CAIRO: There is a reason more street vendors are seen throughout Egypt these days.
Since January, Egypt’s economy has seen a rise in its informal sector, which comprises businesses that operate without oversight or support.
Many members of the informal economy are street vendors, 6 percent of whom, according to a recent survey, have received a higher education certificate but, due to the general weakness of the Egyptian economy, cannot find jobs in the formal sector.
These numbers have only increased with the economic instability brought about by the Jan. 25 uprising, according to Fouad Thabet, chair of the Federation for Economic Development Associations, speaking Sunday at the 13th Tahrir Dialogues at the American University in Cairo (AUC).
Ghada Barsoum, professor of public policy at AUC, explained that the informal economy has become the “number one source of income in Egypt,” as a result of “the lack of opportunities in the formal economy.” Seventy-five percent of Egyptian youth, according to Barsoum, are working in this situation.
These jobs provide no “legal cover,” she said. “This gives opportunities for employers to pay them less than the established minimum wage.”
The informal sector has grown by roughly 20 percent since January, according to Thabet. “That’s why street vendors are everywhere…and that’s why we’re dragging behind.”
According to Thabet, the growth of the informal sector damages the entire economy. Without any oversight, vendors offer fruits and vegetables below the market price, which benefits consumers in the short term but damages the overall economy.
Amina Shafik, a consultant for workers’ organizations and columnist for Al-Ahram newspaper, said that workers in the informal sector face human rights violations. “They are treated like criminals,” she said. “They are always chased by the police.”
In addition, she said, loopholes in current laws allow the labor of children to be exploited for little pay.
Possible reforms
Although the problem of informal sector growth troubles these experts, the necessary reforms remain unclear. Shafik wants the Egyptian government “to provide markets for these vendors.”
In Europe, she explained, vendors sell their products in protected spaces, allowing consumers to return and find the vendor again if a product is faulty. Vendors, in return, are protected from harassment. “There has to be a law,” said Shafik, “to protect both parties: the buyer and the seller.”
Thabet, on the other hand, thinks the answer lies in trade unions. His organization has helped found a union for street vendors in Giza, which they hope to turn nationwide. In exchange for monthly dues, he said, they receive support in case of a crisis. “The right of street vendors to get licensed,” he said, “is one of their human rights.”
Ibrahim Awad, director of AUC’s Center for Migration and Refugee Studies, said the government needs to step in. “We should not attack the informal sector with taxes and fees without providing services,” he said.
All agree that the stakes of not addressing the problem are high. “If they can’t turn into legitimate businessmen,” argued Thabet, “they will become terrorists.”
“After all,” Awad said, “what triggered the first revolution in Tunisia was an attack on a street vendor.”
