[Egypt] Poverty forces many Egyptians into informal economy

from The Daily Star

CAIRO: Poverty-stricken Egyptians are increasingly turning to selling cheap products in the street as a means to survive despite the trade's limitations, according to specialists.

"We have a 'street society' in Egypt. So when families need extra money ... street selling is one of the easiest ways to get it," said sociologist Sarah Loza.

Street vendors have become a major part of Egypt's large "informal sector" - unregistered employment without taxes or benefits - which some experts say makes up approximately 30 percent of the national economy.

"If you can own your own farsha, you are better off. Maybe in 15 or 20 years you can get your own shop," said Galal Ibrahim, a 19-year-old unlicensed street vendor in Cairo's crowded Ataba district.

Farsha is street-seller parlance for merchandise, which can range from food to shoe-shine products.

Street sellers usually lay out there wares on a wooden table on the sidewalk.

Ibrahim works for someone else who has the capital to buy the men's socks and underwear that make up his farsha. His boss pays him 20 Egyptian pounds ($3.50) a day to hawk these items on the streets.

Ibrahim hopes to save some 200 Egyptian pounds to buy his own farsha. On top of that, he says he will need some money to cover all the bribes and fines that are a normal part of a street seller's expenses.

Alia al-Mehdi, a professor of economics at Cairo University and a specialist on the country's growing informal economy, says there are around 300,000 street vendors trying to make a living on Cairo's choked and polluted streets.

However, street vending has severe limitations, according to those who have been plying their trade on the capital's sidewalks for years. Key needs like education and healthcare are often out of their reach.

Ibrahim is one of many thousands of young Egyptians from the poorer southern region who left school for low-paid informal jobs.

Like many others, Ibrahim feels that even if he could afford to continue his education, there would be no well-paid jobs in the end.

"I dropped out of school in Luxor to come here. The 'work-hard-in-school-and-you'll-succeed' thing doesn't work there," Ibrahim said.

"I've been here [on Cairo's streets] five years," he added, "and it is better than working for 50 Egyptian pounds a week in some factory near home, if I could even get that kind of job."

While Ibrahim aspires to a more ambitious business, others count on street trading as a job for life.

Umm Magdy, 72, has been selling her farsha on Cairo's downtown Al-Bustan Street since her husband died 15 years ago. She sells batteries, insoles for shoes, plumbing tape and other accessories.

"I rent a shack [to live in] for 100 Egyptian pounds a month," she explained. "I have three sons to provide for; the first is mentally ill, the second is in jail and the third is unemployed," she said.

"I get 65 Egyptian pounds a month from my husband's pension. Apart from that I have no healthcare or pension, and I have to make everything else from what I can sell, which is hardly ever enough."

According to analysts, Egypt's recent economic growth, which has averaged 5 percent annually over the past five years, has not benefited informal workers.

"Economic growth doesn't mean equality or equal distribution. There is still no mechanism for transmission to these parts of society," said Mehdi.

However, street vendors in Egypt are often arrested and harassed by police and other security services.

The law nominally requires vendors to pay a fee of 50-100 Egyptian pounds for a street-trading license. But the licenses are hardly ever granted for fear of inviting a new influx of vendors from the countryside.

Thus a constant cat-and-mouse game ensues between illegal vendors and the municipal police - known as the baladiyya. Vendors say they pay regular bribes to the police to ensure their continued tolerance.

"When the normal police come round, we have to give them money," Ibrahim said. "If we don't, they send for the baladiyya. If the baladiyya come, they take all your farsha and you have to pay a fine of 110 Egyptian pounds. You don't get the farsha back." - UN Integrated Regional Information Networks