Informal sector formalisation pays dividend. . . as Gweru SMEs contribute

More than 13 000 small to medium enterprises (SME) in Gweru had contributed about $1 billion in taxes and other services to the Government and Gweru City Council (GCC) as of November 2021, a confirmation that it pays to organise the informal sector.

Following demolition of vending stalls in the central business district and Kudzanayi Long Distance Bus Terminus last year, informal sector businesses had to be relocated to facilitate the upgrade of the facility and establishment of smart operating spaces.

In her address at the commissioning of the new-look Kudzanayi Long Distance Bus Terminus by President Mnangagwa on Monday in Gweru, Minister of Women’s Affairs, Community, Small and Medium Enterprises Development, Dr Sithembiso Nyoni, said the commissioning of the terminus was a landmark development for the SMEs sector.

She said vendors who have been organised into formally registered business units were now paying taxes and rentals, which assists in service delivery.

“The information that I collected from the local authority, the chamber of local SMEs and my ministry is that Gweru alone has 6 388 registered and very active Small to Medium Enterprise (SMEs) in manufacturing, services and construction sectors,” said Dr Nyoni.

She said there were also 7 405 informal sector players in about 16 designated areas. The largest site is the open space opposite Mtapa Police Station where there are 4 300 vendors.

“By the end of November, they had contributed nearly a billion dollars in taxes and other service charges to Gweru City Council and Government,” said Minister Nyoni.

She said some of the SMEs were part of the value chain and linkage programmes with big manufacturing companies such as Bata Shoe Company in the leather value chain and the Midlands State University (MSU) in the provision of PPEs.

“At this site (Kudzanayi) alone your Excellency, there are more than 500 vendors creating more than 1 000 jobs. The revenue that GCC is collecting has increased by more than 150 percent,” said Dr Nyoni.

She said under the National Development Strategy (NDS1) blueprint and the SMEs Policy 2020- 2024, workspace provision was one of the key strategies for supporting SMEs to realise Vision 2030.

Minister Nyoni said adequate working space enables SMEs to produce quality products that appeal to both local and international markets.

“The development we are witnessing here today is a good example of empowering the informal sector to graduate to the formal sector and what is encouraging is that the majority of the entrepreneurs are women who have in the past been marginalised,” she said.-The Chronicle