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A.
Introduction
My
name is Kashiwa Lameck, General Secretary of the alliance for Zambia
Informal Economy Associations, currently with 13 informal economy
associations’ affiliates. I’m also council member of the
international committee of Street Net International.
On
the personal level I have been involved in the informal economy as a
market trader for the past 20 years though I worked for the mines for 12
years; I was retrenched in 2000.
B.
I
have been invited to make a presentation on: Collective Bargaining strategy of AZIEA.
1.
My
presentation is structured around the following: 1. In the first part, I
am going to trace the evolution of the phenomenon of the informal economy
in Zambia. In giving this brief historical perspective, I will also
attempt to link the development of the informal economy to the fortunes
or indeed, misfortunes of the Zambian economy as a whole. I will discuss
this under the socio-economic context in Zambia this is in order for the
participants to understand the state of the economy of Zambia and how we
have gotten to be where we are now.
2.
In
the second part of my presentation I will discuss with you some of the
salient characteristics of the informal – economy and the conditions
and constraints that informal economy workers are forced to contend with
in their daily struggle to irk out a living. Lastly then I shall look at
the prognosis or the way forward in this noble effort to organize workers
in the informal economy and contribute to the uplifting of the lives of
our people in Zambia.
3.
Socio-Economic context of the Informal Economy in Zambia.
In discussing the concept and
phenomenon of the informal – economy, forgive me if I will ignore
academic conventions. I will avoid academic polemics and try to deal with
more pragmatic issues.
As
we are fully aware, the concept of the informal sector – and now
informal economy - came into vogue in the early 70’s under the
ILO Employment programme studies in Ghana and Kenya (WEP). At that time
it was noticed and recognized that the principal social problem in many
developing economies was not unemployment per-se, but;
“The
existence of working poor struggling to produce goods and services
without their activities being recognized registered or protected by
public authorities”.
According
to this notion, the informal economy was taken to cover those small –
scale income-generating activities, which take place outside the official
regulatory framework.
These
activities are not necessarily performed with the deliberate intention of
evading the payment to taxes or facial security contributions or
infringing any other registration or administrative provisions.
We have and will continue ague that;
“It
is not so much that the poor are breaking the law but the law is breaking
them”
4.
This apparent illegality arises mainly because these informal
economy operators who in fact only venture into such activities, as a
survival strategy cannot raise the huge sums of money required for
registration and other administrative logistics. In our country Zambia,
the poor would-be operator requires not less than $200 to get the
proposed Business licensed, registered by the authorities. This is in a
country where the monthly wage is about $50.0! It is these transaction
costs, the cost of legality, which are simply too high and hence
prohibitive! We further argue that the mere fact that some of these
activities take place outside of the formal regulatory framework does not
make them illegal. It is simply that these activities are not regulated
by the state because the boundaries of state regulation are not universal
and set in stone. They vary from one state to another.
In
its household budget survey (HBS) conducted by the central statistics
office (CSO, 1997) the Zambian government (GRZ) defined the informal –
economy as:
“Consisting
of all subsistence farmers, all own – account workers and all employees
in unlicensed and unregulated Business”
5.
As you may be aware there is a multiplicity of definitions and
descriptions. From a policy point of view; we can argue that some
definitions are more useful than others. Some people have actually argued
that most of these definitions or descriptive categories are, at best,
tautological statements. Being fully alive to this problem allow me to
use an alternative definition and description of the informal economy as
suggested by BIRCHALL (2001).
“Units
engaged in the production of goods and services with the primary
objective of generating employment and income for the persons
concerned”.
6.
I find this definition more superior because it explains the
economic rationale behind the existence of the informal economy in a
given socio-economic context. The people who do not have access to formal
wage employment find ways of surviving by dealing in local markets in
whatever way they can. Consequently working in the informal economy is a
rational economic decision motivated by the human need to survive. It is
purely a survival strategy to which people are forced to resort due to
economic hardships.
7.
In Zambia, and probably in most other countries too, the informal
economy and its dynamics are very closely correlated to the fortunes and
misfortunes of the mainstream economy. Whereas other people have argued
that the emergence of the informal – economy in Zambia could be traced
back to the colonial times and the development of the mining, enclave
economy predominantly in the copperbelt region of the country, its rise
to prominence has come about with the coming to power of the MMD
government of “free marketers” who embarked upon the wholesale but
dangerously naïve liberalization and privatization economic reforms
under the rubric of the now internationally discredited SAP. This renewed
importance of the informal-economy is best illustrated by the fact that
the Government established the so-called Vendors desk at State House and
appointed a Deputy Minister to be in charge of Street and market Vendors
affairs. This administrative unit was even referred to as the office of
the president, which became almost untouchable by any authority except
the president.
8.
The 1980s could be said to have marked the turning point in the
economic fortunes of the country. There were severe foreign exchange
shortages and currency devaluations under the instigation of IMF /World
Bank (SAP). Foreign exchange shortages led to, among other things,
shortages of essential imported raw material, spare parts to continue
servicing the manufacturing sector. There was industrial capacity under
utilization with many firms operating at levels as low as 30% of their
economic capacity.
Then
came the new phenomenon of smuggling of so-called essential commodities
and the subsequent rise of what was described as the “Black market”.
Indeed one could argue that this was the beginning of cross boarder
trading and the globalization of the informal economy in Zambia.
C. Salient conditions/constraints faced by
Informal Economy workers
9.
As you are aware, there have been several studies conducted on the
various facets of the informal economy. These various studies seem to be
unanimous in their conclusions about the conditions and constraints that
informal-economy workers operate under. Putting together the findings
from these several studies (surveys), I have decided to discuss only a
few conditions and constraints, which seem to have current relevance in
our informal economy in Zambia.
I.
Lack of government policy on the informal economy and its
development
II.
Lack of social security for informal economy workers
III.
Lack of representation in policy dialogue and decision making
IV.
Continued harassment from various types and levels of authorities
(local authorities, Police, Zambia revenue authority, including party
cadres of the political party in power).
10. As regards government policy, there seems to be no comprehensive policy framework out lining the goals of government objectives principles etc as regard this economy. This is not withstanding the government’s pronouncements about the importance of the informal economy in its fight against unemployment and high levels of poverty in our country.
The
lack of legal protection and entitlement to social security is actually
one of the characteristics used by government to define informal economy
workers “These are employers and employees working in private
sector enterprises with less than 5 employees and not entitled to paid
leave and social security scheme”.
D. Collective bargaining efforts
We
have a diverse experience of negotiating with both central and local
government on a variety of issues.
After realizing that we were failing to pressurize and convince
government to enact laws and formulate policies that are favorable to the
informal economy workers because were working separately and our voice
was weak. In 2001 in October we took the initiative of forming an
umbrella organisation called; the Alliance for Zambia Informal Economy
Associations (AZIEA) to strengthen our voice of representation.
Bargaining with central
government through the ministry of local government and housing is not
systematic, but happens as when the burning issues arise, and the
emphasis of the negotiations is to change laws including the market act
which was passed by the British colonial government, and putting in place
friendly police framework to the informal economy workers with the aim of
making informal economy workers be part of the recognized, protected and
represented workforce and enjoy the 7 labor core standards of ILO.
At
central government level we negotiate with the ministry of local
government and Housing, and sometimes request the intervention of either
the Republican Vice President or the President himself.
At
local Government level:
One of the difficulties of bargaining both at local and central level is also the informality of negotiations, a lot of these negotiation sessions are not recorded because the forum as not taken as formal.
In
pursuit of broader objectives of AZIEA, we have undertaken the following
strategies in order to push for negotiations with local or central
government officials or departments.
Education
In
order for our members to appreciate and understand our role as an
organization, we conduct education programmes through seminars and
workshops on the role of the association in society, roles and
responsibilities of members in the organisation, effects of laws and
policies on Markets and Street Vendors and ways and means of fighting for
the repeal of such laws and policies.
Public
meetings
We
hold public meetings to constantly brief and update members on issues of
national importance.
Lobbying
and Advocacy
We
try our best to lobby leaders we identify to be our allies both in
government, Members of Parliament, Councilors and
Town Clerks to take up and support our opinions on issues of the
informal workers.
We
advocate for laws that are favorable to the informal economy denounce any
government intention to suppress informal economy rights and freedoms as
workers.
Demonstrations/
picketing
We
demonstrate in the streets to get sympathy from the public and use these
demonstrations and picketing not to pay market levies to local
authorities as a tool to force government to the negotiating table.
Injunction
In
one instance, we had no option but to seek court intervention after
exhausting all complaint process channels as the local authority seem not
reversing its decision on the increase of market levies
Meeting Government officials
We
try our best in meeting ministers, permanent secretaries, Vice President,
and the President to present our opinion on issues affecting us.
Success
cases:
For a long time, we have managed to shoot down the intension of
councils such as Luanshya and Mansa to unilaterally increase levies when
they have failed to provide services.
With the increase of our visibility, we are now able to secure an
audience at any level and meet any one including the state President.
We have created a united front which is making government
difficult to ignore.
The Zambia Revenue Authority has failed to penetrate markets and
Streets to get the Pay as You Earn due to our strong intervention.
We are invited for seminars organized by government
and to seat on some boards’ e.g. District HIV/AIDS task force
committee.
Unsuccessful
Cases:
We still negotiate at the mercy of those in authority. We are not backed by law.
Lastly,
representation in policy dialogue and decision-making is one of the most
frustrating conditions. Important decisions and interventions are made
supposedly for our own good by those who claim to know what is good for
us. As the saying goes, “there shall be nothing for us without us”.
Accordingly
AZIEA and WEAZ (Workers education association of Zambia) are currently
engaged in dialogue with the national trade union movement through the
Zambia congress of trade union (ZCTU) to establish strategic alliances
and come up with strategic initiatives to organize informal economy
workers, to educate them and create the requisite knowledge-levels and
consciousness for solidarity. For instance AZIEA has taken up the ZCTU
affiliation.
Harassment from the various levels of
government and its agencies, arrests and detention of informal economy
leaders and its members is something we live every day. The level of
harassment is so inhuman and barbaric to the extent that the government
has even established what it is calling the Fast Track Court
that sits at Lusaka City Council premises and so far more than 200 street
vendors have been arrested and prosecuted some fined and others sentenced
2-6 months just because, they want to earn a living.
We
have revenue-collectors from the local councils, Zambia revenue
authority, including even party cadres of the political party in power.
At times our members are harassed for being associated with opposition
parties. Our members loose their merchandize through confiscation and
even theft by these people.
We are
forced to pay fees, charges, levies which at the end of the day are not
even used to provide infrastructure services for our people. The only
time when the government recognizes and appreciates the informal economy
workers is when it is fighting its political battles with the opposition
and during elections. Our vulnerable members are then used as instruments
of violence and chaos by these selfish politicians for their own narrow
selfish interests (to secure their political positions).
E.
Conclusions
From
my short presentation, I hope we can draw the following conclusions:
i.
Though the phenomenon of the informal economy is relatively
recent, it has moved to great prominence following the wholesale
implementation of SAP in our country.
ii.
These SAP measurers have resulted into a complete destruction of
our economic base and thrown thousands of our people into the street as
unemployed and destitute.
iii. The majorities have found alternative survival strategies in the informal-economy, which has now grown to employ about 90% of the labour force.
iv.
Despite the importance of this economy, there is no definitive
government policy on the informal economy, what role it is supposed to
play and what should be done to harness its newly found great potential
to provide employment, generate economic growth and reduce poverty in our
country.
v.
Government believes that this informal economy is an aberration, a
transient phenomenon that will disappear as the economy develops. It
therefore looks at the informal-economy workers as a nuisance to be
tolerated for the moment!
vi.
The trade union movement in Zambia is so far, not prepared to lead
the way in organizing the informal economy workers because it thinks it
is too costly a venture with limited benefits.
vii.
The onus is therefore on us, the informal-economy
associations/organizations such as AZIEA and WEAZ to lead the way.
viii.
This fight against injustice, human poverty and deprivation, the
fight for recognition etc needs our pro activeness and international
solidarity and strategic alliance.
ix.
Collective bargaining is very difficult, more so in the informal
economy, however, unity among the workers plays a crucial role in pushing
local or central government officers to negotiate with us.
x.
Education also plays an important role in promoting common
understanding of the contextual situation of the leaders and members, the
processes of legal/policy formulated and the effects of such measures on
the informal economy workers, and the need to provide intelligent
responses and informed advocacy.
I thank you most Sincerely,
A
LUTA CONTINUA!!!
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