COVID-19 and the World of Work

ILO leads UN joint project targeting hard hit informal sector enterprises

As we enter into the second year of the COVID-19 pandemic and its sustained difficulties for the tourism-dependent Pacific, personal income and employment continues to be a challenge.

Project document | 24 March 2021
Whilst existing small-medium businesses in the informal sector experience severe cash-flow challenges, redundant formal sector workers are transitioning to the informal sector to support their families. As the informal sector swells, vulnerabilities of women and youth led micro-enterprises also increase. These impacts of the global pandemic are heightened by climate change-induced disasters such as the three category five tropical cyclones that impacted Solomon Islands, Fiji, Vanuatu and Tonga in the last year.

An ILO-led UN Joint Project titled “Inclusive Economic Recovery through Sustainable Enterprises in the Informal Economies of Fiji, Palau, Tonga and Vanuatu” is building the capacity of national Business Development Service (BDS) providers to meet the specific demands of informal sector creative and agriculture enterprises. Funded by the UN Secretary General’s Multi Partner Trust Fund (MPTF) for COVID-19 Recovery, the US $2.5m project is jointly implemented with the United Nations Educational, Scientific and Cultural Organisation (UNESCO), United Nations Development Programme (UNDP) and the International Fund for Agricultural Development (IFAD)

Group Discussions
The ILO, convened a technical meeting in Fiji from 23-24 February 2021 bringing together key BDS providers and representatives of target beneficiaries for a planning exercise, targeting the informal sector.
“This project responds to policy recommendations from the ILO Rapid Assessments and the UN Social and Economic Impact Assessment of COVID-19”, highlighted Mr Matin Karimli, the ILO Country Office Director in Fiji. “The informal sector presents many challenges. We know that in Fiji, the pre COVID-19 percentage of informal sector workers was 66.2% - a figure that would have increased exponentially.”

The objectives of the technical meeting were to:
(a) develop innovative and demand driven business training, business advisory and business mentoring for the targeted informal sector beneficiaries and
(b) make BDS accessible to the small-medium business owners so they can sustain their enterprises.

The interface between the supply side (BDS providers) and the demand side (representatives of informal enterprises) provided rich discussions leading to the identification of key priority training areas, advisory and mentoring support that was immediately needed to help sustain their enterprises. These included:

(a) Finance, including cash-flow
(b) Marketing, including digital and social media marketing
(c) Business Continuity Plans (BCP)
(d) Human Resource and Employment Regulations
(e) Compliance, including tax, licences and superannuation
(f) Stress management and counselling
(g) Formalization

For the delivery of BDS, a two-prong approach was recommended by the stakeholders. Firstly, a virtual incubator and accelerator platform will support beneficiaries, allowing them to converge at hotels near their home, which will be set up as co-working spaces. Twice weekly training, advisory and mentoring services will be delivered through pre-recorded and live sessions, for a period of 2 months. This will include monitoring of their enterprises and evaluating changes. On completion of the full programme the beneficiaries will receive a graduation notice.

The second delivery system will take place through face-to-face delivery in rural communities with low or no internet connectivity. Content from the virtual platform will be downloaded onto easy-to-use devices and delivered during face-to-face sessions.

A notable outcome of the technical meeting was the development of partnerships for the delivery of BDS. Each partner brought with them expertise and resources. Proposals for Private-Public-Partnerships between government and private sector was also recommended to support sustainability of this initiative. Delivery partners include:

(a) MSME Fiji of the Ministry of Commerce, Tourism, Trade and Transport (MCTTT)
(b) Fiji Enterprise Engine (FEE) of the Fiji Commerce & Employers Federation (FCEF)
(c) New Zealand Government-supported Business Link Pacific (BLP)
(d) Innovation Hub Fiji of the University of the South Pacific (USP) and UNDP
(e) Australian Government supported Market Development Facility (MDF)
(f) Women Entrepreneurs and Business Council (WEBC) and the Young Entrepreneurs Council (YEC) of the Fiji Commerce & Employers Federation (FCEF)
(g) Fiji Hotels and Tourism Association (FHTA)

In the next few weeks, the project will work with relevant specialists and the above partners to build the content for BDS and the delivery infrastructure with the view to launch the initiative on May 28th 2021. A similar model is envisaged for replication in the other project countries – Tonga, Vanuatu and Palau.