Hawkers: A Blight or Shrewd Businessmen?

Posted on 19 March 2008. Filed under: Economy, Governance, Poverty |

Hawkers go about their business

In developing countries the informal economy sector comprises one half to three quarters of non-agricultural employment. Specifically, these figures amount to 48% of non agricultural employment in Africa, 51% in Latin America, 65% in Asia, and 72% in Sub-Saharan Africa, excluding South Africa. Employment in this sector operates without contracts, worker benefits, social protection and unionization.

In Kenya, within the CBD of Nairobi, 6,000 street vendors with a daily capital stock worth $1 million line the streets and alleys. According to the Socio-Economic Survey on Street Vendors in Nairobi’s Central Business District carried out by USAID and NCBDA, most of the informal traders are young adults (age 25-34) in the most productive period in life. Almost 70% of them are male. Almost all of them (98.2%) have some level of formal education with more than half (51.7%) having secondary (equivalent to Grades 8-12) level of education. Slightly above 5 % have post-secondary education.

Street vending operates, in most countries, outside the regulation and protection of the state. Also referred to as hawking, it is legal according to the by-laws that govern Nairobi City. While there is revision for street trading laws, another by-law, the General Nuisance by-law, is often used to supersede this provision. Created during the colonial administration, the General Nuisance by-law allows city inspectorates to arrest any individual deemed to be creating a ‘general nuisance’ in public spaces. City inspectors invoke this by-law to harass street vendors, even those who have paid their daily license.

The perspective that street vending is a temporary phenomenon has contributed to the neglect of local and national development planners in consciously integrating the subsector into development plans. Relocation attempts reflect this mindset. Between 1980 and 2005, seven relocation attempts have been made by Nairobi’s City Council. Street vendors however consistently return to the Central Business District (CBD) as it offers a ready and lucrative market for their goods. Relocation efforts have not been successful because the new locations have lower pedestrian traffic and/or customers with lower purchasing power than in the CBD.

According to Dr. Winnie Mitullah (Senior Research Fellow, Institute for Development Studies (IDS) at the University of Nairobi) informal sector activities, such as street vending, provide sustenance for many citizens and contribute substantially to the economy. At the city-level, resolving this tension between the desired modernization of the city and the “non-modern” activity of street vending is critical as part of a larger economic development strategy. In trying to attract foreign businesses and investment and boost tourism, Nairobi’s administration has been seeking the sleek, modern look. It however ignores the fact that street vending and other economic activities provide 70% of Nairobi’s employment while 60% of Nairobi’s population lives below the poverty line. Bridging the gap between modernization and development is imperative.

When stakeholders are ignored in policy formulation, they react at the implementation stage. The skirmishes with the city officials on the streets of Nairobi are the physical manifestation of this reaction to policy. In the light of this, the city council has been reviewing its archaic by-laws as a means of removing regulatory barriers that obstruct business. On the other hand, Parliament is currently debating a Small and Medium Enterprises Bill which if passed, will create a governing council that will oversee the regulation of all formal and informal small and medium enterprises. In both cases, the voice of the street vendors is being brought into the discourse.

Struggling for the right to trade

The UN-HABITAT in its theme Inclusive City argues that an inclusive approach must be used for balancing, reconciling and trading off competing interests and priorities. In most cities, the interests of micro and small enterprises such as street and informal traders are competing with those of medium and large-scale enterprises, with the former being disadvantaged. All types of enterprises in urban areas should have the right not only to the Central Business District (CBD) but to all urban goods and services. The campaign urges actors to discuss the question of ‘who’ in a particular city is excluded from ‘what’ and ‘how’.

Concepts such as participation, empowerment, and social inclusion have become buzzwords that do not make sense to the poor who are engaged in informal economic activities. In the usage of these concepts, emphasis is often placed on participatory development, and participatory political processes, rather than participatory market processes. The Bellagio International Declaration of Street Vendors of November 1995 urges governments to develop national policies for hawkers and vendors by making them part of the broader structural policies aimed at improving their standards of living by giving them legal status, issuing licenses and providing appropriate hawking zones in urban areas. The declaration further calls on governments to integrate vendors into urban development plans.

Legal reform

Clearly the biggest problem so far encountered in most developing countries is the lack of or inconsistencies in the legal framework caused by internal factors such as organizational weaknesses and the workers’ ignorance of their rights. Other factors include undermining by public authorities; negative social attitude towards informal economy; corruption and political manipulation.

Ghana, Uganda, Zambia, South Africa and India guarantee the rights of their citizens to earn a livelihood. In most countries, this legislation has not yet extended to workers in the informal economy. Regulation of informal trade is usually administered through local government bylaws which are sometimes administered in contravention of the constitutional rights of the street vendors.

In a meeting by Streetnet International on collective bargaining in the informal economy and Laws and litigation strategies in street vending sector held near Dakar, Senegal, 26 – 30 march 2007, participating organizations resolved to fight for the adoption of new laws, or reform of existing laws, containing the following elements:

• recognition of informal workers (including street vendors|) as workers, and recognizing their workplaces (e.g. the streets);
• specification of basic constitutional rights of informal economy workers (including street vendors) which are protected in terms of this law;
• formal recognition of the freely-chosen organizations of workers in the informal economy, and their elected representatives;
• statutory representation of workers in the informal economy at local Council level and at national/Parliamentary level;
• formal dispute procedures to be invoked when negotiations in statutory forums reach deadlock;
• clear definition of the role of different national Ministries in relation to workers in the informal economy;
• System of social protection for workers in the informal economy (including street vendors).

The informal economy makes an important contribution to the economic and social life of the city. It also offers diverse opportunities for absorbing the people who are unemployed and for the new entrants into the economy, which include the school leaving youth who are unable to further their studies because of financial constraints.

 

 

By Brenda Marangu
Law Student, Catholic University of Eastern Africa

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