Research: Informal economy overlooked - Solomon Star News

Research: Informal economy overlooked

10 April 2014
Author 

A study on women traders in Papua New Guinea showed that the importance of the roles of market and informal economy were not given due recognition.

The report showed that market access was increasingly gaining importance in developing countries which affords an opportunity for reducing poverty, improving food security, creating and strengthening income, and generating employment and job retention.

The research, conducted by the National Research Institute (NRI), aimed to contribute to the implementation of the National Informal Economy Policy from the perspective of women’s participation and business advancement in the local economy.

Former senior researcher with the NRI Dr Yunxian Wang said informal businesses appeared to be profitable.

“In PNG many important sources of income and livelihoods such as market trade are regarded as informal or even illegal, and – more critically – the importance of the roles of the market and informal economy are not given due recognition,” Wang said.

“Therefore, there is a need to give priority to the development of the informal sector and the local economy.”

The research identified the linkages between rural production and markets, the barriers to advancement from petty trading to microbusinesses.

Despite the strong economic growth and the development of extractive industries in PNG, there was little spill over to the local economy and community, and women remained far from these formal economic sectors.

According to the study it was estimated that 37% of the population remained in poverty, with most being in the rural areas.

Trading in open markets has been a predominant form of informal economic activity in PNG. Among the Pacific Island countries, PNG has been well studied on the issue of informal market trade.

PNG has a dualistic system of subsistence production, which comprises cash crops and subsistence farming.

Port Moresby (The National)

2408 Views
Editor