International Journal of Scientific and Research Publications, Volume 6, Issue 9, September 2016 771 ISSN 2250-3153 Issues, Challenges and Prospects of Women-owned Small and Medium Scale Enterprises in Maldives S.P.Premaratne and Gamini Kudaliyanage Abstract- The paper aims to find out: i) what problems/ entrepreneurs in the Maldives through Case Studies, Key challenges are facing micro - scale women entrepreneurs in the Informant Interviews (KIIs) and Focus group Discussions Maldives; ii) in what industries are these small-scale women (FGDs). entrepreneurs engaged in; iii) what measures have been put in To meet these objectives, the study exclusively employs 24 place by the Maldivian government and other institutions to case studies of three islands (ATOLS): ADDU, LAMMU and assist such micro-scale women entrepreneurs; and iv) what can Thinnadhoo, which cover 5 Business Development Centers (1) be recommended in future for micro-scale women entrepreneurs Thindhoo (4 cases), (2) Kudahuvadhoo (6 cases), (3) Addu (5 in the Maldives. The study employs 24 case studies , Key cases), (4) Kulhudhufushi (3 case), and Laamu (6 cases). Informant Interviews and Focus group Discussions. The main challenge that women and youth MSMEs face is adequate and Micro, Small, and Medium-sized Enterprise (MSME) timely financing on competitive terms particularly longer terms The micro, small, and medium-sized enterprise (MSME) and limited human resource availability for scaling up their sector in the Maldives includes many smaller and micro businesses. The policy and regulatory issues, institutional enterprises, but as most of them are informal. There is limited weaknesses in the absence of credit appraisal and risk information about their characteristics and their contribution to management / monitoring tools affect the aspiring and existing the economy. The development of the sector has been identified entrepreneur to enter the MSME arena. Most MSMEs have by the government as a key strategy to generate employment, limited access to larger markets in terms of market linkages, reduce poverty, and contribute to economic growth. A range of transport, telecommunications information exchange which obstacles to sector development has also been identified: they seriously undermine the demand for their products. include skills deficiencies, start-up costs, limited access to finance, high collateral requirements, imperfect market Index Terms- Women entrepreneurs, Micro and small scale information, inadequate business development services, lack of enterprise, active learning model, Maldives access to banking facilities (especially in the atolls), and high costs of interisland transport and other infrastructure and services. I. INTRODUCTION Many microenterprises, especially those run by women in the smaller islands, would be more aptly categorized as M aldives has a Gender Development Index (GDI) of 0.767 and Gender Empowerment measure (GEM) of 0.430 and is ranked highest in all of South Asia (ranked 77 for GDI and 90 for livelihood or income-generating activities rather than as growth- oriented enterprises due to their subsistence nature and lack of GEM1 (HDR 2009) indicating overall improvement in certain commercial orientation. indicators for women. According to the government of Maldives, men and women have relatively equal access to education, health Women and Micro Enterprises services , employment and empowering women by 2010 ( Maldives women are primarily engaged in home-based Maldives Strategic Policy Framework 2009-2013). The labour income generating activities. Nearly half the employed females force participation rate of women decreased from 60% in 1978 to in the atolls and 40% of employed females in Male’ fall into the 37% in 2005. Women’s share of wage employment in the non- category of home-based own-account workers or contributing agriculture sector is at a low 30%. While women’s labor force family workers. Despite their significance, past statistics indicate participation rate has gone up in the past few years, it is still that the most of the WOMEs fail within the first few months of considerably lower than that of men (59% compared with 79%). operation. WOMEs are also known for their low start up and Women’s unemployment rate of 39% is twice the men’s working capital. Under normal circumstances women’s unemployment rate of 19%. However, progress has been enterprises have low growth rate and limited potential partially relatively slower toward achieving three MDGs: promoting due to the type of business activities they run. gender equality and women’s empowerment, ensuring The SME Mapping Survey (SMEs) Ministry of Economic environmental sustainability and partnership for development. Development (MED) and UNDP, March 2010 (MED 2010), This current study purely seeks to find out: i) what found that SMEs in commercially progressive islands were problems/ challenges are facing micro - scale women mostly in the hands of men while a few women are active in the entrepreneurs in the Maldives; ii) in what industries are these “leftover” economic activities such as food vending and running small-scale women entrepreneurs engaged in; iii) what measures small restaurants and retail shops. The majority of women micro- have been put in place by the Maldivian government and other entrepreneurs—remain “stuck” in home-based, small-scale institutions to assist such micro-scale women entrepreneurs; and production, especially in the agriculture and fisheries sectors. iv) what can be recommended in future for micro-scale women These women are engaged in the production of fruits and vegetables in their home gardens and sell these and leftover www.ijsrp.org International Journal of Scientific and Research Publications, Volume 6, Issue 9, September 2016 772 ISSN 2250-3153 fishery produce in local markets, with limited food processing the Maldives envisages establishing the requisite institutional and capacity and low commercial returns. In the small category or organizational mechanisms to restructure and consolidate MSME highly vulnerable islands, women entrepreneurs played a leading development activities and support services in order to achieve role in stagnant small sector businesses for family survival while economies of scale and efficiency of operations. In recent years, men migrated to other progressive islands. the Ministry of Economic Development (MED) has taken The scale of operation of these entrepreneurs is small and leadership with respect to consolidating government MSME caters mostly to the demand of the small population in the development efforts in an effort to develop a more holistic islands. Lack of finance prevents them in making future plans to approach to private sector development (PSD) and MSME sector enhance the scale of operation and to develop commercial promotion. Supporting business growth is a strategic objective of business catering to the external markets. External supply MED’s strategic plan that includes, among others, providing linkages with wholesalers, exporters and resorts are negligible as technical and other support to new business start-ups, initiating 92% of entrepreneurs deal only worth local private individuals. targeted programs to promote trade and investment, and About 88% of the SMEs have identified marketing information entrepreneurship development. Hence, establishing policy and marketing linkages as the highest priority area in which they direction for MSME development is consistent with MED’s require support. Similarly infrastructure, transport, finance, mandate. Recent new initiatives in line with government policy training, and technology are equally important highest priority to support the growth of the MSME sector include the support service areas. establishment of an SME Council and the enacting of a Further, the social expectations of women in the Maldives legislative bill, known as the MSME Act. The SME Council is continue to prioritize homemaking and household management, responsible for formulating plans to achieve government MSME with tasks performed within the confines of the home. Women sector development goals and providing overall coordination, are expected to take care of children and the elderly, and to take monitoring and evaluation of related sector promotion programs. responsibility for all household-related tasks. Women are missing The MSME Act includes provisions for (i) legal definition of the out on the opportunity to develop and improve their own MSME; (ii) creation of a MSME Council; (iii) establishment of a enterprises. Reviews of many entrepreneurial development body to oversee business development services, known as the programs show lower participation by women than men in all MSME business development service centers; (iv) registration of types of entrepreneurial development activities, except where the MSMEs; (v) establishment of an MSME credit guarantee business development services are conducted as part of school scheme; and (vi) other special provisions to encourage MSME programs or events. sector growth. One of the intentions of the MSME Act (2013) is Another aspect is that women have limited access to the to create an enabling environment for the promotion and resources required to start and run their own enterprises. development of MSMEs with a view toward reducing poverty Women’s inability to access credit to finance business start-ups and related vulnerabilities. It aims to make the sector broad- is a major stumbling block. Women poorly own loan collateral based, innovative, resilient, and internationally competitive in accepted by banks is limited to the types of property (land, order to ease the cost and complexity for MSMEs to operate and house, ocean vessel). Women lack information about markets. to enhance the entrepreneurial spirit among all Maldivians. The Women are not encouraged to interact socially or in the public Act has several women- specific commitments: (i) to review and arena and therefore are restricted in the ways in which they can amend legislation and policies that may inhibit participation by find out market information. Women are stuck at the lowest end women and other disadvantaged groups in the MSME sector; (ii) of the value chain, or engage only in spillover economic to provide support to MSMEs owned and operated by women activities that are manageable at the household level. and youth; (iii) to include a woman to represent women In addition to these constraints, young women, in some entrepreneurs as one of the seven permanent members of the areas may have to negotiate social and cultural barriers for higher MSME council; and (iv) to increase women’s voices and views education and employment away from home, with most families among the MSME council’s four invited members. wanting girls to stay closer to home and in certain kinds of jobs, The Maldivian Government is committed to (i) enhance for example working at resorts, not being thought suitable for women’s economic empowerment, and (ii) ensure zero tolerance young women. The rigidity of these constraints varies and against any form of harassment of women. Other priorities set increasingly there are young women breaking through cultural out by the Government include (i) eliminating barriers for barriers and entering non-traditional sectors. Young women who women to join the labor workforce, (ii) opening opportunities for face restrictions on mobility could avail the island-based women’s greater participation in the political sphere, (iii) livelihood opportunities, whereas young women and men who protecting families from the negative impacts of divorce, and are entrepreneurial would be linked to the Business Development (iv) ensuring equal distribution of matrimonial property after Service centers established by Ministry of Economic divorce. Development(MED) to develop their capacity. The strategic action Plan 2009–2013 sets out five key policies for SME development: (i) to formalize the sector and Government Policies and Gender compile sector data to facilitate evidence-based policy making; The government of Maldives has recognized the issues of (ii) to consolidate SME-related policy formulation and income and gender disparities and with the support of the United institutionalize one-stop services for SME development; (iii) to Nations Development Programme (UNDP), Maldives has facilitate incentives and support services for micro, small, and implemented policies that directly address these issues. Under medium business development; (iv) to develop the human the policy framework (Anne Dhivehi Rajjel), the Government of resources required for development and management of SMEs; www.ijsrp.org International Journal of Scientific and Research Publications, Volume 6, Issue 9, September 2016 773 ISSN 2250-3153 and (v) to facilitate participation and linkages of SMEs to major exploration model by Ericson and Pakes (1995). The empirical economic sectors. implications of these models are similar to each other in some While the Cooperative Societies Act (act number 2/2007) is respects, and different in others. gender-blind, the Cooperative Society Governance code, which The current research is based on the active learning model became effective in 2010, builds on the basic principles of the act of Erickson and Pakes (1995). The active learning model states and opens opportunities for women’s participation in cooperative that a firm explores its economic environment actively and societies. It specifically provides for 20% women’s participation invests to enhance its growth under competitive pressure from in cooperative societies and requires an annual report that both within and outside the firm. According to this model of includes the initiatives taken by the cooperative society to learning, owners or managers of SMEs could raise their increase women’s participation. This provision is especially efficiency through formal education and training that increases useful to women with limited resources, as it allows potential their endowments while government may support their activities entrepreneurs, especially in the outer islands, to pool together through the creation of the enabling environment. Entrepreneurs their resources for business start-ups, such as in retail trade; fish or managers of SMEs with higher formal education, work harvesting and processing; agriculture production, processing, experience, training and government assistance would therefore and marketing; and handicrafts production and marketing. be expected to grow faster than those without these qualities. Further, the establishment of the credit information Bureau This could best be achieved by government intervention through in 2011 increased MSME opportunities to access credit even the provision of financial assistance, developing infrastructures, without loan collateral. The Maldives credit information Bureau capacity building of SME operators and favorable taxation addresses the issue of collateral requirements by providing the policies. This study applies this model to examine issues, credit histories of potential borrowers, including the underserved challenges and pprospects of WOMEs in Maldives. MSMEs, so that credit history rather than collateral could be used to access loans. The information is provided in a Case Studies and Basic Profile of the Cases standardized format to banks, nonbank financial institutions, and The total sample of cases conducted includes 10 male and utility companies to facilitate credit decisions. 14 female entrepreneurs. Their average age is 34 years. The level The 2008 constitution is founded on the fundamental of education of them is relatively low, though there are three well principle of “equality for all” and guarantees the same rights to educated entrepreneurs. Table 1 presents the details of their female and male citizens (article 62(a)). These include the right personal profile. to education, employment, ownership of property, and freedom of expression and movement, among others. It guarantees Table 1: Personal Profile of the cases equality and nondiscrimination (articles 17(a) and (b)) within the context of an “open democratic society” and directs the courts to BCs Age Male female Education refer to international treaties to which the Maldives is a party Thindhoo 45 3 1 good (article 68). It obligates the state to promote the rights and Kudahuvadhoo 31 3 3 Low/good freedoms of the people (article 18), which is interpreted as Addu 31 2 3 Low promoting societal and cultural change when norms, beliefs, Kulhudhufushi 31 0 3 Low attitudes, and practices tend to discriminate against women and Laamu 34 2 4 Good diminish their full enjoyment of equal rights despite legislated Total 34 10 14 Low/good provisions for equality. These interventions by the Maldivian Source: Case Studies 2015 government have helped the country to achieve five out of the eight Millennium Development Goals (MDGs), ahead of the Thindhoo BC 2015 deadline making it South Asia’s only “MDG+” country Altogether 4 cases in which three of them are male and one (Department of National Planning. Millennium Development is female have been conducted and analyzed. Their level of Goals: Country Report 2010. Male). education is good. They have started their own businesses, rather than inherited from their families. These entrepreneurs receive Theoretical Framework their family support for running their businesses. Some of them The literature on industrial organization proposes several started their business as they have a free times (retried), some of theoretical models- Jovanovic’s (1982) model; Ericson and the started their businesses to support their families by earning Pakes’ (1995) model; Lambson’s (1991) model; Hopenhayn’s extra income due to hardship of their family life. (1992) model; and Asplund and Nocke (2003) model - of the Key challenges that they face include access to finance, no dynamics of firm behavior that incorporate heterogeneity among proper training programs (vocational training), inadequate raw firms, different sources of uncertainty and exit/ entry outcomes material and transportation. Policy makers could look at the (Cabral, 1997; Caves, 1998). Among them, the most popular two issues of access to initial capital and transportation. models are the “passive learning” model by Jovanovic (1982) and the “active learning” which is also known as active www.ijsrp.org International Journal of Scientific and Research Publications, Volume 6, Issue 9, September 2016 774 ISSN 2250-3153 Table 2: Cases of Thindhoo BC Case Profile Strengths Challenges Requirements 1 Age: 56 - Education - Initial finance - Government Gender: Male - Good - No land for support for Status: Married with 5 knowledge on agriculture allocating land children (retired) the economy - No training for agriculture Education: High - Courage programs for Business: Agriculture - Innovative farmers (vegetable & fruits) - Experience Start: Himself - Free of family Performance: just started, problem but had a construction firm (children are before (successful) grown up & independence) 2 Age: not given - Learner - Financial support Gender: Male - Innovator - High air fares Status: married with - Family support - Unemployment children . Education: good Business: Multi-businesses (diving school, hardware, Guesthouse) Start: himself Performance: Success 3 Age: 51 (retired) - Courage - Lack of availability Gender: Female - Children of wood Status: married with 6 grown up - Lack of capital children (Grown up & - Optimistic - Transportation independence) Education: not mentioned Business: Fish processing Start: Herself Performance: Success 4 Age: 27 - Modern - Finance Gender: Male thinking - Raw materials. Status: married with 1 child - Innovator Education: not mentioned - Best Business: started with entrepreneur coconut seller, now run a construction firm Start: his owned Performance: Success Source: Case Studies 2015 Kudahuvadhoo BC Challenges faced by these entrepreneurs mainly include Six cases have been conducted: 3 males and 3 females. shortage of skilled labor, transportation, poor infrastructure These entrepreneurs are relatively young and the level of facilities such as ICT and boats services, limited market and high education of them is fairly good. Key strengths of these competition. Policy makers and planners could work on the entrepreneurs are strong family support and their social issues of the shortage of skilled labor in different fields. Every networks. Most of them are social entrepreneurs and work as one cannot be an entrepreneur. community leaders. They always try to learn from experiences. www.ijsrp.org International Journal of Scientific and Research Publications, Volume 6, Issue 9, September 2016 775 ISSN 2250-3153 Table 3: Cases of Kudahuvadhoo BC Case Profile Strengths Challenges Requirements 1 Age: 32 - Education - No internet - Proper Gender: Male - Good facilities internet Status: Married with knowledge on - Lack of skilled facilities children (not mentioned) the economy labor Education: High (school - Courage principal) - Innovative Business: Making trophies - Family Start: Himself, but a background business family - Extension Performance: successful social networks 2 Age: 31 - Learner - No family support Gender: Female - Innovator - Shortage of skill Status: Married with 2 - Courage labor children. - Social - High Education: good networks transportation cost Business: Supply local product to market Start: herself Performance: Success 3 Age: 30 - Courage - Inadequate Gender: Female - Family infrastructure for Status: married with 2 support shipping (boats) children services Education: not mentioned - Transportation Business: Delivery services Start: Herself Performance: Success 4 Age: 26 - - Access to finance Gender: Male - Competition Status: Married with one - Limited market child - Lack of skilled Education: not mentioned labour Business: Boat services Start: his owned Performance: Success 5 Age: 26 - Social - Lack of labour - Financial Gender: Female networks - Access to finance support Status: Married with 1 child Education: Low (G5) Business: Short-eats shop Start: her owned Performance: Success 6 Age: 42 - Family - Access to finance - Gender: Male business - Market Status: Married with 3 background (middlemen children problem) Education: Low Business: Fish products Start: herself, but family members doing businesses. Performance: Success Source: Case Studies 2015 www.ijsrp.org International Journal of Scientific and Research Publications, Volume 6, Issue 9, September 2016 776 ISSN 2250-3153 ADDU BC Key challenges include limited market (inputs well as output), Five cases, 3 females and 2 males, were conducted in Addu family responsibility, and unsteady of income. Balance between BC area. These entrepreneurs are young, but they have low level domestic responsibilities and business engagement is the one of of education. Some of them have become entrepreneurs as a the key changes faced by women entrepreneurs. Policy makers result of livelihood struggles. Some of them have gathered and planners could develop business linkages in order to business experiences from their families. Courage and family maintain a steady market. supports are the strengths that can be identified form these cases. Table 4: Cases of ADDU BC Case Profile Strengths Challenges Requirements 1 Age: 34 - - Children - Support for Gender: female education marketing Status: Single with 2 - Marketing - Good price children - Low price Education: Low (G 7) - No support from Business: Mat making officers Start: - No steady income Performance: failure 2 Age: 34 - Education Gender: female - Courage Status: married with 2 - children (sick husband) Education: good Business: Short-eats, now local café) Start: her self Performance: Success 3 Age: 30 - Good family - Labour Gender: Male support - Inputs (fish) Status: married with 3 - - Output market children - Competition from Education: not mentioned large firms Business: Fish products Start: him self Performance: Success 4 Age: 29 - Modern Gender: Male thinking Status: married with 2 - Family children supports Education: low Business: Art & crafts Start: family inherit Performance: Success 5 Age: 28 - Family Gender: Female supports Status: married with 2 - UNDP children supports Education: low (G 7) Business: Baking cakes Start: herself Performance: Success Source: Case Studies 2015 Kulhudhufushi BC have not acquired business culture, skills and experience from Three cases were conducted in Kulhudhufushi BC area. All their families. Their strengths include courage, family supports, of them are female entrepreneurs. These entrepreneurs are young, their social networks and community leaderships. Key challenges and have received low level of education. All of them have include access to finance, domestic responsibility, and male- become entrepreneurs as a result of livelihood struggles. They dominated culture. Balance between domestic responsibilities www.ijsrp.org International Journal of Scientific and Research Publications, Volume 6, Issue 9, September 2016 777 ISSN 2250-3153 and business engagement is the one of the key changes faced by women entrepreneurs. Table 5: Cases of Kulhudhufushi BC Case Profile Strengths Challenges Requirements 1 Age: 29 - Courage - Initial finance - Financial Gender: female - Innovative - Mange with support Status: Married with 2 - Family support domestic children responsibility Education: Low Business: Sewing Start: Herself Performance: Success 2 Age: 35 - Social - Business alter - Financial Gender: female entrepreneur with husband’s support Status: married with 2 - Family support jobs/businesses children. Husband has a job - Extra burden Education: Low - Balance between Business: (Previously) domestic Sewing, (planning) catering responsibility and services businesses Start: her self - BCs are Performance: moderate politically motivated 3 Age: 30 - Courage - Domestic - Financial Gender: Female - Optimistic responsibility support Status: Single with 4 - Member of - Access to finance children (Divorced) Women Education: Low Committee Business: Sewing (Dress - Social Worker making) - Social Start: Herself Entrepreneur Performance: Success - Vocational training (fashion and dress making ) - Use new tech (ICT) Source: Case Studies 2015 LAMMU BC Most of them are social entrepreneurs and work as community Six cases have been conducted: 2 males and 4 females. leaders. They always try to learn from experiences. These entrepreneurs are relatively young though one female Challenges faced by these entrepreneurs mainly include entrepreneur is 58 years old. The level of education of them is limited business opportunities in the island, limited formal relatively good. Key strengths of these entrepreneurs include training opportunities, and poor infrastructure facilities such as their education, strong family support and their social networks. ICT. Policy makers and planners could work on the issues of the inadequate of formal training facilities and access to finance. Table 6: Cases of Lammu BC Case Profile Strengths Challenges Requirements 1 Age: 22 - Education - Initial finance - Financial Gender: female - Good - Limited business support Status: No married knowledge on opportunities Education: High (Business the economy due to small an Degree) - Courage island Business: Cake making - innovative (but no a firm) Start: No business firm www.ijsrp.org International Journal of Scientific and Research Publications, Volume 6, Issue 9, September 2016 778 ISSN 2250-3153 Performance: not started 2 Age: 35 - High quality - Child ‘labor’ - Online Gender: female products - Family credit training Status: married with 1 - Learner indebt (facebook) child. Husband has job - Innovator - Interest free Education: good - Use new tech loans Business: Cake and Mas like internet - Mias including Start: her self facebook Performance: Success - Home-based business - Family support 3 Age: not mentioned - Good family - Family issues Gender: Female support Status: married with 6 (children) children (Divorced) - Courage Education: A/L - Optimistic Business: Sewing (tailoring - Member of shop) Women Start: Herself Committee Performance: Success 4 Age: 24 - Modern Gender: Male thinking Status: married with 1 child - Family supports Education: A/L (father) Business: retail & whole - Use new tech sales (facebook) Start: his owned, but uncle - Social has a business Networks Performance: Success - Planning to open a restaurant - Participated a business training program 5 Age: 33 - Family supports - Collateral issue Gender: Male - Business - Online business Status: married with 2 background without taxes children since from a - Poor business Education: good (A/L) business family training (formal Business: Electronic shop business (mobile, laptop etc) knowledge) Start: himself, but a business family Performance: Success 6 Age: 58 - Family supports - Family issues Gender: Female (adult children) (early stage) Status: married (3 times) - Family (farmer) - Poor business with 6 children background training (formal Education: poor - Formed business Business: Farming cooperative knowledge) Start: 3rd Husband (farmer) society and take Performance: Moderate collective decision. Source: Case Studies 2015 www.ijsrp.org International Journal of Scientific and Research Publications, Volume 6, Issue 9, September 2016 779 ISSN 2250-3153 Overall Analysis have to do cooking, cleaning and all the households (home) Reasons for starting the business works. We have to help children home work also. It is very Women mainly start their businesses to give extra support difficult to find time for the business what we are doing…”, to family. A 34 year female entrepreneur in the areas of ADDU hailed one 35 year female entrepreneur from Kulhudhufushi BC. BC said “…we have two children. My husband’s income is not Their inability to attend to domestic work, time for education of enough for us. I decided to start the businesses…”. The other children, personal hobbies, and entertainment adds to their reasons that are highlighted in the cases include (1) to give side conflicts. support to the family, (2) difficult to find a job, (3) to balance 7. Credit Facilities: Women are often denied credit by work-family life, (4) to utilize free time, (5) to capture market bankers on the ground of lack of collateral security. Therefore, opportunities, and (6) to earn extra income while working at women’s access to capital is limited. The complicated procedure home. of bank loans, the inordinate delay in obtaining the loans and running about involved do prevent many women from venturing Problems of Women Entrepreneurs: out. In many cases, family members provide financial There are umpteen problems faced by women at various assistances. “… my (adult) children gave money to start this stages beginning from their initial commencement of enterprise, business”, said a 58 year female entrepreneurs from Lammu BC. in running their enterprise. The problems that are highlighted in 8. Shortage of raw-materials: Women entrepreneurs these cases, KIIs, and FGDs are as follows: encounter the problems of shortage of raw-materials. The failure 1. Men dominant Society: Entrepreneurship has been of many women entrepreneurs can be noticed due to the traditionally seen a male preserve and idea of women taking up inadequate availability of raw materials. entrepreneurial activities considered as a distant dream. Women 9. Heavy Competition: Many of the women enterprises have to face role conflict as soon as they initiate any have imperfect organizational set up. But they have to face entrepreneurial activity. It is an uphill task for women to face severe competition from organized industries. such conflicts and cope with the twin role. 10. High cost of production: High cost of production 2. Absence of Entrepreneurial Aptitude: Many women undermines the efficiency and stands in the way of development take the training by attending the Entrepreneurship Development and expansion of women’s enterprises, government assistance in Programs without entrepreneurial bent of mind. Most of the the form of grant and subsidies to some extent enables them to training programs given by various institutes target only tide over the difficult situations. However, in the long run, it providing vocational skills rather than entrepreneurial skills. By would be necessary to increase efficiency and expand productive starting an owned-account business, women try to find a place or capacity and thereby reduce cost to make their ultimate survival an opportunity to utilize their vocational skills and to seek a possible, other than these, women entrepreneurs so face the solution for financial burden. Their purposes hardly engage any problems of labour, human resources, infrastructure, legal entrepreneurial attitudes and motivation. formalities, overload of work, lack of family support, etc. 3. Quality of Business development trainings: It seems 11. Lack of skilled labor: it is a twin problem: i.e. skilled that all women entrepreneurs are given the same training across labor and cost of production. While unavailability of human the BCs through business development programs. capital including skilled labor is one of the issues faced by the 4. Marketing Problems: Women entrepreneurs WOMEs, the WOMEs cannot afford such labor since they are continuously face the problems in marketing their products. It is too expensive for these firms. one of the core problems as this area is mainly dominated by 12. Triple burden issues by women entrepreneurs. males. Women fail to expand the market. Their market is only Women entrepreneurs have to balance their triple burden their neighborhood, ‘market dent’. For marketing the products responsibilities, the responsibilities of productive, reproductive, women entrepreneurs have to be at the mercy of middlemen. The and social. elimination of middlemen is difficult, because it involves a lot of 13. Poor in delegating responsibilities: In their personal running about since marketing deals with customers in many lives, women have a tendency to try to do everything. When islands. Women find it difficult to spend time outside home for women add “entrepreneur” and “business owner” into the mix, marketing their products. Women entrepreneurs also find it this tendency is further extravagant. Women act like they have to difficult to capture the market and make their products popular. do everything and to take all the responsibilities or are the best One possible solution for this problem might be integration of person for every job and have a tougher time delegating WOMEs into the value-chain. responsibilities to others. This is a major hurdle to overcome in 5. Financial Problems: Obtaining the support of bankers, order to have a successful business. managing the working capital, lack of credit resources are the 14. Feel like a second citizen. Women feel like a second problems which still remain in the males domain. Marketing and citizen in such a society and do the family. It does not seem that financial problems are such obstacles where even training men do not try to realize the trigger and let women become first doesn’t significantly help the women. Some problems are citizens. So men do not take seriously women-owned businesses. structural in nature and beyond the control of entrepreneurs. Common challenges facing WOMEs in the Maldives 6. Family Conflicts: Women also face the conflict of include such problems as lack of enough capital, difficulties in performing of home role as they are not available to spend transportation and marketing, and competing demand related to enough time with their families. They spend long hours in household chores, difficulties in licensing procedures, finding business and as a result, they find it difficult to meet the demands staff with the right skills, and willing/ability to work for a small. of their family members and society as well. “… As women we The greatest barrier facing women entrepreneurs in the Maldives www.ijsrp.org International Journal of Scientific and Research Publications, Volume 6, Issue 9, September 2016 780 ISSN 2250-3153 is access to finance. This is an issue because of requirements of becomes a great challenge. The case studies further show that collateral. Responsibility of entrepreneurs for dependants has women see enterprises as a means of setting them free from limited opportunities to make savings or undertake business asking from their spouses money for the basic necessities of their expansion and diversification. The financial aspects of setting up families (not for themselves, but family as whole) – food, a business are without doubt the biggest obstacles to women. clothing and health. What they earn is totally spent for the benefit Women are principally tied with family life by supporting of the entire family. Another key motivating force for women to husbands and caring children. First propriety of women has become business owners has been identified as interest in helping become domestic responsibility. They think of business ventures others. Women entrepreneurs in small scale business receive and opportunities as a result of financial struggles faced by their substantial family support at start-up and in the course of running family. Most women entrepreneurs are struggling with triple their business. Such support is however, based mainly on social burden responsibilities, rather than enjoying their engagement in rather than economic consideration. businesses. They have limited time for engaging business Finding and retaining good employees is essential for the activities. success of a business, but can be difficult for women These triple responsibilities are serious challenges for entrepreneurs in the Maldives. Since WOMEs tend to be smaller women entrepreneurs. One other challenge is the responsibility and informal, they are often less likely to provide job security of providing for the extended family and relatives. It seem that and retain good talent. Some women find that they are not taken women are overloaded with business and family responsibilities seriously by their employees, especially in non-traditional and may not have the time to join some beneficial associations sectors. and this automatically limits the expansion of women-owned Micro enterprises, particularly WOMEs are also especially enterprises in the Maldives because women own relatively vulnerable to competition. Competition (markets) and ineffective social networks. General voice of women who information related factors, are said to be major challenges. Most participated the FGDs is: ‘We are isolated socially; we lack of these markets are not expanding all over the country and not previous work experience, entrepreneurial skills, and access to expanding globally. Markets for WOMEs mainly concentrate on enterprise information and marketing facilities. We are loaded neighborhood. with domestic responsibilities. By and large, we spend on our time as wives, mothers and ‘managers’ of the home front due to Strengths of WOMEs our chores, make it nearly impossible to successfully operate an - Family supports enterprise’. - Social networks through women committees Entrepreneurship always involves some level of risk taking. - Commitments and handworks For women in the Maldives gender stereotyped perception of - Financial pressure self, lack of confidence and assertiveness appear to be major - Business Centers barriers. The fear to risk is a big hindrance. The status of women - Earning opportunities while taking domestic in a patriarchal social structure makes women dependent on responsibility males in their lives –husbands or fathers –and family resistance is Weaknesses a major disincentive to business start-up. Other close male family - Being a woman members often make decisions for women hence going against - Small market the independent spirit of entrepreneurship. - Men dominated culture In addition, women are usually less educated than men, - Low level of education and trainings making them less well equipped to manage a business. Lower - Lack of entrepreneurial skills education does not emphasize entrepreneurship skills. It - Isolation decreases the chances that women will have the knowledge - Inadequate support from officers needed to excel in business. Low level education creates a barrier - Fear of failing to them accessing training and other business developments - Credit discrimination services. - Lack of managerial skills Dealing with the government official and bankers has Opportunities proved to be a very big challenge to women entrepreneurs in the - Large amount of young unemployed female Maldives. Being a woman seems to exaggerate that fact since - Female reproductive cycle: when children grow up, most women are harassed by the city council officials when they women become unemployed come to inspect the business premises and when women - Time availability for home-based micro enterprises entrepreneurs are looking for some supports from the officials. It - Government and funding agencies focus women and seems that there is no “one-stop shop” which informs an aspiring young entrepreneurs entrepreneur, either women or man entrepreneurs, what is - Social pressure required of him or her in terms of regulations to be followed for Threats licensing and other supports. - Complicated formalities When business training is available, women may not be - Lack of access to technology able to take advantage of it because it is held at a time when they - Lack of access to information are looking after their family. Usually, women start business at - Lack of necessary resources including skilled labour an older age than men, when they have had the family and - Lack of coordination among supporting agencies children. These case studies also highlight this trend. This - Male dominated supportive networks www.ijsrp.org International Journal of Scientific and Research Publications, Volume 6, Issue 9, September 2016 781 ISSN 2250-3153 - Poor transportation being many small islands globalization intensifies, lack of innovation and the 3. Way Forward competitiveness of Maldivian MSMEs. MSMEs will be critical for Maldives next level of growth. Therefore financial It is commendable that as a country that is described in its institutions would have to be more forward looking, innovative constitution Maldives as a “ soverign , independent, democratic and develop new business models to position themselves to state based on the principles of Islam” (Ministry of Legal support the growth of MSMEs in Maldives. Mentoring and Reforms, 2008, Constitution of the Republic of Maldives, supporting existing entrepreneurs to build the capacity and Chapter 1, Art.2, Male) have positive introduced policy reforms encouragement for new entrepreneurs to enter the MSMEs will and initiatives for the development of MSMEs. touch the lives of the most vulnerable and marginalized sections However it is noted that there are still constraints that of our society, specially Youth, Women and disadvantages impede the growth of the MSMEs in Maldives. Maldives faces groups. skill shortages and human resource development constraints causing fewer women to be employed. Identification and creation of entrepreneurial opportunities for the poor, including women REFERENCES and youth, and facilitation of skills development through [1] Asplund, M. and Nocke, V. (2003). Firm turnover in imperfectly business and vocational training programs has been limited so competitive markets. PIER Working Paper 03-010, University of far. 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The policy [9] MED, (2010), SME Mapping Survey of Sixteen Islands in the Maldives–An and regulatory issues, institutional weaknesses in the absence of Assessment of the Findings, Ministry of Economic Development (MED) in credit appraisal and risk management / monitoring tools affect collaboration with UNDP; 24 June 2010. the aspiring and existing entrepreneur to enter the MSME arena. Most MSMEs have limited access to larger markets in terms of market linkages, transport, telecommunications information AUTHORS exchange which seriously undermine the demand for their products. Lastly with the opening up of economy and as First Author – S.P.Premaratne and Gamini Kudaliyanage www.ijsrp.org