WATCH: Informal trading under lockdown
The informal trading sector is a critical part of the South African economy. While the vast majority of informal operators earn well below the income tax threshold of R79 000 per annum, informal economy still provides livelihoods, employment and income for about 2.5 million workers and business owners in the country.
It’s estimated that one in every six South Africans who work, work in the informal sector. With the ongoing battle against the coronavirus, the informal sector has been adversely affected by the lockdown regulations which have been put in place.
What type of informal sector businesses have been affected during the current lockdown?
- Street trading
- Trading in pedestrian malls
- Trading at markets
- Trading at transport interchanges
- Trading in public open spaces
- Mobile trading, such as from caravans, and light delivery vehicles;
- Roving traders
- Trading at special events, etc.
South Africa’s government recognises the role informal trading plays in poverty alleviation, income generation and entrepreneurial development and, in particular, the positive impact that informal trading has on historically disadvantaged individuals and communities.
It is for this reason that informal trading has been recognised in the Constitution, with local authorities granted the powers to regulate informal trading so that it continues to play a role in the economy.
Before the coronavirus pandemic and new lockdown regulations, informal traders were subject to local municipal regulations which required that they possess a permit in order to trade. In order to qualify, the applicant must:
- Be an informal trader, or desire to become an informal trader.
- Hold no other permit in respect of the trading area where the permit is being applied for.
- Be a South African citizen, failing which, must possess a valid work permit which includes, but is not limited to, a refugee permit.
- Not employ and actively utilise the services of more than 5 people.
- Have the ability to meet the trading hours as the City may determine, etc.
As a way to combat the coronavirus, Government revised and released comprehensive regulations which also touched on informal trading. Initial gazetted regulations did not allow informal trading to continue, but these regulations were later relaxed. The issuing of the permits comes after informal traders were deemed “essential” under the Disaster Management Act. What is required under relaxed trading regulations?
Permit requirements to trade during lockdown
- Obtain Municipal City certificate of acceptance
- Have proof of trading and a valid ID/passport
- Operate between 8am and 5pm
- Keep 1m distance between stalls
- Wear personal protective equipment, including a mask, sanitisers, gloves and have water available.
A quick check around the city of Johannesburg showed a number of informal traders have started trading with many expressing happiness with the relaxation of regulations.
“We are very happy that government thought of us and relaxed regulations. This is our source of livelihood. Business is very slow because most people are under lockdown but at least we are making some income” said one trader.
