The advent of globalisation coupled with the recent (2008-2009) global
financial crisis has caused a decrease in formal employment everywhere
in the world in particular the developing nations. This article explores
whether the informal business sector in Buffalo City Metropolitan
Municipality (BCMM) is prioritised as a contributor in the municipality’s
local economic development strategy. A survey questionnaire was
administered to informal business actors in BCMM and semi-structured
interviews were conducted with BCMM managers in the Business
Development and LED Directorates. The study found that the municipality
acknowledges the contributions of the informal business sector in local
economic development from a job creation (self-employment) and
poverty alleviation perspective. The lack of financial support, the absence
of a clear policy or strategy dedicated to the prioritisation of the needs
of the informal sector, and the lack of designated trading space for the
informal sector specifically, however, hampers the informal business
sector’s optimum functioning.