‘Unleash economic power of women’

TOKYO – International Monetary Fund (IMF) managing director Christine Lagarde yesterday urged governments to “unleash the economic power of women” to boost sluggish global growth.

At the first World Assembly for Women in Tokyo (WAW! Tokyo 2014) here, Lagarde stressed the importance of unleashing the economic power of women in order to boost countries’ growth potential, by changing economic policies, laws and institutions as well as attitudes and culture.

“Seven years into the worst global financial crisis since the Great Depression, the recovery is still too tepid and too turbulent. And even after the crisis abates, we will face grave challenges to growth – as a slower ‘new normal’ sets in, as populations age and as economic disparities increase,” Lagarde said.

“Given these challenges, we will need all the economic growth, dynamism and ingenuity we can get in the years ahead. Thankfully, a key part of the solution is staring us right in the face – unleashing the economic power of women. Bringing the world’s largest excluded group into the fold,” she said.

Lagarde said countries can lift up women by adopting more pro-female, pro-family approaches. Such policies include moving more from family to individual taxation; providing more affordable child-care and parental leave; and allowing for more flexible working arrangements.

In Sweden, one percent of the gross domestic product (GDP) is devoted to childcare and pre-primary spending – more than most other countries and three times more than Japan, Lagarde said.

She said the government of Sweden also takes workplace flexibility very seriously.

“It is no coincidence that Sweden has one of the highest female participation rates in the world,” she said.

Lagarde said women in any part of the world face barriers to flourishing and achieving their potential.

Gender gaps in labor force participation exist all over the world – ranging from 12 percent in the developed economies to 50 percent in the Middle East and North Africa.

Japan is somewhat in the middle – its female participation rate is 65 percent, 20 percentage points lower than males. This is better than the Asia average, but still low for a developed economy.

“When women do participate, they tend to be stuck in low-paying, low-status jobs. Globally, women earn only three-quarters as much as men – this is true even with the same level of education, and in the same occupation,” Lagarde pointed out.

She said women also tend to be overrepresented in less secure jobs – such as informal, temporary or part-time work.

“This is partly because they want more flexible work options, and partly because they are locked out of higher-status careers,” she said.

She cited the case of Japan where many large companies reserve the permanent positions for men, and women flock to lower-paying and less secure jobs.

“Globally, women also tend to be locked out of leadership positions, where gender seems to matter more than ability,” the IMF official said.

She said women make up only five percent of Fortune 500 CEOs. They account for only 24 percent of senior management positions around the world – these numbers are fairly consistent across Asia, Europe, Latin America and North America. In Japan, it is nine percent.

“Clearly, the global economy is not using its productive resources very effectively. It is tossing away economic growth at a time when it cannot afford such wanton waste. This needs to change,” Lagarde said.

“The benefits of greater inclusion are clear – not just for women, but for all of us. For a start, women are the ultimate agents of aggregate demand, accounting for 70 percent of global consumer spending. So if we want growth, let us put women in the driver’s seat,” she said.

In the case of the Philippines, there is still much to be done to empower the women, according to Sen. Loren Legarda, one of the participants in the conference.

Legarda said the government must provide more support to empower women, especially in rural areas.

She said there is a need to provide viable income alternatives to women, adding there are laws that support women micro-entrepreneurs, particularly the indigenous women.

“For many, especially in far-flung, rural, still very traditional and conservative areas of the country, there is still disparity between men and women’s empowerment and rights. This so-called social inclusion, which is expected of women, really does not happen,” Legarda told The STAR.