In a 2018 investigation on gender inequality and business, Vietnam surprises economists with their female business ownership ratio. They have the highest ratio in Asia, securing sixth place overall.
Analysing 57 economies, the Mastercard Index of Women Entrepreneurs (MIWE) seeks to analyse the progress and achievement of female entrepreneurs and business owners. These countries, which makes up almost 80 per cent of the world’s female labour force, includes Vietnam, China, Canada, and more. 2018 marks the second year of this study. It measures the level of Women’s Advancement Outcomes, Knowledge Assets & Financial Access and Supporting Entrepreneurial Factors. Furthermore, the index also analyses the factors and conditions aiding in the closing of gender gaps within an economy.
Overall, MIWE ranks New Zealand as the best economy for female entrepreneurs, followed by Sweden and Canada. Conversely, Korea saw the biggest increase in score, going from 53.5 to 57.2. Vietnam came in 18th place with a score of 65.5.
One of the key findings of the index is the fact that female business ownership does not correlate with the wealth and advancement of its economy. In fact, the countries with the highest female business ownership ratios are actually those with less wealthy economies. Women there are often forced into business out of necessity, with their high drive to sustain themselves and their family being driven by unfavourable entrepreneurial, social, economic, and financial conditions.
An exception to this is Vietnam as female entrepreneurs are more driven by opportunity than necessity. In fact, they take as many business risks as their male counterpart and they are the only one within the study to be as equally inclined as men to save up or borrow to support their business endeavours. In fact, according to a Global Entrepreneurship Monitor, they are more inclined to invest than men.
While the chances of succeeding for female entrepreneurs are higher in wealthier and more developed economies, Vietnam, with their low-middle economy, surprises their ranking of 18. This is partially due to the fact that Vietnamese women has an equal opportunity to men in obtaining higher education, with their high Gross Enrollment Rate of 100 being the driving force behind their advancement in business ownership.
Vietnam also has the third lowest gender gap in the study with 86.7 women to every 100 men involved in business and entrepreneurship.
Despite all these achievements, Vietnam’s female business ownership ranking has actually dropped by once place since last year. Many issues factor into this. Vietnamese women tend to delve into less stable operations with three quarter of their businesses being concentrated in customer services. Furthermore, the businesses often suffer from financial problems and low to no profit, causing many to discontinue. There is also a lack of innovation-driven entrepreneurship and low desire to internationalize – only 1.5 per cent of businesses have more than 25 per cent of their customers being international.
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