African liveability

Best bet for Cape Town’s urban food security? Informal trade

CTP_AGM_ResilientWalkingTour_20131107_(c)Lisa Burnell (40)

Africa is in the midst of a massive reinvention – moving from a predominantly rural continent to one that will soon be characterised by its urban areas. The World Bank estimates that by 2030, 50% of Africans will be living in urban areas, after which cities will only continue to grow and expand.

Needless to say, this urbanisation trend brings with it a host of challenges – from meeting the demand for affordable housing and public transport to ensuring that food is easily accessible to all.

The latter has come under the spotlight in the Western Cape recently, as the provincial government, in partnership with Southern Africa Food Lab (SAFL), called on members of the public, as well as representatives from all sectors of the food system, to actively participate in creating a strategy that will not only seek to provide enough food for all, but enough of the right, nutritious food for all.

During a three-day Food and Nutrition Design Lab, six diverse food security initiatives that had been identified by the WCG and SAFL beforehand were discussed in collective workshop sessions in the hopes of shaping them into actionable plans that could be implemented within the coming months and years.

Among a collection of unsurprising topics, such as the establishment of more school vegetable gardens, a clamp-down on food waste and an emphasis on early education feeding programmes, there was one wild card with all the trappings of a game-changer, especially for cities: crowding in support for the sale of nutritious food in informal markets.

Food security in Africa

The UN Food and Agriculture Organization (FAO) defines food security as a situation in which all people, at all times, have physical, social and economic access to sufficient, safe and nutritious food which meets their dietary needs and food preferences for an active and healthy life.

In previous decades, the food security agenda in Africa was largely focused on rural areas with food production by small farmers at its core. However, as impoverished rural populations steadily spill over into cities in search of employment opportunities, it’s obvious that a drastic change of tack is required  not only in shifting the focus toward urban areas, but also placing more emphasis on the retail of food that is both healthy and affordable.

As Caroline Skinner and Gareth Haysom point out in their paper titled The informal sector’s role in food security: a missing link in policy debates, African cities are characterised by high levels of informality, which of course, has a direct influence on the where, what, why and how of people’s purchasing habits.

Leif Petersen, Camilla Thorogood and Mmeli Sotshononda embroider on this idea in their paper, Crowding in support for the sale of nutritious food in informal markets, presented at the Food and Nutrition Design Lab, stating that: “[w]ith economic migrancy effectively transferring rural poverty into urban and peri-urban areas there is an increased reliance on the growing ‘cash economy’ within these landscapes.”

This phenomenon has contributed to a major shift in food markets and individual diets, which presents a growing range of challenges for policy makers, but also a growing range of opportunities.

Informal trade policies in South Africa

According to Petersen, Thorogood and Sotshononda, the current overarching policy environment in South African cities is generally problematic for informal business, due to both over- and under-regulation, which conspire to negatively impact activity and growth.

Even though South African provinces and metro municipalities are mandated by the 1993 Business Act to regulate and support the informal sector, many have been lax in their approach and in some cases even draconian.

In 2013, for instance, Johannesburg’s City Council conducted a massive raid, confiscating the stock of about 6,000 inner-city traders, despite the fact that the City’s 2009 street trading policy clearly states that “informal trading is a positive development in the micro business sector as it contributes to the creation of jobs and alleviation of poverty.”

Similarly, the City of Cape Town’s policy advocates “a thriving informal trading sector that is valued and integrated into the economic life, urban landscape and social activities”, yet there is an allocation of only 410 street trading bays throughout the inner city.

What the inner cities lack in opportunity for small businesses, however, the peri-urban areas and informal settlements make up for.

In a 2014 article on how rule-bound cities can better accommodate diversity, Cape Town Partnership CEO, Bulelwa Makalima-Ngewana points out:  “if we judge an informal settlement according to what it is rather than what we think it should be, we see that it actually works in many respects. There is an unwritten set of rules and norms, and you understand how to engage your neighbour and what you can expect from your neighbour. It is still ‘informal’, so we tend to be afraid of it, and look at it as something that needs to be regulated even more.”

A liveable African city, she says, “must allow formality and informality to coexist, and for informality to add value to our culture and lifestyle.”

Informal trade’s contribution to GDP and other benefits

Estimated at about 10.7%, the collective contribution of South Africa’s informal economy to the national GDP is relatively small compared to other African cities, such as Benin where 61.8% of the national GDP comes from informal trade and even Egypt’s 16.1%. However, if you disregard the comparisons, 10.7% is still a significant contribution, especially when considering the potential micro enterprises have in helping reduce poverty among the lowest quartile of income earners  especially women – through accessible employment opportunities.

Furthermore, various studies have found that some 39% of all informal businesses in townships form part of the food system and, therefore, play an important role in getting food on the tables of low-income families.

Why informal trade is central to food security

There are, of course, a number of factors that contribute to the popularity of these businesses in informal settlements, five of which are listed below:

  • Location and operating hours

Typically located close to transport hubs and schools, these businesses are integral to warming the bellies of those who leave home too early to eat breakfast, offering meals or snacks that can easily be eaten on the go. Along with this, they tend to trade only at times of highest consumer demand, which means that they are available when needed, unlike more formal businesses that stick to strict operating hours.

  • Caters to cultural tastes

Since their operations are so localised, informal businesses are able to cater for the specific tastes of the people they serve. Many township food businesses specialise in traditional niche dishes that are hard to find in the more suburban and central areas of the city eg walkie-talkies (braaied chicken heads and feet), sheep heads and tripe.

  • Could help minimise food waste and encourage market efficiency

Because many of the foods traded by these informal services have little value in formal markets, they create an ideal opportunity for abattoirs to dispose of ‘fifth quarter’ products and chicken farms of ‘spent hens’ in a manner that isn’t wasteful. The use of these full nose-to-tail animal products enhances the overall market efficiency.

  • Credit

Offering credit to regular customers is a key part of the informal business model, enabling poor households to ‘buy’ food even when they do not have the cash to do so.

  • Smaller quantities

By breaking bulk purchases into smaller quantities, informal traders enable consumers to buy only what is needed when needed.

Harnessing the power of informal trade

Even though the grassroots benefits of informal trade are obvious, especially in relation to the food sector, not enough is being done on government level to harness its potential, especially for the distribution of fresh and healthy meals and ingredients among the poorest of the poor.

As part of the Food and Nutrition Design Lab, Petersen, Thorogood and Sotshononda proposed a pilot project in which an interlinked approach to crowding in support for informal sectors will be followed. This will include physical investment in infrastructure (eg installing bulk refrigeration to help keep stock fresh) and the development of regularising opportunities for informal business (eg guidelines for municipal authorities with respect to regulation and best practice LED methods).

Ultimately, this pilot project will represent an opportunity to learn, evaluate and suggest revisions for local laws and regulations to allow for enhanced informal enterprise regularisation, which  in turn  may encourage more support from provincial and local governments.

Find out more about the various important roles fulfilled by the informal sector on the Sustainable Livelihoods website.

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