IMF's Lagarde says women vital for global recovery

Staff Writer
Columbus CEO

TOKYO (AP) — Empowerment of women and equal opportunities are crucial for driving a stronger global economic recovery, and for revitalizing Japan, the head of the International Monetary Fund said Friday.

The global recovery is too tepid and too turbulent, IMF chief Christine Lagarde told a gathering organized by the Japanese government and business groups to support Prime Minister Shinzo Abe's campaign to promote a stronger role for women in the economy.

"Even after the crisis abates, we will face grave challenges to growth," Lagarde said.

The global economy is not utilizing women effectively and is "tossing away economic growth at a time when it cannot afford such wanton waste," she said.

Abe has made greater gender equality a priority in his "Abenomics" program aimed at propelling the world's third-largest economy out of a long deflationary slump. As its workforce ages and shrinks, Japan needs women to help fill labor shortages and drive economic growth.

Last week, Abe appointed five women as ministers in a Cabinet reshuffle, matching the previous record set by former Prime Minister Junichiro Koizumi. But overall, few women hold political office or executive positions in business.

Japanese women rank high in terms of education, but tend to put their careers on hold to raise their families. Long working hours and limited access to affordable child and elder care are obstacles for working mothers, while employment and tax systems are structured to favor families with stay-at-home mothers. When women do return to work as their children get older, which most do, they generally can only get part-time, lower paying work.

While the gender gap for wages is almost universal, Japan's is on the high side at a 29 percent gap even with equal educations and occupations, Lagarde said.

Globally, since women account for 70 percent of consumer spending, it makes sense to "put women in the driver's seat," she said.

Countries such as Japan need to change policies and laws, but also institutions, attitudes and culture in order to boost their growth potential by better using their female talent.

In some cases, countries have effectively used quotas to bring more women into leadership roles in business and government. Such quotas helped increase the proportion of women lawmakers in Rwanda's parliament to over 50 percent.

Setting targets is another good option, said Catherine M. Russell, the U.S. ambassador-at-large for Global Women's Issues.

"Having a goal in mind is best. It makes it clear where you are and are trying to get to," she said.

Politics are only a start, though, and businesses need to understand that it is in their own interest to have greater gender equality, she said.