The informal economy, poverty and employment project is a sub-regional initiative which has been implemented in Cambodia, Mongolia and Thailand.

It seeks to achieve its broader goal - to reduce poverty through improving the quantity and quality of decent work opportunities for women and men in informal economy - by promoting:

• Organization, representation and voice;
• Improved productivity and market access; and
• Reduced vulnerabilities.

Project provides a Decent Work integrated approach to the informal economy (IE) as well as poverty alleviation for informal economy workers and operators.

Delivery of the initiative - via the ILO constituents and other non-governmental and community organizations working with the informal economy.

Target group

The direct recipients are ILO constituents and other stakeholders including informal economy workers and employers. The ultimate beneficiaries are poor women and men in the informal economy inclusive of young people and disabled workers.

Immediate objectives:

• To create greater awareness and enhance capacity of ILO constituents and key stakeholders to formulate, implement, monitor and evaluate policies, programmes and projects for the informal economy;
• To foster enabling environment and enhance capacity of informal economy workers and employers to move towards decent, productive work through realization of their rights, voice and representation;
• To increase earnings of beneficiaries in replicable pilot projects for higher productivity and market access through activities that enhance representation and voice;
• To identify and implement concrete measures to improve the social protection of informal economy workers and employers through representative organizations; and
• To facilitate replication of lessons learnt and good practices from pilot projects, as part of the ILO’s global programme on the informal economy.

Informal economy in Mongolia in brief

Informal economy is a new phenomena in Mongolia emerged with transition to the market economy. Following are some figures showing the current situation of IE in Mongolia:

• 126 thousand people engaged in informal economy (LFS, NSO,2004);
• Main activities: retail trade, services, financial services, manufacturing, transport, artisanal mining (32 activities listed as informal for taxation purpose);
• 44.9per cent of IE people engaged in service; 34.9per cent - in manufacturing and trade sectors;
• 55.2 per cent-male; 44.8per cent-female; 64per cent - people aged 20 – 40;
• From 115 thousand PWDs 4per cent- working in informal economy, 90per cent - unemployed;
• 98.9per cent of total working children are self employed;
• 70.9per cent-urban, 29.1per cent-rural; high rural-urban migration (1/3 of UB population are in-migrants); and
• 70.5 per cent - education level higher than complete secondary.

Challenges and opportunities for Mongolia to implement this project:

• ILO-Mongolia cooperation: Built on previous initiatives (study in 2001, National Conference on IE in 2002, draft policy document );
• State - Strong presence of the state (and social partners) and high literacy provides good starting point for capacity building in new areas of governance needed for transition (local planning, service delivery, entrepreneurship, business registration/regulation, local development);
• Representative organizations - Fewer players in the private sector but continuing effort to identify and support/strengthen representative organizations;
• Private sector - Need support & acceptance of small economic actors, such as street vendors; and
• Strong internal migration patterns results in rise of IE.