Inclusive international trade: Assisting female-led firms in export development

Project Active from to Firms and Women's Economic Empowerment

While many lower- and middle-income countries aim to grow and diversify their exports, enabling small and medium sized firms to export and enter global value chains remains a key challenge. This is particularly true for female-led firms, which only compose 5-10% of all firms in the MENA region and overall less than 20% in other parts of the Global South. So far, there is little evidence what measures can improve the integration of female-led firms into global value chains. This project aims to fill this evidence gap by rigorously assessing the impact of export consortia on the export performance of female-led SMEs in Tunisia through a randomised controlled trial. This experiment is part of the second phase of the German Development Cooperation project “Export Promotion to new, Sub-Saharan Markets (PEMA II)”, which is implemented by the German Development Agency GIZ together with the Tunisian export promotion agency CEPEX. The idea is that forming consortia is another way of reducing the fixed cost of exporting by pooling resources, sharing risk and potentially even selling products together under the same brand. Furthermore, closely collaborating with other firms broadens your business network, which is considered a key success factor in the trade literature.

The findings of this project are highly policy-relevant also beyond Tunisia, as export promotion measures for female firms and measures on how to broaden female business networks were identified as important policy areas in recent reports by the World Bank. We expect that the intervention has a positive impact on the export performance, the size of women’s business network and potentially also on their entrepreneurial self-confidence. If proved successful, we hope that the intervention will be rolled out broader and form part of CEPEX regularly offered services.

To rigorously measure the impact of the programme, up to 160 eligible firms will be randomly allocated into treatment and control groups. The firms will be stratified by sectors prior to the random allocation to assure they operate in similar fields. The firms in the treatment group will receive 23 months of technical assistance for the formation of the consortia. The impact on export performance and intermediate outcomes, such as business network size or behavioural changes, will be measured through three surveys (baseline and 2 follow-up surveys after the intervention). Administrative data will be used to complement export performance data.