Lagos’ “Ultra Modern” Fad and its Impact on the Informal Sector

The Lagos State government on Wednesday  morning demolished the popular Oshodi Market. Steve Ayorinde, the State Commissioner of Information, said shutting the market would enable the state commence the transformation of the Oshodi Market bus stop to an ultra-modern bus terminal.

Lagos is aiming to become an urban mega city, and with this comes the responsibility of developing and embarking on major town planning and infrastructural projects. This goal invariably sets the government against actors in the infomal sector, when projects such as the construction of ultra modern markets displace existing market infrastructure – all in a bid to fit the new aesthetic goals of the government. Similarly, when actors in the informal sector occupy unapproved public spaces for business, and are disbanded by the government for the sake of new infrastructure projects, there is also tension. Such infrastructure projects may be the construction of rail tracks, roads or power station, in this case a bus terminal, to mention a few examples. How then can the government meet the need for infrastructural development, while at the same time, cater to the demand by the informal sector for physical spaces to conduct their respective businesses?

Over the past few years, major markets that serve as livelihood for those in the informal sector have undergone urbanization. Most notable among them are Tejuosho Market, Aswani Market, Sandgrouse Market, Alade Market (on-going) and more recently Oshodi Market. These infrastructural developments are reflected in the constructions of shops into urban offices; banking halls; cinema halls; food courts, and ample parking spaces. Before the urbanization process, these markets accommodated over a thousand traders and stocked goods worth millions of Naira. Usually, the tenants of the market are given some assurance, that at the completion of the urbanization process they will have right of first choice of shops, and they would also make adequate arrangement for temporarily place to continue trading until the construction is completed. However, when one interrogates the possibility of traders (sellers of petty items like pepper, meat and so on) purchasing stalls in the new markets, it is not clear how they may be able to afford the new structures. The government claims they would source mortgage for the traders, which would prevent them from being excluded from the project. This is a claim which has not yet been verified. However, there is a challenge as to how this mortgage scheme will be effectively implemented. For instance, will a kiosk owner or a vegetable seller be able to afford the mortgage, how much are they even able to pay?

There is a prevailing condition of the stigmatization of credit as I encountered during my doctoral ethnographic research, which represents a major obstruction to the success of this scheme. Many entrepreneurs lamented on the possibility (or not) of securing loans to purchase goods for trade, not to mention the low chances of securing loans to own a shop. To buttress this point, in terms of this belief about credit, this is an excerpt from a respondent.

Q: Why do you not just get a business loan or a mortgage?

A: God forbid! Get a loan or mortgage for a shop! Will they even give someone?

Q: What if you access the mortgage thorough a government scheme?

A: That one no possible, I do not have any relatives or know anybody in government. Case closed

Actors in the informal sector appear to be in this space, in order to raise capital for the businesses they aspire to found in the formal sector. Income generated in the informal sector serves as a major source of capital for most businesses. This may be because of their inability to access bank loans and government grants or because they despise credit. However over time, they save the proceeds from their informal businesses until they are able to finance their desired businesses.

A few respondents narrated how they started their businesses by engaging in a smaller trade to save enough money to start their desired businesses. How would it be possible for the government to expect a petty trader to be able to finance a mortgage, where majority are complaining about servicing their current rents and restocking their goods. The high cost of living in Lagos, an urban area, makes the situation more challenging for traders in the informal sector. I give this example from a respondent, a kiosk owner in Alade market, who sells wristwatches and belts, and has been given a notice to leave his shop for the urbanisation process to take place in Alade market.

A: I do not think the government is fair on this one, I know they have do it in many places but I did not expect they would come to Allen, it is not up to three years I collected my shop in this market. As I told you before I use to be a street hawker but because of this KAI people (Kick Against Indiscipline enforcement officers) I managed to put some money together to get this shop and start selling this stuffs in this market, but this thing they are doing looks like they want to send me back to be a street hawker. (Agom)

My findings show that the informal sector serves as a springboard for some to later crossover to the formal sector. The continuous push by the Lagos State Government in its modernisation drive wipes a major source of income for majority of the population that live in the informal sector. This might later lead to people engaging in illegal activities, poverty, drug abuse, child and girl trafficking, and sudden but avoidable death. Though we agree that the infomal sector activities often take place in unapproved public spaces; spaces, which are cleared later, when much-needed infrastructure development projects are implemented. It is necessary to recognize the interests within the poor communities and ensure they are integrated into the urban planning process.

Local vs Modern Market

As a means of encouraging the integration into the formal sector, Lagos government can consider building stalls or sheds for specific market-places as is obtainable in certain societies while also having the ultra modern market shops. This stalls or shed should be leased to the traders, this according to respondents will be much welcomed, and it is affordable by the traders. Picture 2 shows Leicester ultra modern Highcross Mall, situated just few feet steps away from Leicester Market, by doing this, both formal and the informal sector have been successfully taken care of. The picture below shows traders selling similar goods, but the one in Lagos lives in the constant fear of the possibility of government coming to destroy their goods for more infrastructural work to be embarked upon while the one in Leicester knows that nothing of such will happen as they have the approval of their government.

Leicester vs Lagos Market

The Lagos State government has successfully integrated the informal sector into its economic plan though one-sided, through its revenue generation technique. They were able to achieve this through consulting with and building a relationship with stakeholders in the informal sector. Key stakeholders need to also be carried along in the urbanisation process of the city which includes: market leaders, trade association leaders, community elders and leaders.

The government has focused most of its attention on achieving its Mega City Project, but it will do itself a lot of good if the government pays attention to the common man on the street. And as former governor of Lagos Tunde Fashola said at the Liveable City Conference in 2013:

“…The project of governance in a mega city is firstly and lastly for the people and about the people including the man on the street who must be able to LIVE in it. He must be able to BREATHE in it. He must be able to DREAM in it – dream for himself, for his family, for his succeeding generations. He must be SAFE in it”. (TundeFashola, 2013)

Therefore, Lagos government should do more towards creating jobs, regulating formal jobs, providing social security and also ensuring a viable commercial environment for those in the informal sector.

Twitter: @CreativityTurf

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