11 June 2008

Asian Women Play Role in Shaping Family and National Fortunes

U.S. Treasurer Cabral addresses Global Summit of Women

Pushpa, 29, pulls a cart at a busy junction in Chennai, India, where she sells breakfasts to laborers, earning a profit of $3 a day.

By Deidra Avendasora
Staff Writer

Washington -- Asian women will play a vital role in safeguarding their families’ and nations’ financial welfare as three economic trends affect the lives of people around the globe, a top U.S. Treasury official said.

Speaking at the 18th Global Summit of Women in Hanoi, Vietnam, June 6, U.S. Treasurer Anna Escobedo Cabral identified microfinance practices, changes in Asia’s demographics and financial literacy rates as the top reasons for the growing role Asian women are taking in economic matters.

The first major trend -- microfinance -- allows the poor to deposit small savings with reputable financial institutions and receive small loans or low-cost insurance to help them expand small businesses.

“Women achieve great success when given access to resources through microfinance,” Cabral said. “There is overwhelming evidence from developing regions of the world that women's investments help families, help the economy, and reduce poverty in the developing world.”  She said women were key to the reconstruction of Rwanda’s economy and play an important role in India, a country that over the past 15 years has had a high percentage of working women and has enjoyed the rapid economic development and large reductions in poverty.

Microfinance’s role in alleviating poverty is of particular importance to Asian women, Cabral said, because two-thirds of the world’s poor live in Asia and women are often disproportionately affected by poverty.

The second major trend affecting Asian women is the aging of Asia’s population.  While places such as Laos, Cambodia and Vietnam have relatively young populations, Thailand, Singapore, South Korea and south India are beginning to see increases in the number of older citizens.  Japan already has one of the oldest populations in the world.

U.S. Treasurer Anna Escobedo Cabral, who frequently speaks to international audiences, addressed the 18th Global Summit of Women.

When a large percentage of a country’s citizens are older, that nation’s economy faces certain challenges and opportunities.  Countries will need strong national pension systems and health care systems to support the elderly, Cabral said. 

As long-time workers retire, female workers will become instrumental in their nations’ continued economic growth and in their families’ financial well-being, she said.  “In many economies, fewer traditional workers will be in the work force, and more nontraditional wage-earners, including more women, will have to play an even greater role in the work forces throughout Asia in order to support growth,” she said.

“Also, families will bear an increasing financial burden of taking care of older individuals. Caring for aging family members, educating their children, and saving for their own retirement will create an increasing financial burden for women in Asia,” Cabral said.  

The third major trend is an increase in women’s financial literacy.  Cabral defined financial literacy as “knowing how to save, plan for retirement, understanding credit, and understanding the importance of using banks and financial institutions.”

“By educating people about these issues, we can make a positive impact on the world economy,” she said.

“If we figure out how to help families before they get into trouble -- maybe by taking simple steps such as making a daily budget, or educating young people about savings -- we can improve lives.”  

Asian women should learn more about saving and investing, since inefficient saving is the biggest challenge for many Asian countries, Cabral said. 

“As retirement and education costs increase, it becomes more and more important that households have access to more and better investment options, so that they can meet their future financial needs while also being able to consume more now.”