1.1 Background:The Project on the Promotion of the Informal Sector for Development in Africa was initiated and implemented by the United Nations Economic Commission for Africa (ECA) and funded by the Government of the Federal Republic of Germany. The Project aims at creating an environment for the informal sector operators to increase their contribution to the socio-economic development of their countries. ECA intends to share the experiences gained in the four pilot countries with all the stakeholders which include African Governments, UN Agencies, the donor community, the civil society, the private sector, and the informal sector operators themselves, in order to find better ways and means of supporting the informal sector in the African region.

Cote d’Ivoire and Ghana participated in Phase I of the Project in 1992 and 1993. The Project was extended to Ethiopia and Zambia, in 1995/6 under Phase II. The ECA Project on the Promotion of the Informal Sector for Development in Africa – Phase II: Pilot Assistance to Zambia, officially started on 7th October, 1996. The Project in Zambia was to last for 18 months and was implemented in Lusaka Urban and in the Copperbelt.

Following a successful mid-term evaluation on behalf of GTZ by external consultants in May 1997, the Projects in Ethiopia and Zambia were extended to Phase III, starting from November 1998.

1.2 Objectives of the Project: The long-term objectives of the ECA is to contribute to the speeding-up of the process of socio-economic development in Africa through the expansion of the role of the informal sector. This could be done by increasing the informal sector’s efficiency in the production of goods and services and by assisting it in the creation of employment as well. One way of attaining this objective is to try a promising approach in a few countries that can later be used by other African countries for the purpose. Experiences gained should, thus, be shared with other African countries and donor agencies interested in promoting the informal sector. Its immediate objective is to sensitize decision-makers in several African countries to the need to improve the informal sector’s enabling environment. In achieving the objectives, the Project aims to assist the micro and small enterprises (MSEs) to learn how to solve their own problems, and to play a more prominent role in the socio-economic development of the African countries.

1.3 Target Group: The Project’s target group are informal sector operators (ISOs), in particular the micro and small entrepreneurs (MSEs), usually considered to be the same as micro and small enterprises (MSEs). Thus, the terms ISOs and MSEs will be used as synonyms in this paper, whereby ISOs refer to the persons/entrepreneurs while MSEs refers to the businesses/activities/enterprises. MSEs are women and men:

• Involved in manufacturing activities and service provision, e.g. maintenance, repair, food preparation, construction and transport;
• Employing fewer than 10 people and in most cases even fewer than five;
• Often unregistered and not complying with legislated standard and regulations;
• Often operating from semi-permanent locations, e.g. on foreign land in open air, in urban areas;
• Using little capital of their own savings or borrowed from family members and friends.

1.4 Project Approach: The Project applies a participatory approach using group methodology. It is process oriented, dialogue oriented and aims at raising the competence of the participants. The Project:

• Approaches individual MSEs and their informal organisations to identify the problems they face in their businesses, prioritize the problems identified, analyse the root causes of the problems, plan actions and implementation strategies, and implement the plans prepared;
• Assists the groups to analyse the causes of the problems and to devise actions to overcome them by moderating and structuring their discussions and making experts from different institutions available;
• Assists the groups to solve their own problems by linking them to other existing groups, organisations and on-going projects;
• Provides encouragement, devoid of any pressure to groups; to formalize their groups into recognized associations, cooperative societies, and to join with other existing groups to form bigger organisations;
• Facilitates only and leaves all action to the groups; (the NPC and the Project Animators (PAs) initiate the process, moderate, encourage, bring in experts and liaise with organisations and people who may be of help to the MSEs);
• Expects the groups to contribute to the conceptualization and costs of measures identified by them for the solution of their problems.

2.1 National Project Coordinator (NPC): The Project is led in the country by the National Project Coordinator (NPC) with the following terms of reference:

• To initiate and facilitate social processes as animator, moderator and catalyst.
• With the help of the Chief Technical Advisor (CTA), to provide guidance to the groups.
• To assist the groups get in contact with any other person who can assist them.
• To recruit, train, employ and supervise Project Animators who do most of the activities at grassroots level

2.2 Advisory Board: The NPC is supported by an Advisory Board appointed by ECA. The Advisory Board had 16 members during Phase II and 14 members during Phase III of the Project. Comprising representatives from different Ministries and other Government Agencies, banking and micro finance institutions, private sector organisations and donors, the Board meets once every two months. The Chairperson is elected among the regular members of the Advisory Board. The function of the Advisory Board is to assist the NPC in accordance with the methodological approach adopted for the Project and to tackle any problem arising in the process. The Board is also an important to keep Government authorities and other organisations informed about the Project, its approach and progress and to sensitize them to the needs of the MSEs.

2.3 Project Animators (PAs): Eight Project Animators (PAs): Five for Lusaka, three for Ndola and one for Kitwe. They underwent an initial three weeks training programme based on Visualization in Participatory Planning (VIPP) since this method provides participatory and people centred conscientising, analysing, planning and problem solving techniques. The training was facilitated by local consultants. They were later trained in One Up Business Management, which is a Trident Institute Training Methodology. The training took two weeks and was facilitated by the Evangelical Fellowship of Zimbabwe. This training was offered after realizing that the majority of the ISOs needed training in business management at a very basic level, and that it would be costly to hire experts to train all these ISOs. After being trained, the PAs were expected to train the ISOs in business management. Later the project staff were trained in Participatory Approaches or advanced (VIPP). The PAs also received in-house training in the preparation of project proposals, credit management and leadership skills.

The PAs and the NPC also went to Masvingo in Zimbabwe to visit a similar project called Informal Sector Training and Resources Network (ISTARN). The purpose of the visit was to study ISTARN’s methods, activities and results and to exchange ideas and experiences in order to learn for the promotion of the informal sector in Zambia. At the end of the study visit, the two projects observed that networking could be established in the following areas:

• Continued exchange of information between the two projects,
• Mutual study visits by ISOs,
• Training of the ECA PAs by ISTARN in Small Business Advisory Services (SBAS),
• Attachment of two UNECA PAs by ISTARN for two weeks or so.

2.4 ECA and CTA: The ECA Headquarters, ECA Subregional Development Centre for Southern Africa (ECA/SRDC-SA) and the Chief Technical Advisor (CTA) play an important role in the implementation of the Project activities as follows:

• ECA Headquarters (HQ) has the overall responsibility for planning, budgeting, implementing and accounting for the Project towards the German funding institution GTZ. It therefore guides and supervises the NPC directly by means of missions and regular communication and indirectly through the Chief Technical Advisor (CTA). HQ ensures that the funds needed for implementing the Project activities are available in time. The funds are released to the SRDC-SA on imprest/advance basis.
• ECA/SRDC-SA makes available its conference facilities to the project, in particular for holding the Advisory Board meetings, ensures that the Project gets the required funds by advancing money to the NPC and by collecting, processing and transferring vouchers to HQ. The SRDC-SA also participates in some of the Project activities, such as radio programmes, officiating at Project functions and inviting stakeholders/participants to project functions when requested to.
• The CTA assists ECA/Headquarters in the guidance and supervision of the project and supports the NPC by providing advise, encouragement and counseling at all times. Similar support is extended to the PAs during his visits to Zambia. He also advises ECA on how best to plan and implement the project activities in Zambia and Ethiopia and sees to it that funds are made available at the right time.

3.1 Selection and Survey of Cities: It was agreed by the ECA and the Zambian Government that the project will be implemented in Lusaka Urban and two other towns in the Copperbelt on the basis of large population and high unemployment rate in the three towns and the assumed presence of a high number of ISOs. In this regard, a survey was done in Lusaka Urban, Kitwe and Ndola

Urban in order to order to base the selection of compound/markets and trades to work with on a solid foundation. It determined:

• How many MSEs do exist in the three cities, and where exactly they are located,
• How many MSEs work in different trades,
• The gender distribution of MSEs,
• The type of shelter they work under, and
• The existence of employees/helping hands.

The survey was done in 44 compounds/markets in Lusaka Urban, 10 compounds/market each in Kitwe and Ndola Urban. The PAs went into the streets of identified compounds and markets, with little talking or no talking, unless where necessary. Emphasis was put on looking and observing the situation and entering the observations into a simple form.

The results of the survey showed that in all, 4,355 ISOs (1,603 female and 2,752 male) were identified in Lusaka Urban, Kitwe and Ndola Urban. The number of female ISOs identified is only 37% of total ISOs identified. This was less than what the project had anticipated under the belief that certain trades, such as tailoring, hairdressing and running simple restaurants are highly dominated by women. In fact, they are, but most probably many female ISOs were missed in the survey because they operate from their houses and are not as visible.

3.2 Selection of Markets and Trades: Based on experience gained from other programmes working with groups, it was agreed that each animator can comfortably organize and supervise ten groups. Thus, the Project would work with 100 groups. Learning from previous experience again, it was agreed that each group should have a maximum of 25 and a minimum of 15 members. The upper limit has been put at such a high level to accommodate for dropouts.

Since the majority of the ISOs were found operating in the markets, the Project decided to work in municipal council markets as well. This has two advantages: firstly, it eases the task of finding and addressing them; and secondly, facilitates group formation because usually the ISOs know one another already and have had some interaction. Only those markets were selected to participate in the project where trades with at least 15 representatives were found.

Similarly, trades were selected on the basis of number of MSEs identified in each trade. It was assumed that people in the same trade have the same or similar problems and would therefore more easily agree on certain issue. So it was decided to form groups according to trades. Mixing ISOs from different trades in one group may frustrate some ISOs if their problems are not attended to. Trades should only be mixed if they have common features. So, trades with 15 and more (up to 25) MSEs were selected to participate, and special consideration was given to them.

3.3 Group Mobilization
How were the groups formed? After the feedback had been given, the PAs went to the selected markets to inform individual ISOs about the Project and to invite them to meet in groups. Apart from addressing ISOs, the PAs also talked to the leaders in those markets. That means, groups were formed in three ways:

• PAs invited ISOs to group meetings individually,
• ISOs who volunteered to assist the PAs mobilised fellow entrepreneurs,
• Market officers or political leaders, especially those from the ruling party, invited ISOs to group meetings.

Assistance by leaders and ISOs helped to make the work of the PAs much easier since they did not have to talk to every ISO individually. This would have taken much more time.

Efforts made to encourage the participation of Women: The results of the survey show that about 37% of the identified ISOs are women. The project made an effort to find out why so few women were identified even in trades believed to be female dominated. It was learnt that:

• Most of the female entrepreneurs operate from their homes for the following reasons; they cannot afford to pay rent for the shops/stands in the markets; and they want to do their businesses from homes along side their household chores;
• Most women are involved in trading, especially street vending, and farming. Since the project is excluding those trades, a lot of women are left out.

In order to increase the number of women participating in the project, the staff made a deliberate move to look for female entrepreneurs in the compounds. As a result, the project has 14 women only groups, involved in tie and dye activities, tailoring, baking, oil extraction and homecraft, etc. Additionally, women can be found in other (mixed) groups. Efforts to contact more women ISOs and to form women’s groups are still being made.

The process that Groups undergo: The groups decide how often, when and where they will meet. The majority of the groups agreed to meet once a week. Some groups who had wanted to go through the process quickly, agreed upon meeting twice a week. In their meetings, the groups go through a process that enables them to critically look at their situation and come up with a way forward that can assist in improving their businesses. They go through this process with the facilitation of the PAs. The process consists of the following steps:

• discussing about their businesses,
• identifying problems that they face in their businesses,
• clustering the problems,
• prioritizing the problems,
• discussing about the root causes of their problems,
• making action plans for solving their problems,
• implementing the action plans.

3.4 Addressing Problems Faced by MSEs

During the process of analysing the problems that MSEs face, a number of problems came up. The problems of MSEs are similar in all the markets of the three towns. After clustering and prioritizing them the following were identified as major problems:

• lack of capital for raw materials and equipment/tools (by about 50% of MSEs),
• lack of skills and business management abilities (about 30%),
• lack of market for their products (about 10%),
• lack of space for shelter to operate from (about 10%),
• lack of commitment and discipline in business - this problem affects nearly everybody except that the extent to which it affects each person differs.

In the 24 months of cooperation with Project staff, the majority of the MSEs have not been idle but has been trying hard to solve their problems. With the support and encouragement of the project, the MSEs have taken various efforts to solve their most urgent problem.

• To overcome the lack of capital:

- 28 groups were linked to micro-finance institutions so that they can be able to borrow.
- MSEs opened accounts with banks for the purpose of saving their money in a safe manner instead of keeping it in their homes or pockets where it can be stolen or used for other purposes. They now realize that they can get interest for their savings, that they can use their savings for personal purposes instead of misusing business money, and that they can use their savings as security if they want to borrow from those banks.
- 16 groups have formed their own associations and co-operative societies. Their aim is to mobilize own resources for the creation of their own credit schemes. They feel that in that way they can be able to get credit cheaply since they will make their own rules unlike the banking conditions which they find to be harsh.
- Some groups that have been selling their products on credit have decided to stop after realising that most of their capital has been tied in credit given to clients.
- Some groups have written to their Members of Parliament asking for both financial and non-financial support.
- Some groups buy in bulk in order to be able to negotiate for lower prices.
- Some groups use group transport, which helps reduce the costs of transport.
- Some women’s groups carry out fund-raising activities to raise money that can help in solving some of the problems such as opening bank accounts, paying for members that have problems to pay back loans, etc.

• Skills and business management deficiencies - MSEs have realised that:

- they have a problem to sell their products because some of their products are of poor quality;
- they lack knowledge on pricing their products, so that the prices are either too high or too low;
- they do not know how to look for markets or how to advertise their products.

• In order to solve the marketing problems:

- MSEs have continued approaching local institutions in search of markets for their products.
- Some have tried to improve the quality of their products in order to be attractive to their customers.
- Efforts to do pricing more professionally than before are being made.

• To overcome the lack of space for shelter to operate from, MSEs have, with the advise and support of PAs, continued approaching municipal councils for space.
  
• Lack of commitment and discipline is being considered seriously by ISOs. They have realised that it is important for them to distinguish between business and personal requirements.

3.5 Linking of Groups to Local Institutions: As earlier indicated, one of the objectives of the project is to assist ISOs to learn how to solve their problems on their own. Whenever MSEs group need the cooperation of other organisations in their problem solving endeavours, the role of the project is to link the groups to such local organisations. This cooperation has two aspects: firstly, MSEs need governmental agencies and private sector entities as allies for the improvement of the enabling environment. Secondly, there exist partnerships between MSEs and other organisations which usually last long (e.g. supplier-client relationships) and easily surpass the project’s duration. By assisting the MSEs to tap the resources locally available, will take them way longer than if the project would give them the resources. It is a do-it yourself concept confirmed by the saying that “if you give a person a fish, you feed that person for a day, but if you teach her/him to catch fish, you will feed that person forever”. During the last four years, the project has been able to link some MSEs and their groups to local organisations/institutions for various support:

• 28 groups have been linked to micro-finance institutions for funding.
• 350 MSEs (135 female and 215 male) have been linked to commercial banks for saving and borrowing purposes.
• One group has been linked to Zambia Oxygen Ltd (Zamox) and Crown Cork in Ndola, for the purchase of raw materials (empty drums).
• Many groups in search of space for shops, water facilities, etc. have been linked to councils.
• Many MSEs participated in an exhibition organised by various institutions.

3.6 The Project’s Direct Contribution

Apart from facilitating, guiding, advising, counseling, etc. the Project has made direct contributions to the MSEs in the following areas:

• Training in Leadership Skills: 297 ISOs (119 female and 178 male) have been trained in leadership skills.
• Training in Technical Skills. As a condition for the improvement of the quality of products, the Project conducted nine (9) skills training courses in carpentry and tailoring.
• Business Management Skills. Management skills are lacking among the majority of the MSEs. To assist the situation, the Project trained all the PAs in One Up Business Management. In turn, the PAs have conducted 78 courses in business management so far, for 904 ISOs (317 female and 587 male). More courses are to be conducted.
• Project Staff, Advisory Board members and Representatives of ISO groups sometimes make joint visitation to various institutions that may help to solve some of the problems that ISO groups fall.

4.1 Groups: The Project is working with 1,546 ISOs (545 women and 1,001 men) organised in 108 groups. 38 groups were concluded by the project. Some of them reached a stage where they felt that they had accessed the services that they needed from the project and would now work on their own. Some were excluded because they were not cooperating and were not willing to participate actively in implementing their action plans. Under the circumstances, the project had to organise 30 new groups in order to continue working with the original number of 100 groups.

4.2 Other People Reached by the Project: More people than the MSEs working directly with the project have been reached through the monthly radio programmes that the project conducts. They are produced in English and two local languages (Bemba and Nyanja) that are used in the areas where the project operates. Depending on the message to be passed to the listeners, the project decides on who participates in the programme. The project staff, ISOs, Advisory Board Members and staff of SRDC-SA all get an opportunity to contribute to the radio programmes. People do write to and call the Project office and some make personal visits after they have listened to the radio programmes. They request for advice in business matters and some enquire as to how they can participate in the project. Some people in areas where the project is not operating enquire whether it will be extended to their areas. Besides radio programmes, the project also reaches more people through newspapers, television programmes, bulletins and forums organised by other institutions.

5.1 Purpose: The Project in Zambia held its National Workshop on 26th-27th March, 1998, whose purpose was:

- To bring together all the stakeholders who include (ISOs), Private Sector, Civil Society and Government, in order to enhance the process of developing an enabling environment for the informal sector, as a condition for its increased contribution to the country’s economy.
- To promote partnership between ISOs and other stakeholders through a consultative process in which sharing of experiences and information, reviewing of project activities and distribution of information will be enhanced.

5.2 Objectives - The objectives of the workshop were that by the end of the workshop, we should be able to have:

- Described the process, outcome and shared the experiences learnt from the project.
- Assessed the methods/approach, the implementation strategy and results of the project.
- Learnt from the projects Phase II methodological approach, implementations and organisation set-up and consequences for Phase III.
- Initiated groups and experiences learnt so far to seek support from the informal sector.
- Initiated discussions and considerations on the broadening, continuation and sustainability of the approach and process.

5.3 Expected Benefits to the Target Group – As a result of participating in the workshop, it was anticipated that the participants would enjoy the following benefits:

- ISOs would have an opportunity to meet and interact with different individuals and organisations that can be of help in their efforts to promote their businesses.
- Local organisations would be able to meet some of the possible clients for their organisations.
- All stakeholders would be able to meet and share experiences, approach and process of the Project that they may use in their work with the informal sector.
- Government would be able to learn from the ISOs and Project approach and process on how best they can be able to promote the informal sector in Zambia at the present situation of high rate of unemployment.
- Local organisations will be able to get information on the activities of the micro and small enterprise.
- Stakeholders would be able to know the efforts that the ECA is making in the promotion of the Informal Sector in Africa.

5.4 Outcome of the Workshop - The two days workshop was attended by 192 participants. The workshop was held in a frank and friendly manner with due regard to the different opinions that were expressed. It was gratifying to note that ISOs were aware of the purpose of the workshop and actively participated in the deliberations both in group and plenary sessions. The other workshop participants were attentive and sympathetic to the cause of the ISOs. This was demonstrated at one stage by the immediate production of a list of Micro Finance Institutions for the ISOs’ use when the issue of where to get finance kept coming up.

The Workshop was encouraged to make practical recommendations for the resolution of the eight main problems that ISOs face which include:

- lack of access to finance
- lack of access to training
- lack of access to raw materials
- lack of access to markets
- lack of access to production and marketing space
- social problems
- registration, tax assessment/harassment

5.5 Follow-up Activities - There was broad consensus among the participants that there should soon be organizational structures in place that can continue the commendable work that the Project had started. Specifically, the following were decided upon:

• After the review of the workshop proceedings by the Project’s Advisory Board and, all potential partners were to be invited to a workshop for discussions on how the project was to continue.
• Linkage between ISOs and financial institutions, training institutions, councils, government registration (land companies, etc.) agencies, insurance agencies, suppliers of raw materials, were to be established where they did not exist and strengthened where they did exist.
• Formation of ISOs’ associations to carry out advocacy on several issues was to be encouraged; Business co-operatives of ISOs should be formed.
• Review of relevant legislation, e.g. Town and Country Planning Act for the improvement of the services offered to MSEs was to be pursued; the review should consider recommendations of the co-operating partners and ISOs.
• That a follow-up workshop on Access to Production and Marketing Space by ISOs be held after six months from the date of the National Workshop. The Workshop was to be attended by officials from the Ministries of Local Government and Housing, Lands, Councillors and members of the Market Advisory Committees from Lusaka Urban, Ndola Urban and Kitwe where the Project is operating. The ISOs and co-operating partners of the project were also to attend this workshop.

Phase III of the Project started in January 2001 with the following activities:

- linking of MSEs to local institutions.
- organising new groups to replace those that have been concluded/graduated.
- implementing recommendations and follow-up activities from the National Workshop.
- training of the ECA/SRDC-SA staff.
- deciding on the continuity of project activities after end of project in August 2001.
- implementing the Revolving Micro Credit and (RMCF).
- training of ISO groups in business management, credit management, technical skills and leadership.

Many ISOs groups identified lack of capital as one of the biggest problems hampering their enterprises from developing. In order to assist ISO groups to access credit, the project linked ISO groups to micro finance institutions (MFIs).

However, a number of ISO groups could not meet the conditionalities that MFIs had. Even some of the ISO groups that managed to meet the conditionalities did not find it easy to repay back loans. Some of such conditions are of making weekly/bi-weekly repayments and in most cases interest rates were very high. Weekly/bi-weekly repayments are not easy to meet specially for manufactures/producers who are the target participating in the project because their products take longer to make and sell. The extension of the project to Phase III enabled ECA and the project to consider implementing the RMCF as an additional direct intervention by the project to ISO groups. Credit documents for the purpose such as credit policy and procedures, application forms, letters of offer, loan agreements, etc. were prepared/revised by the project for use. Implementation of the RMCF officially started in September 2000 with a fund of US$20,000.00.

Purpose of the Fund: The RMCF is designed to provide small credits that will help the members with working capital or/and to meet investment requirements. The RMFC is based on the Grameen Bank Model adopted to local realities.

Eligibility: ISO groups that have participated in the project activities and have formalized their groups into associations, cooperative societies and business names. Informal groups that have been active in implementing activities aimed at solving their problems are also considered.

Criteria: The criteria for groups to qualify include:

- groups with duly elected boards/committees;
- provision of a basic business plan to show that the project is viable and will be able to pay back the loan with interest;
- payment of a K5,000 as application fee;
- deposit record in terms of membership contribution and savings;
- 10% of loan to be deposited in the RMCF’s savings account as down payment;
- 1% of total loan to be paid as processing fee;
- group members approve applicant’s business plan;
- all members get loans at the sametime
- all group members guarantee the loans received;
- the groups in addition to guarantee the pledge items worth the amount borrowed as collateral to the RMCF;
- all group members should have undergone some basic training in business management and credit utilization;
- loanees have identity ands issued by the project.

Modalities of Disbursement: Modalities for disbursing loans include the following:

- The loan to the group is repaid in equal monthly instalments. The total loan is paid back within the shortest possible period and maximum of six months;
- The interest rate charged on loans given is determined by the base rate plus a minimum of 10% and is subject to change any time. Currently the interest rate is 30% annum;
- A group does not get a second round loan before it clears the first round loan;
- The groups are responsible for the loan provided to their members. Failure to repay a loan leads to penalties that include fines, disqualification from getting another loan and legal action;
- The value of the first round loan does not exceed K200,000.00 (US$55) per beneficiary. The maximum valve of a loan is K1,000,000 (US$275) per beneficiary after three (3) rounds;
- When a group has paid back the loans of one round, it may get another round of loans which will be higher than the previous ones;
- The ISO groups executive members are required to cooperate with the project in facilitation of loan disbursement, repayments, savings and has to assess a regular basis it members are using the loans according to the purpose that they applied for.

Audit and Site Visits: The project makes internal audits every month to ISO groups that get loans. The project also makes weekly visits to groups that get loans where guidance, advise, etc. is provided on spot. Other interested parties do visit the groups as well.

Outreach of the RMCF: 35 ISO groups have accessed loans since the RMCF started in September 2000. In all 491 (181 female and 310 male) ISOs have accessed loans. Total loan amount given out is K115 million (US$31,680.00). Out of the 35 ISO groups currently participating, five are in their second round loans after paying back their first round loans within 1-4 months time. 30 groups are in their first round loans.

Loan Repayments: In most cases loan repayments have not been very bad. Slow loan repayments were experienced during the months of December 2000 to February 2001, reasons being that this is the period when new school calendar start in addition to Christmas and New Year holidays. This is also the period when we experience heavy rains that most markets where ISO groups operate get flooded and impassable for would be customers to reach the ISOs. However, an average repayment rate has been 88.33% for the last five months. The project is assisted by the Credit Committee of the Advisory Board. Majority of the members of the Credit Committee are representatives of the MFIs.

During the national workshop held in March 1998 and during other forums attended by ISO groups and other stakeholders, it was decided that project activities should be continued and replicated in Zambia under a different structure.

Since then the project and ISO groups, with the support of the Advisory Board and through the Sub-Committee on Sustainability and Training, have been discussing on how the project activities can be continued. Currently, the option at hand is of merging project activities with activities of another GTZ funded project – the Integrated Skills Training Project for the Informal Sector (STEP-IN). Once the merger has been implemented, there will also be a possibility of assisting ISO groups who have formalized their informal groups into associations and co-operative societies to establish a federation. It is anticipated that once the federation has been established, the federation can continue and replicate the activities even after the end of the STEP-IN project.

Realizing the fact that the unemployment rate has continued to increase in Africa, (i.e. more people are joining the informal sector), ECA will continue their efforts aimed at empowering the ISOs in various ways. The efforts will be continued by disseminating and sharing the participatory approach, information, experiences gained from the four pilot countries with other African countries, UN Agencies, the donor community and other stakeholders. In order for the ECA to be able to disseminate the approach, experiences, etc. it was decided that a training programme be organised for the ECA and SRDC staff that will be involved in counseling and training other stakeholders.

In the year 2000, a consultant was engaged to prepare a training manual for UNECA that will be used to train the staff. The training manual has been completed and training will be conducted from 15th-18th May, 2001 in Zambia and earlier in Ethiopia.

10.1 Experiences: The project staff has experienced a number of issues which include the following:

• It proved difficult to change the prevailing attitude of ISOs, that is, a demanding one, just asking for resources. It took the project a long time to convince some of the ISOS that they are better off if they learn how to solve their problems on their own because they would use that skill for a long time. Receiving resources would only help them for a short time.
• Lack of appreciation of non-financial support by most ISOs compared to financial support. As a result of the previous donor approach of provision of resources like loans, grants, most ISOs do not regard non-financial support as help that can benefit them.
• ISOs are different and they react differently to new approaches meant to promote/develop their businesses. ISOs who seriously want to improve their businesses are willing to learn, while those who are not serious are not willing to learn. They only demand grants to be given to them. They are just there to chance any resources that projects or donors may bring.
• The level of lack of information among MSEs in the informal sector on the one hand and local institutions in the formal sector on the other, on how they can support each other is high. When there is an intermediary like the ECA Project, which helps to bring the two parties together, a lot of anxiety and interest is shown by both parties.
• Despite efforts taken by most of the Advisory Board members to sensitize their institutions on the need of the informal and formal sectors to work together, not much change has taken place to provide the enabling environment.
• Culture of people only expecting gifts or free things and as a result are not responsible to pay back loans.

10.2 Strengths - The strengths of the project lie in the fact that:

• The Project uses a participatory and group approach which enables all the participating ISOs to take an active role at all levels of implementing the project activities. They are guided to make their own decisions. The group approach enables the project to reach many people within the short period.
• Most ISOs co-operated well and participated actively in the group work. Some excelled by meeting and taking actions alone, i.e. in the absence of the PA. All of them spared their precious working time for the group meetings and activities without receiving any compensation by the project. They recognised that the group meetings and activities are in their own long-term interest.
• The presence, dedication and hard work of the Project Animators who tirelessly spent their time facilitating, training, advising, guiding and counseling the ISOs despite the pressure for funding exerted on them by ISOs, made it possible for the Project to achieve what it has been able to do.
• The PAs are:
  - serious, committed, development oriented, and, if necessary, work after working hours, at weekends and on holidays,
  - open to learn and share experiences,
  - team oriented and have a high team spirit,
  - have grasped the sector’s strength and needs and are developing a good experience. They are the future NPCs and Sub-Regional Trainers and Advisors when it comes to disseminate the approach Africa-wide.

• The continued support and guidance by the members of the Advisory Board to the NPC and the Project as a whole allowed the Project to make contacts, access support and information for MSEs from some of the local institutions. The members:
  - exhibit genuine interest in, commitment for and ownership of the project, are reliable in their presence at meetings and in their assistance whenever needed,
  - take interest in the MSE sector, too, get exposed to it by visiting ISOs at their production sites and attending some of their meetings, counsel and help jointly and individually,
  - helped actively to prepare the National Workshop,
  - look for ways and means to consolidate, continue and replicate the project activities after its ending.

• Continued and close guidance, counseling, supervision, training and the preparation of funds by the CTA to the NPC and the project as a whole enabled the project in Zambia to achieve what it has been able to do.
• ECA Headquarters and the SRDC-SA made available the funds when required which made it easy for the project to implement its activities. SRDC-SA staff participates actively in the project activities whenever called upon.
• GTZ’s efforts as financier of the Project need great appreciation. Without its contribution UNECA could not have tried a promising approach in Zambia that can be broadened and continued.
• Cooperation by local organisations/institutions.

10.3 Weaknesses - The weaknesses of the Project include the following:

In conclusion, it is important to re-emphasize the fact that most of the African countries in the region are faced with a high rate of unemployment. As a result, most of the people are trying to work on their own as business persons. It is for this reason that the objectives and approach of the project that have been initiated by the ECA in Zambia, implementation of the project activities, activities undertaken by the project in Zambia, outreach of the project and experiences learned from the project could be utilised by other African countries in the region in their efforts to promote the Informal Sector. Once the Informal Sector has been developed in the countries, they will go a long way to contribute towards the economies of many African countries.