The Law-Growth Nexus II (LGN II): Labour Law and the Enabling Business Environment for MSMEs:-> Phase out of the Zambia Component

Since 2008, the ILO has implemented the Law-Growth Nexus (LGN) Project whose objective is to strike a balance between minimizing the cost of the regulatory burden on MSMEs and enhancing the prospects for competitiveness and growth, without compromising the application of International Labour Standards. The LGN I Project contributed to filling the gaps in information and knowledge regarding the influence labour and labour-related laws and regulations have on MSME employment and particularly on the growth prospects of MSMEs, their decisions regarding formality and the quality of the jobs MSMEs create. Following the conclusion of LGN I, a second project phase, LGN II, commenced in July 2011. The overall objective of the LGN-II Project has been to contribute to a more enabling policy environment for MSME development in Kenya and Zambia by supporting the uptake of and exposure to labour law in the MSME sector. Priority sectors were designated as the public transport (specifically ‘matatu’) sector in Kenya, and the construction sector in Zambia, with 500 more and better jobs created in the MSME sector in each country as the overall outcome. To this effect, the LGN II has invested heavily and developed tools, products and advisory service capacity for the Zambian construction sector. The ILO obtained a no-cost extension agreement from the close of the project in July 2013 to the end of October 2013. Following this no-cost extension, ILO Zambia, in agreement with the project donor NORAD, was provided with the opportunity to develop an exit strategy or phase-out plan to promote the sustainability of the components of LGN II by consolidating the methodologies, tools and networks developed by the LGN II. To build onto the gains achieved by the project and synergize with similar projects without starting any new initiatives, the ILO proposes a nine-month LGN II Phase-out Project to strengthen and deepen the local stakeholders’ capacity to sustain the use of methodologies, tools and products developed by the LGN II Project in Zambia. There are substantial expectations by national stakeholders regarding the ILO's and Norway's commitment to finish what has been initiated and avoid an abrupt ending. This echoes the final evaluation recommendations, as accepted by the ILO and the donor NORAD, which underscored the need to ensure that the investment in and development of tools, products and advisory service capacity by LGN II in Zambia are embedded into the practices of stakeholders in the Zambian construction sector. In addition, the project contributed to the creation of a conducive business environment for MSMEs in which business incentives such as preferential access to markets and better access to finance among MSMEs who comply with labour legislation. In addition to this, the ILO has identified opportunities to continue with some of the components of LGN II through its support to inclusive green growth, job creation and job quality in Zambia under the Green Jobs Programme.

Project symbol

ZAM/14/51/NAD

Admin unit

CO-Lusaka

Start date

25/08/2014

End date

31/07/2015

Total allocation

270522

Total expenditure

Status

Closed

266241

Development Partners

Norway, Norwegian Agency for Development Cooperation

Country/Countries

Zambia

Outcomes

Ratification and application of international labour standards