E-formalization regional report

Renewing the social contract through e-formalization in the world of work

Before and during the COVID-19 crisis, countries around the world have made increasing use of digital technologies to leapfrog barriers to formalization and reach out to those in the informal economy. These “e-formalization” policies show considerable untapped potential to accelerate trajectories away from informality and provide protection to those who need it most.

This report explores how digitalization can add to or detract from the goal of transitioning to the formal economy drawing on selected examples from developing countries in Asia and sub-Saharan Africa. Part 1 of the report examines the barriers to e-formality and factors preventing countries from leveraging the digital economy to encourage shifts towards formal economy. Part 2 details examples of public policies which are making an impact in developing economies’ abilities to unlock ICT opportunities for inclusive development. Part 3 examines the three policy spheres that link to e-formalization and proposes some guiding principles and building blocks for policy development.