44184 M AY 2 0 0 8 Voices of Women Entrepreneurs in Bosnia and Herzegovina |  VOICES of Women Entrepreneurs in Bosnia and Herzegovina TABLE OF CONTENTS Acronyms..........................................................................................................................................2 Acknowledgments...........................................................................................................................3 IFC Foreword....................................................................................................................................4 MI-BOSPO Foreword........................................................................................................................5 About IFC’s Gender Program: About MI-BOSPO: Executive Summary..........................................................................................................................6 IFC supports the participation of women MI-BOSPO is a leading micro-credit Chapter 1: The Legal and Economic Context Facing Women’s Businesses . in Bosnia and Herzegovina..............................................................................................................8 as well as men, as an important part of its organization in Bosnia and Herzegovina mission to foster sustainable private sector targeting women. The organization’s mission Chapter 2: Dealing with Bureaucracy...........................................................................................15 growth in developing countries. Recognizing is to economically empower women, led by Chapter 3: Bosnian Women: Building Partnerships for Success..................................................24 that aspiring businesswomen are often the belief that the economically empowered prevented from realizing their economic woman can better influence social change .........................................................................................................................28 Recommendations. potential because of gender inequality, IFC and contribute to better quality of life within ...........................................................................................................29 Useful Links and Resources. is committed to creating opportunities for the family. women in business. Endnotes.........................................................................................................................................30 References......................................................................................................................................31 Voices of Women Entrepreneurs in Bosnia and Herzegovina |  ACRONYMS ACKNOWLEDGMENTS This report was prepared by Jozefina Cutura, Many of the women interviewed are MI- BIH Bosnia and Herzegovina IFC consultant, and is part of a collaborative BOSPO clients, and the author is grateful to BEEPS Business Environment and Enterprise Performance Survey effort between IFC’s Gender Program and MI-BOSPO for facilitating the interviews. MI-BOSPO, a micro-credit provider targeting CEDAW Convention on the Elimination of All Forms of Discrimination against Women The author thanks the many individuals who women in Bosnia and Herzegovina. gave valuable feedback on earlier drafts of this CIDA Canadian International Development Agency The report is based on desk research and report, including Natalie Africa, Alma Bijedi´ c, DFID Department for International Development in-depth interviews with ten Bosnian women Mark Blackden, Michael Edberg, Leora Klap- entrepreneurs in September 2007 whose per, Shahbaz Mavaddat, Nejira Nali´ c, Carmen EBRD European Bank for Reconstruction and Development profiles are featured in this report. Interviews Niethammer, and Zouera Youssoufou. Report EU European Union were also conducted with relevant donors, layout and formatting were prepared by Kate government agencies, and non-governmental Tallent Design & Communications. FBIH Federation of Bosnia and Herzegovina organizations. The women interviewed We finally thank the wonderful women FIAS Foreign Investment Advisory Service run businesses that range from micro- entrepreneurs who gave up their valuable enterprises with fewer than 5 employees, IFC International Finance Corporation time to share the stories of their successes and to large businesses employing up to 50 challenges, and who serve as the inspiration to IMF International Monetary Fund workers. While many are in the traditionally many other Bosnian women and girls as they women-dominated service sectors, others are KM Convertible mark chart their economic futures. branching out to areas such as engineering. NGO Non-governmental organization ROSCA Rotating Savings and Credit Association RS Republika Srpska UN United Nations UNECE United Nations Economic Commission for Europe UNIFEM United Nations Development Fund for Women US United States USAID United States Agency for International Development  | Voices of Women Entrepreneurs in Bosnia and Herzegovina Voices of Women Entrepreneurs in Bosnia and Herzegovina |  IFC FOREWORD MI-BOSPO FOREWORD Increasingly, the importance of women’s entre- in MI-BOSPO in 2006 which has helped to MI-BOSPO was created to provide access to —but also an opportunity for the other things preneurship and its contribution to economic significantly expand its client base. In addition funds for low-income women. As time passed, to happen. It provides hope and encourage- growth is being recognized around the world. to the investment, IFC has provided MI- this mission statement was adjusted, but the ment to the 26,000 women entrepreneurs that Entrepreneurship creates new jobs, which is BOSPO with advisory services on corporate fundamental purpose has never changed. are our clients. essential in a country with high unemploy- governance, strategy, and gender issues. MI-BOSPO today enables easy access to long- Although MI-BOSPO has been in this ment rates, especially among women and term funds for women entrepreneurs, and it In a country that is still adjusting to the transi- business for over 12 years, there was never youth. Because Bosnia and Herzegovina has aims to become the primary source of funding tion to a market-led economy, there is little a chance to consolidate information on our the lowest female labor force participation for all women in Bosnia and Herzegovina. We rates in South-East Europe, female entrepre- information on the obstacles that female- still have a long way to go. Not only because clients and women entrepreneurs in general. owned enterprises in Bosnia and Herzegovina Research on gender issues in Bosnia and Her- neurship can provide a productive outlet for a we need to grow and get stronger as a financial face. This publication helps fill this gap, shed- zegovina is often partial, the data is not very well-educated and underutilized talent pool. institution, but because many women still ding light not only on the challenges facing reliable, and little of it focuses on women in need to grow stronger in their own thinking, This publication is a joint product of MI- women, but also celebrating their successes business. That fact says so much about the low families, communities, and in their businesses. BOSPO and IFC’s Gender Program (Gender and demonstrating the potential of business priority that gender issues have been given in Entrepreneurship Markets—GEM), which activity for job and income generation. It is to If you ask women in Bosnia and Herzegovina our country. promotes women’s private sector participation. be hoped that this important effort to better whether they think that women are discrimi- Yet the numbers of women entrepreneurs IFC is pleased to have partnered with MI-BO- understand the characteristics, contributions nated against, only a few might answer in the are growing, and hopefully one day they will SPO, a microfinance provider targeting wom- and challenges of women entrepreneurs will positive. This is the case not because there is no become strong enough that MI-BOSPO will en, to document the obstacles facing women be the catalyst for further work, and most gender discrimination, but because awareness not be needed anymore. All these women entrepreneurs and the inspiring stories of their importantly, for expanding women’s entrepre- on the subject is very low. Women, especially will have easy access to long-term funds from business success. IFC made an investment neurship in Bosnia and Herzegovina. in rural areas, tend to say that they are house- banks and they will be crucial contributors wives and do not work. But when they start Shahbaz Mavaddat to the well-being of the country. As women’s talking about their everyday activities, they re- Director businesses gain in strength and our awareness alize how much work they accomplish. That is Southern Europe and Central Asia of their potential increases, we might see many where change starts—by becoming aware. And IFC more reports such as this one being produced that is often a difficult process. MI-BOSPO is to showcase their successes. therefore proud to partner with IFC’s Gen- der Program in researching the successes and While waiting for this change to happen, obstacles of businesswomen in Bosnia, raising MI-BOSPO is thankful to IFC for supporting awareness on the issue, and helping women this report. It will serve as our base for future become better advocates for needed change to research and a reference in everyday work. improve their business success. Most importantly, MI-BOSPO hopes that this report will be an inspiration to existing women When we asked women what inspired them to entrepreneurs and will make them proud of start businesses, they said it was a wish to fi- what they have achieved, but will also inspire nancially contribute to the household, to have other women to become aware of their poten- something of their own, to have their own tial and invest in their business success. money, to be successful and respected. MI- BOSPO provides one of these things—money c Alma Bijedi´ MI-BOSPO Marketing Manager  | Voices of Women Entrepreneurs in Bosnia and Herzegovina Voices of Women Entrepreneurs in Bosnia and Herzegovina |  EXECUTIVE SUMMARY MI-BOSPO, have stepped in and successfully filled this gap to provide funds quickly and Figure 1: Percentage of Persons who Took Loans in the Preceding 12 Months, According to Source of Loan by Sex with fewer requirements, albeit at high inter- Women are a significant, but underutilized 26.9 percent of these are women (chart 1), a 60 est rates, enabling an ever greater number of force in Bosnia and Herzegovina’s economy. figure which is comparable to regional aver- women to finance their businesses. 50 The severe lack of research on women in the ages. At the same time, women make up 69.3 40 private sector means that their challenges and percent of unpaid family workers.2 When Heavy household and childcare responsi- 30 contributions are not well recognized. This report women do have businesses, they tend to focus bilities may lead women to invest less in aims to fill this gap, compiling available research on traditional service sectors, such as small economic activities. Women spend much less 20 on the topic and showcasing positive role models retail shops or beauty parlors. time on their businesses than men do. A female 10 of women in business, in the context of the business owner spends, on average, 29.2 hours 0 Women entrepreneurs cite dealing with country’s post-conflict background. per week on her business, compared to 46.9 Family Employer Banks Credit unions, ROSCAs, others licenses, taxation, finance, and labor issues hours that a male business owner spends on his women men In the immediate aftermath of the war, mo- as the biggest obstacles to their business enterprise (figure 2). Many women turn to self- mentum on women’s empowerment helped success. In 2008 Bosnia and Herzegovina Source: World Bank (2001). employment out of necessity, and for some Bos- enshrine equality for women in legisla- was ranked 105th in the World Bank Group’s nian businesswomen self-employment seems to tion. Positive changes include the ratification Doing Business in 2008 report, which rates help accommodate family responsibilities. of the Convention on the Elimination of All countries annually on the ease of doing busi- Forms of Discrimination against Women, and ness. The country’s pace of reform has slowed The lack of strong networks and pervasive Figure 2: Hours Worked per Week by Type of Employment the adaptation of key new laws on women’s from a few years ago, and its rank slipped cultural barriers also discourage women 50 rights, including the Gender Equality Law, the from 95 in 2007 to 105 in 2008.3 This is a from entrepreneurship. Many women lack 40 Gender Family Law and the Law on Protection worrisome trend for all businesses, but it is the self-confidence in their ability to run a against Domestic Violence. A requirement that likely to affect disproportionately women- business. Thirty-four percent of the women 30 one third of candidates on party lists during owned businesses due to their small size and interviewed in a 2002 survey of 428 women 20 elections must be female helped strengthen lower capacity to deal with a difficult busi- across the country noted that they are unsure women’s participation in politics. ness environment. if they have the right skills and knowledge to 10 start a business, with another 9 percent noting 0 Despite positive legislation and political ad- On a positive note, women make up a that they lack information needed to start a Public employee Owner or Other Total vances, women continue to be economically slightly larger percentage of bank borrow- self-employed business.5 Moreover, women in the private disadvantaged, and contribute less to the ers and are also more likely to borrow from men women sector remain largely unorganized. Profession- economy than men. Bosnia and Herzegovina’s credit unions, rotating savings and credit Source: Federation of Bosnia and Herzegovina Federal Office of Statistics (2006). al organizations tend to be male-dominated, women have strikingly low labor force partici- associations and other sources, while men are with limited participation from women. The pation rates of only 43 percent, compared to slightly more likely to borrow from fam- stories of succeeding in a challenging post-war lack of strong women’s business associations the global average of 52.5 percent, and suffer ily (figure 1). However, the average size of a environment can provide inspiration to young means that women do not have a network of from high unemploy- loan that a woman takes out is smaller than women who are just starting out in their other businesswomen to turn to for sharing Chart 1: Persons in Employment by . ment levels.1 They a man’s, at 2,702.50KM (US$2,169) versus Status of Employment ideas and knowledge, which impacts their professional life. By listening to the voices of earn, on average, less 3,395.82KM (US$2,725), and women are Bosnia and Herzegovina’s women and docu- access to resources, training and information than men. Moreover, more likely to take out loans for immedi- menting their inspirational stories, the report that could increase their business success. few women turn to ate consumption such as daily family needs demonstrates the vast but underutilized poten- Employees entrepreneurship. Ac- rather than investment, indicating that they This report is one advocacy tool that wom- tial of women and sends the message of how Self-employed Unpaid cording to the 2007 invest less in their businesses.4 Both women en can use to show their success stories important it is to implement policies that will family workers Labor Force Survey, and men who take out bank loans complain and make their views heard with policy encourage and strengthen their performance. only 22.6 percent of of overly long and complicated procedures, makers and the international community. employed Bosnians as well as the high cost of borrowing. In the The report highlights the many positive role Source: Agency for Statistics of Bosnia-Herzegovina (2007). are self-employed and meanwhile, microfinance providers, such as models of Bosnian businesswomen, whose Voices of Women Entrepreneurs in Bosnia and Herzegovina |  Chapter 1 The post-war transition has not encouraged Turkey, are close to, or higher than the global women’s participation in the private sector average of 52.5 percent (figure 1.1).8 Since the signing of the Dayton Peace Accords in late 1995, Bosnia and Herze- Women also suffer higher unemployment govina has been rebuilding its institutions levels. In 2007 the unemployment rate for The Legal and Economic Context . and strengthening its economy. The country women was 32.9 percent, versus 26.7 percent Facing Women’s Businesses . is now divided into two largely autonomous for men.9 Unemployment rates are alarmingly entities, Republika Srpska and the Federation high among young women in the age category in Bosnia and Herzegovina of Bosnia Herzegovina, with some of the data of 15 to 24, where their unemployment levels presented in this report being separate for have reached a staggering 63.1 percent, com- these two entities. pared to 55.6 percent for men in the same age category.10 Bosnia’s women were generally perceived to enjoy equal rights and strong social protection in many spheres of life during the social- ˇ c L e j la R adon ci ´ , B H crafts , ist times, but the conflict was marked by an S ara j e v o erosion of their status. The influx of foreign aid since the end of Bosnia’s war and donors’ s hopping with Purpose is the motto of BHcrafts, a network of Bosnian women producing beautifully hand-crafted pieces with tra- support for gender issues brought new energy ditional patterns that range from knitwear and accessories to home to the women’s movement. Yet, many women’s décor. The products have been sold at Neiman Marcus, Agnes B, and National Geographic and Sundance catalogues. The company has an non-governmental organizations (NGOs) T international reach, selling products in Europe, Japan, and the United his section provides an introduction to the legal and political changes to help ensure equality and services that sprung up in the mid to late States. Several outlets in Sarajevo offer gift options to local tourists. and regulatory framework facing women in Bosnia for women in the post-war period, indicating 1990s tended to focus exclusively on women’s BHcrafts is one of few Bosnian businesses that have embraced and Herzegovina. The chapter also discusses how how reform momentum in the immediate political participation or human rights issues. the social entrepreneurship agenda and used it to generate profit through a message that their items not only represent a beautiful education, traditions, and cultural norms affect women’s aftermath of a war can be a good opportunity Few focused on women in the private sec- purchase but also benefit impoverished women. Knitting for BHcrafts towards ensuring women’s empowerment. tor and their potential to contribute to the is the main source of income for many of the women the company economic status and influence their employment and employs, and allows them to support their families and send their country’s economic development. children to school. The network usually includes about 350 women business choices. Bosnia and Herzegovina’s 2003 Law on Gen- per year, but can engage up to 700 women when orders are in high der Equality is meant to further strengthen Women’s participation in the economy is low, demand. However, according to Lejla, “the local laws do not distin- Bosnia and Herzegovina’s Legislative Frame- but increasing guish our social entrepreneurship model from a regular business.” women’s status in areas such as employment, The company has two sets of registrations, and is registered as a firm works Seek to Ensure Gender Equality Female labor force participation rates in Bos- media, education, and the private sector. The and as an NGO. “We do two separate sets of accounting for the firm The constitution prevents discrimination nia and Herzegovina are strikingly low. Com- and the NGO. This separation is a big problem.” law prohibits discrimination based on gender based on sex and guarantees equal opportuni- parison data on pre-war trends are unavailable, and sexual harassment in the workplace, and it Started as a psycho-social project in 1995 by Lejla during her stint ties for its citizens. Bosnia and Herzegovina but research indicates that women made up a working for the Norwegian People’s Aid organization, BHcrafts has mandates equal pay for equal work. This law been supported with funding and technical assistance by various ratified the Convention on the Elimination significant share of the labor force, particularly also seeks to harmonize the country’s legisla- donors, including the European Union, the Canadian International of All Forms of Discrimination against in the industrialized sectors.7 Even though Development Agency (CIDA), UNIFEM, and the World Bank. As such, tion with the acquis communautaire, as part Women (CEDAW) in 1994, and it adapted the company is one of few donor-supported projects in the country of the European Union accession process. Yet, women today make up 51.9 percent of the that has focused on women’s private sector participation and eco- in 2005 key new laws on women’s rights, working age population, their labor force par- nomic empowerment. women’s organizations in the country note including the Gender Family Law and the ticipation rate is only about 43 percent, which that the implementation of the law has been BHcrafts has done an excellent job with marketing its products, and Law on Protection against Domestic Vio- is much lower than in developed countries. it encourages buying through its website (http://www.bhcrafts.org/). limited and that appropriate by-laws are still lence. A requirement that one third of Each BHcrafts product includes a small card with the handwrit- missing.6 According to Bosnia’s 2005 CEDAW However, their participation rate has been ten name of the woman who made it. Sales are also encouraged candidates on party lists during elections steadily increasing over the last decade. In through various fashion and charity shows, and auctions at statement to the UN, the country’s courts are must be female has helped strengthen embassies. In the future, Lejla is looking to further strengthen overloaded, and have therefore had limited contrast to Bosnia and Herzegovina, women’s her brand, increase production, and focus more on the women’s participation in politics. Other post labor force participation rates in much of the European market. capacity to handle cases dealing with discrimi- conflict-countries, such as Afghanistan or rest of Central and East Europe, except for nation against women. Rwanda, secured similar positive legislative 10 | Voices of Women Entrepreneurs in Bosnia and Herzegovina Voices of Women Entrepreneurs in Bosnia and Herzegovina | 11 Most new jobs in Bosnia and Herzegovina are may be due partly to women working less, but Table 1.1: Structure of the Working Age Population, . being created in the informal sector, which also to the fact that women are concentrated in by Education and Sex accounted for 42 percent of employment in less well paid occupations. 2004. Also, women make up 69.3 percent of Labor Force While older women tend to lag behind . Employed Persons Unemployed Persons Inactive Persons unpaid family workers. Yet, the participation men in educational attainment, educational Female of women in informal employment is almost backgrounds of younger women are compa- Primary School 25.4 26.8 72.2 the same as in formal employment, demon- rable to men’s and Less strating once again their lower participation in Education statistics in Bosnia and Herze- Secondary School 56.1 68.3 26.3 the productive economy.11 In general, unem- govina indicate slightly lower secondary College, University, 18.4 4.9 1.5 Masters, Doctoral ployment rates are higher for women than for school completion rates for women. Yet, Degrees men across the former Yugoslav countries, with lower completion rates are more pronounced Male the largest gender gaps in Bosnia and Kosovo.12 among the older generation of women who Primary School and Less 22.5 25.5 55 also have high unemployment rates. However, Secondary School 66 71 39.8 Figure 1.1: Women’s Labor Force Participation Rates . These low employment levels for women tend in Bosnia and Comparator Countries women currently graduate from university College, University, 11.5 3.5 5.2 to be mirrored in other post-conflict coun- Masters, Doctoral in higher numbers than men in both the Degrees tries, such as Kosovo or Angola, as women Federation and Republika Srpska. Moreover, Source: Agency for Statistics of Bosnia-Herzegovina (2007). in the post-war period focus on household a greater share of employed women has a activities and donors and policy makers typi- higher degree, such as a college or university cally fail to capitalize upon women’s economic Entrepreneurship is not well appreciated or degree (table 1.1).15 developed in Bosnia and Herzegovina potential in their reconstruction programs. In their post-conflict assistance international While sex-disaggregated data on private sector Interestingly, women also made up 58 per- donors have tended to focus on construction- activities is scarce, statistics indicate quite low cent of students of business management in heavy projects, which mainly employ men. In- overall entrepreneurship levels in the country. 2005/2006, which should help them acquire creasing the focus on opportunities for women Over 85 percent of enterprises in Bosnia and 0 10 20 30 40 50 60 70 skills needed in business. Yet they are also in the economy is therefore a significant gap Herzegovina are micro enterprises, with 10 or the majority of students getting a degree in in donor aid to post-conflict countries. fewer employees. This is in line with the overall Turkey Bosnia Croatia Slovenia Japan Romania Albania UK US subjects such as education, health, fine arts or regional trend of pronounced micro-enterprise philosophy. Men, on the other hand, tend to Source: World Economic Forum (2007); US Census Bureau; Yemtsov and Tiongson (2008). Even when employed, women tend to earn participation. The number of small, medium significantly less than men choose degrees in information technology and micro firms per capita in Bosnia and Her- Women’s incomes are much lower than men’s or engineering. zegovina is the lowest in the Eastern Europe Figure 1.2: Mean Monthly Individual Income by Gender in both Republika Srpska (RS) and the Federa- region, especially in comparison with the more These positive trends in women’s education tion of Bosnia and Herzegovina (FBIH) (figure advanced central European countries.16 350 do not seem to be reflected in their labor 1.2). The gender disparity in earnings mirrors Employment force participation rates, which, as discussed 300 global trends. In the U.S., for example, women According to the 2007 Labor Force Survey, Emp + non-emp above, remain well below the rates for men. earn, on average, 77 cents for every dollar only 22.6 percent of employed Bosnians are 250 The fact that higher education for women that men make.13 However, the data in Bosnia self-employed and 26.9 percent of these are KMs per month All income in the 15-24 age category has not translated 200 and Herzegovina indicate a much higher gulf women (chart 1.1). This figure is comparable into employment indicates that they may be between women and men. Data from 2005 to the rest of East Europe and Central Asia 150 particularly affected by the small formal indicate that women in Republika Srpska had where the average percentage of female entre- 100 employment sector and gender bias. More- a mean monthly income from employment preneurs is 26.8 percent (figure 1.3).17 over, as the country’s education system is not of KM60 (US$48) per month, compared to 50 well adapted to market needs and is under- Part of the reason for such low entrepreneur- KM145 (US$116) for men. In the Federation going reforms, both women and men could ship levels might be that many Bosnian citizens 0 women’s mean monthly income was higher, RS Male FBIH Male All BIH Male RS Female FBIH Female All BIH Female benefit from more practical skills needed tend to prefer formal employment with a firm at KM129 (US$104), compared to KM196 Source: DFID (2005). in business. over becoming an entrepreneur, reminiscent of (US$157) for men.14 The earnings disparity 12 | Voices of Women Entrepreneurs in Bosnia and Herzegovina Voices of Women Entrepreneurs in Bosnia and Herzegovina | 13 Male firms are bigger, so of course they The significant amount of remittances in the are more successful. Women have small country may also affect levels of entrepreneur- ship. Bosnia and Herzegovina is among the top Box 1.1: Engaging in Business as a Way to Heal: . businesses, but they help us survive. 20 countries in the world receiving remittances, ´ , D ance . N ada S t j epano v i c —Mejrema Alimanovi´ c which amount to over 11 percent of GDP .19 Re- S tudio S ebasti j an , B r ckoˇ the communist legacy that guaranteed employ- ment with solid benefits. This preference may search has found that individuals who switch from not receiving remittances to receiving “ I like dance. And I wanted to turn the minds of the children away from negative things and towards something positive,” says Nada payments are 3.5 percent less likely to start a Stjepanovi´ c about her motivation for starting Dance Studio Sebastijan. shape their reasons for not getting into busi- business.20 This may well affect many Bosnian “There was dancing in my house from the time I was born,” she says. ness and may also help explain why there are “I went to dance schools and trained.” She set up her business in 1996, women with husbands or relatives outside the and now gives classes in aerobics, dance, modeling, and ballet in the town so few women entrepreneurs. country on whose support they rely. of Brcˇ ko. She also organizes beauty competitions in her town and the region. Data from the World Values survey indicate Nada is involved in all aspects of the studio’s work, from managing administrative duties to conducting the dance classes and giving catwalk lessons to aspiring models. Today the studio has about 300 stu- that Bosnian women are also more likely Chart 1.1: Persons in Employment by . dents who span a variety of ages. About 8,000 people have taken courses from the studio in the past than men to favour increased government Status of Employment 11 years in the town of Brc ˇ ko. A master at multitasking, Nada has accomplished all of this in addition to her full-time job as a financial director at a local firm. She was even recognized with a “Woman of the ownership of business rather than private Year” award by her municipality a few years ago. ownership, suggesting that women have a Nada has never had to do much advertising for her business. Local TV stations have been eager to cover less positive attitude towards business than Employees her competitions and events, and Nada notes that her students’ distinctive look while out and about men.18 One reason for this cautious attitude Self-employed in town speak for itself. Her most pressing task now is to secure her own space for classes, as they are Unpaid currently held in the town’s youth center. to business may be due to the loss of support family workers services, such as childcare, social security, and maternity leave that women were accustomed to during communism, which has increased Source: Agency for Statistics of Bosnia-Herzegovina (2007). women’s vulnerability. Despite their low business ownership, wom- from exile and finding few other employment en do express a growing interest in starting options. For some, starting a business was Figure 1.3: Share of Female Entrepreneurs . a business by Country, Eastern Europe and . a positive, therapeutic activity and a coping Central Asia Region A survey conducted in 2002 found a marked mechanism (box 1.1). increase in the numbers of women who ex- Latvia pressed an interest in starting their own busi- Women’s businesses are smaller than men’s, Hungary and tend to be clustered in the traditional Georgia ness, from 18 percent in 1998 to 60 percent Bulgaria trade, handicrafts, and service sectors Kazakhstan in 2002.21 Faced with poor employment op- Ukraine Country-wide data on women’s business activ- Slovenia portunities, Bosnian women increasingly view Estonia ity are scarce, but the graph below from the Poland entrepreneurship as a viable source of income. Russia Banja Luka municipality shows that women’s Romania Moldova For female-headed households poverty may businesses are focused on handicrafts, trade, Kyrgystan Total be a particular motivating factor. About 25 Lithuania and services, perhaps due to the lower initial Bosnia percent of households in the country are fe- Yugoslavia capital investment and skills requirements for Belarus male-headed (15 percent of these are widows), Tajikistan these sectors (figure 1.4).23 This is in line with Czech Republic and 61.4 percent are likely to be below the Croatia other countries in the region, where women’s Slovakia poverty threshold, compared to 33.5 percent Macedonia businesses are predominantly clustered in Uzbekistan of households headed by men.22 Azerbaijan wholesale trade, retail, and textiles. The choice Albania Armenia Women interviewed for this study note a of the industries women focus on partly ex- 0 10 20 30 40 50 variety of reasons for starting their businesses, plains why their firms are smaller in terms of % of entrepreneurs female but most did so out of necessity. A number of sales revenues and profits.24 Source: Sabarwal and Terrell (2008). women started their business upon returning 14 | Voices of Women Entrepreneurs in Bosnia and Herzegovina Sometimes we women feel like we are not being taken seriously. I am trying . to break that mode of thinking. . has always been present in the society persists, and combined with the lack of childcare op- tions strongly shapes the work habits of many women entrepreneurs (box 1.2). Seventy-one Chapter 2 c —Ružica Jankovi´ percent of the women interviewed for the Dealing with Bureaucracy World Learning STAR Network survey noted The lack of self-confidence among women . that patriarchal traditions and customs that in their ability to run a business is an . inhibiting factor put a woman “in her right place” contribute to Thirty-four percent of the women inter- their lower position in society. viewed in a survey by a women’s NGO, the World Learning STAR Network, noted that Box 1.2: Defying traditional norms: . they are unsure if they have the right skills ´ , S kelani R u ž ica Janko v ic and knowledge to start a business. Another 9 percent noted that they lack information needed to start a business. This finding should O riginally from Srebrenica, Ružica fled with her husband and two children to Serbia in 1992. not be surprising, given that their educational She initially accepted various menial jobs because she needed the income, including a stint at a backgrounds are often not well suited to cousin’s café. Two years later she finally decided business. The lack of positive role models for to take matters into her own hands. “In Skelani I saw a kiosk that was in a fairly good shape and businesswomen in mainstream media may not too destroyed, so I decided to invest in open- also contribute to this poor confidence among ing it,” she says. Skelani is a small community women about their ability to start a business. near Srebrenica, in a remote region of Bosnia on Relative to its regional neighbours, Bosnia It is difficult here to operate legally. If the border with Serbia that is poorly accessible by and Herzegovina still suffers from a weak roads and marked by a large number of people you operate legally, there are inspec- Traditional cultural norms also hinder who have left the area since the war. business environment women’s business success Bosnia and Herzegovina was ranked 105th tions coming upon you from all sides. Yet Ružica remained undeterred by the town’s The communist legacy brought to Bosnian in the World Bank Group’s Doing Business in They always find something that is not remoteness and its diminishing population. women over the past half century formal equal- Initially, as people continued to move out of their 2008 report, which rates countries annu- in order. . region, the profits were low. But the business ity, but the 1992-1995 war saw an erosion of continued. Ružica’s store is in the center of Skel- ally on the ease of doing business. While c —Ružica Jankovi´ privileges and equality that women had gained ani, has a good reputation in the community, some countries in the West Balkans, such as and has steadily attracted customers from across during that time. Today the traditional divi- Croatia, are reforming rapidly, Bosnia and the area. She now employs four female workers sion of roles between men and women that in a grocery store that sells a variety of goods, Herzegovina’s pace of reform has slowed Figure 2.1: Bosnia and Herzegovina’s Ease of Doing Business . including food, beauty products, and drinks. from a few years ago, and its rank slipped Compared to Global Best Practice and Select Economies As a female entrepreneur, Ružica has had to fight from 95 in 2007 to 105 in 2008 (figure 2.1). 160 Figure 1.4: Number of Women and Men Entrepreneurs by Sector . prejudices. According to her, “even when our The declining rank is partly due to the fact in the Banja Luka Municipality business partners know that they should come to 140 me to resolve certain questions, they turn to my that many other countries are reforming 120 husband instead.” Ružica thinks that high unem- 1800 faster and partly due to the national political 100 ployment rates among women in the country are Ranking 1500 due to their limited mobility and “their high level landscape that has not sufficiently focused 80 women men of responsibility within the family. We still need to on reforms. This is a worrisome trend for all 60 1200 keep taking care of all the household chores.” A well-respected woman in her community, Ružica businesses, but it is likely to affect dispro- 40 900 is active in local politics, and was portionately women-owned businesses due 20 the first woman to be 0 600 elected to the post of to their small size and lower capacity to deal Singapore Macedonia, Montenegro Serbia Croatia Greece Bosnia and Albania 300 the representative of with a difficult business environment. FYR Herzegovina Source: World Bank (2007a). the town People’s 0 Committee Trade Production Services Handicrafts in 2004. Source: UNECE (2004). 16 | Voices of Women Entrepreneurs in Bosnia and Herzegovina Voices of Women Entrepreneurs in Bosnia and Herzegovina | 17 Women entrepreneurs interviewed cite Government fragmentation, which is the Box 2.1: Dealing with a Difficult Bureacracy: . dealing with licenses, taxation, finance and result of the complex political structure of the ´ , Z latarica H abibo v i c F ahira H abibo v i c ´ , labor issues as the biggest obstacles to their country devised in the aftermath of the war, Ži v inice business success also contributes to the cost of doing business. The barriers to business success that women A s soon as the American military set up a base in the Živinice region at the end of Bosnia’s war, the Habibovi´ c family saw an opportunity. Realizing that the soldiers were interested in gold as gifts to take home cite are reflected in the Doing Business rankings, where the areas of starting a busi- There is a high level of decentralization in Bosnia and Herzegovina, with fourteen gov- for their significant others, Fahira and her husband opened a series of four jewelry outlets in the American ernments operating with little coordination military bases catering to the military personnel stationed in the region. They seized the opportunity to offer ness, dealing with licenses, paying taxes, and among each other. As noted in a 2007 White products to the American military personnel early on, when there were few competitors, and have managed registering property received the worst rating to diversify their operations since then. Paper completed by the Bosnia-Herzegovina in 2007. A survey of businesses in Bosnia and Foreign Investors Council, the duplication of The business did very well between 1996 and 2007 when the American military left, but starting out was Herzegovina, which does not contain sex- not easy. “Getting a permit to operate on the American military base took a long time and re- essentially the same authority over multiple quired a lot of paperwork,” Fahira says. The couple registered their business in 1996 but had disaggregated data, mirrors some of the same government levels poses particular problems.26 to undergo tests to prove the quality of their gold. Once the business was set up, they concerns, but also includes uncertainty over were plagued by numerous inspections. Finally, attending trade shows abroad has not A number of the women interviewed noted been easy, given the difficulty for a Bosnian national in getting a visa to travel abroad. economic policy and corruption as the biggest frustrations with trying to do business in dif- This is also the reason why the family had to reject an offer to be the national repre- obstacles (figure 2.2). sentatives for a Turkish jewelry chain in Bosnia and Herzegovina. ferent parts of the country and hesitation to The 2007 Transparency International cor- expand to other regions, due to the unclear or The Habibovi´c family now has various other business ventures, including a bakery, a supermarket and a gambling club. Theirs is a joint business, in which ruption perception survey assigned Bosnia varied business requirements of the different the husband does business negotiations and travel, and Fahira is responsible for and Herzegovina the 84th to 93rd position regions (box 2.1). running the day-to-day operations and sales. The couple believes that running their businesses as a family and dividing up tasks has helped them achieve their success. among 180 countries, lagging well behind the Business Licensing Can Impose Early Hurdles The Habibovi´ c’s are currently also investing in a disco club, which they intend to give to EU and its accession country candidates.25 their son to manage due to his interest in music. for Women Entrepreneurs Women’s businesses are, on average, smaller Bosnia’s ranking for the “Dealing with and their owners tend to be less confident and Licences” indicator in the Doing Business educated in business matters. As a result, deal- report improved by 10 places—from 160th to ing with issues such as government bureaucra- 150th between 2006 and 2007—partly due . cy can become even more daunting for them. K ana N & N , N erma H amzi c and ´ . ´ , I lid j a N arcisa K a v azo v i c N Figure 2.2: Barriers to the Operation and Growth of Businesses (percentage of firms) erma and Narcisa have come a long way from sewing pillows and bedcovers in their garage Economic policy uncertainty and selling them at the marketplace. They now own a spacious production space in Ilidja with a Corruption colourful new showroom. The company employs 25 people and sells 130 different articles across Cost of financing Tax rates the former Yugoslavia, with occasional exports to Sweden, Germany and Russia. Macroeconomic instability Anti-competitive practices of other producers Their success masks difficult beginnings. The sisters started their business after returning to Bosnia Tax administration Organized crime/mafia from Spain, faced with the need to ensure survival and provide for their families. They used an old Functioning of judiciary sewing machine and their personal bedding to make their first pillows, which Access to financing they stuffed with the leftover materials of military uniforms. Street crime/theft/disorder Contract violations by customers and suppliers Their biggest problem has been various government regulations that have negatively affected their business. Customs and trade regulations According to Nerma, “laws here don’t stimulate business, they only stifle it.” The sisters formally registered their firm in 1996 Business licensing and note that the process was difficult. “Even now the government makes problems. That’s how they make money,” Nerma and permits Labor regulations says. “The requirements and taxes are horrible. If it were not for these people we employ, we would sell all of this.” Even open- Skills and education ing their new showroom has not been easy. According to Narcisa, “There were many requirements before we opened it. They of available workers keep harassing us, but nobody tries to help.” Transportation Electricity Access to land Nerma and Narcisa believe that their success in this difficult business environment is due to their being able to fill a gap in the Telecommunications market and offer the customers what they need. “Everybody needs a pillow and bedding. Just as we need to eat, so do we Title or leasing of land need to also sleep and cover ourselves with something while we are asleep,” says Narcisa. The sisters are now grooming their 0 10 20 30 40 50 60 70 80 90 100 three daughters to eventually take over the business. According to Narcisa, “We will leave the company to them to continue where we left off.” No obstacle Minor Moderate Major Source: BEEPS2 18 | Voices of Women Entrepreneurs in Bosnia and Herzegovina Voices of Women Entrepreneurs in Bosnia and Herzegovina | 19 Lengthy, Complicated Procedures and . We get loans from commercial banks. But Table 2.1: Dealing with Licenses in . the Cost of Bank Finance are Issues for Figure 2.3: Percentage of Persons who Took Loans in the Preceding 12 Bosnia and Herzegovina the interest rates are too high, and the Women’s Businesses Months, According to Source of Loan by Sex Procedures (number) 16 terms are too short. . Duration (days) 467 Bosnia and Herzegovina is ranked at number —Lejla Radonci ˇ ´c 60 Cost (% of income per capita) 790.3 13 in the Doing Business report in terms 50 of the ease of obtaining credit, reflecting an larger percentage of bank borrowers and 40 Source: World Bank (2007a). excellent performance in this area. Banking are also more likely to borrow from credit 30 reform in 2001 has led to the liberalization unions, rotating savings and credit associa- to ongoing efforts on the inspections reform of the banking sector, and the country has a tions (ROSCAs) and other sources, while men 20 and the “regulatory guillotine” process.27 competitive banking market with regulatory are slightly more likely to borrow from family 10 However, it is still a poor ranking, and several and supervisory functions that are being en- (figure 2.3). 0 women complained of delays and a frustrat- forced. Moreover, credit to the private sector is Family Employer Banks Credit unions, ROSCAs, others ing bureaucracy in obtaining needed licenses growing rapidly, with real private sector credit The numbers indicate that women in Bosnia women men (box 2.2). The process requires, on average, 16 averaging 22.8 percent between 2001 and and Herzegovina may be better off in terms of Source: World Bank (2001). procedures and 467 days (table 2.1). The time 2006.28 The country has an inclusive credit securing credit than women in the rest of the and effort needed to navigate these procedures registry that covers both commercial and region. A study using data from Europe’s Busi- can significantly delay business start-up and micro lenders. ness Environment and Enterprise Performance (US$2,725) for men, and women are more discourage formalization. Given that women Survey found that female-managed firms have likely to take out loans for immediate con- also bear prime responsibility for household Few of the women interviewed for this report a 5.4 percent lower probability of securing a sumption rather than investment, indicating tasks, they may experience these procedures noted access to finance as an issue; rather both bank loan than male-managed firms. More- that they invest less in their businesses (figure more acutely than do men. women and men complained of the cost of over, female-managed firms pay, on average, 2.4).30 Also, Bosnian entrepreneurs are more finance. In fact, women make up a slightly 0.6 percent higher interest rates than their likely to finance their business start-up with male counterparts.29 In contrast to the rest of personal funds rather than bank loans. While Europe, the same study found that women- bank finance is rarely used for business start- Box 2.2: Dealing with Licenses: . owned firms in South-Eastern Europe report ups in the country, research has found it to M irsada M ehmedino v i c ´ , . fewer constraints in access and cost of financ- be significant in ensuring business survival.31 K onfekci j a S D M , L uka v ac ing than male-owned businesses. Therefore, the fact that women are less likely M irsada was working in a garment factory in Italy after her escape from the Bosnian war when she met her future husband, an Italian with a long family history of working in the garment industry. However, the average size of a loan that a to take out bank loans for business purposes is likely to have a negative impact on their busi- After the war ended Mirsada and her husband returned to her home town of Lukavac and built SDM woman takes out is smaller than a man’s, at ness survival. Lukavac, a garment factory that produces slick Italian shirts for export to the Italian market. 2,702.50KM (US$2,169) versus 3,395.82KM Living in an area of the country known for the high level of pollution from the surrounding heavy While access to bank finance is less of a industry and large chimneys at the city’s entrance, Mirsada was looking to start a business that would problem for women, businesswomen inter- offer alternative employment opportunities to the local population and would not harm the environ- Figure 2.4: Average Loan Size (in KM), by Sex ment. Konfekcija SDM now employs 50 workers, of whom two are male. As is common in the garment viewed for this report note that the length of industry, women have taken on all levels of responsibility in her factory, from working in production to 5000 time it takes to get bank financing, the lack being directors. With unemployment in the region high, Mirsada feels positive about her contribution. women men of long-term financing options, as well as the 4000 While her intentions were good, Mirsada realized that opening up the factory complicated paperwork and requirements are would not be very easy. Even though Mirsada started to set up her business in 2003, she did not commence operations until 2006. It took two and a 3000 problematic and lead them to turn instead to half years to obtain all the necessary paperwork and permits from the 2000 microfinance institutions. Men tend to turn to government. She notes having to go to various different ministries, with no clear explanations of who was responsible for what. Her microfinance for the same reasons. business site was finished only in 2005. Despite her challenges, 1000 Mirsada is optimistic about her future prospects. Her business is still in the expansion phase and she plans to more than double 0 her workforce in the coming years. Average loan size Source: World Bank (2001). 20 | Voices of Women Entrepreneurs in Bosnia and Herzegovina Voices of Women Entrepreneurs in Bosnia and Herzegovina | 21 As in many other parts of the world, the lack and in late 2007 a new Law on Leasing was A number of the women interviewed are of registered property under their own name enacted in Republika Srpska. Leasing can receiving both micro-credit and bank loans. can become a problem for women when help women’s businesses with limited start-up Women preferred microfinance loans due to seeking bank financing, particularly for capital and cash flow to start operating imme- the convenience and speed associated with larger loan amounts diately. Yet few of the women interviewed for obtaining them (box 2.4). Yet they note that Box 2.3: MI-BOSPO — Increasing Women’s Access to Finance through The law provides for joint property registra- Micro Loans this report seemed aware of the potential that interest rates are too high. Depending on the tion, but traditional practices of registering I leasing offers, indicating the need for educa- type of loan, microfinance institutions charge land in a man’s name tend to prevail. Only 6.5 tion on this product. from 15 to over 20 percent interest, com- nitiated in 1996 as a World Bank pilot project, MI-BOSPO has evolved into a percent of women interviewed for the STAR leading micro-credit organization in Bosnia targeting women. The organization’s pared to 8 or 9 percent interest charged on a mission is to economically empower women, led by the belief that “the economi- Network survey reported owning land in Microfinance institutions have stepped in to consumption or housing loan by commercial cally empowered woman can better influence social change and contribute to their own name (figure 2.5). Moreover, forty fill the funding gap better quality of life within the family.” banks.35 With competition in the micro- percent of women noted that lack of property There is a large presence of microfinance enterprise market in the country increasing, the As of March 2008, MI-BOSPO had 26,580 active clients and a loan portfolio makes accessing finance difficult. organizations in Bosnia and Herzegovina. In of KM64,000,000 (US$51,375,307). Based in Tuzla, the organization focuses interest rates have been on a downward trend. 2004, there were 46 registered microfinance mainly on northeast Bosnia. The loans range from US$180 to US$18,200, with The numbers are similar across the former providers in the country.34 Many of these were an average tenor of 13.5 months. On any given day, one can see the MI-BOSPO Taxation Imposes Further Burdens on staff in the colorfully branded company vans visiting clients in the cities that the Yugoslav countries. In neighbouring Monte- established with donor assistance following Women’s Businesses organization serves. negro only 3 percent of property is registered the end of the war, but are now self-sufficient Bosnia and Herzegovina is undertaking tax MI-BOSPO is involved in various community initiatives, such as a local recycling in women’s names, while the corresponding (box 2.3). The country passed similar micro- reform, including lowering property taxes and program, and is starting a foundation that will focus on research and programs figure in rural parts of Kosovo is 10 percent.32 finance laws in Republika Srpska in 2001 and simplifying corporate income taxes.36 How- to the benefit of women. MI-BOSPO is a member of Women’s World Banking, a global network of microfinance organizations based in New York. The growth in the leasing market in the the Federation in 2000. A new law on micro- ever, tax rates are still rated by entrepreneurs For more information, visit: http://www.mi-bospo.org. country could have positive effects for women. credit organizations stipulates that micro- among the highest obstacles to doing business Outstanding leasing contracts in Bosnia and credit organizations have to transform from in the country. For instance, taxes that an Herzegovina grew by 74 percent between non-profit organizations to either foundations employer has to pay for each employee to the 2004 and 2005.33 The IFC has been work- or commercial entities. social insurance fund average about 70 percent ing to update the leasing legal framework, of an employee’s net pay, making it very costly Box 2.4: Benefiting from Microfinance: . MI-BOSPO is simple because we know and to create new jobs.37 ´ , M ilk C ow . N izama I msiragi c . B reeding F actor y N ear T uzla trust each other. . ˇ c´ , . I M irsada M a j dan ci We had problems with taxation at first. “ c —Mejrema Alimanovi´ H erbal P harmac y M editera started work with MI-BOSPO as soon as they began operating here seven years We had nine inspection visits within . S ago,” says Nizama Imsiragi´ c, sitting in the shade of a tree in front of her milk six months. . cow breeding factory at a large farm near Tuzla. Running a family business to- teeped in a family tradition of herbalists and with a degree in pharmacy, gether with her husband, Nizama started out by selling the milk of her one cow it seemed only natural for Mirsada to turn to herbal medicine when she was Figure 2.5: Women’s Property Ownership . in the neighborhood. Soon enough she saw the potential for more. She now has c —Fahira Habibovi´ looking to start her own business. Mirsada is today the director and sole in Bosnia nd Herzegovina (percentage) eighty cattle and various machines for processing milk. Their milk is sold to the owner of a pharmacy that focuses on herbal medicine and natural drugs. Tuzla Milk Factory and distributed to the region. 50 She started her business in 1997 after returning from exile in Germany, now employs five people, and is increasingly focusing on herb growing and Loans from MI-BOSPO have played a key role in this development. “I production on her family-owned land. “I have focused on plants because of 40 The Doing Business in 2008 report found that had one cow and wanted one more,” says Nizama. “I got a loan my family tradition and history. Nature is our salvation,” she says. Her clients the number of payments in the taxes category from MI-BOSPO and bought a second cow.” Her experience are the locals from her town of Živinice, including athletes and people who 30 has been reduced from 73 to 51 annually with MI-BOSPO has been positive and she values the long- believe in alternative medicine. standing relationship with the organization. “They are very 20 from the previous year, but the total estimated fast. Now that I have secured their trust, I can get credit at Mirsada used her own funds to start the business, yet notes that financing has required time for processing these payments any time,” she says. been an issue. “Banks are not an attractive option for financing, as they have 10 too many requirements. While microfinance organizations have higher interest increased from 100 hours to 368, increasing Going forward, Nizama would like to focus on breeding rates, they are faster. Yet they do not offer large enough loans.” 0 complexity. The complexity and cost of the the Holstein breed of cows, which are distinctive black- Land House and-white-colored cows known for their large milk Mirsada has a resilient spirit, and notes: “I do not intend to give up. I will con- process may be one of the reasons why wom- production capacity. Nizama is optimistic about her in own name don’t own tinue to fight on.” In the future, she hopes to acquire more land and expand en, who tend to be more time constrained firm’s future: “We have this large space for the cows, in the herbal production side of her business. joint no answer/ which we invested a lot of funds. We have capacity for 50 don’t know than men, do not formally register their small more cattle.” Source: Baksic-Muftic, Jasna et al. (2003). informal businesses or hire workers. 22 | Voices of Women Entrepreneurs in Bosnia and Herzegovina Voices of Women Entrepreneurs in Bosnia and Herzegovina | 23 There is no flexibility with employees. . number of women entrepreneurs noted issues numerous labor inspections by government to pay the maternity leave through the social The state does not offer good training . with poor quality of workers and the difficulty that often amount to harassment. A study by insurance system instead of leaving it effec- in finding good employees. the World Bank Group’s Foreign Investment tively to the employer.41 Moreover, research for workers. We are coming out of a . Advisory Service (FIAS) noted that the system indicates that employers often disregard the communist system, and the state is . Vocational education opportunities are also for labor inspections lacks reasonable rules and norms of the labor law, prevent women from insuring people who do not have good limited for those who wish to improve their remedies and gives individual inspectors large using maternity leave, and sometimes even fire work habits. We have gone through 150 skills, and companies tend to invest little amounts of power but little accountability. women during pregnancy.42 in training their workers. Moreover, a 2006 workers to get 50 good ones. This situation can easily lead to requests for labor study found that vocational training is Discrimination against older women is also —Mirsada Mehmedinovi´ c bribes that are difficult for women entrepre- associated with a negative effect on earnings of prevalent, with older women being rejected neurs to refuse.40 about 20-25 percent, probably due to the fact from consideration for employment due Poor Worker Skills Can Impact Women’s. that poor people with lower job prospects tra- Women employees, in particular, are often to their age and looks. Job advertisements, Business Performance ditionally enrol in vocational programs instead seen as a burden by employers. The World particularly in the services industry, often The education system in Bosnia and Herze- of completing a full secondary school degree.39 Bank has argued that the one year maternity have specific requirements for applicants to be govina has not adapted to a market economy. A 2005 World Bank Education Restructuring leave policy, mandated in the labor laws, hin- below 35 years of age and to look attractive.43 The system focuses on training for defined Project has been designed to address some of ders female employment. Maternity benefits Increased awareness by women’s NGOs and jobs in a command economy rather than these issues. in Republika Srpska are financed through Gender Centers on this problem and gender adaptability and flexibility, and has yet to general payroll contributions and are therefore sensitivity training for the private sector may equip young people with the skills that are Rigid protection has meant that private em- not a disincentive to hiring women. In the help change such perceptions. ployers have had a difficult time firing and needed in the private sector. According to the Federation the benefits are supposed to be hiring workers World Bank, more than 40 percent of second- financed by the Cantonal social protection While there have been some initial reforms ary students in the country continue to study system, but in practice are often left to the of the labor code and employment institutes, programs in hundreds of occupational spe- employers to finance, creating a disincentive more is needed. Women entrepreneurs tell of cializations for which there are few jobs.38 A to hiring women. One potential solution is . M e j rema A limano v i c´ , . K iosk S hop M eri , L uka v ac W hen her husband was injured during the war and had to stop working, Mejrema borrowed funds from relatives and started a small kiosk to ensure the family’s survival. “Those were the post-war years, and life was difficult. My husband was a war invalid and we were having a hard time getting by.” But the hard times are long over for Mejrema. From her first small kiosk, Mejrema has developed a variety of business ventures in her town of Lukavac that include agriculture and coffee roasting. Four years ago she also opened a greenhouse where she grows strawberries and vegetables that she sells in her own shops. The market for her products is local, and Mejrema says she would have to improve the labeling to be able to sell the products elsewhere. Her biggest problem has been finding well qualified and reliable employees. “Today’s youth do not like to work hard and are not careful. They don’t have good work habits. It is very hard to find good workers.” With a business that depends on customer loyalty, she has had a hard time finding workers who have a pleasant and friendly attitude towards the customers. Mejrema is looking to expand her fruit and vegetable production. She recently attended training on large-scale production and agronomy, and looks forward to applying the lessons in her business expansion. Voices of Women Entrepreneurs in Bosnia and Herzegovina | 25 Chapter 3 We need to get together more, and . exchange experiences. There is no . Figure 3.1: Hours Worked per Week by Type of Employment Bosnian Women: Building . women’s business association here, but we 50 Partnerships for Success should start one. 40 c —Mejrema Alimanovi´ 30 women entrepreneurs, as well as government 20 and business leaders. Yet it has few active mem- 10 bers and limited resources, making it difficult to offer comprehensive services to its members. 0 Public employee Owner or Other Total self-employed This lack of organization of women in busi- men women ness tends to be mirrored in the rest of Central and Eastern Europe, as many women in the Source: Federation of Bosnia and Herzegovina Federal Office of Statistics (2006). region are reluctant to associate themselves with ‘feminist’ ideas or be singled out as a marginalized group.46 Moreover, business membership organizations do not tend to ´ , . D u š anka Jo v ano v i c Unemployment is high among women because of The unavailability and high cost of childcare cater their services to women entrepreneurs. C lothing B outi q ues M a j a. ˇ B r cko their high level of responsibility within the family. . services and the general belief that a woman A 2000 study found that only 29 percent of We still need to keep taking care of all the . household chores. should be home with her children may also contribute to this time allocation.44 Currently organizations in Central and Eastern Eu- rope provided such services, compared to 41 D ušanka has always been interested in fashion, but she turned it into her profession out of necessity in the early post-war years. less than 9 percent of children attend a pre- percent in the European Union.47 As a result, Faced with poor employment opportunities, she started to sell bags c —Ružica Jankovi´ eleven years ago in the town of Brckoˇ where she was living with her school educational institution, and kinder- professional organizations tend to be male- family. That initial effort has been expanded into three boutiques Managing work-life balance in light of gartens charge between KM100 (US$80) and dominated, with limited participation from selling clothing to women and men of different age groups and women’s disproportionate responsibilities . economic means. KM120 (US$96) per month.45 Since women’s women, and women enjoy less access to re- in the home earnings average KM129 (US$104) in the sources, training, and information that could Despite the demands that her business imposes, Dušanka seems Many women turn to self-employment out to maintain a good balance between her work and her family life. Federation and KM60 (US$48) in Republika increase their business success. of financial necessity, and for some Bosnian She employs eight female staff who help run the shops and are Srpska, the cost of childcare is a too high reliable, long-term employees. In an industry known for its tendency businesswomen being your own boss seems Strong women’s business organizations could to employ young and attractive female workers, Dušanka does not burden for many households. to help accommodate family responsibilities. provide much-needed training, networking discriminate in hiring, and her employees are between the ages of and advocacy 20 and 52. When Bosnian women run their own busi- Women entrepreneurs need stronger networks ness, they are likely to spend significantly less Business networking is valuable for sharing Few of the women interviewed noted receiv- With competition increasing, it is becoming more difficult ing training or information relevant to their to operate and vie for the attentions of fickle consum- time on it than when they are employed for ideas, contacts and news in one’s industry, for ers. Dušanka would like to open a more exclusive someone else. A female business owner spends, getting business referrals, and securing deals. business, which membership in an association boutique, but does not think that people in her could provide. One reason for women’s low town would be able to afford it. on average, only 29.2 hours per week on her Yet, even though Bosnia and Herzegovina business, compared to 46.9 hours that a male has a vibrant women’s movement and strong participation in associations may be due to “A lot of people ask me how I manage to do it their large family responsibilities. Yet many all. You have to love this job in order to do it,” business owner spends on his enterprise. In fact, civil society organizations focusing on gender she says. “But I do not exhaust myself too much. men work longer hours in every work category. issues, women in the private sector remain women expressed interest in networking and It is all a matter of organization, and for now training opportunities, indicating a strong I’ve managed to get organized.” Going forward, This data indicates that many women may be largely unorganized. Dušanka’s goals include buying an apartment choosing self-employment or exit the labor force need for such an organization. There are many for her daughter who will soon begin university The BH Women’s Economic Network is one global examples of successful women’s business studies as well as opening another shop. partly due to their greater household burdens existing organization that brings together associations, whose models could provide (figure 3.1). 26 | Voices of Women Entrepreneurs in Bosnia and Herzegovina impetus and ideas for the women in Bosnia schemes, have received donor support in heard. The report highlights the many positive and Herzegovina (box 3.1). Bosnia and Herzegovina. Yet these represent role models of Bosnian businesswomen, whose ad-hoc activities in an environment that lacks success stories can provide inspiration to young Government and donors should work with a coordinated, strategic focus on women in women who are just starting out in their profes- women’s businesses to ensure change the private sector. sional life. By listening to the voices of Bosnia’s Donor assistance in Bosnia and Herzegovina women and documenting their inspirational to date has focused overwhelmingly on issues The government has enacted supportive stories, the report demonstrates the vast but such as women’s political participation, peace legislation and put in place a machinery to underutilized potential of women and sends the building, or trafficking. In other post-conflict address gender concerns, including Gender message of how important it is to implement countries donors have traditionally supported Centers at the state level and at the level of policies that will encourage and strengthen similar gender activities, typically failing to entities, and Gender Equality Commissions. their performance. capitalize upon women’s economic potential. These organizations might be well placed to Encouragingly, in recent years donors have strengthen support for women in the private started to support initiatives geared towards sector, including engaging in advocacy on is- women’s business potential, such as in Kosovo sues facing women entrepreneurs. (box 3.2). Some economic empowerment initiatives, such as the BHcrafts initiative This report is one advocacy tool that women ´ , C leaning . L e j la S paho , P erspe - H a v a F azli c described earlier in this report or micro-credit can take to policy makers to make their views kti v a E ngineering , S er v ice S E I F , H air and . Visoko T anning S alon , F lower S hop. K alesi j a Box 3.1: Networking for Success: Examples Box 3.2: Donors Promoting Women L ejla Spaho has an impressive resume —she is a teacher at a secondary school A fter living in Germany for several years, Hava returned to her of Women’s Business Associations Entrepreneurs in Kosovo in Visoko, the national head of the BH small Bosnian town of Kalesija in 1997 filled with optimism about National Association of Women Faced with poor employment prospects and Women’s Economic Network, a cantonal the future, but also with various business ideas. Yet she first focused Business Owners a patriarchal system, women in Kosovo are representative, and also the owner of Pers- on family and spent some time raising her three children. facing particular challenges as Kosovo strives pektiva Engineering, a firm providing services With 9,000 women-owned businesses in to rebuild its institutions and economy. in consultancy, engineering, and architec- Hava soon got to work. She had always loved flowers, and started by America as its members and 80 chapters tural design. After being a director of a selling flowers on the street in her town. Soon enough, there were throughout the country, this association cre- To address the issue, the Swiss Agency for De- state-owned construction firm, she used her plenty of clients, and Hava opened a flower shop in 2004. Today she ates networking opportunities for its members, velopment and Cooperation initiated a project business connections to open her company also owns a hair salon, a tanning salon, a greenhouse for growing organizes nation-wide conferences and public in 2001 to foster small and medium enter- ten years ago. flowers, and a newly opened cleaning service SEIF. “I get the ideas policy days, and provides tools for growing prises, with a particular focus on building skills for my businesses from listening to the needs of the customers. I a business. For more information, visit their among young women. The program offers As a leader of the BH Women’s Economic brought back a lot of positive impressions from Germany,” she says. website: http://www.nawbo.org/ courses for women entrepreneurs on business Network, Lejla is an advocate for issues She and her husband are now focusing increasingly on their cleaning management, accounting, and marketing, as facing women in the economy and in busi- service. “People are not aware about cleaning services in this market. Jordan Forum for Business and well as vocational training. A media campaign ness. According to Lejla, the network has We will need at least a year of advertising to acquaint Professional Women and exhibitions showcasing women’s products about 1,800 members in each region of the people with the notion,” Hava says. are designed to counter societal prejudices country, though a small number of these are Established in 1976, the Forum provides a and encourage young women to enter the active. The network facilitates information A dynamic and hard-working woman, Hava platform to develop, empower and advocate business arena. sharing, conducts research, advocacy, and manages to juggle her personal life with for women in business in Jordan. For more training activities. the demands of her various businesses. information, visit their website: http://www. For more information, visit: http://www. Despite the multiple demands on her bpwa.org.jo/ swisscontact.org/english/pages/PR_Dn/PR_ According to Lejla, “part of the problem day, she finds time for family and Dn_005_Img.php with the network has been that the women usually leaves work by 4 or 5pm. “I Global Directory of Women’s members expected financial support from love to work but I am also attached Business Associations the network. Also, businesswomen have to my family. I usually cook myself. no time to be part of an association given But I am having a harder time IFC’s Gender Program houses a Global all their other obligations.” Yet she remains making time for friends these days.” Directory of Women’s Business Associations, a passionate advocate for women in busi- As if managing a growing family and searchable by country: http://rru.worldbank. ness, taking a leadership role and an active various businesses were not enough org/External/psd-gender/ part in the network’s training activities and work, Hava is also studying on a part-time learning exchanges. basis for a university degree in economics. 28 | Voices of Women Entrepreneurs in Bosnia and Herzegovina Voices of Women Entrepreneurs in Bosnia and Herzegovina | 29 RECOMMENDATIONS USEFUL LINKS AND RESOURCES Issue Recommendations Responsible agency BH Women’s Economic Network MI-BOSPO Micro-Credit Organization http://www.bhzem.ba/aktivnosti/centralna http://www.mi-bospo.org/ Complex bureaucratic Eliminate Bureaucratic Hurdles that Hinder the Success of Women . Government, business procedures in areas such in Business and Provide Training associations, donors /index.php US Small Business Administration Free Online as obtaining licenses, employing workers or b Increase the mobility of the labor force and address the pervasive discrimination Gender Center of the Federation of Bosnia Business Courses accessing finance have a in hiring by strengthening the implementation of the Gender Equality Law, to and Herzegovina http://www.sba.gov/services/training/ disproportionate burden help increase women’s low labor force participation rates. on women’s businesses http://www.fgenderc.com.ba/en/o_gender_ onlinecourses/index.html due to their smaller busi- Conduct training on gender sensitivity and diversity within the private sector to b centru.html ness size and capacity to help change negative company culture and attitudes towards women. Women’s World Banking address the issues. The b Ensure that education initiatives address gender inequalities, including encourag- Gender Center of Republika Srpska http://swwb.org/ complicated govern- ment structure in the ing entrepreneurship training for women in secondary education. Contact: E-mail: gcrsoffice@blic.net country has meant that World Bank’s Gender Program b Create a central registry to make it easier to obtain permissions for doing Website: www.gc.vladars.net procedures for getting www.worldbank.org/gender business permits are not business and help standardize procedures. standardized. Gender Equality Agency of Bosnia . World Bank’s Europe and Central Asia . and Herzegovina Gender Website Lack of awareness and Offer Training to Increase Business Success Commercial banks or http://www.arsbih.gov.ba/ education on business micro-credit providers, http://web.worldbank.org/WBSITE/EX- issues may be an inhibit- Offer education on business and financial management. b women’s associations and IFC’s Gender Program TERNAL/COUNTRIES/ECAEXT/ ing factor for women NGOs, Gender Centers entrepreneurs. b Build and strengthen leadership skills of businesswomen, and provide informa- www.ifc.org/gender EXTECAREGTOPGENDER/ tion on new technological and business developments in their industry to help 0,,menuPK:570872~pagePK:34004175 grow women’s businesses. IFC Advisory Services in South-Eastern . ~piPK:34004435~theSitePK:570862,00.html Europe (PEP-SE) Educate women entrepreneurs on the benefits of leasing. b http://www.ifc.org/pepse World Learning STAR Network Women in business Support Women’s Advocacy Donors, government, and http://www.worldlearning.org/star/ remain poorly organized businesswomen ILO’s Get Ahead for Women in Enterprise and lack a coordinating Increase women’s advocacy on private sector development issues by supporting b Training Package and Resource Kit body and networking the creation of a women’s business association, and strengthening existing opportunities. bodies such as the BH Women’s Economic Network. http://www.ilo.org/public/english/region/asro/ bangkok/library/pub4c.htm Sponsor international learning exchanges between Bosnian women entrepre- b neurs and women’s business associations from other countries. Initiate regular two-way dialogue between government and women in business. b Conduct further research into concerns facing women in business, and ensure b business surveys are sex-disaggregated and analyzed by gender. Many Bosnian women Highlight Women’s Success Stories to Raise the Profile of Women . Businesswomen, media, are held back by poor in Business government and donors self-confidence and lack of a belief in their ability Increase awareness of women’s potential in business and highlight the success b to succeed in business. stories of women in the private sector, such as through this publication, by work- ing with the media and sponsoring events that celebrate women’s achievements in business. 30 | Voices of Women Entrepreneurs in Bosnia and Herzegovina Voices of Women Entrepreneurs in Bosnia and Herzegovina | 31 ENDNOTES REFERENCES 1 ILO (2008). 23 UNECE (2004). Agency for Statistics of Bosnia-Herzegovina. 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