In addition to its work to fight climate change, the Development Bank of Austria has set itself the goal in its strategy of contributing to the economic empowerment of women in developing countries through its investments. By joining the 2X Challenge, OeEB underlines this commitment. The goal of the global initiative is to mobilise USD 15 billion for 'gender-smart' investments by the end of 2022. A goal that has become even more important as a consequence of the COVID-19 pandemic.
Women are more affected than men by several dimensions of poverty, such as education, income, or health. Therefore, OeEB also pays attention to gender equality in all its projects and aims to make a specific contribution to economically empowering women in developing countries. In June 2021, OeEB joined the 2X Challenge, a global initiative of development banks that aim to jointly mobilise USD 15 billion for projects with this goal by the end of 2022.
"Reducing inequalities and tackling the obstacles that still limit women’s economic participation and opportunities are key to accelerate development and reduce poverty. Therefore, we have anchored gender equality as a cross-sector objective in our strategy and aim to empower women through our investments. Joining the 2X Challenge highlights this commitment and we look forward to working with our DFI colleagues to advance gender-lens investing. Because investing in women benefits everyone", say Sabine Gaber and Michael Wancata, members of OeEB's Executive Board. Alongside OeEB, the World Bank's International Finance Corporation (IFC) and the European Bank for Reconstruction and Development (EBRD) became the newest member of the initiative.
About the 2X Challenge
The 2X Challenge was launched in June 2018 during the G7 Summit in Canada as a major new commitment to unlock resources that will help advance women in emerging markets as entrepreneurs, as business leaders, as employees and as consumers of products and services that enhance their economic participation. The investments from the initiative enable women in developing countries to access leadership positions, quality jobs and financing. Just two years after its launch, the members of the 2X Challenge have committed USD 6.88 billion and mobilised another USD 4.5 billion in gender-smart investments from private investors, securing more than double the original USD 3 billion target. A core aspect of the 2X initiative was the establishment of the 2X Criteria, which quickly became a global industry standard for gender-lens investing.
Economic empowerment of women during COVID-19 pandemic
A growing body of evidence suggests that identifying effective ways to support women as entrepreneurs, leaders, employees, and consumers will increase gender equality, reduce poverty, and promote more inclusive and robust economic growth. Studies show that women represent a growth market bigger than China and India combined. The devastating economic impact of the COVID-19 pandemic, which disproportionately affects women, underlines the meaningfulness and necessity of 'gender-smart' investments. Investing in women is therefore not only the right thing but also the smart thing to do.
"According to recent studies, global growth could miss out on USD 1 trillion if women workers in sectors that were hardest hit by the pandemic do not return to the workforce. With our investments and participation in the 2X Challenge, together with other development banks, we can make a significant contribution to reducing inequalities between men and women and enabling more resilient, sustainable economies", explain Sabine Gaber and Michael Wancata.
As the recently published Development Report shows, OeEB provided around EUR 35 million for the economic empowerment of women in 2020. For example, a credit line of USD 20 million was signed in May 2020 to Banco Ficohsa in Honduras. The funds will be used to finance local micro, small and medium-sized enterprises (MSMEs), with 50% of the funds dedicated to women-owned businesses. Banco Ficohsa aims to become the leading bank in Honduras for women owned MSMEs, offering special services such as insurance, training and various support services for women entrepreneurs.
The current OeEB Development Report 2020 is available for download here.