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

Abstract

Since the implementation of the Economic Structural Adjustment Programme (ESAP) policy in 1991, formal employment in Zimbabwe shrunk as the economy contracted. This was intensified by the Fast Track Land Reform Program (FTLRP), whereby capacity utilisation was further reduced resulting in severe retrenchments in both the private and public sectors. As a result, many people turned to informal trading for survival. It is on record that both skilled and unskilled labour in underperforming economies survive on informal
sector activities. The city of Gweru has not been spared of the deindustrialisation affecting other parts of the country. The mushrooming of informal enterprises has revived economic activity in the city despite the numerous challenges faced. This paper interrogates the benefits and challenges of informal trading in economic development using the descriptive design supported by the purposive sampling technique. The sample consisted of 500 stakeholders participating in informal trading. A mixed method approach was adopted. Data was collected using questionnaires and analyzed using SPSS V16 using the 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 of Gweru. Nevertheless, entrepreneurs are by harassment by law enforcement agents, lack of financial support and infrastructure. Given their significance to
the economy of Gweru, the paper suggests that these businesses should be assisted by all relevant stakeholders so that they graduate from informal to formal sector players. This will boost rapid, overall, economic growth.