No, Women Don't Need a 'New Economic World Order.' We Just Need Freer Markets

By Magatte Wade.

"In the middle of a presidential election year, there is now talk of a "new economic world order." Some believe that free trade and other free-market principles have failed workers over the decades, with U.S. Trade Representative Katherine Tai claiming workers need a "positive vision" for the future.

While positivity is certainly important, the global economy doesn't need a revolutionary reset. We just need capitalism to be unhindered by government, reaffirming the value of entrepreneurship for men and women. When it comes to addressing poverty and the poor, "prosperity" almost seems like a dirty word. Yet prosperity-building is the only real solution to poverty, and you can't build prosperity without the free market—the government can't do that job.

This is especially true for female entrepreneurs like me and other women, millions of whom are desperate to be uplifted by the free market. They can only be empowered by an entrepreneurial mindset, which helps people find the right jobs or create them for others.

Two questions are important: How do we create jobs in the places without them? And how do we create sustainable jobs for women?

Lest we forget: Before capitalism, most of the global population was living in extreme poverty. Most human beings were struggling to survive, let alone thrive. In 1820, the extreme poverty rate was 90 percent.

Today, the rate of extreme poverty is 10 percent, and dropping. In recent decades, since the end of communism in Russia and other countries, poverty has declined faster than at any previous point in human history. The transformative nature of capitalism—predicated upon individual liberty, entrepreneurship, and the access to work—is especially empowering to female entrepreneurs, who have historically encountered fewer opportunities to contribute economically than their male counterparts.

Many of the world's poorest countries are poor in part because their governments impose undue restrictions on private-sector economic activity. Nearly two-thirds of the world's extremely poor women and girls live in just one region: Sub-Saharan Africa.

But why is Africa so poor? Why is my birth country Senegal struggling? It is not for lack of economic potential, given our population of more than 18 million?

The government's stifling of entrepreneurship is the problem, speaking as a Senegalese small business owner myself. To legally bring skincare ingredients into Senegal, I must reckon with import tariffs of 45 to 70 percent. I am forced to pay more than $4,400 in annual duties to import such goods into Senegal, whereas comparable U.S. businesses enjoy frictionless access to these same materials.

Beyond my home country, Zimbabwe requires over 20 different procedures to start and formally operate a business. Developed economies, on the other hand, generally require four to five streamlined steps. In Nigeria, business registration takes at least 34 days, and that is only the time part of the equation. The money part is even costlier. It costs over 60 percent of the average annual income, compared to mere hours in Canada or Singapore, which have no fees to boot.

Then there is the Central African Republic, where it takes 17 documents, 55 days, and $5,555 per container to import goods. In Angola, entrepreneurs must undertake 44 procedures requiring 1,296 days to enforce a contract, while Sierra Leone levies nearly 40 types of taxes on companies large and small.

Women are set up to fail in such economic ecosystems. Not only does the government stifle entrepreneurs, but it also reduces the multiplying effect of entrepreneurship. After all, in addition to business owners themselves, entrepreneurship supports their workers, their families, their communities, and their country. Undermine the innovator, and their innovation is not allowed to benefit countless others.

Common-sense policy reforms can break down poverty and build prosperity. Seemingly small reforms that make it easier to build a business or hire employees can have a cumulative impact that grows in one generation.

There are many issues to address in creating prosperity. Corruption, lack of government transparency, and armed conflict all contribute to poverty. Establishing an environment friendly to entrepreneurship is the place to start, and the evidence is abundant—anecdotal and empirical.

We don't need revolutionary economics; we just need freer markets around the world. There is nothing more positive than that.

Magatte Wade is founder of Skin Is Skin, a cosmetics company based in Africa. She is author of the new book The Heart of a Cheetah, and shares her experiences in the newly released documentary film She Rises Up."