The Role of the Informal Sector in national Socio-Economic Development: The Case of Mutare Central Business District, Zimbabwe

Abstract

The paper interrogates the role of the informal sector towards socio-economic development in Zimbabwe through the use of Mutare Central Business District as a case study. A mixed-method approach was used to gather data for this paper. Data collection instruments were in-depth interviews, questionnaires, and documentary research. Study findings revealed that the informal sector contributes towards socio-economic development in many facets. Some of them include employment creation, generation of incomes, savings and investments as well as social security and medical care among others. However, despite the positive contributions of the informal sector to socio-economic development, the sector is myriad with several challenges. The capability approach was of prime significance as it helped in envisaging major debacles that blurred the realization of socio-economic development by informal sector traders. Some of the challenges included finance, limited social insurance, and poor government policies, and programs. The capability approach was instrumental in identifying that through government support, urban poverty could be eradicated. The paper concludes by proffering several recommendations. Some of them include that the informal sector traders and the Government should join hands and ensure that affordable and adequate insurance policies are there to protect their businesses.