Plate 9.5: Gas Welders Working along Madzindadzi Road
4.2 Background of Informal Enterprise Development in Zimbabwe
Before the realisation of independence in 1980, informality was at its minimum considering the existence of heavily enforced statutes and instruments like the Town and Planning Act of 1946, the Vagrancy Act of 1960, and the Vendors and Hawkers’ By-laws of 1973 (Brand, 1986; Gumbo, 2013). At that time, the society was racially divided (Chirisa and Dumba, 2012).
It has been argued that during that pre-independence era, informal manufacturing activities that were common in African locations included welding, carpentry and crafts (Gumbo, 2013). The assessment in this chapter is limited to post-independence (from 1980 onwards) realities because before 1980 informality was largely insignificant to receive mass attention, a situation which extended into the greater part of the first decade after attaining independence (Weketwe,
91 1989; Zinyama et al. 1993; Gumbo and Geyer, 2011).
Gradual gripping socio-economic upheavals of the late 1980s ignited the government to seek for a conditional loan from the International Monetary Fund (IMF). One of the conditions attached to this loan was the nation’s adoption of an Economic Structural Adjustment Program (ESAP). Hasty implementation of ESAP saw the chronic exodus of industrialists, a downward spiral of economic activities, privatisation of firms, among other notable changes (Zinyama et al. 1993). Landslide retrenchment of workers pressured them to find sanctuary in informal enterprise. Further precipitating the progression of informal enterprise was the awarding of millions of dollars in compensation to ex-combatants in the late 1990s which left the country’s economy in tatters (Mzumara et al. 2015).
The onset of the fresh millennium was characterised by the historical Fast Track Land Resettlement Programme (FTLRP) which led to further massive exit of industrialists leaving people jobless (Mabhena, 2012). The gradual ‘wilting’ of the formal trade sector coupled with client decrease and corruption saw the retrenched workforce joining the informal trade sector where they formed small-manufacturing clusters (Chirisa, 2007; Muponda, 2012; Gumbo, 2013). This reactionary resort by desperate employment-seeking citizens gave rise to a marked increase in informal enterprise.
Whilst earning a leaving through informal activities, a harsh clean-up campaign dubbed OM of 2005 dehumanised people as it destroyed their sources of livelihood (Tibaijuka, 2005;
William, 2006; Gumbo and Geyer, 2011). Drawing lessons from the parable of endurance, when there lacks a second option, people press on. This has been highlighted as one of the explanations why informality is resistant to enforcement forces (Chirisa, 2007; Miraftab, 2009;
Varley, 2013). The period after the historical OM was marked by an increased tension between
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the ruling party, ZANU-PF, and two formations of the main opposing party, Movement for Democratic Change (MDC T and MDC M). This political crisis was largely pronounced in form of socio-economic crisis characterised by another significant rise in informality. Table 4.1 succinctly summarises this growth in informal enterprise development in Zimbabwe.
Table 4.1: Informal Enterprise Development in Zimbabwe (Adapted from Weketwe, 1989;
Zinyama et al. 1993; Gumbo and Geyer, 2011)
Period Probable Cause General Description Comments Early 1990s Adoption of ESAP ESAP presents the following
prescriptions among others:
Deregulation of the transportation sector
Privatisation of companies
Withdrawal of state aid on some companies
Reduction of state aid in diverse sectors exposed companies to heavy shocks and stresses which saw the downfall of many companies. Other retrenched workers found sanctuary in the informal trading sector.
Late 1990s Awarding of millions of dollars to ex- combatants
This left the economy in tatters Appeasement of ex-combatants at the expense of addressing pressing issues is tantamount to misplacement of priorities. This strained an already overstrained economy. Various effects were pronounced in increase in informal activities.
Early 2000s Fast Track Land Resettlement Program
Transfer of land title from White minority to the Black majority
Being an agro-based economy, a significant percentage of upstream and downstream industries collapsed leaving a substantial quantity of people jobless. This partly pushed employment-seeking citizens into informality.
Late 2000s Political and socio- economic conflict amongst political parties
General lack of consensus amongst the ruling party, ZANU PF, and two formations of the key opposing party, MDC T and MDC M, especially prior to, during and after the 2008 presidential elections.
Protracted political and socio- economic conflict melted the economy down to its knees.
Nearly all systems became dysfunctional and everything turned informal with high levels of clientalism and corruption more pronounced.
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The summary in Table 4.1 has indicated that informal enterprise development was not an event, but a process which fed from political and economic policies adopted by government from 1980. The same argument resonates well in one study that tested and proved the hypothesis that the development of the informal trading sector is resultant of economic and political policies adopted by the new Zimbabwean government from 1981 to 2010 (Gumbo, 2013).
Confirmation of this hypothesis followed a historical trace that packaged the economic and political ideologies adopted by the Zimbabwean government over a thirty-year period with view of bringing to fore their implications on informal trade sector development (Gumbo, 2013). Three major ideologies were noted as socialism (1981 to 1990), neo-liberalism (1991 to 2000) and authoritarianism (2001 to 2010). Each of these ideologies contributed towards the growth of the informal sector. Informality has grown to a point where it is now more of a pseudo-permanent development than anything. It is against this realisation that the government called for the compilation of a national informal sector database in 2014. This chapter intends to answer two major questions. Who are the final users of the called for database? What sort of data do these users need for them to make knowledgeable decisions? Responses to these questions constitute the major discourse of this chapter.