The informal cross-border trade : the case of informal cross-border trade between Lesotho and Durban - South Africa.
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The processes of globalisation and trade liberalisation promote formal international trade world-wide. The processes have been accompanied by the renewed vigour to improve international competitiveness of the formal enterprises. Amidst these changes, there is a growing interest in the extent of informal sector activity as a form of income generating or subsistence activity within the developed and developing countries. However, little agreement exists in the literature as to what constitutes the informal economy, what activities in addition to monetary exchange make up the informal economy and where these activities are located. The lack of consensus on the proper definition is reflected in the lack of systematic information about all the caveats of this sector. As a result, the informal crossborder trade has failed to attract attention of the academic researchers. Little is known about whether the benefits of globalisation and trade liberalisation trickle down to the lower end of the informal sector. This study explores and describes the problems faced by the Lesotho informal cross-border traders operating between Lesotho and Durban. It provides a profile of their experiences and problems along different stages of their journey. That is between their homes and the border gates, at the border gates on the their way to Durban, on their journey to Durban, in Durban, and the border gates on their return journey to Lesotho. This study examines the relationships between these traders and the traders in Durban. It tracts what happens to their goods once they are imported into Lesotho. The study concludes that trade and non-trade barriers pose a number of serious problems for the informal traders, and therefore hinder the development of international trade in the informal sector.