Abstract

Accurately estimation of the size and contribution of the informal sector and non-observed economy is crucial for achieving inclusive national accounts indicators in developing countries. This paper reviews best practices in measuring the informal economy to enhance the accuracy and reliability of economic statistics, with a focus on the unique challenges faced by developing countries especially in Egypt. Drawing on a range of methodological approaches and data sources, the paper highlights key strategies for capturing informal economic activities and integrating them into official statistical frameworks. By synthesizing lessons learned from diverse contexts, the paper offers practical recommendations for improving the measurement of the informal economy to enhance inclusion in national accounts indicators in developing countries. The number of informal sector establishments in Egypt reached 53% of the total establishments, and its production reaches 11% of the total production, and it employs a workforce of up to 31.4%, with 4 million workers.