Another Alternative to Reduce the Unemployment: Formalization of Informal Sector Entrepreneurship in Djibouti

The main aim of this paper is to provide a harmonization of the classification of economic activities in Djibouti based on international classification of economic activities. For this, the paper uses the data reported by Djibouti National security Fund (DNSF) and Djibouti Chamber of Commerce (DCC). The harmonized classification allows to give better visibility when it comes creating jobs for business sector and will also help single desk service. The new classification allows to establish a comparison between the informal and formal economics activities. We also estimate the employment created in the informal sector using this new approach. According to our new approach, there are at least 178 enterprises in the informal sector and at least 790 employments in the informal sector. These informal employments can move to 790 formal employments. In the preceding work, we provided a classification of unemployed people and classified economic activities belong in the illegal sector. Then, we estimated there are at least 15670 employment opportunities which allows to reduce the unemployment of order 6¨%. This contribution allows to lower unemployment in Djibouti and provide useful guidance for policy makers in the Republic of Djibouti.