Informal sector key for growth, fighting poverty

Zim Now Writer

City of Harare Town Clerk, Phakamile Mabhena Moyo, has said the informal sector has the potential to build markets, expand trade, fight poverty and generate employment.

Speaking at a Small and Medium Enterprises Policy Development fora, Eng Moyo said the council is developing a new SMEs policy since it has confidence that the informal sector plays a significant role in the creation of employment.

“We are here for the development of the policy because we recognise that the informal sector can lead to economic benefits in urban areas. The sector is important in the creation of employment and poverty alleviation. It has the ability to provide income to unskilled and semi-skilled workforce who could otherwise be unemployed.

“In this way the sector is playing a very crucial role in achieving sustainability of cities. The upliftment of the conditions of the SMEs sector is a very critical tenet of the City’s sustainability as ignoring them will result in the decay of the city,” said Moyo.

He said there is need to mainstream the informal sector into the economy of Harare as a province.

Moyo added that the sector has the potential of growing and contributing significantly to the development of the economy if well nurtured.

An informal economy or informal sector or shadow economy is the part of an economy that is neither taxed nor monitored by any form of government. The size of Zimbabwe's informal economy is estimated to be 64,1%, which represents approximately ZWL$42 billion.

Comparable data for 2018, also published by Zimbabwe National Statistics Agency, shows that in the four years to 2022 informal-sector employment grew by a staggering 39%, from 4,6 million to 5,9 million.