Entrepreneurship is a powerful tool for economic empowerment, and in Lesotho, women and youth are stepping up to reshape the business landscape. With limited formal employment opportunities, many are turning to entrepreneurship to drive economic growth, create jobs, and foster innovation. However, despite this momentum, significant barriers remain, making targeted support crucial for sustaining this progress.
The Growth of Women Entrepreneurs in Lesotho
Historically, women in Lesotho have been heavily involved in informal businesses, particularly in retail, agriculture, and small-scale manufacturing. While women have made strides in formal business ownership, challenges such as access to capital, market entry barriers, and limited mentorship opportunities persist.
Key Statistics on Women in Business:
- Business Ownership: Women own around 39% of formal businesses in Lesotho, the highest percentage in Sub-Saharan Africa, yet they remain underrepresented in key economic sectors such as manufacturing and technology.
- Employment: Women make up 47% of the workforce, yet many remain in low-paying and informal jobs, lacking access to growth opportunities.
- Financial Inclusion: While 62.4% of women have access to financial services, they still face greater difficulties than men in securing funding.
Opportunities for Women Entrepreneurs:
- The Competitiveness and Financial Inclusion (CAFI): Programs like CAFI offer targeted incubation and business development support to women entrepreneurs in Lesotho. Through its initiatives, women-owned businesses gain access to financing, business training, and investor readiness programs.
- Enterprise Development Initiatives: Organizations such as Prime Cubate, Maseru Business Club, The Entrepreneur’s Network, LEAP, Phaphama Rise Foundation provide technical support, mentorship, and tailored financial solutions to help women scale their businesses.
- Government Policies & Global Partnerships: Lesotho’s strategic development plans now emphasize the growth of women-owned businesses with partnerships from institutions such as the African Development Bank (AfDB) and UN Women.
Youth Entrepreneurship: A Rising Force
Lesotho’s youth face an unemployment rate exceeding 30%, pushing many young people to start their own businesses as an alternative to traditional employment. Youth entrepreneurship is proving to be a transformative force, driving innovation and job creation in the country.
Key Youth Entrepreneurship Insights:
- Aspirations: Around 65% of Basotho youth want to pursue entrepreneurship, demonstrating strong potential for business growth.
- Financial Barriers: Many young entrepreneurs struggle with limited access to capital and markets, restricting their ability to scale businesses.
- Market Challenges: Over 56% of youth-led enterprises cite unreliable markets and supply chain constraints as major hurdles.
Programs Supporting Young Entrepreneurs:
- CAFI: Young entrepreneurs under CAFI’s initiative receive business incubation, financial literacy training, and connections to investors.
- Bacha Entrepreneurship Project: This initiative funds promising youth-led businesses, with recent winners securing M200,000 each to support their enterprises.
- Global & Regional Networks: Youth-focused organizations such as YALDA (Youth Alliance for Leadership and Development in Africa) connect young business owners with international opportunities and mentorship.
Addressing Challenges & Expanding Opportunities
While there is clear progress in empowering women and youth in business, several challenges still need to be addressed:
1. Limited Access to Finance
- Many businesses struggle to access affordable funding due to stringent lending criteria from traditional banks.
- Solution: Organizations like Prime Capital are bridging this gap by offering alternative financing solutions such as purchase order financing and invoice discounting to help SMEs manage cash flow constraints.
2. Skills & Business Training Gaps
- Many young entrepreneurs and women-led businesses lack the necessary financial literacy, strategic planning, and management skills.
- Solution: Training initiatives from CAFI, ILO, and AfDB help build business acumen, focusing on sustainability, investor readiness, and market expansion.
3. Regulatory & Market Access Barriers
- Small businesses often struggle with complex registration processes, high compliance costs, and limited market opportunities.
- Solution: Incubation programs under organizations like Prime Cubate assist entrepreneurs in formalizing their businesses, securing contracts, and navigating business regulations.
Looking Ahead: The Future of Women and Youth Entrepreneurship in Lesotho
With continued investment in women and youth entrepreneurship, Lesotho has the potential to build a more resilient and inclusive economy.
- Strengthening SME Financing: More efforts are needed to expand financial products tailored for small businesses, including credit guarantee schemes and blended financing options.
- Increasing Business Mentorship & Coaching: Programs like CAFI’s incubation initiative are helping young entrepreneurs gain hands-on guidance in business development and sustainability strategies.
- Enhancing Market Linkages: By connecting SMEs with retail chains and large corporate buyers, initiatives such as CAFI can open new revenue streams for women and youth-led businesses.
The rise of women and youth entrepreneurs in Lesotho is a movement, not just a moment. By providing access to capital, mentorship, and business development support, the entrepreneurial ecosystem in Lesotho can thrive, leading to job creation and economic resilience.
Now is the time to support and celebrate the trailblazers redefining business in Lesotho. 🚀