Following a push from first daughter Ivanka Trump, the World Bank unveiled a new program Saturday that is designed to boost women entrepreneurs in developing countries and fight the norms that hold them back, such as uneven access to loans and shaky property rights.
The Women Entrepreneurs Finance Initiative, as the bank calls it, announced Saturday it had raised $325 million from numerous countries, with $50 million coming from the United States and other contributions from Germany, Saudi Arabia, the United Arab Emirates, Japan, China, the United Kingdom, South Korea, and the Netherlands. The World Bank hopes the program can raise in excess of $1 billion.
At an event Saturday morning at the G-20 summit in Hamburg, numerous world leaders praised the initiative, with several singling out Ivanka Trump for helping the program get up and running. But the biggest praise came from her father, who said it could result in a transformation of the global economy.
"The world economy will grow and millions of people will be lifted out of poverty," he said. "Millions and millions of people."
Even with the support of world leaders, the program faces numerous challenges. There have been numerous programs that aimed to help women access money so they can grow businesses, but none have taken off to the scale that the World Bank is hoping.
Ivanka Trump, who serves as a West Wing adviser to her father, planted the idea “several months ago,” the White House official said, but will have no authority over the initiative's investments or operations.
The program — which will support loans, mentorship programs and gender equality advocacy — is funded by individuals, companies and foreign governments. The first countries to make a public commitment were Saudi Arabia and the United Arab Emirates, which pledged a combined $100 million after President Trump and his eldest daughter visited Saudi Arabia in May.
Less than a third of global businesses are owned by women, and the initiative aims to grow women-run enterprises across Africa, Latin America and the Middle East. It will also help facilitate loans to entrepreneurs, ranging in size from between a few hundred dollars to several hundred thousand dollars, depending on the applicant's needs. World Bank officials said they hope to make the capital available later this year or in early 2018.
German Chancellor Angela Merkel said there will have to be proper stewardship over the program, adding that "I do hope that the money will be used in a wise" way, but she expressed confidence in World Bank President Jim Yong Kim to ensure that this would occur. Trump also praised Kim, who was picked by President Obama.
The White House has proposed slashing several existing programs that offer assistance to developing countries and a 31 percent cut to U.S. diplomacy and aid spending, but it has thrown support behind the World Bank's new program. It represents the White House's attempt to reorient the way it finances foreign diplomacy, but Congress is expecting to fight the White House to restore some of the other foreign aid cuts.
Although Saudi Arabia's announcement that it would donate to the fund came as Trump and his eldest daughter visited the country, the president has spoken harshly about the nation in the past.
Last year, he slammed his political opponent Hillary Clinton for allowing her foundation to accept funds from Saudi Arabia. (Women cannot legally drive there and often need a male guardian's permission to conduct everyday business.)
“Saudi Arabia giving $25 million, Qatar, all of these countries,” he said during a presidential debate with Clinton in October. “You talk about women and women's rights? … These are people that kill women and treat women horribly. And yet you take their money.”
But since becoming president, Trump has warmed markedly to Saudi Arabia. He had a lavish reception there several weeks ago and he has sided with Saudi Arabia in numerous foreign policy disputes.
The World Bank has a long history of providing support to women who grapple with economic disadvantages. In 2011, the international lender launched a multimillion-dollar program to support female small-business owners with the U.S. Agency for International Development.
The Women Entrepreneurs Finance Initiative, however, is the first World Bank-led effort to change public policy in countries where men tend to have far more legal and social power.
In the Middle East and North Africa region, for instance, about 25 million women in cities don’t have equal constitutional or property rights, according to the International Property Rights Index.
A disproportionate number of African countries, meanwhile, make it harder for women to hold onto property, United Nations reports show. The share of men who own a house or land in Uganda is 21 percent higher than the share of women. Without clear laws, a widow could lose her home after the death of her husband, if her husband’s family chooses to take it away.
Without a stake in property, it’s harder to obtain credit and easier to slip into poverty, said Simone Schaner, an economics professor at Dartmouth College.
“There’s a need to pay attention to the complex reality women live in,” she said. “They’re often not able to reach their full potential because of certain social structures.”
Of the World Bank program’s focus on shifting policy, she said, “Giving people the resources and making sure things are in place so they can use those resources effectively is the best way to go.”