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Women empowerment absolute economic no-brainer: IMF chief

Women empowerment absolute economic no-brainer: IMF chief

WASHINGTON: Women’s empowerment is not just a fundamentally moral cause, it is also an absolute economic no-brainer, says International Monetary Fund’s managing director Christine Lagarde.

Earlier this week, she helped launch a campaign to reduce the gap in women’s labour force participation by 25 per cent by the year 2025. The plan, envisaged by the G-20 nations at their summit meeting last November, would create an estimated 100 million new jobs for the global economy.

“By the latest estimate, there are more than 3½ billion reasons why gender equity matters,” said the IMF chief.

According to a World Bank report, released last year, there are more than three and a half billion women in the world.

“And if those are not enough … women’s empowerment is … also an absolute economic no-brainer,” said the IMF chief.

The statistics she included in a statement released by her office in Washington showed that if the number of female workers were to increase to the same level as the number of men, GDP in the United States would expand by 5pc, by 9pc in Japan, and by 27pc in India.

“These estimates … are significant and large enough to be taken seriously. This applies particularly to countries where potential growth is declining as the population is ageing,” Ms Lagarde said.

Other statistics showed that getting more women into secure and well-paid jobs raises overall per capita income. For example, in Turkey, it has been estimated that gender parity in employment could increase per capita income by 22pc. Similar gains are also possible for many other countries.

A research conducted by IMF staffers shows that greater gender equality not only raises absolute income, it also helps to reduce income inequality.

The study compares a so-called Gender Inequality Index to measured income inequality. The results suggest that a boost to education and employment chances for women could lead to improvements in income equality of a magnitude that historically took decades to achieve.

Another study by the Food and Agriculture Organisation has estimated that giving women the same access to farming resources as men could increase agricultural output in developing countries by up to 4pc—lifting over 100 million people out of hunger.

“So, to sum up, boosting growth, raising overall incomes, reducing inequality, and tackling poverty: that is why the promise of 2025 is so important,” Ms Lagarde said.

The IMF chief also highlighted three critical areas for empowering women, education, work and having a family.

She pointed out that one extra year of primary school boosts a woman’s earning potential by 10 to 20pc.

One extra year of secondary school boosts her earning potential by 25pc.

“The message is clear: girls’ education is probably the single best investment a country can make,” she said.

While emphasising the need for giving more jobs to women, Ms Lagarde referred to a recent IMF research, which shows that almost 90pc of countries have at least one important legal restriction that makes it difficult for women to work. In half of the countries included in this study, when gender equity was constitutionally granted, female labour force participation increased by at least 5pc over the following 5 years.

The IMF chief pointed out that even with the same level of education, and in the same occupation, women earn just three-quarters of what men earn.

She also stressed the build the infrastructure needed to encourage women to work, such as access to basic transport or energy sources.

She also underlined the need to provide women with equal access to finance. This is an issue she plans to raise at a UN summit later this month, she said.

Published in Dawn, September 9th, 2015

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