Formalization of MSMEs is essential for the formalization of employment in those enterprises. It goes hand in hand with a conducive business environment, economic growth and better working conditions. It also leads to increases in tax revenues which are needed to provide public goods and services. Formalization benefits businesses to the extent that it reduces unfair competition from informal enterprises. Formalized enterprises gain access to finance, business development services and technologies and reduce their exposure to government fines. They can also participate in public biddings or act as suppliers or retailers for larger companies. Some of the good practices on MSME formalization in Africa are presented in this report.
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