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THE PROBLEM OF GENDER EQUALITY IN TRADE
Article by Ludovica Davoli
Revision by Federico Grossi
The development of international trade towards a global market has brought a significant increase in the overall wealth of the population, both for developed and underdeveloped countries. However, these positive outcomes are not equally distributed.
Women benefit less from the advantages of international trade owing to their situation, which results both in unequal level playing field when compared to the male population, and in the impossibility to fulfill their ambitions in this particular field. In fact, women often face indirect discrimination because of the amount of time they spend in unpaid family care, the difficulties they face in accessing financial support and, last but not least, because of the lack of female role models that can support and inspire younger girls to access the international trade market.
1. Unpaid care work
Due to traditional family stereotypes, females are required to employ much more time, compared to their male counterpart, in the care of their children or their elderly relatives. The OECD estimates that women spend on average 3 to 6 hours in caring for their family, compared to the average of half an hour to one hour spent by men. As much as established roles are slowly fading, this situation still causes a significant obstacle for women to access the international trade market, making them less flexible in their employment. Rigid hours are rarely compatible with a job that requires interaction with clients from different countries and different time-zones. Furthermore, the burden of taking care of their families makes women less desirable for positions that require frequent travelling. Evidence shows that, due to cultural norms, geographical mobility is still a barrier preventing women from making the most of the economic benefits that derive from international trade.
2. Access to financial resources
Female owned businesses are also less likely to benefit from international trade because they are less likely to have access to the financial resources necessary to survive in such a competitive environment. Women are often owners of Medium, Small or Micro enterprises (MSMEs) that need consistent financial support to access the international market and because this field carries more risks than domestic trade, banks usually have higher requirements in terms of creditworthiness and due diligence. International surveys led by the WTO show that women are 7 percentage points less likely to obtain credit from banking institutions for their business initiatives and are required to sustain a higher interest than male. As a result, female entrepreneurs tend to support their businesses with their own resources, facing the risks of losing vital means of sustainment for themselves and their family. Such a condition causes a detriment to them and frequently discourages women from entering international trade and limiting their exchanges to the domestic market.
3. Lack of role models
Finally, the lack of female role models is a significant obstacle to the achievement of equal representation in the international market. A professional and social network is fundamental to ensure a successful growth in this field. Specific business information and “know – hows” are a fundamental part in the mentoring of new entrepreneurs wishing to enter a specific business area. Owning to the fact that women often lack professional connections, they are less likely to find an adequate mentor and less likely to succeed in their careers. Research shows that male – owned firms tend to find costumers through traditional channels while female – owned ones must resort to alternative means. These differences in treatment discourage women from entering male – dominated sectors, especially with regard to international trade.
4. Positive outcomes of a higher involvement of women in trade
The positive outcomes of an increased female involvement in international trade go beyond a higher employment rate and the support of MSMEs.
Studies have shown that where women are involved in international trade related employments, their marital age and childbirth age are delayed, especially in developing countries. This encourages young girls to dedicate more time to their studies. For example, in Bangladesh, women employed in such businesses spend an additional 1.5 years on their education. This, in turn, allows them to be more eligible for the high skilled employment opportunities offered by businesses involved in international trade.
Furthermore, increasing the female presence in the trade landscape and ensuring exposure to stories of successful women would provide young girls with “landmarks” to look up to and role models to turn to for help and guidance. Witnessing women succeed in their trade – related employments could activate a “snowball – effect” on male – led businesses, encouraging them to trust women in apical positions.
5. How the drafting of trade agreements can help close the gender gap
International trade agreements, such as those promoted by the WTO, are an important tool to achieve gender equality in trade. Today, many Preferential Trade Agreements (PTA) contain gender related provisions. For example, the Generalized System of Preferences (GSP), which is the oldest US Trade Preference program, sanctions with the withdrawal of preferences any developing country that violates international conventions, which also safeguard gender equality.
However, the measures taken are not enough: the progress made so far is not sufficient to reach the SDG 5 of gender equality by 2030.
Steps must be taken to ensure female representation in the drafting process of trade agreements to help identify sectors that might benefit less from [FG1] international trade agreements and prevent such negative outcomes. In order to achieve this goal international organizations should promote ex-ante analysis of the effects of such agreements to highlight possible indirect discriminations against women. Lastly, gender disaggregated data, now absent or vague, must be collected and studied in order to fully understand the nature of the gender gap in the different sectors of international trade.
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6. Conclusion
In conclusion, the main aim of both single countries and international organizations should be to reach a point where positive action is no longer necessary because society has overcome the cultural and technical difficulties that prevent talented women from being as successful as their male equivalent. However, until such a goal is achieved, policies must be adopted in order to fill this gender gap; only then will the international trade market be a fair and fruitful competition for everyone.