MSMEs in the Informal Sector: Formalization Ensure Sustainable Finance and Decent Jobs?
About 2 billion workers, or over 60 percent of the world’s adult labor force, operate in the informal sector –at least part-time, according to the ILO. The COVID-19 pandemic hit informal workers particularly hard, especially women. Micro Small Medium Enterprises (MSME), both formal and informal, make up over 90% of all firms around the globe and offer employment to one-third of 1.2 billion people in the world who work in the informal sector. They generate services for other sectors like small and large industries, retail, tourism, transportation, construction, etc., and contribute to over 30% of GDP and more than 70% of all jobs created in developing countries. MSMEs were heavily impacted by the pandemic and continue to face existential challenges on various fronts including but not limited to business formalization.
MSMEs, both formal and informal, make up over 90% of all firms around the globe1 and contribute to more than half of the GDP in most countries irrespective of income2. As many countries struggle to cope with the growing debt burdens and limited fiscal space to finance the SDGs, the important role of MSMEs as catalytic forces for achieving the SDGs cannot be stressed enough. Despite formalization gathering pace, MSMEs and those in the informal sector also continue to struggle to access formal finance. Without the appropriate regulatory reforms, social protection measures, access to formal finance, and capacity building in tools such as financial literacy and numeracy tools to help manage finances effectively, inclusive growth and a decent work environment for those in the sector will remain a challenge. As part of the Development Cooperation Strategy 2020-25, the ILO is forging partnerships that advance policy objectives and coherence within the framework of Integrated National Financing Frameworks (INFFs) that promote Financing Decent Work. In this panel, the speakers will share global and on-the-ground perspectives and explore steps countries are taking through regulatory reforms, access to finance, and capacity building to ensure sustainable finance and decent work for MSMEs in the informal sector.
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Speakers:
- H.E. Mr. Arrmanatha Christiawan Nasir, Ambassador, Permanent Mission of Indonesia to the UN (TBC)
- Ms. Chantal Line Carpentier, Chief, UNCTAD New York Office of the Secretary-General
- Ms. Adriana Marina, Founder of Hecho por Nosotros & animaná, Argentina
- Mr. Amar G. Prabhu, Principal of Don Bosco Industrial Training Institute Kurla, Mumbai, India
- Ms. Sandie Ejang Elobu, CEO, Western Silk Road, Ltd., Uganda
- Ms. Nana Efua Brown-Orleans, Program Lead, Duapa Workspace, Ghana
- Ms. Estella Kabagaya Eldradaa, Founder, Mama Children Village, Uganda
Organizers: NGO Committee on Financing for Development, Virginia Gildersleeve International Fund (DBA Women First International Fund), Salesian Missions Inc, Africa Development Interchange Network, Institute of the Blessed Virgin Mary, Sisters of Charity Federation
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CoNGO Notes: The NGO Committee on Financing for Development is a Substantive Committee of the Conference of NGOs in Consultative Relationship with the United Nations. Likewise, for more information on the NGO Committee on Social Development, please visit ngosocdev.org. For more information on the NGO Committee on Sustainable Development/NY, please visit ngocsd-ny.org. For more information on the NGO Committee on Sustainable Development/Vienna, please visit ngocsdvienna.org. For more information on the NGO Committee on the Status of Women/NY, please visit ngocsw.org. For more information on the NGO Committee on the Status of Women/Geneva, please visit ngocsw-geneva.ch. For more information on the NGO Committee on the Status of Women/Vienna, please visit ngocswvienna.org.