Enacy Mapakame and Chipo Chaumba
Stakeholders in the informal sector say the 2020 National Budget does not adequately address the sector’s concerns, despite its immense contribution to economic development.
Key among these concerns are the formalisation of the sector as well as provision of decent work
space that should enhance production output, job creation as well as overall contribution to the economy.
At a Zimbabwe Coalition on Debt Development (ZIMCODD) post budget seminar with members of the Parliamentary Portfolio Committee on Finance held on Friday in the capital, stakeholders concurred the sector had been overlooked in the 2020 National Budget, although it has anchored the economy in the past two decades following an economic downturn that saw bigger corporations downsizing operations while others eventually closed.
Vendors Initiative for Social and Economic Transformation executive director Samuel Wadzai pointed out that one of the major concerns for the sector was lack of decent working space which he said the 2020 National Budget failed to address.
“Without being pessimistic, there were efforts by the Minister to contribute to the development of the sector, such as the $90 million for development purposes, but much could have been done especially on ensuring there is creation for adequate operating space for the informal sectors, with adequate facilities like running water, toilets, shades so that traders are able to operate from spaces that are conducive for business,” he said in an interview on the sidelines of the seminar.
“On the issue of formalisation of the sector, it’s important that the Government speedily moves to ensure there is conformity and what the International Labour Organisation call recommendation 204, which calls for the formalisation of the informal sector is actualised in Zimbabwe,” he said.
Mr Wadzai also bemoaned the lack of training for the sector, yet this could help improve
production and profitability for the sector that employs an estimated 80 percent of Zimbabwe’s population.
“We need to see Government inject money to support these processes for the informal sector. We also want to benefit from any tax holidays that may be available for businesses while also contributing to economic growth,” he said.
On November 14, Finance and Economic Development Minister Mthuli Ncube presented the 2020 National Business themed “Gearing for higher productivity, growth and job creation”.
Minister Ncube said Government will continue to play a key role in capitalising various institutions which support women, youth and medium and small-scale enterprises (MSMEs) besides facilitating access to markets, workspace, trade promotion and capacity building, among other functions.
In light of this, Treasury allocated $90 million to capitalise the Small and Medium Enterprises Development Corporation (SMEDCO) as part of initiatives to support budding enterprises.
Other institutions supporting MSMEs projects such as Women Development Fund, Community Development Fund, Zimbabwe Women Micro-finance Bank and Empower Bank were also allocated $20 million, $15 million, $100 million and $50 million in that order.
The Treasury boss also highlighted the importance of creating linkages between MSMEs and large enterprises which he said played a critical role in
the development of industry and creation of employment.