After the earthquake, the stealth economy

The New York Times offers a view of the post-earthquake encampment set up in the Pétionville Club, the 9-hole golf course in Port-au-Prince.

What's significant: With 44,000 residents living under tarps, this new neighborhood has "a quasi-mayor, a ragtag security force, a marketplace, two movie theaters, three nightly prayer services, rival barber shops and even a plastic-sheeted salon offering manicures and pedicures." The article goes on to highlight the commercial success of these refugees in their own city.

"Everything is for sale, like hair extensions in baggies and padlocks for the wooden doors that many have installed in their tarp-covered shelters. Inside a United States Agency for International Development tent outfitted with freshly made benches and a flat-screen television, one entrepreneur charges about 12 cents for screenings of a “Terminator” movie and the Malaysian kung fu film “Kinta.” Another young businessman rents out his Playstation in one of the designated 'child safe' areas, a green netting atop four poles. A woman runs a bar atop a crate."

But the article concludes that international agencies want to move these self-sufficient and entrepreneurial people out of the city: "Moving families from encampments like the Pétionville Club entails finding and preparing some 1,500 acres of land — one relocation site recently opened and another is being prepared — and then persuading people to move outside the metropolitan area, international groups say."

This neighborhood is functioning and, compared to many other encampments, relatively healthy. Why break it up? Why send it out of the city? These are the very people who ought to be at the center of the renaissance of the Haitian capital.

Swindon, a city of perhaps 200,000 people west of London, is pushing to redevelop its town center by getting rid of street traders, many of whom have been working there for better than 25 years. The Swindon Advertiser reports.

Why do political authorities always see those who sell flowers and donuts from carts on the street to be blight? The truth is that street sellers make the urban experience more vital and charming and boost business for everyone. That's why pushcarts have re-appeared, in a highly planned form, in malls and shopping centers. That's, in part, why street fairs and farmers markets are popular.

death of a teenage hawker

The Guardian offers a moving account of the death of Fabienne Cherisma, who was shot by Haitian police.

Nice lede: "Fabienne Cherisma spent her life assessing margins."

In addition to highlighting the personal tragedy of a bright 15-year-old's life cut short, it brings up the question: what is looting?

No one suggests that looting for profit is a great thing. And on a mass scale, looting can turn into rioting. But, after the earthquake that killed more than 100,000, people in Port-au-Prince are simply trying to survive. In the context of the massive devastation, and the unconscionably high rates now being charged by air cargo companies to bring supplies into Haiti (a much worse form of looting), why is taking two folding chairs and three paintings a capital crime?

after the earthquake

As the Haitian people recover from the tragedy of last week, System D--the informal economy--is playing its part.

Government officials and businessmen tell Reuters that street markets and street hawkers are back in operation in Port-au-Prince. That's hugely good news. As usual, the informal economy is back up and running before the banks and the rest of the formal economy.

happy informal new year

It's that time again. All across the planet, thousands of men and women are standing on streetcorners selling noisemakers and ugly sunglasses shaped to say 2010. For the coming day or two, hawkers and other unlicensed street vendors will be out in force in almost every country of the world.

The trumpet sellers of Java are reporting very slow sales, according to this article in Vivanews. One sidewalk vendor said he had expected to move more than 1,000 trumpets, but so far has rung up just 200 sales. Bad weather may have something to do with it. And people everywhere are facing tough times.

But that's no reason not to have fun.

A big Shadow Economy is a good thing

Researchers at Deutsche Bank--the German multinational--have reached a staggering conclusion about the informal economy: it's a good thing. The Financial Times has details.

From the article: "Countries with a high prevalence of moonlighting builders, unrecorded cash transactions, missing invoices, tax evasion or illegal activities such as drug dealing, have seen smaller contractions during Europe’s worst downturn since the 1930s than more honest neighbours." For instance, "Greece’s economy has shrunk only about 1 per cent this year – compared with about 4 per cent for the European Union as a whole."

Moroccan rhythms

The Moroccan government reports a boom in the informal economy, according to a report in the Middle East North Africa Financial Network.

The statistics are impressive: 40,000 new businesses (and only one in five new businesses is registered with the government.) In 2007, according to the government survey, informal businesses in Morocco created more than 2 million jobs and had a turnover of 279.9 billion Moroccan Dirhams, or about $36 billion US.

In Morocco, the informal sector is growing way faster than the formal.