Informal sector in Zambia: employment consequences of the legal and regulatory framework

The study (which forms part of a series of ILO studies on Benin, Tunisia and Burundi) carried out during end of 1989 examines the regulatory barriers and their consequences on the growth of the informal sector in Zambia. It is based on a data analysis from various secondary sources and on a sample of informal sector units located in Lusaka. It examines the historical context in which regulations were conceived and discusses their current relevance. It concludes that various legal and regulatory constraints (e.g. regulations on urban land use and zonal laws) have adversely affected start-up and subsequent operation of the informal units by raising their costs of production, restricting mobility, decreasing revenues and discouraging investment. The study proposes measures for either eliminating regulatory barriers or modifying them with a view to promoting urban informal enterprises. The measures proposed include abolition of rigid regulations separating residential and retailing or manufacturing areas; establishment of spatial zones in which regulations governing commercial activity do not apply; and special support to the informal sector production by protecting it from competition from liberal imports.