The role of the informal sector in the national economyMOZAMBIQUEIntroduction============In an attempt to answer the topic this essay will discuss the role of the informal sector in the Mozambican economy. For a better understanding of the topic, some important definitions are given. For the purposes of this essay, the concept of economics can be defined as the science concerned with the production and consumption of goods and services, the circulation of wealth, and the redistribution of income. On the other hand, the concept of informal sector was introduced into international usage in 1972 by the International Labor Organization (ILO) in its Mission Report to Kenya. Although there is no consensus on the definition of the informal sector, other than the fact that in Mozambique the concept varies according to different historical periods, the following are the common characteristics of this sector as defined by the ILO: (a) ease of entry; (b) dependence on indigenous resources; c) family ownership; d) small-scale operations; (e) labor-intensive and adaptive technology; f) skills acquired outside the formal sector; (g) unregulated and competitive markets. Since then, various authors and the ILO itself have introduced numerous definitions. The 1999 ILO/ICFTU International Symposium on the Informal Sector proposed that the informal sector workforce can be classified into three broad groups: (a) owner-employers of micro-enterprises, few paid workers, with or without apprentices; (b) self-employed workers, who own and manage a sole proprietorship, who work alone or with the help of unpaid workers, generally family members and apprentices; (c) paid or unpaid employees, including paid workers in micro-enterprises, unpaid family workers, apprentices, contract work, home workers and paid domestic workers. (Santos inDhemba; 1999)Economic-social situation in Mozambique======================================== The signature of The peace agreement and the implementation of the Structural Adjustment Program (SAP) in Mozambique have caused an impoverishment of the poor, especially in cities where the decline in purchasing power is more felt since it is more difficult to find an alternative income for buy food. Market liberalization has opened up the possibility of importing goods, however the purchasing power of Mozambican citizens is still very low. There has been an increase in unemployment levels following the mass retrenchment originating from the implementation of the SAP policy. According to a World Bank study and many other studies, unemployment is a strong indicator of economic crisis. Despite all the measures taken by the government to promote economic and social development, this development has not spread fast enough to the masses. Due to the pervasive effects of economic globalization, population growth and urban migration, the active labor force was growing at a much faster rate than the labor supply.