As you go through traffic in Nigeria or pull up to a traffic light, several street hawkers swarm towards your window, eagerly trying to convince you to purchase their goods. They call out the name of their products or even address you personally. "Madam, I never sell anything today, please help my market." You can buy pretty much anything on the road, from a Rolex wristwatch, dogs, or a functional DVD set. To a certain extent, the prevalence of street vendors across the country represents the economic condition of Nigeria; particularly in the employment sector. It is also symbolic of the hustle and entrepreneurial spirit embedded in the people.
Street vending is the most visible form of informal economic activity across developing countries. It may account for as much as 70% of urban employment in Nigeria and has become the source of livelihood for many Nigerians unable to secure white-collar jobs. Likewise, the low barriers to entry, low start-up costs, and flexible hours make the occupation attractive. Regardless of its massive contribution to the economy and employment, many still view the activity as a nuisance that ought to be eliminated or at least kept in check by the government.
The sour side of street vending
Arguably, street vendors are harmless. They have one purpose: to sell their wares and make money. In fact, their supply is driven by the continuous demand by customers who indicate a preference for the convenience and affordability of these roadside products. In cities like Lagos, where traffic is part of everyday life, street vendors provide an essential service to tired and frustrated drivers stuck in traffic. Yet, there seems to be a constant cat and mouse relationship between the government and street vendors, with the latter often treated like criminals.
From an economic standpoint, they promote informality, undercut prices, propel the market for smuggled goods and encourage bad business practices. These vendors are not held accountable and often get away with activities that would be considered unethical in the formal sector.
Food and drink constitute a major part of the street vending market; raising a serious question about public health. According to the World Health Organization (WHO), around 600 million people die from food contamination annually. Consumers are therefore putting themselves at risk daily when they consume these unidentified items; that cheap plate of rice could come at a price.
We also have the pertinent issue of child labour. Most of the children littering the streets ought to be in school. Instead, they spend their days doing dangerous jobs that could potentially cost them their lives. And, in some cases, these children become part of the Almajiri system or even fall into the hands of human traffickers.
A different approach
The Nigerian government has formed a habit of banning/excessively regulating goods or services that prove to be a stubborn problem. But, this cold turkey approach is not always effective. In 2016, the Lagos state government banned street vending by reviving its 2003 Street Trading and Illegal Market Prohibition Law. The punishment for violating the law is a fine of ₦90,000 ($250) or a 6-month jail sentence. It is unclear how effective this approach has been as hawkers and roadside sellers still populate the city like nobody's business, albeit they now move with caution. Imposing a ban would not stop street vending because they are no jobs available. The government needs to do something different.
People respond to incentives. Instead of constantly causing commotion, the government can come up with a market-friendly approach that satisfies both parties. Formalising street vending could mean the creation of market places or hawker centres for street vendors. In cities like Singapore and India, the government has incorporated street vendors into their urban development plans and set out vending zones for them to carry out their activities peacefully with a valid license. The formality of this structure also makes it easier for the government to conduct routine checks to ensure that the minimum health and safety requirements are met.
The issue of child labour cannot be ignored. Nigeria currently has the highest number of out of school children in the world, and it is clear why. To secure a better future for children, the government needs to enforce labour regulations for children street vendors and support this with free and compulsory education so they have an alternative.
How about adopting the Igbo apprenticeship system at a national level? The government can also incentivise business owners to take in street hawkers and train them in business for a specified time. After which, they can be given a start-up sum to open their own business. Not only would this method get people off the streets, but it would also allow the scaling up of small businesses and encourage formalisation. Singapore has a similar model called the Hawker Master Trainer Pilot Programme, which fosters entrepreneurship by creating ties with the private sector.
As the poverty capital of the world, it is no surprise to learn that street vending has become a survival mechanism for many. The government should focus its effort on the transformation of the economy and driving inclusive growth so that more jobs are created and people are earning enough to live a decent life. When Nigerians get off the streets and start meaningfully contributing to the formal economy, everyone benefits.