[ad_1]
Cape Town, 9th January (360info) The pros and cons of the informal economy and how the immigrant business space starts and expands.
Immigrants working in the informal economy, such as small traders, are often criminalized, but they can actually bring many benefits to the local economy.
About 60% of the world’s population participates in the informal sector, and this is most pronounced in emerging and developing economies, although it is also a significant part of advanced economies.
Modern cities tend to exclude or marginalize informal economic activities, which are often accused of being places of unsanitized, illegal enterprise and crime hotspots.
Nonetheless, this negative perception is slowly changing and new approaches to better manage the informal economy are being introduced.
Over the past decade, national and local governments in South Africa have realized the importance of the informal economy as it provides a large number of employment opportunities. As a result, the authorities took a more developmental approach, such as involving local councils in managing the informal economy and considering it in local planning.
Their main challenge is to develop innovative, inclusive and supportive policies that recognize the value of the informal economy and the people who work in it.
Immigrant entrepreneurs may have been excluded from planning and policymaking processes, but they managed to create their own space in South Africa’s informal economy, despite exclusionary immigration policies and tighter regulation.
First, they lack options. Due to the lack of job opportunities in the formal labor market and the absence of inclusive immigration policies, immigrant entrepreneurs from African and Asian countries have flocked to join physically demanding and risky informal businesses in South Africa’s central business districts, mainly Johannesburg.
Natives also tend to avoid these entrepreneurial ventures because of their cultural beliefs and negative attitudes, thereby providing more opportunities for immigrants—this is known as the cultural neighborhood theory.
The lack of state support and protection forces migrant workers to strengthen their support networks with compatriots and other immigrant groups. Social capital and social networks are considered equivalent to legal and political rights enjoyed by local people. Language barriers and a lack of a common culture and a shared history with the natives, as well as cultural institutions brought in from home facilitate connections between immigrants.
One result is that immigrants concentrate in specific areas of the city and pass through tight-knit commercial and social networks. Over time, this process developed into an enclave economy.
Many African and Asian immigrants have settled in Gauteng, mainly because of the good business prospects the province offers. The province includes Pretoria, Johannesburg and many of the mining and industrial towns that drive South Africa’s economy.
According to a 2017 study by Dr Tanya Zack, a South African urban planner and visiting senior lecturer at the University of the Witwatersrand, transactions by cross-border traders traveling to South Africa from neighboring countries were estimated at R10 billion (5.81 billion). billion) ) held annually in downtown Johannesburg.
Individual cross-border traders from neighboring countries such as Zambia can pump up to 50,000 rand ($2,884) into Johannesburg’s informal economy, Zucker said. In Gauteng alone, some 50 organizations provide transport services in 19 districts, transporting migrants and their goods to Johannesburg to do business.
The informal economy also creates opportunities to attract migrants from across Africa and Asia. One benefit is the relative ease of starting and running your own business in South Africa’s informal economy.
South Africa is a large economy in Africa. South Africans have relatively high purchasing power, strong desire to consume, and little tendency to bargain. For immigrant businessmen, while they do compete with other immigrants or natives, they still have a better chance of bouncing back if their business fails.
Diversity also thrives. Many immigrant merchants chose to offer familiar products to other immigrants, such as food and clothing belonging to a particular race or ethnic group. Cultural events and an emotional attachment to homeland help fuel demand for products offered by ethnic minorities.
However, official policy in South Africa is to try to bring informal businesses into compliance and as part of the “formal” economy.
While there are some candidates for this path, the government’s approach to failing to recognize the diversity of the sector, or the fact that many survivalist efforts never outgrow it, should be commended for the role it has played in reducing poverty Be respected.
The government’s 2017 draft white paper on international migration removed migrants’ right to work, leaving them in an even more precarious position. Other rules and regulations aimed at restricting the rights of foreigners to trade in informal businesses are also being drafted.
In addition to preventing natives and migrants from unleashing the economic potential of the informal economy, changing social and urban forms will present ethical and practical challenges around the governance of space, rights and representation.
Ignoring the role of the informal economy and cracking down on migrant workers’ businesses in the informal economy ignores the additional benefits they can bring, such as reduced crime. In Johannesburg and other central business districts in South Africa, immigrant entrepreneurs are improving security in precincts and converting former crime spots into business districts.
For example, Ethiopian immigrants have contributed to the economic and physical transformation of Jeppe, Johannesburg by investing, leasing and building properties, and connecting the CBD and the township economy.
An Ethiopian immigrant businessman interviewed in Port Elizabeth bought a dilapidated building and converted it into a supermarket and hotel. Not only does he create jobs and boost the local economy, he also indirectly contributes to crime prevention.
Immigrants also have the potential to challenge gender power relations. There is evidence that immigration supports women’s economic and social emancipation. Migration and urbanization thus remain very disturbing processes, offering opportunities to renegotiate generational and gender hierarchies.
However, this has not always been the case in South Africa. For Ethiopian women, entrenched gender power relations from the homeland persist. This is mainly due to lack of proper documentation and increasingly strict labor market rules for informal enterprises. South Africa’s anti-immigration policies are not helping. However, other factors reinforce the hierarchy of power relations, including security concerns, where female migrants are often forced to rely on men for protection. It can go even further, with Ethiopian male immigrants beginning to dominate socioeconomic and cultural institutions originally run by women, leading to a role reversal.
In the past, local governments have dealt with the informal economy through various regulations targeting small traders. This approach is based on a restrictive view of the ‘problem’ of the informal economy. These negative perceptions have led to the marginalization of this part of the economy.
This is illustrated by the insufficient reference to the informal economy in many official plans and economic strategies.
Furthermore, it has been argued that municipal planners often view the informal economy as a spatial issue (positioning of markets) rather than an integral part of the local economy and a key factor in preventing higher unemployment.
The reality is that the informal economy is an important part of the economy in almost every locality in South Africa and cannot be achieved if the requirements of comprehensive planning are ignored.
The way urban development is discussed needs to change. Measuring the accessibility and inclusiveness of a city starts with understanding how people seek to use the city to fulfill their aspirations. It should be recognized that the informal economy benefits a segment of the population due to low entry costs. They enable people to access opportunities.
Rather than “formalizing” informal activities to fit standard cities, providing amenities and infrastructure in accordance with acceptable rules and regulations can help unlock the huge dividends inherent in the informal economy. (360info.org)
(This is an unedited and auto-generated story from a Syndicated News feed, the content body may not have been modified or edited by LatestLY staff)
[ad_2]
Source link