By Ana Maria Vargas
Lund University and the University of Milan
Being poor, uneducated and unemployed can be a crime in many places in the world, particularly if you decide to sell food or other products in the streets. The penalties for selling products without a license or some other form of lawful permission are potentially as high as six months imprisonment in countries like Egypt, and can include the confiscation of a vendor’s goods and fines that have to be paid to the municipality. The plight of global street vendors is exemplified by the story of Mohamed Bouazizi, the Tunisian fruit and vegetable vendor who set himself on fire in 2010 as a protest following the confiscation of his goods by the police, becoming a catalyst for the Tunisian revolution and the Arab Spring.
Informal vendors face exclusion, poverty and difficult working conditions due to laws that criminalise their work. Other legal barriers commonly make it difficult for informal vendors to work within, and under the protection of, the law. Such barriers include the high cost of business registration, and requirements that businesses are conducted from established and fixed premises. The solution to this problem, according to many development agencies, lies in bringing informal vendors into the formal economy. Thus international organisations such as the World Bank and the United Nations vigorously promote business laws for the poor. Legal reforms have been implemented in many countries in order to make it easier for small businesses to be registered and to work within the law.
Using the case of street vendors in the city of Bogotá, the capital of Colombia, my research shows that legalisation (which may be distinct from formalisation) can be a tool for empowerment and poverty reduction in cases in which it is carefully tailored to the needs of the people involved. My research is based on interviews with 169 street vendors who were able to legalise their businesses in Bogotá between 2006-2012. Instead of harassing vendors and using police force to control them, the city of Bogotá provided the vendors with basic tents (such as the ones seen in the photo above), and granted them the right to conduct their businesses from the tents.
Legalisation helped the vendors to increase their freedom and to improve their lives because having a legal status provided them with the security that police offices would not evict or harass them. Vendors were able to focus on their businesses and invest more in new products because now they did not fear the confiscation of their goods by the police. They were not, however, formalised in the sense of having to register their businesses or pay taxes. They remain part of the informal economy, but now the state does not criminalise their work. Along with the security that comes with knowing that your business is legal and police cannot confiscate your goods, the tents protected the vendors from the weather. In a city like Bogotá, informal vendors often have to run to protect themselves and their products from the rain as well as from the police. Poor weather conditions decrease their productivity and income because their products are exposed and often damaged by rain.
This case shows the need to adapt the law to the circumstances of the poor, and to develop policy that allows the law to be implemented in a manner which is responsive to the needs of the poor. Developing countries cannot aim to have poor people start-up businesses in commercial malls, and to pay taxes and rent, as might be a reasonable expectation in wealthier countries. Reality shows that if you do not change the law to adapt to the circumstances of the poor, street vendors will resist the law, seeking to support themselves and their families while trying to escape the attention of the police in their daily lives. Laws that do not correspond to the reality of the poor may not only generate disobedience but also tragically events like the immolation of the Tunisian vendor Mohamed Bouazizi and major popular revolts. Making the law answer to reality, and to the needs of the poor, is not only a means of fostering development and reducing poverty, but also of enhancing political stability and social harmony.