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UNRISD Podcast: Examining Kenya’s Informal Economy: The Jua Kali.

20 May 2009

20 May 2009 – In this episode, an UNRISD researcher examines the means by which Kenya’s informal economy sustains its members, and how incorporation into the formal sector can be achieved.

Please use the link to the right of this page to access the podcast. (5mins 21secs, MP3 file, 2.45mb)

Transcript of the podcast:

Erika Anderson: You’re listening to the UNRISD podcast, and my name is Erika Anderson. Today’s episode features an interview with Mary Njeri Kinyanjui, a research fellow at UNRISD.

On the streets of Quito, Ecuador, Quecha women sift through refuse in search of paper or plastic the government will reimburse them for. In the night bazaars of Bangkok, Thailand, locals hawk hand made goods, a calculator with giant numbers acting as their translator. In Kenya, drivers of the local buses, or Matatus, transport workers along the clogged roads of Nairobi.

Millions of people make their living in what is known as the informal economy, but because neither their profits nor losses are reflected in gross national products or GDP, the fruits of their labors are largely ignored.

As a research fellow at UNRISD, Mary Njeri Kinyanjui has given the informal economy the attention she feels it deserves.

Mary Njeri Kinyanjui: The informal sector is a fairly broad phenomenon in Kenya. In Nairobi alone it employs more than 500,000 people. It comprises of small businesses in, in trade, in vehicle repair, in furniture making, in metal work, in dress making, and in food selling, and cloth hawking. So it’s a very broad industry with a very high level of employment.

Erika Anderson: In the case of Kenya, associations in the informal economy, jua kali, provide a safety net for its members. Once a week, market workers might pool money and donate it to one member on a rotating basis. Or they might make group investments and use it to buy land. In informal settlements, they might construct the piping themselves to provide running water. Kinyanjui explains why such a strong network exists.

Mary Njeri Kinyanjui: And they are largely rooted in the the African belief that I am because we are, we are because I am, that one cannot exist as an individual, one exists because others exist, and the communties exist because individuals exist. So because of that there is a whole lot of interdependent relationships that are brought to society and the market and they work quite well in the jua kali.

Erika Anderson: Though the formal economy is looked toward as a model, Kinyanjui points out that it has its own paradoxes.

Mary Njeri Kinyanjui: You find that somebody is employed in a cooking fat factory. He is making cooking fat. But he cannot buy cooking fat to last him a month with his salary. So really I don’t know where the pricing, or what mechanism operates. Because once I lived near a beer factory, and when the workers would come from the beer factory, they know they have been making beer, they would want to drink beer, but the only beer they could afford was a local brew called changa.

Erika Anderson: In Kinyanjui’s experience, though governmental and non-governmental organizations often see these issues and want to help, they make a grave error by arriving with the assumption that they know best.

Mary Njeri Kinyanjui: So when they come in they don’t know where to begin and where to start. So they again have all these overheads in terms of costs in terms of building infrastructure, group infrastructure, which are already there. So my main point of thinking is that we behave just like the missionaries when they arrived, and they said that these people have no religion and we have to give them a religion. So we arrive in communities and assume these communities have no markets, they have no idea of even how to organize themselves and want to impose on them what to do.

Erika Anderson: Much of the development world believes that the solution to the pitfalls of the informal economy - the lack of security, the long hours, the low pay and potential illegal aspects such as child labour - is via formalization. But how do you substitute one for the other? Kinyanjui says you don’t; the method should be incorporation, not substitution.

Mary Njeri Kinyanjui: So the question I think everybody would be asking me is how do we bring them on board. And I think that the way we can bring them on board is putting our ears close to the ground, working with them, inviting them to develop our projects, listening to the reference points in community, because in these communities there are reference points, like the school teachers, the pastors. The communities have their own leaders even if they are poor. And they know how to plan for themselves. And once we engage with these individuals, then we shall make a milestone.

Erika Anderson: Kinyajui hopes to compile her findings into a book, but in the meantime, what she really wants is change.

Mary Njeri Kinyanjui: Change takes time. And it comes from different quarters, so I am hoping that somehow the message will get where it’s supposed to.

Erika Anderson: For more information, go to our website, www.unrisd.org If you have any suggestions for future podcasts, email us at press@unrisd.org. Thank you for listening.

For UNRISD news, this is Erika Anderson, in Geneva.