The Transformative Power and Challenges of Informal Traders in Shaping Urban Development in Incubation Centre, Windhoek, Namibia

Informal traders are a fundamental yet often overlooked force in urban development, shaping both the economic and social landscape of Incubation Centre Katutura, Windhoek. Informal traders play a vital role in community development by fostering economic resilience, social inclusion, stimulating local economic activity and cultural preservation. This study critically examines the role of informal trade in fostering local economic resilience, employment generation, and social cohesion, despite systemic challenges such as regulatory constraints, inadequate infrastructure, and financial limitations. It highlights the entrepreneurial spirit among traders, who navigate economic hardships to sustain livelihoods and support household economies. The findings highlight how informal traders contribute to urban vibrancy by providing essential goods and services, supporting low-income households, and stimulating entrepreneurial activities. However, the sector remains marginalized in formal urban planning and policy frameworks, limiting its growth potential. By analysing the intersection of informal trade and urban development, this study advocates for inclusive policies that recognize the informal economy as a critical driver of sustainable urban growth. Addressing the structural barriers faced by traders through improved access to markets, financial resources, and legal protections can enhance their contribution to economic stability and social integration in Namibia’s evolving urban landscape. These insights provide a basis for policymakers, urban planners, and development stakeholders to foster a more equitable and dynamic urban economy.