Unorganized “sidewalk’ private sector,When would it be connected to production? [Archives:2004/775/Business & Economy]

September 23 2004

The unorganized private sector is to be seen in urban and countryside areas, practicing its activity without having licenses. Its groups are spread on sidewalks of town streets' sidewalks and small shops in the countryside. This type of private sector includes groups of peddlers, porters, taxi drivers, repairs workshops owners and others who do not care about activities of organized and recognized private sector.
These segments do however constitute a significant part of the national economy with regard to the number of those working in it and size of activities they practice, whose added value is estimated at around 20% of the gross domestic product of registered economic activities in both private and public sectors.
According to official estimates, the number of people economically active and not connected to organized activities is about 600 thousand workers forming 25% of the total economically active population outside the agricultural sector in the countryside.
In the urban areas, the proportion of workers in local private sector is estimated at 59% of the urban workforce and around two thirds of them work in the unorganized private sector in installations employing less than five individuals, which is equal to 40% of the workforce active in the economic activities of urban areas.
Activities of the unorganized private sector seem to be away from orientations of the economic policy effective in the free economy market and this condition makes it at a reality of randomness and needs for measures to merge its activities with the rest of other economic activities. It is therefore, the owners of this activity say they feel they are lagging behind for staying on the sidewalks practicing free commercial works, which are not open to modernization and development such as moving into the field of converting industries or at least at large workshops and construction. They add that working outside productive establishments would always remain an experience amidst noise of streets and their crowdedness with pedestrians, under the scorching heat of the sun and threats of municipality authorities.
Unorganized public sector member Ibrahim al-Suraihi says the workers in this sector always dream of being liberated from streets but their potentials would not allow them to organize themselves within the licensed private sector to practice large-scale trading activities. He sees that solution to the problem of this kind of private sector in the Yemeni cities is a necessity to create balances in productive activity of the private sector. This solution requires the extension of the social safety umbrella to offer support to these groups and enable them to practice developed productive activities generating income based on renewable bases.
Despite the government's pursuit of supporting activities of organized private sector to increase the economic growth based on market economy and freedom of competition, this sector faces a number of problems and difficulties such as the government's more work for completing constitutional and material structures and amending some laws and administrative rules connected to fixing economic defects that impede the private sector activities. Those working in the unorganized private sector confirm however that the government's encouragement is focused on the registered private sector as it plays an important role in developing the productive base and diversity of income sources as well as creating new work opportunities. This in turn limits opportunities for developing activities performed by those of free work.
Despite the feeling of pessimism shown by those working on the sidewalks, they are still hopeful that economic stability would lead to prosper their incomes and embarkment on practicing small economic activities to grow larger under circumstances of competition and then increase their revenues for using the in investment in medium projects future.