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MMC Khoza welcomes Council approval of Draft Informal Trading policy

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MMC Khoza welcomes Council approval of Draft Informal Trading policy

MMC Khoza welcomes Council approval of Draft Informal Trading policy

25th March 2021

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The Member of the Mayoral Committee (MMC) for Economic Development in the City of Johannesburg, Cllr Lawrence Khoza, welcomes the approval of the Draft Informal Trading policy, which will set out an integrated, holistic approach in the informal trading sector and will guide all City departments and municipal-owned entities (MOEs).

The draft policy, resulting from extensive consultations with various stakeholders, is aimed at creating a well-managed informal trading sector, along with its needs. It is also consistent with the Growth and Development Strategy 2040 and the Government of Local Unity priorities.

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Informal trading is estimated to contribute between 5% and 8% to the Gross Domestic Product (GDP) and employs more than 20% of the workforce. Informal traders are majorly from disadvantaged backgrounds and are unregistered, which the draft policy seeks to address through its developmental approach to enable access to livelihood, jobs and entrepreneurial opportunities within the informal trading sector.

The Draft Informal Trading Policy is underpinned by three principles:

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Economic Principle – Productive growth in the informal trading sector – to be facilitated through identifying and reinforcing high trading areas. Upholding the rights of South Africans and foreigners to trade in the informal sector.

Social Principle – Reduce inequity through the provision of services and through active programmes to support the most disadvantaged population access to opportunities through informal trade.

Spatial Principle – Informal traders to be proactively accommodated in the spatial and development plans. In the establishment of new townships, the City will seek to ensure that sidewalks are wide enough to accommodate informal traders, as well as pedestrians.

Amendments made to the previous policy

 

The Old (2007 Policy)

The New (2019 Policy)

1.

It is not aligned to relevant international, national and provincial legislation, policy and strategy.

It is aligned with relevant international, national, provincial and local government legislation, policy and strategy.

2.

No co-ordination and institutional functioning with respect to the informal trading.

Improves co-ordination and institutional functioning with respect to the informal trading.

3.

Weak or no relationships with all stakeholders. Exclusion of informal traders and property owners.

Strengthens relationships with all stakeholders as the basis of an inclusive economy.

4.

It is a restrictive policy, informed by the by laws.

It is an inclusive, developmental and regulated policy.

5.

It is a survivalist business and is not sustainable.

Informal trading is ‘here to stay’ and expanding with modern, industrial growth.

6.

It is only marginally productive.

It is a major provider of employment, goods and services for lower-income groups. It contributes a significant share of GDP.

7.

It exists separately from the formal economy.

It is linked to the formal economy – it produces for, trades with, distributes for and provides services to the formal economy.

8.

It represents a reserve pool of surplus labour.

Much of the recent rise in informal employment is due to the decline in formal employment.

 

MMC Khoza has called on the residents of Johannesburg to familiarise themselves with the Draft Informal Trading policy and to take part in the public engagements around the formulation of the final policy. He emphasised that public participation is important as this gives the people of Johannesburg a voice to raise their concerns.

The adoption of this policy will benefit the most underprivileged people of our society – young people who will want to start their own business in the informal sector and will help the City to respond effectively.

This draft policy seeks to integrate and simplify processes of application and for the Department of Economic Development to be the single-entry point for informal traders in Johannesburg.

 

Issued by The City of Johannesburg

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