hoofdstuk 3: Towards a strategy.

specific areas where interventions could help to create the conditions for the development of a more dynamic and better protected informal sector + its integration in society.

4 broad objectives:

• -improvement of the productive potential
• -improvement of the welfare of the poorest groups
• -establishment of an appropriate regulatory framework (soc. protection + regulation)
• -organisation of informal sector producers and workers.

these objectives are not mutually exclusive

Improvement of the productive potential of the informal sector

1) improvement of the productive potential

-measures to raise productive potential

more emphasis on activities which have a potential for growth

-->identify specific branches which compete/have a complementary relationship with the modern sector

markets

--->enhance the demand for informal sector products

--> strengthen markets linkages with the rest of the economy

*important role for gov. as purchaser of goods/services/buildings

--> strengthen acces to modern sector markets through development of subcontracting

* goods must be reliable and save---> skills

finance and credit

@ obsacle:obtaining official credit ---> own self-help savings and credit schemes (also stimulates collective action) ---> basis for 'modern' credit programmes

training and technology

* skills: obtained by trad. apprentice system.

@ quality depends on:

• skills master
• communicative skills master

@ this system only provide skills appropriate for low productive, low technology enterprises of the informal sector

--> interaction between trad. and formal training

• --> improvement/ upgrading technologies
• --> provide basic techniques training (for bookkeeping/ marketing/ prod. org./ costing/ pricing/ etc.)

infrastructure

@informal sector generally lacks basic facilities and amenities

• operate in makeshift premises
• no acces to electricity/ clean water/ sanitation facilities
• --> discourage investment

--> radical shift in public spending

welfare improvements

productive assistance measures accompanied by measuresimproving the welfare of the poorest

--> meeting the basic needs of the poorest groups

-->3 points:

1. support to children
2. gov. also ought to stimulate non-official bodies
3. aim is developping the capacities of the poorest groups to help themselves

The regulatory framework and social protection

*informal entrepreneurs want to legalize as much as possible

@barriers for legalisation and the development of social security schemes:

• excessive bureaucratic requirements for registration
• high costs for registration
• gov. regulations concerning the general interests of the community
• payment of taxes --> should be progressive/ simple/ beyond corruption

* some laws are essential, others are not or can be more flexible

@lack of observance of labour legislation

• @increased costs involved
• @no explicit and enforcable contracts --> no job security

--> not reducing the legal standards of rotection, but make them a goal to be attained

* 3 core standards

• basic human rights (as freedom of association/ from forced labour/ from discrimination)
• measures to reduce the most abusive forms of exploitation in the informal sector (childlabour)
• occupational safety and health

-->system of labour inspection auxiliaries (ex. retired craftsmen) who provide training/ advice/ information to the owners and workers in the informal section

-->general strategy towards the development of soc. protection in the informal sector should make use of:

• direct provision by the state
• formation of collective social mechanisms within the sector
• reliance+ enhancement of the mutual support of the family structures

Organisation of informal sector producers and workers

-->Informal sector producers and workers should also undertake things themselves.

@exploited because of:

• heterogeneity informal sector
• competition within the groups

*every culture has traditional forms of social organisation.

• too limited/ localised
• operating with limited resources to achieve major change

--> co-operatives: active participation members

• democratic management
• equitable distribution among the members

  @perceived by gov. as instruments

--> together with official co-operative

*trade union

*modern sector is using the informal sector more and more by subcontracting, etc.

@trade union dificult because of limited resources+ self-employment informal workers

--> elimination of exploitation+ improved working conditions through trade union type organisations

• -->closer links trade union+ co-operatives

  -->employers' organisations

• --> act as pressure groups

  -->provide improved technology/ skills

  --> acces to facilities/ services offered by modern sectorenterprises (health services)

al these have to work for the informal sector to be able to get any further into the mainstream economic life