- Fines for vendors and patrons of Rwanda's huge informal economy
- Crackdown could have devastating consequences
(CNN)The 27th African Union Summit in Kigali showcased a city on the rise.
President Paul Kagame's Vision 2020 program has overseen epic construction projects in the Rwandan capital, such as the $300 million Kigali Convention Centre, and instilled a focus on sustainability that includes a ban on plastic bags, and one day each month of compulsory community service when the public cleans the city.
But the future appears less bright for the thousands of street traders working in Kigali, following a new directive from the city council imposing harsh new restrictions.
"Whoever is caught peddling on the street or buying the products will (be fined) RWF10,000 ($13)," the directive announced. Traders' goods are to be confiscated.
Pressure has grown on the informal economy in recent years, although it accounts for 73% of non-agricultural employment in Rwanda and 46% of the nation's GDP. Traders have complained of increasing harassment, and the new Mayor of Kigali Monique Mukaruliza has made her position clear.
"We want street vendors to quit working on streets," Mukaruzila said in May. "They should work in an organized way and promote the development of our country."
'Empowering young people'
City officials argue the crackdown is necessary as street trade causes economic and social problems.
"The issue is that street vendors don't pay rent or taxes, and people complain that if they buy something faulty they cannot take it back," says spokesperson Bruno Rangira. "There is a lot of littering where the traders operate, and we have had some cases of people selling smuggled goods."
The new measures represent stricter enforcement of an existing prohibition on street vending, Rnagira adds, and they offer new opportunities. The city is offering low-interest loans to traders if they are willing to transfer their businesses to approved, tax-paying market sites.
"This is aimed at empowering these young men and women involved in informal business to put them into the formal sector," he says. "We are not making them unemployed, we are making them more sustainable. We want more taxpayers and larger businesses."
Cleaning the streets
But the task of bringing the vast street trade into the mainstream economy is hugely ambitious, particularly as traders have rejected previous initiatives.
"Many of such directives have come and died away," says Fred Mwasa, a journalist with Kigali Today news agency. "Kigali authorities have been pushing for years for these hawkers to go to established markets and operate from there. They have resisted."
A recent Human Rights Watch report highlights the risks for those who defy the rules. The group documented dozens of cases of vendors being arrested and detained without trial at the notorious Gikondo Transit Center, and in some instances being subjected to violence, extortion and torture.
The police describe the facility as a "re-education center," where street vendors are encouraged to find legitimate work. But testimonies from the workers highlight their desperation.
"Every day I risk going back to (Gikondo), but I continue working," one vendor told Human Rights Watch. "They say they send us there to correct us or to get us to abandon our trade, but we don't have money to start a restaurant or a bar. The police just say, 'Abandon your work', but what can we do?"
Crackdowns on street traders are becoming increasingly common and severe in the major cities of Sub-Saharan Africa, where rapid development is pushing the informal economy to the margins.
Nigerian capital Lagos recently sanctioned jail sentences for both vendors and buyers of street produce, generating a fierce backlash against a perceived "war on the poor." South African cities such as Cape Town and Johannesburg have driven out much of the informal trade after long-running campaigns.
This heavy-handed approach can have damaging consequences, according to Caroline Skinner, senior researcher with the African Centre for Cities, University of Cape Town and urban research director of Women in Informal Employment: Globalizing and Organizing (WIEGO).
"(Traders) are part of the fabric of the city, providing cheap goods in convenient locations for poorer consumers," says Skinner. "If they could be integrated into urban planning with proper facilities it would be good for consumers and provide livelihoods for people in desperate need."
A WIEGO study in South Africa found that street traders typically have dozens of dependents, who also suffer in any crackdown.
Skinner adds that enforcement measures are typically expensive and impractical.
"Unless you give people other opportunities they will be back in a day or a month," she says. "There are opportunity costs as the police will not be chasing real criminals. It takes a lot of human resources and money to remove people."
Zimbabwe has had success in clearing street traders through sustained brutality, says Skinner, but severe crackdowns also breed corruption as underpaid police solicit bribes to protect traders.
Skinner is skeptical of Kigali's proposition of transferring traders to approved markets.
"There are too many examples in Africa of using "white elephant" markets to move people away from economically viable places," she says. "They are attempting to hide the informal economy."
The effect is often segregation, says Skinner, as the low income traders are corralled into ghettos while the city centers are kept pristine for the affluent classes.
As Kigali presses ahead with sparkling modernization, life on the streets is likely to grow harsher.