Townships to CBD: The project of ten informal traders in the formal economy of Cape Town, Western Cape.
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Date
2020
Authors
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Publisher
University of the Western Cape
Abstract
The Quarterly Labour Force survey by Statistics South Africa (2019) portrays a very bleak future for the South African economy and labour force. The unemployment rate is 27.6% and youth unemployment stands at 55.2%. The National Development Plan (NDP) recognises the relevance of the informal sector and the value that it will contribute to the economy and to solving the challenges of unemployment in South Africa. The NDP projects that the informal sector, which includes domestic work, will create between 1,2 and 2 million new jobs by 2030.
Few studies have been conducted on informal trading projects. This study explores the case of a ‗transitional‘ informal enterprise support project aimed at micro-enterprise development wherein 10 informal traders in Cape Town took occupancy of provincial government-sponsored kiosks on 9 May 2016. The Long Street kiosks (LSK) offer 10 traders per year a unique trading opportunity in the CBD free of rent and service charges for a period of one year, with access to a unique and potentially large market.
The purpose of this study is to critically examine the role played in the informal enterprise development project by the Western Cape provincial government through its project manager, the Department of Economic Development and Tourism (DEDAT). This research attempts to investigate aspects of project design such as the selection criteria of the informal traders for the project, and selected results such as whether the project provided the traders with enough market exposure to the formal economy and whether their businesses were improved by participation in the project.
The qualitative research approach was used for this study of the LSK project, which was a single case study, as both a unit of analysis and as a research method. The study involved a combination of two approaches, namely desktop research followed by interviews and focus group sessions.
The study found that a number of limitations and shortcomings in the conduct of the project impacted on the mixed results and success achieved, pertaining to selection criteria, lack of financial and other resources, training, market-related problems, skill set limitations as well as environmental factors such as transport. The study nevertheless cast useful light on potential changes and recommendations that could enhance the project going forward and provides new insights on the complex relationship between the informal and formal
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economies and their relative potential for addressing the challenges of employment and economic growth.
Description
Magister Artium (Development Studies) - MA(DVS)
Keywords
Long Street kiosk, Unemployment, Entrepreneurship, Informal traders, Local economic development