Formalizing the Informal Sector
ILO provides a guide in the transition of workers from the informal sector to the formal sector in South Africa, Malawi and Mozambique.
3 October 2016
Pretoria (ILO News): In recognition of the significant contribution the informal economy makes to national GDP and the alternative economic opportunities and livelihoods it provides (with high levels of decent work deficits), South Africa, Malawi and Mozambique commit to promote sustainable enterprises which will contribute to poverty reduction and attainment of Decent Work.
All the three countries have adopted Recommendation 204: Transition from the Informal to the Formal Economy Recommendation (2015). R204 provides a guide to member states to Recommendation No 204 provides guidance to Members to pursue a threefold objective:
As part of their commitments, these countries have developed their respective Decent Work Country Programmes developed and signed by Workers, Employers and Governments.
ILO has partnered with the Government Flanders, which will provide financial support, to lead the initiative on “Knowledge Sharing for Micro, Small and Medium Enterprise Development” between South Africa, Malawi and Mozambique. As part of this support, ILO has carried out an assessment of the Enabling Environment for Sustainable Enterprises (EESE) in South Africa. Furthermore, ILO organised a capacity development and learning course to provide examples of promising practices on SME development and enterprise formalisation that create space for tripartite actors and practitioners to reflect and design intervention models that work for South Africa.
In September 12 – 16, 2016, decision takers, policy makers and practitioners who took responsibility to implement measures to support initiatives geared toward the formalisation of enterprises and SMEs development met in Pretoria, South Africa to assess practical solutions for SMME development and formalization of enterprises. The discussions, which were facilitated by the International Training Centre of the ILO, were solution-driven, providing participants with insight into diversified examples and practices of enterprise formalization in other countries, reflecting on measures at all levels and incentives for enterprises to formalize in South Africa.
In addition to the discussions, participants were taken on a field trip to meet with leaders of the Informal Economy Traders Office, the Tswane Abarekese Forum, who shared with them some of the challenges faced by South Africa’s informal economy. The participants also had a chance to hear success stories which were achieved with the support of the municipality.
One of the participants in the workshop, President of the Maputo Youth Chamber of Commerce, Ana Noémia highlighted how the experience of meeting with the Abarekese Forum has opened her mind to collect experience that she can use in her own country, as she works directly with the informal sector. “I can assist the sector in my country by adopting similar strategies as those of the Tshwane Abarekese.” She emphasised on the paramount importance of dialogues between governments, workers and the private sector to ensure the championing of formalization.
All the three countries have adopted Recommendation 204: Transition from the Informal to the Formal Economy Recommendation (2015). R204 provides a guide to member states to Recommendation No 204 provides guidance to Members to pursue a threefold objective:
- facilitate the transition of workers and economic units from the informal to the formal economy, while respecting workers’ fundamental rights and ensuring opportunities for income security, livelihoods and entrepreneurship,
- promote the creation, preservation and sustainability of enterprises and decent jobs in the formal economy and the coherence of macroeconomic, employment, social protection and other social policies; and
- prevent the informalization of formal economy jobs.
As part of their commitments, these countries have developed their respective Decent Work Country Programmes developed and signed by Workers, Employers and Governments.
ILO has partnered with the Government Flanders, which will provide financial support, to lead the initiative on “Knowledge Sharing for Micro, Small and Medium Enterprise Development” between South Africa, Malawi and Mozambique. As part of this support, ILO has carried out an assessment of the Enabling Environment for Sustainable Enterprises (EESE) in South Africa. Furthermore, ILO organised a capacity development and learning course to provide examples of promising practices on SME development and enterprise formalisation that create space for tripartite actors and practitioners to reflect and design intervention models that work for South Africa.
In September 12 – 16, 2016, decision takers, policy makers and practitioners who took responsibility to implement measures to support initiatives geared toward the formalisation of enterprises and SMEs development met in Pretoria, South Africa to assess practical solutions for SMME development and formalization of enterprises. The discussions, which were facilitated by the International Training Centre of the ILO, were solution-driven, providing participants with insight into diversified examples and practices of enterprise formalization in other countries, reflecting on measures at all levels and incentives for enterprises to formalize in South Africa.
In addition to the discussions, participants were taken on a field trip to meet with leaders of the Informal Economy Traders Office, the Tswane Abarekese Forum, who shared with them some of the challenges faced by South Africa’s informal economy. The participants also had a chance to hear success stories which were achieved with the support of the municipality.
One of the participants in the workshop, President of the Maputo Youth Chamber of Commerce, Ana Noémia highlighted how the experience of meeting with the Abarekese Forum has opened her mind to collect experience that she can use in her own country, as she works directly with the informal sector. “I can assist the sector in my country by adopting similar strategies as those of the Tshwane Abarekese.” She emphasised on the paramount importance of dialogues between governments, workers and the private sector to ensure the championing of formalization.