from bank My own saving Credit from friends or family member

Credit from private money lender

Support from NGOs Other

9. Did you have a bank account for the business in the first year of the business and do you have now?

Types of account Within first year of business Now Saving account ( how many) Current account ( how many) 10. Whatwas the most important reason to start this business?

A. Demand for the business product B. Profitability of the business C. To create a job

11. What were the major factors that were helpful in stating your business?

A. Own interest to start the business B. Family and friend helps in the business C. Interest of today’s government

12. What were the main problems faced in starting this business?

A. Financial problems B. Market problems C. Raw materials problems D. Attitude of people towards women E. Transportation problems F. Policy problems

13. Does the business environment discriminate against WMSEs business?

A. Yes B. No

14. Are there situations where the business environment affects WMSEs than their male counter parts?

A. Yes B.No

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15 .Are aware of any policies or regulations that affect women owned entrepreneur’s

A. Yes B. No

16. Does your being a woman make it difficult for you to get a loan?

A. Yes, how B. No ,then what

17. Have you faced any problems in borrowing money?

A. No B. Yes

If the answer is yes which problems did you face? Select from the following

a. Policy procedure b. High interest rate c. Lack of collateral d. In ability to prepare business plan e. Other problems

19. What is the trend of your expenditure when you start your business and now? And what about your general living standard?

Improved No change Deteriorate Expenditure General living standard (house furniture, basic necessities)

the role of women micro and small enterprenuers in poverty reduction

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