Uganda - Informal Economy & City Growth

Policy Brief for Decision Makers: Uganda - The Role of the Informal Economy in City Growth

This Policy Brief is addressed at policymakers and synthesizes the research report “Transformational Change in Sub-Saharan Cities: The Role of Informality in the Hybrid Economy of Uganda” in order to provide specific key facts and recommendations to address the informal economy.

It strongly argues for a more nuanced understanding of the informal economy and to move away from dividing the economy into a formal and informal ‘sector’. Such a view limits the scope for a more holistic approach to urban economic growth and the development of appropriate policies that can have a transformative impact. Support to informal operators within a formal-informal continuum and a ‘hybrid economy’ is likely to offer a much more effective route to positive transformation. A radical change of policy direction is needed to give appropriate support to informal enterprises, establish a more flexible and accessible regulatory framework and encompass informal governance mechanisms.