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By: Gavin Chait on 03 May 2007
There is plenty of wealth in the informal economy - which is why it exists. All the laws that you mention are expensive and the very barriers to entry that attract traders into the informal market. Consumers who support street traders know that they offer no guarantees - which is why retailers are still growing quite convincingly even with hawkers on the streets outside selling similar goods. That hawkers are still able to compete shows that they have some competitive advantages. And trust me - with the aggressiveness of city officials - all street hawkers pay something.
If our informal sector was Zimbabwe - a sovereign state - would you be so eager to demand of them that they must first obey our laws and standards before we invest? Or do you think that, in investing, they would gradually adopt our laws and standards as they can afford them?
First we must address our attitude to the informal sector, then we must create bridges which allow legal investment back and forth across the two markets. Only then will we "discover how to address the problems of poverty".
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