Informal: public policies at a crossroads

This economy persists in Africa, despite the formalization measures implemented for decades, the reasons for which are well known. It deprives States of precious fiscal resources and therefore of means of intervention to support the sectors and more generally the implementation of policies for regional planning, infrastructure construction, education, health or social protection. Not to mention the induced effects on health risks, due to the lack of traceability of food production, and on the destabilization of the sectors, via the creation of distortions of competition.

However, since 2017, the IMF (International Monetary Fund) seems to be making a shift in its policy by relying on a new definition of the informal sector, now conceived as encompassing " family businesses that produce some market value without being registered and, more broadly, underground production resulting from productive activities that are carried out by registered businesses, but may not be declared to the authorities in order to evade regulation or taxation, or because they are simply illegal »^[1]Using this definition, the institution classifies African countries according to the weight of the informal sector in their economy and considers that it represents up to 90% of employment and two-thirds of the gross domestic product.^[2], the vast majority of the actors concerned working for their own account.

The informal sector's image as a social and economic buffer has emerged from the Covid-19 pandemic strengthened, judging by the numerous analyses published over the past few weeks.^[3], African countries, particularly south of the Sahara, seem more resilient than one might have feared, which demonstrates the social utility of this sector: “Resilience is in the DNA of the African informal sector ", declares Jean-Luc Konan, CEO of Cofina, to Jeune Afrique^[4].

However, as the president of IFAD (International Fund for Agricultural Development) points out,^[5], populations working in the informal economy, and a fortiori those who derive all their income from these activities, remain the most vulnerable and the most threatened, particularly in terms of their food security. In particular, despite the apparent resilience of these populations, let us not lose sight of the systemic risks they could face in the medium term: immediate survival strategies can jeopardize, for example, the preparation of upcoming harvests (access to inputs made more difficult, lack of cash, absence of labor to carry out current harvests likely to finance the following ones, etc.), and this at a time when many city dwellers are migrating to the countryside, which increases the difficulties in rural areas.

This is also why, for the first time, around twenty countries have implemented initiatives explicitly targeting the informal sector in response to the Covid crisis: monetary aid and food aid for the poorest, deferral of payment of water and electricity bills, fight against eviction from housing, including informal housing.[6]. Ivory Coast, for example, has released 100 billion CFA francs for “relieve informal sector actors”^[7]Donors follow: the AfDB (African Development Bank) has granted 264 million euros to Morocco to support the purchasing power of workers, including those employed informally.^[8]. It remains that helping these actors, who by definition have no legal existence or are unknown to State services, is difficult.

Executive Secretary of the African Union Development Agency, Ibrahim Assane Mayaki, adds that " These workers, as they demonstrated when the lockdown measures were lifted, know how to demonstrate an extraordinary capacity for recovery and resilience. This sector can become an asset for Africa from the moment when a better link between the informal sector and the ecosystem of African SMEs is found […] in urban areas, but also, I insist on this point, in rural areas »^[9].

However, the health crisis makes it urgent to better regulate certain informal practices. It has led most African states to close their borders, resulting in a sharp increase in undeclared international trade, which must be curbed to prevent the transmission of the virus.^[10]Likewise, food markets, even informal ones, must be better controlled, without forgetting, even if the task seems unrealistic, the transport of goods whose health standards are generally non-existent.

The crisis has therefore brought public authorities to a crossroads. On the one hand, they are beginning to recognize the crucial importance of the informal sector and to grant it certain support previously reserved for formal actors. On the other hand, they have the opportunity, if not the obligation, to control certain aspects of the informal sector and thus initiate a partial formalization of its activities. This is, moreover, the meaning of one of the recent World Bank initiatives in favor of social protection for informal actors.[11]The question is how far this hybrid approach can be taken and whether it is up to the challenge. Of course, another question remains, that of the difficulty in interpreting the sources in order to, beyond individual cases, identify major trends and better understand the situation of informal actors facing the current crisis.