The Destruction of the Informal Sector
In the past week the government of Zimbabwe has taken steps to destroy
of what has become known throughout Africa as the informal sector. This
consists of about 3 million small-scale business enterprises - none of
are registered or pay direct taxes but which play a major part in the
There are 800 000 small scale peasant farmers and their families, but
in the cities where this kind of economic activity has thrived as the
sector has crashed. The activities take on many forms - cross border
who take orders from urban business and then find the foreign exchange
go to South Africa or Botswana to source the products required. I
once that about 5000 traders crossed the borders every day doing
to 20 per cent of all imports.
Vegetable and fruit sellers are found almost everywhere - a vendor
just a few tomatoes every day can make as much as a worker in industry.
Small scale industry goes on where ever there is a vacant lot and takes
all sorts of tasks and produce products such as wire netting, door
windows, furniture. The motor industry and public transport is another
of informal sector business - hundreds of small vans operate in urban
and provide a very efficient form of local transport, which is used by
millions every day.
In the housing sector the role of the informal economy is just as
ubiquitous - with a back log in housing running to over 1 million units
official lists and only 1,4 million housing units actually on the
over 40 per cent of the urban population is thought to be technically
homeless - they live in crowded tenements and as lodgers - often living
whole family in a single room. Desperate for any sort of privacy and
life many take to constructing shacks in other peoples yards or on
ground in peri urban and township areas.
This means that some where about 2,5 million people live in makeshift
accommodation without adequate sanitation or clean water. They include
hundreds of thousands of children. Many brought to the towns because
education and health services are so much better than they are in the
areas, or their parents have died from Aids or a related illness and
are living with the extended family.
So we have a massive structure of informal sector activities - almost
eclipsing the formal sector that was so dominant in 1980. I estimate
informal business may generate as much as half our GDP, handle as much
per cent of all foreign exchange and 20 per cent of our exports and
They support 3,4 million urban people and 4 million rural people. They
provide transport for the great majority and meet the basic housing
requirements of at least 8 million people. They pay taxes through the
indirect systems of taxation that exist (VAT and others) and provide a
market for the formal sector as well as income support for the
Despite the complete failure of the Zanu regime to maintain the formal
sector - with GDP declining nearly 50 per cent in 7 years, exports down
half and employment by over 40 per cent - the State has now decided to
decimate the one thing that is working - the informal sector.
If I had not seen it myself I could not have believed that so stupid
heartless a thing could be carried out. On Thursday last week I watched
armed police destroy the markets in Beitbridge - the border town with
Africa. I saw them burn food, steal groceries and smash furniture.
Afterwards one street kid said to me as I walked past - "this is
Gono!" referring to the governor of the Reserve Bank who seemed to have
triggered this exercise in an effort to gain control of informal money
markets. Others just sat stunned - not quite appreciating that the
just robbed them of virtually everything they owned.
We saw evidence of the cyclone all the way to Harare and then over the
weekend we saw the Capital City go up in flames. The markets at Magaba,
Mbare all destroyed and billions of dollars worth of goods taken or
destroyed. My daughter witnessed a team on the street cutting a vendors
dog stand loose and then loading it onto a truck - she remonstrated
them and they threatened to arrest her. Some Z$2 billion in cash stolen
vendors by the Police.
All over the City homes were destroyed, goods stolen or destroyed and
threatened with loaded weapons and live ammunition. They were also
threatened with tear gas supplied by Israel that stuns its victims.
in charge of this mindless destruction said that they had orders to
anyone resisting. In one area I visited the majority of the squatters
voted Zanu PF in the recent election, believing that in doing so they
protecting themselves from eviction because the land they occupied was
theirs - they sat stunned by events surrounded by burnt out wrecks of
homes and crying children who had spent the night out in the cold.
The question is why are they doing this - punishment is one reason
police to those they were hurting, punishment for voting MDC in the
But I think there is another reason and this is that Mugabe - now in
final stages of his rule, has decided - like Stalin in the 30's and Pol
in the 60's and the Afrikaner administration in South Africa, that it
time to move some people out of the cities and back to the rural areas.
is a mass eviction of unwanted urban poor being forced to go "back to
rural homes" and "grow food!"
In the cities they are a threat - restless, independent and proving a
powerful support base for opposition politics. In the rural areas they
be controlled and perhaps forced to grow food where none is being grown
present. Will they get away with it - probably, just like Stalin and
and the apartheid regime. But only for a while, eventually the tide
turn and when it does, those who were the oppressors will themselves
the victims of their own evil acts.
To back up this thesis that strange new Ministry called the Ministry of
Rural Housing and Social Amenities with Munangagawa in charge has been
a massive budget from nowhere to operate with. This suggests that they
really are trying to force a relocation of population. In the past 5
rural populations have been declining - the math's suggest by as much
per cent per annum. This coupled with the impact of Aids has meant that
these areas can no longer even feed themselves. Mugabe is trying to
When you go to bed tonight - just think of those tens of thousands of
hungry, destitute people and their children who will sleep in the open
near zero temperatures, without hope or a future. Mugabe is goading the
population to revolt - then he can declare a state of emergency and
what is left of our civil liberties and rights.
Bulawayo, 1st June 2005