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While the informal sector is the ‘forgotten’ sector in many ways, it provides livelihoods, employment and income for about 2.5 million workers and business owners. One in every six South Africans who work, work in the informal sector. Almost half of these work in firms with employees; these firms provide about 850 000 paid jobs – almost twice direct employment in the mining sector. The annual entry of new enterprises is quite high, as is the number of enterprises that grow their employment. There is no shortage of business initiative and desire to grow.
The social and economic successes of Asia have drawn global attention to the developmental state as a possible model for developing countries. In South Africa, many, including government, see this as a possible panacea to the country's social, economic and institutional crises. However, a government committing itself to constructing a developmental state is one thing; actually implementing the necessary institutional and policy reforms to bring that into reality is another.