News Article
The reality check

The reality check on the impact of COVID-19 on Informal Economy

On the 23rd of April 2020 Zimbabwe Chamber of Informal Economy Associations (ZCIEA) hosted a live radio discussion program on Capitalk 100. FM. The discussion was on the reality check on the impact of COVID-19 on the informal economy workers and traders. The now and post lockdown life reflection. The Discussants were Minister of Women’s affairs, Community and SMEs Development Dr. Stembiso Nyoni, ZCIEA Secretary-General Wisborn Malaya, Zimbabwe Lawyers for Human Rights Denford Halimani. The program was also broadcasted on Star FM, Diamond FM, and Nyaminyami FM.

The International Labour Organisation estimates that COVID-19 will wipe out 6.7% of the working hours globally in the second quarter of 2020, this is equivalent to 195 million full-time workers, in some regions particularly Africa have higher levels of informality, Zimbabwe included which combine with lack of social protection in some cases high population density and weak capacity which pose severe health and economic challenges for governments. Worldwide 2 billion people work in the informal economy mostly in emerging and developing economies and are particularly at risk of COVID-19.

Minister Dr. Stembiso Nyoni gave a brief background of the Ministry of Women’s Affairs, Community and SME Development, its role, and functions. She summarised the background and functions of the Ministry as follows: The Ministry has an operational department that involves women’s affairs and community development, cooperatives, and small and medium enterprises. Its role is to work with women, to attend to the affairs of women, their empowerment, their participation in political, social, and economic life. It also deals with Communities’ on community development, to work with cooperatives and small to medium enterprises. She also highlighted the fact that women are the majority of workers in the informal economy and also the majority in Small and medium enterprise. Women need to be supported to enter into the corporate world because only 15% of corporates or big businesses are owned by women. Women are now going into the business big time but the only constraint is that we still don’t have structures that accept women.

Minister Nyoni also highlighted the state of SMEs and informal economy during COVID-19 lockdown. With this COVID-19 and lockdown, SMEs have been affected more than any other businesses, for instance, there has been a freeze of business operations with almost 86% of SMEs have closed down. There is a disruption in the productive supply chains in the manufacturing, agriculture, construction, services, retail, and other sectors. There is also a depressing aggregate consumer demand and loss of perishable stocks as most women were in small scale agriculture and in the food market. There is also reduced business cash flow and erosion of livelihoods and income. There is also an inability to service business expenses such as bank loans, utility payments, and rent. There is increased hunger at the household level since the majority of informal economy workers and traders were breadwinners.

ZCIEA Secretary-General Wisborn Malaya presented the situation on the ground stating that COVID-19 and lockdown measures have a negative impact on the informal since the majority survive from hand to mouth. People are hungry that is a fact and to make matters worse the lockdown period was extended for 2 more weeks. There was an unlock of some sectors of the economy for them to trade but the prevailing situation on the ground is that there are many conditions that are not allowing traders to work, its good as they are still locked down. ZCIEA Secretary-General also said that the Ministry managed to communicate to as many associations on the support from the government and indicated processes and procedures on how to register members from these associations so that they benefit from the government support. The associations complied with the directive from the Ministry by submitting their databases. This is now the fourth week of the lockdown all the associations reporting none of their members have received assistance from the government. On the ground, there are some reports that some people received funds and it becomes a concern since ZCIEA submitted membership database through 10 Provincial offices our members should benefit. The money is not enough but that effort of the government if it is received by a hungry person they will appreciate.

In response, Minister Nyoni said the Ministry of Finance, Ministry of Public Service, Labour, and Social Welfare and Ministry of Women’s Affairs, Community, and SME development are working together to make sure that this money gets to the people. She also said the Ministry is working closely to support Associations in making sure that there is no hunger to anybody that was providing livelihoods and those livelihoods have been lost. ”We are appreciative of active associations like this one (ZCIEA) that keeps us informed so that we expedite, their concern is our concern and this is why our President set this fund”, said Minister Nyoni. “We are hoping that very soon those who were registered to get this fund will get it so that we move into a medium-term in which those that now are opening their businesses get the support,” said Minister Nyoni.

ZCIEA Secretary-General said ZCIEA submitted a membership database to Provincial offices and tasked Territorial leadership to make a follow up to the officers but unfortunately some Provincial officers communicated that they haven’t received the data, the data was supposed to be submitted to district offices and this is where the confusion is. “We were given a list of 10 Provincial officers and their email address where we were supposed to send the data, and this is what we did,” said Mr. Malaya. Minister Nyoni said she will make a follow up on the issue of data submitted and rectify the problem she further said if data was submitted to Provincial offices all they need to do is liaise with district offices and verify data so that we don’t delay people.

Zimbabwe Lawyers for Human Rights member Denford Halimani gave a legal perspective on the demolitions of vendors’ stalls, tuckshops, and all informal structures. Mr. Denford Halimani said the starting point is the Constitution of Zimbabwe, section 74 states that no person may be evicted from their home or their home demolished without an order of Court after considering all the relevant circumstances. He said we are not sure if the demolitions were accompanied by court order, and also not sure if those structures that are being demolished were given prior notices to make representations to the authorities carrying out evection. If that was not done we believe that to be in violation of section 68 of the Constitution which gives right administrative justice. “Section 68 of the Constitution; Right to administrative justice (1)Every person has a right to administrative conduct that is lawful, prompt, efficient, reasonable, proportionate, impartial, and both substantively and procedurally fair. (2) Any person whose right, freedom, interest or legitimate expectation has been adversely affected by administrative conduct has the right to be given promptly and in writing the reasons for the conduct. (3) An Act of Parliament must give effect to these rights, and must- a. provide for the review of administrative conduct by a court or, where appropriate, by an independent and impartial tribunal; b. impose a duty on the State to give effect to the rights in subsections (1) and (2); and c. promote an efficient administration”. “That position of the Constitution of very clear, the Constitution is the supreme law of Zimbabwe, any law, practices, custom or conduct which inconsistence with it is invalid to the extent of the inconsistency and the obligations imposed by the constitution are binding on every person whether that person is a natural person or juristic person including all the state and all executive, legislative and judicial institutions and agencies of government at every level,” said Mr. Halimani.

Mr. Halimani said since the advent of our 2013 Constitution our Courts have dealt with matters of this nature and held that it is unlawful and illegal for anybody to demolish a home or structure without a court order. Any action that is done by anybody natural or juristic, council, or otherwise must be accompanied by a court order without court order such actions are potentially liable to be declared illegal. Mr. Halimani advised that those whose structures which were demolished without a court order and prior notices should not take law into their own hands but to go through the court processes to prove that they have suffered loss or harm.

ZCIEA Secretary-General said the demolitions of informal economy workers’ markets are not in Harare only it’s the whole country. There was no communication with regards to demolitions, people are locked in and they don’t have where to start from after lockdown since they survive from hand to mouth. “Demolitions of markets happened when there was a cholera outbreak, the target was the informal economy, typhoid outbreak the target was the informal economy and now we have COVID-19, the target is the informal economy”, said Mr. Malaya

Minister Nyoni said that there is a need for serious negotiations between the SMEs themselves, Ministry of Local government, Ministry of Housing, and social amenities and find a way forward together. She also spoke on the issue of formalization of informal economy workers and that process needs the support from the government so that we have back to back production side and distributive side. Minister also encouraged associations to work together with the government towards formalization and promote the growth of the economy. Minister Nyoni said no structure should be built for SMEs and informal economy without consulting them, this is why a structure on Beatrice Road is a white elephant because SMEs and informal economy traders were not consulted, and rentals are expensive and beyond the reach of the traders. “I’m calling upon a dialogue that will lead to sustainable, workable structures and organizational systems that will be a win-win for everybody that is involved”, said Minister Nyoni. Minister Nyoni also said that when planning for buildings or markets for the informal economy we should also take into consideration People with Disabilities’ easy access into those markets or buildings.https://www.facebook.com/capitalkfm/videos/535438607400343

Share

Leave a Reply