The role of the informal sector in the national economyMOZAMBIQUEIntroduction============In an attempt to answer the topic, this essay will discuss the role of informal sector in the Mozambican economy. For a better understanding of the subject, some important definitions will be given. For the purposes of this essay, the concept of economics can be defined as the science that deals with the production and consumption of goods and services, the circulation of wealth and the redistribution of income. on the other hand, the concept of informal sector was introduced into international usage in 1972 by the International Labor Organization (ILO) in its mission report to Kenya. Although there is no consensus on the definition of the informal sector, and in Mozambique the concept varies according to different periods of history, here are the common characteristics of this sector as defined by the ILO: (a) ease of entry; (b) dependence on indigenous resources; (c) family property; (d) small-scale operations; (e) adaptive and labor-intensive technologies; (f) skills acquired outside the formal sector; (g) unregulated and competitive markets. Since then, different authors and the ILO itself have introduced numerous definitions. The ILO/CISL international symposium on the informal sector organized in 1999 proposed that the informal sector workforce could be classified into three broad groups: (a) owner-employers of microenterprises, some paid workers, with or without apprentices; (b)own-account workers, who own and operate a sole proprietorship, who work alone or with the assistance of unpaid workers, usually family members and apprentices; (c) paid and unpaid dependent workers, including employees of micro-enterprises, unpaid family workers, apprentices, contract workers, home workers and paid domestic workers. (Santos to Dhemba; 1999)Socio-economic situation in Mozambique============================================================================== ================= The peace agreement and the implementation of the Structural Adjustment Program (SAP) in Mozambique have caused impoverishment of the poor, particularly in the cities where the decline in purchasing power is felt the most, because it is more difficult to find alternative income to buy food. Market liberalization has opened up the possibility of importing goods, but the purchasing power of Mozambican citizens is still very low. There has been an increase in unemployment levels due to the mass withdrawal caused by the implementation of the SAP policy. According to a World Bank study and numerous other studies, unemployment is a strong indicator of economic crisis. Despite all the measures taken by the government to bring about economic and social development, this development has not spread to the masses quickly enough. Due to the pervasive effects of economic globalization, population growth and urban migration, the labor force was growing at a much faster rate than the availability of human resources.