Social Sciences & Humanities Open 3 (2021) 100094

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Social Sciences & Humanities Open

journal homepage: www.elsevier.com/locate/ssaho

Ghana’s informal economic sector in the face of a pandemic

Philipa Birago Akuoko *, Vincent Aggrey , Anastasia Amoako-Arhen
Development Studies, Kwame Nkrumah University of Science and Technology, College of Arts and Built Environment, Department of Planning, Ghana

A R T I C L E I N F O A B S T R A C T

Keywords: Africa has not been spared the socioeconomic effects of Covid-19. But with a different socioeconomic setup where
Informal worker informality takes the center stage, the effects of the pandemic in Africa is like no other continent. The neo-liberal
Pandemic approach to informality on the continent meant that the informal sector’s contribution to development was
Global south
largely neglected. Specifically in Ghana, city authorities have been preoccupied with displacing informality or
Cities
absorbing it into the formal sector. Consequently, the state had weak social safety nets for informality. Ironically,
how well Ghana will do in the face of the pandemic now lies in the hands of the seemingly neglected informal
sector. Like the case of the rejected stone, the road to Ghana’s socioeconomic recovery rests on the informal
sector. This paper discusses the concept of informality during a pandemic, the economic power that rests in the
hands of informal workers, and their neglect by city authorities that demonstrates the need for governments to
reform its regulations regarding the informal sector during and after this pandemic.

1. Covid-19: the Ghanaian situation
With the growing number of cases recorded all over the world, the
effects of the Covid-19 pandemic are evident globally in all aspects of life.
The effect of the pandemic on the African continent was feared and
speculated by several scholars and institutions (British Broadcasting
Corporation (BBC) (2020); World Health Organisation (WHO) (2020);
Wills, 2020; Zhao et al., 2020) and the Gates (The Africa Report, 2020) to
be worse than seen in other parts of the world. Contrary to these pro-
jections however, as of August 29, 2020, the African statistics on the
Covid-19 pandemic was a total of 1,230,159 cases; 29,106 deaths; and
961,692 recoveries (Aljazeera, 2020).
In the Ghanaian context, the Ghana Health Service announced on the
March 12, 2020 to the general public the confirmation of two imported
cases of Covid-19. Consequently, from results of Covid-19 tests con-
ducted on the two suspected infected persons, the Ministry of Health
(MoH) initiated contact tracing of people that the suspected people
encountered upon their arrival in the country (Ghana Health Service
(GHS), 2020). This incidence further necessitated a push for mandatory
quarantine of all inbound travellers to minimise the importation of
possible cases from the March 21, 2020. A complete closure of all entry
points into Ghana was implemented on March 22, 2020 (Ministry of
Information (MoI) (2020). The number of cases attributable to contact
tracing was soon increasing in the major cities of Accra, Tema and
Kumasi, three cities with the most confirmed cases. This development led
to a partial lockdown of these cities on March 30, 2020 for two weeks and
later extended for another week, bringing the lockdown period to three
weeks. At this point, there were several outcries by various classes of
people in Ghana for diverse reasons.
Most workers in the formal sector, particularly the elite applauded the
government for the steps taken to ensure people observed ‘stay at home’
and ‘social distancing measures’. These measures, they proclaimed to
have yielded positive results in limiting the rate of spread of the Covid-19
pandemic in China and other countries that had been worse plagued
(Zhao et al., 2020). On April 20th, 2020 the President of Ghana, Nana
Addo Dankwa Akuffo Addo addressed the country once more and this
time round, citing an exhaustive and aggressive contact tracing outcome,
lifted the lockdown on these cities intimating that citizens were now in
charge of their own health and welfare. He admonished the citizens to
resort to the use of nose masks in public and also advised the practice of
social distancing, washing of hands and use of hand sanitizers as had
earlier on been entreated.
The other side of the lockdown narrative is the outburst of private
sector workers; mostly traders in the informal sector, artisans and en-
trepreneurs who were concerned about their economic upkeep in these
difficult times (The Guardian, 2020). Informal workers, mostly street
hawkers, and traders in open spaces were some of the most affected
group who recounted their inability to afford food for sustenance for the
three weeks’ period that these cities were locked down while entrepre-
neurs were worried of having to pay their staff in these times without

* Corresponding author.
E-mail addresses: philipabakuoko@gmail.com (P.B. Akuoko), vincentkwesiaggrey@gmail.com (V. Aggrey), anasamoakoarhen@gmail.com (A. Amoako-Arhen).

https://doi.org/10.1016/j.ssaho.2020.100094
Received 7 May 2020; Received in revised form 24 November 2020; Accepted 27 November 2020
Available online 11 December 2020
2590-2911/© 2020 The Author(s). Published by Elsevier Ltd. This is an open access article under the CC BY-NC-ND license (http://creativecommons.org/licenses/by-
nc-nd/4.0/).
P.B. Akuoko et al.
making revenue (International Trade Centre, 2020). Also, artisans who
receive their wages on a daily or weekly base could not earn money
during the locked down period. In an attempt to assist the poor in cities,
the government provided daily meals to feed those who could not afford.
However, concerns were raised regarding the cost of meals and the
manner in which they were districted particularly without recourse to
COVID 19 protocols.
This scenario describes the economic effect of the Covid-19 on
workers in Ghana, particularly informal workers. Consequently, this
paper establishes how the decision by the government to lift the lock-
down was from pressures mounted by informal workers born out of
economic distress and not merely a resultant effect of the effective tracing
that the ministry of health had undertaken.
2. Conceptualising informality during a pandemic
UN-Habitat (2013) asserts that out of every 10 urban dwellers of the
world, a minimum of 7 were located in the global south cities that are
dominated by informality (Roy, 2014, pp. 9–27). The growth in infor-
mality according to Watson (2009) is because governments are unwilling
to provide infrastructure; residents unable to pay for the services and
poverty rates keep shooting up. Informality in Africa has been the pri-
mary response and management strategies adapted by urban dwellers to
reside in the city, exploit opportunities in the market and simply, survive
(King & Dovey, 2013).
Informality is not a binary concept; it stretches from economic ac-
tivities to settlements (King and Dovey, 2011; Obeng-Odoom, 2011) and
goes beyond a phenomenon strictly related to poverty and poor countries
(Organisation for Economic Co-operation and Development (OECD),
2009; King and Dovey, 2011). Banks et al. (2019) advocate for the ho-
listic and critical analysis of the informality because it has transended
economies and keeps bulging in spite of efforts to curb it (Obeng-Odoom,
2011; Steel et al., 2014).
The assumption was that the workers in this sector are the ‘margin-
alised’ workforce (Williams & Youssef, 2014) with no formal qualifica-
tion (Yusuff, 2011; La Porta & Shleifer, 2014) who is in the sector as a
survival strategy (de Soto, 1989, 2000; La Porta & Shleifer, 2014).
Contrary to this assumed notion of the informal being ‘unplanned’, King
and Dovey (2011) demonstrated that informality springs out of a well
thought out ‘strategic speculative action’ by urban inhabitants. More-
over, Williams and Youssef (2014) have proven that the informal sector
was neither opportunity driven nor necessity driven.
The theorization of the informal sector has gone from being labelled
as ‘hidden’, ‘black’, ‘second’ to being recognized as a permanent and
important aspect of urban lives globally (Darbi et al., 2016; Lindell et al.,
2019). The earlier view of informal sector was that it was transient and
was going to give way for formalisation that came with urbanization and
industrialisation (Goodfellow, 2018; Yussuf, 2011). However, as pointed
out by Charmes (2012), the informal sector has increased in size from
about 37 percent of gross domestic product (GDP) in the 1990s to
approximately 50 percent by 2010 in developing economies.
Despite its recognized importance, city authorities and governments
regard the informal sector as a challenge to urban development (Darbi
et al., 2016; OECD, 2009). City authorities in addressing the manifold
problems posed by the growth of the informal sector have adopted
diverse strategies (Obeng-Odoom, 2011). In times past, basing on the
speculations of the neo-liberal writers, the informal sector was ignored
and left to be absorbed by the formal sector however, the informal sector
has persisted (La Porta & Shleifer, 2014). Regardless, governments in
sub-Saharan Africa have been more focused on the illegality of informal
sector rather than its capacity for development (Mbaye & Benjamin,
2014). As an alternative therefore, city authorities now react to infor-
mality through several means among which are displacements and
resettlements (Cernea, 2006), demolitions, relocations, and evictions
(Steel et al., 2014).
In African cities, socio-economic activities have been discussed
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Social Sciences & Humanities Open 3 (2021) 100094
extensively on its (in)formality and or (il)legality. One of the most
common socio-economic activities in African cities is trading (Asante,
2020); (Ikiodia, 2012); Lindell et al., 2019). It is in line with this assertion
that Ikioda (2012) classifies informal workers as those workers without
government permit, approved trading spaces and or permanent locations
in the city but have inconspicuously inserted, attached or settled them-
selves and their activities into urban open spaces. Informal workers in
sub-Saharan Africa make up over 80 percent of micro businesses in cities
and contribute immensely to the urban socio-economic fabric (Steel
et al., 2014; National Micro Small and Medium Enterprises (MSME)
Policy, Ministry of Trade and Industry (MoTI) 2019).
Regardless of the pressure from city authorities and successive gov-
ernments, the informal sector has been resilient (Banks et al., 2019)
which is in part explained by its unstructured nature that permits the
creation of several enterprises and divergent business opportunities
which have less stringent bureaucracy surrounding its formulation and
regulation. Though the informal sector has been resilient in the past, the
Covid-19 pandemic comes with a new challenge and the sector now more
than ever, has to be ‘re-resilient’. To be re-resilient, the informal sector
will have to improve job security and offer new opportunities to city
dwellers to earn their livelihoods, and enhance their strategic speculative
actions.
The ILO (2020) in its recent briefing paper speculates that as many as
1.6 billion of the 2 billion informal workers in the world will be affected
by the pandemic and the measures to contain it. The dilemma faced by
these informal workers would be to die from hunger or the virus. With
informal workers needing to provide sustenance to their families,
containment measures in countries with large numbers of informal
workers would likely be unsuccessful. The ILO (2020) further asserted
that the African sub region had 83 percent of its informal workers
affected and that the consequences of the pandemic were more severe in
countries where full lockdown measures had been implemented. Ghana
is one such African country.
In Ghana, the governance resentment to informality has meant the
sector was never the focus for successive governments and the only time
they received attention was when they were being displaced or evicted
(Steel et al., 2014). With close to no regulated working conditions
informal workers suffer greatly during ‘lean or low-season’ of work when
demand for their products fall drastically. They mostly have mid-to-high
family sizes and hence high family dependency rates, among others. It is
the above group who make up close to 85 percent of the urban economy
in Ghana (Ministry of Trade and Industry (MoTI) 2019). Women are
disproportionately represented in informal economic activities, though
the composition across regions varies (Chen, 2006; Pedwell & Chant,
2008; Women in Informal Employment Globalising and Organising
(WIEGO), 2012).
This assertion provides an indication of how the pandemic may affect
the health and socio-economic wellbeing of women and households in
sub-Saharan Africa. Aptly put, the Covid-19 pandemic has exposed the
poor safety net for the informal sector that drives the economy. As part of
its recommendations to protect informal workers from the impact of the
pandemic, the ILO (2020) calls for policies to reduce informal exposure
to the virus, ensure adequate health care for the infected, and provide
income and food support to individual and families.
3. Methodology
The paper was conducted mainly through secondary data sources.
Thorough a review of articles from various government and ministerial
websites including the Ministry of Information, the Ministry of Health,
and the Office of the President of Ghana. Articles and reports from
various institutional and organisational websites such as the World
Health Organisation, the British Broadcasting Corporation, the Guardian
and many other websites of media houses and news agencies were
included in the data analysis for the study. Furthermore, literature on
neo-liberal urbanism, informal economic activities and urban
P.B. Akuoko et al.
governance in global south and relevant concurrent data were all ana-
lysed and incorporated into the presentation of the study.
4. Informality and governance response to Covid-19 in Ghana
The importation of the Covid-19 cases into Ghana is similar to that of
other global south countries like Brazil as illustrated by de Oliviere and
Arantes (2020). In that, the disease arrived in Ghana through the elite
and middle class who contracted it on their travels from Europe. The
concentration of infection remains in the capital city of Accra particularly
in elite neighbourhoods. Accra is the leading city with more over 80
percent of recorded cases (Ghana Health Service, 2020). The urban poor
in Ghana refused the efforts of the government to remain under lock-
down because they cannot afford to buy and store food as predicted by
the ILO (2020). The statistics on the Ghanaian situation as of August 31,
2020 is 44,205 total cases, 276 deaths, and 42,777 recoveries.
From the period of lockdown till it was lifted, the various media
websites in Ghana (graphic.com.gh, adomonline.com, myjoyonline.com,
peacefmonline.com) and social media platforms reported on the many
instances of outcry by the poor and vulnerable informal workers who
refuse to adhere to the ‘stay at home’ protocols. In particular, most
market women refused to adhere to the protocols because they preferred
to die from an unknown virus than from starvation. In several markets in
cities of Accra and Kumasi, the law enforcement officers were captured
and seen on social media platforms reprimanding people because they
ventured out of their homes in search of sustenance during the lockdown
period. Consequently, the lockdown was eased after the third week by
the president in his televised address to the nation. With informal
workers needing to work daily for the next day’s ration of sustenance, the
current projection predicts a higher rate of infection among the poor
informal workers most of whom are still in contact with each other. These
informal workers operate markets in Ghana and so the rate of infection is
bound to scale up among such workers particularly when the infected are
mostly asymptomatic as reported by the Ministry of Health (MoH) (MoH,
2020).
In response to the outcry by informal workers and their reaction to the
government’s Covid-19 protocols, the Corona Virus Alleviation Pro-
gramme (CAP) was announced by the President of Ghana on April 5,
2020 in a televised address. The CAP is a comprehensive package to
among other things serve as a stimulus package, and address the social
and economic effects of the deadly pandemic on Ghanaians. Prior to this
address, there had been no effort made to acknowledge and assist
informal workers in any capacity. For instance, the Minister of Finance
addressed Parliament on March 30, 2020 with just a single paragraph to
highlight the vulnerable state of informal workers (Ministry of Finance,
2020). All the support outlined by the minister, Ken Ofori-Atta was
geared towards the formal private sector.
In the CAP package, the government of Ghana has dedicated GHS 600
million funds to be deployed through the National Board for Small Scale
Industries (NBSSI). Most importantly, the CAP acknowledges that Micro
Small and Medium Enterprises (MSME) are distressed by the impact of
Covid-19 and that 40þ percent of these MSME are women led and that
these women are breadwinners of their homes. Moreover, the NBSSI
acknowledges the fact that the micro enterprises are mostly of the
informal sector. Although, the CAP intervention is not proportional to the
impact of the pandemic on the informal economy, it is a welcome attempt
at assisting afflicted workers.
In spite of the fact that a large number of informal workers may not be
able to access the CAP, the provision for those informal workers who will
access it may help to revive their trade and demonstrate their agency in
the urban economy. Moreover, the 1-year loan moratorium is good and
the 2-year repayment period even better. The provision presents gov-
ernment the opportunity to make amends and atone for its neglect of the
informal economy and incorporate it into mainstream governance
system.
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Social Sciences & Humanities Open 3 (2021) 100094
5. Conclusion: the informal sector-previously neglected, crucial
now
The speculation of this paper is that the government decision to lift
the lockdown was born out of economic distress from pressures mounted
by informal workers. During the lockdown period, the government’s
efforts to feed the urban poor was not very effective and people in the
informal sector needed to go back to work to be able to fend for them-
selves. The incessant cries from the informal workers coupled with the
government’s lack of concrete plans to help them were the major factors
that influenced the decision to lift the lockdown.
The argument is that informality is an integral part of the urban
economic fabric in Ghana. The informal economic sector needs to be
better integrated and managed into the urban economy rather than ef-
forts to reform it. The lesson from the actions of informal workers and
reaction of the government of Ghana reveals that the government could
have lessened the socio-economic impact of the pandemic if informal
workers had a better social safety net and could afford to practice
aggressive social distancing. However, with a virtually non-existent
safety net and state support, these informal workers resisted the lock-
down efforts and continue to operate without following legislated
protocols.
The Covid-19 pandemic has showcased the power of informal
workers to cause governments to influence a cause of action. The
pandemic also demonstrates the extent of neglect of the informal econ-
omy by city authorities and calls for closer attention to the informal
sector by stakeholders. The introduction of the CAP intervention is evi-
dence of the ability of the government to manage and enhance the
informal economy.
CRediT authorship contribution statement
Philipa Birago Akuoko: Conceptualization, Methodology, Investi-
gation, Formal analysis, Resources, Data curation, Writing - original
draft, Writing - review & editing, Visualization, Supervision, Funding
acquisition. Vincent Aggrey: Conceptualization, Software, Validation,
Resources, Funding acquisition. Anastasia Amoako-Arhen: Writing -
review & editing, Visualization, Project administration, Funding
acquisition.
Declaration of competing interest
With the submission of this manuscript we undertake that:
We directly participated in the planning, execution, or analysis of this
study.
We have read and approved the final version submitted.
The contents of this manuscript have not been copyrighted or pub-
lished previously.
The contents of this manuscript are not under consideration for
publication elsewhere.
The contents of this manuscript will not be copyrighted, submitted, or
published elsewhere, while acceptance by your Journal is under
consideration.
We have no conflicts of interest whatsoever and have duly acknowl-
edged all references cited.
The cost of undertaking this research was borne by the authors and as
such has no potential of adversely influencing the article’s content.
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