European Union Invests €10 Million to Empower Afghan Women Entrepreneurs through WE-LEAD Phase II with UNDP

Kabul, Afghanistan – 22 January 2026 the European Union (EU) has announced a major new investment of €10 million to launch the second phase of the Women’s Economic Empowerment through Local Enterprise Development (WE-LEAD) programme. Implemented by the United Nations Development Programme (UNDP), this EU-funded initiative is designed to be a cornerstone of the European Union’s commitment to protecting the livelihoods and agency of Afghan women.

This new phase builds on the results and lessons of WE-LEAD Phase I and UNDP’s Area Based Approach for Development Emergency Initiatives ABADEI. It will support women at different stages of economic activity from informal savings groups to micro, small and medium sized enterprises through integrated financial and non-financial services tailored to Afghanistan’s social and economic context.

With a budget of €10,000,000, WE-LEAD II focuses on removing barriers that limit women’s economic participation, particularly restricted access to finance, markets, skills, and reliable income opportunities. The project promotes culturally appropriate and Sharia-compliant financial mechanisms combined with business development support, mentorship, and market linkages.

The initiative will be implemented in selected underserved provinces in the Central and Central Highlands regions, where women’s labor force participation is low, and access to financial services remains limited. By working through community-based platforms and local market systems, the project aims to ensure safe, inclusive, and sustainable engagement for women entrepreneurs.

Women’s Economic Empowerment through Local Enterprise Development Phase II

Key interventions under WE LEAD Phase II include:

• Transforming informal savings groups into Sharia compliant Rotating Savings and Credit Associations (ROSCAs).

• Expanding access to subsidized Islamic microfinance for women entrepreneurs and business owners. 

• Supporting women led micro and small enterprises through blended finance and tailored business services.

• Strengthening women’s integration into local value chains using a market systems approach.

• Launching a Social Enterprise Idea Challenge to support women led community driven solutions.

Through these combined actions, the project is expected to strengthen household resilience, increase women’s incomes, and enhance women’s agency in economic decision making, contributing to more inclusive and sustainable recovery outcomes.

Veronika Boskovic Pohar, EU Chargée d’Affaires to Afghanistan stated:

“The European Union is proud to continue its partnership with UNDP through the next phase of WE-LEAD. This 10 million Euro project supports inclusive and durable alternative livelihoods with a focus on building small women and men enterprises by linking them to the market. It also promotes community-based financial mechanisms and strengthens links between entrepreneurs and markets across Afghanistan & beyond. By investing in women business, in communities and local markets, we are helping Afghan households to build resilience and self sufficiency"

Stephen Rodriques, UNDP Resident Representative in Afghanistan, emphasized:

“This new phase of the EU-funded WE-LEAD programme marks a continuation of the EU commitment to long term investments that drive economic growth, job creation and stronger financial systems. Building on earlier gains, the programme will support thousands of women and women-led businesses with financial literacy, access to Sharia-compliant finance, and tailored business support services. By helping women start and grow strong enterprises we will not only help improve their incomes and agency, but we will also be contributing to broader economic recovery and much-needed job creation across Afghanistan.”

WE-LEAD Phase II is implemented under UNDP’s ABADEI platform, through partnership with many organizations which supports community resilience, job creation, and inclusive local economic recovery across Afghanistan through principled area-based programming.