informal economy

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Workers in Türkiye

Published in Dawn, December 20th, 2022

“Once you’re in their books, you’re done for. … they’ll ask you what you do, how much tax you pay, where you’re registered, how much you make, and are you left wing or right wing.”— Mustafa Efendi, a character in A Strangeness in My Mind by Orhan Pamuk

WHEN you think of informal labour in Türkiye, the image that comes to your mind, if you read this, is the life of a street vendor in Istanbul, unfolding amidst diverse layers of changes: personal, social, political, environmental, ecological in the wake of urbanisation and the melding of tradition with modernity. The saga of change, chronicled by Pamuk in the novel, spans four decades from the 1980s to 2000s.

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Informal Economy

Published in Dawn on January 21 2018

THE 12th Five Year Plan (2018-23) — to be finalised soon — is based on a strategy that combines “inclusive growth with green development”. In recent years ‘inclusive growth’ — growth that benefits all segments of society — has replaced ‘poverty alleviation’ as a catchphrase in development planning. Everyone is talking about it, including the IMF, World Bank, ADB, ILO, national governments as well as those averse to the ‘growth’ paradigm. So let’s hope all players in the international and national arena mean it and are out to promote “equity, equality of opportunity, and protection in market and employment” as defined by the World Bank.

The time has come for Pakistan to address inequity and to tackle the informal economy, which is considered a barrier to inclusive growth as it excludes the majority of people from accessing opportunities of productive growth in the economic realm and deprives them of entitlements at work because of their informal status. In comparison, workers engaged in formal, registered, tax compliant businesses and units are legally covered for social protection.

The government cites its inability to bring thousands of small enterprises under the tax net, while the enterprises point to financial constraints as the main reason for remaining informal. However, both concede that formality is desirable for it benefits all stakeholders in the long run. Yet the goal remains elusive.

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