An Evaluation of The Effectiveness of Policy Implementation on Sustainable Informal Trading in the City of Gweru, Zimbabwe

Abstract

Since the implementation of the ESAP policy in 1991 formal employment shrinked as  the economy contracted. This was further intensified by the Fast Track Land Reform Program (FTLRP) were capacity utilisation nose-dived resulting in enormous retrenchments in both the private and public sector. As a result, the majority of the people have turned to informal trading activities for survival. It has been realized that both skilled and unskilled labour in underperforming economies survive on informal sector activities. The city of Gweru has been not spared of deindustrialisation that has affected other parts of the country. The mushrooming of informal enterprise has revived economy activity in the city despite the numerous challenges they face. Therefore, the paper investigated the benefits and challenges of informal trading  towards economic development, a case study of Gweru, which has also been hit by massive deindustrialization. Descriptive design was employed to investigate the benefits and challenges of informal trading towards economic development, in the city of Gweru and it was supported by purposive sampling technique. The sample consisted of 500 stakeholders participating informal trading. A mixed method approach was adopted. Data was collected using questionnaires and analyzed using SPSS V16 using principal component extraction method with Varimax rotation. The study revealed that informal trading generated revenue, sustained livelihoods, provided cheap goods and services, created employment and contributed significantly to the development of the economy Gweru. Nevertheless, entrepreneurs are constrained in their manoeuvres because of lack of harassment by law enforcement agents, lack financial support and infrastructure among others. Given their significance to the economy of Gweru, the paper suggests that these businesses should be assisted by the relevant stakeholders with all possible policy options for promoting sustainable trading activities so that they to graduate from informal to formal sector. This will boost rapid economic growth