By Own Correspondent
ZIMBABWE must urgently find ways to support informal sector groupings, a development which can catalyse the much needed formalization process, a top International Labour Organisation (ILO) official has recommended.
The remarks come at a time when the embattled Southern Africa nation has been classified by the International Monetary Fund (IMF) as being among the world’s top five informalised economies.
Government is on record for stating that an estimated 5, 7 million people are employed in the informal sector.
However, labour unions criticise the quality of employment in this sector for not living up to the expected labour standards.
But speaking to The Worker during a training workshop recently, ILO’s Senior Specialist, Employers Activities Maria Machailo-Ellis called for support towards the informal sector associations.
“The informal economy in Zimbabwe is growing at a much faster pace and the question we need to answer is what must be done by the employers groups to bring the sector on board. And this calls for support towards the sector.
“This can be achieved by lowering barriers to formalization like reducing the high formalisation taxes and offering incentives which encourage formalisation among other measures which include putting in place a framework encouraging a balancing act on all the challenges,” she said.
Machailo-Ellis said the employer organisations need to find ways to cater employers in the SMEs segment arguing the strategy will partly contribute towards adoption of a decent work culture.
“So the bottlenecks to registration for one to fully participate in an employers grouping need to be relaxed. The pressing issue is how can we make it easier for us to formalize and this must overtake other considerations like revenue generation,” she added.
The prolonged informalisation of the Zimbabwean economy has also sidelined tax authorities from revenues running into millions of foreign currency since the sector evades taxation.