Friday, April 25, 2008

Cultural Differences and Informal Markets

A little update followed by a story...but they actually occurred in reverse order. Oh well.

Update

Starting with the most recent.

Here is a picture of us receiving our long awaited honey filling machine from Denmark!!!! It was suppose to arrive 2 months ago, we were even told it was at the airport 6 weeks ago and had papers clearing it. I'll be helping setting it up so we can start selling retail packs in Zambia, this will allow us to both diversify so reduce dependency on exports but also to drive up demand so we can deal with more than 6000 rural farmers. After 6 weeks in Nirobi, it arrived.


Unloading at Forest Fruits in Lusaka

Last weekend we had a meeting for engineers without borders and sure enough, it was back in Livingstone, home to Victoria Falls. It was great to see everyone and we celebrated as a David Damberger and Jenn Dysart are heading back to Canada after each of them have spent over 3 years volunteering here in Zambia. The weekend may have included a moon-rainbow, karaoke, fireworks, ice-cream and giant baguette subs.

Letting Loose in Livingstone

(David Damberger, Trevor Freeman, Ka-Hay Law, Eli Angen, Thulasy Balasubramanium, Hans Hesse, Mark Hemsworth, Ashley Raeside)



A few days ago we loaded a container full of organic beeswax to go to Europe. Over 13 tonnes! Each sack weighs 40kg and we had to hand bomb all 300+ sacks 4 times to get them in there.

20' container of organic beeswax for export


So ya, all is well.


Now for story time.


A Day spent Downtown.

One day last week I got to go downtown to run some erands with a co-worker, his name is Maleh and he is a mechanic at Forest Fruits.

My task for the day was simple enough, to get a new cable for the electronic scale so that we could get it going to weigh all the blocks of organic beeswax before exporting them to Europe.

Maleh had to get a replacement part for the gearbox (transmission) on the toyota. While I'm at A&A Electronics he went across the street to find his part.

He tries 3 shops and no luck. We try another part of town, and still no luck. We then go to the hub of town, right beside 'city market'. As soon as we start walking he runs into a guy he knows who is a dealer in parts and he says he'll get the part and bring it to us. I imagine he would markup the price and this is how he makes a living.

As we wait, Maleh buys a bottle of water from a vendor in the parking lot. I'm enjoying the downtown and I see a crowd of 20 or 30 people all gathered around 1 guy and Maleh explains to me that the guy is a running a little casino on the side of the road where people place there bets and the dealer pays out 2-to-1 if they win and sometimes the dealer won't have enough money and everyone yells at him.

We wait a little more, I start to get thirsty but don't have any money on me. Maleh offers to buy me a drink but I decline because I feel guilty accepting.

We keep waiting and he starts showing me this headset deal that he bought for his cell phone which has a microphone halfway down the wire with a little button on it to speak into it. I thought he looked pretty modern and in general, pretty stylin. He shows it to me because its not working, so I try it on my phone and really had to play with the wire by sorta half putting it into the socket and it only working in one ear. Maleh decides he wants to return it, he just bought it yesterday and it already doesn't work. I told him that would be a good idea.

The guy comes back and says sorry, can't find your part.

We head off through the rediculously busy downtown capital city and after we turn a corner Maleh moves into the middle lane and he slows and asks a guy on the side of the street (who is selling belts) something that I didn't quite understand. He goes a little further and asks the same thing again to a guy selling game boards. This time I get it and I can't believe my eyes and ears...he was looking for the guy who he bought this headset from yesterday and this was the place where he bought it!!! I think to myself, "this is nuts! what kind of return policy does the guy on the street have?"

Vendors on the side of the road in Lusaka...they're very common.


Two things about the way things are here.

1) Social networks are the most important thing to Zambians.
2) The informal market is huge! In my two hours downtown, we dealt with 4 people who sell something and surely don't report anything to the government.

In Canada the informal sector is quite small. Babysitters...some farmers markets...drug dealers...

In developing countries, it can account for 50% of employment. In Lusaka, I'd guess three quarters of the people are buying and selling stuff without a business licence.

I imagine the government doesn't have the capacity to police everything nor the capacity to streamline the process for getting a business licence.

A study in Peru found that it took 11 permits, 207 bureucratic steps, visits to 48 government offices and the equivalent to 22 months worth of wages to purchase a business licence with an address.

The same study did the same process in New York where it took just 4 hours.

In Zambia, it seems everyone is forced to be an entrepreneur, yet I've heard this is given little or no attention in the curriculum at school.

1 comment:

Eddy said...

Nice story and I recognise a lot of things, since I work all together for about 2 years in the country. It's a lovely country but things work completely different to how it works in Canada of Europe. "Connections" is very important, but that is no real different to the business market in general. But things like customer service is unknown in this (and in general African countries (even official shops in the more developed South AFrica country). There are no consumer organisations like we know. That's why the guy was looking around for the seller. When he finds him, there will be no problem most of the times to return it. At least not in Zambia, some other African countries could be more difficult (West Africa, South Africa), depends to the mentality of the people.
You asked yourself, why the gouvernment doesn't take action about the street sellers. Oficial stats say, that the unemployment rates are between 60-70%. Those people who are unemployed survive this way. If you would forbid the street selling, you won't survive the next elections. Simple as that! It's self-regulating and especially
in cities it will be minimal way to survive, nobody will think about this as it doesn't make sense to change it. And surviving is what they know and are used to
Brings us to the pollowing point: there is a huge culture difference between Africa and "us". Africans are used to live in "tribes" and that means, the community cares for each other. This starts from the family, relations between families (mariages) following by responsability for the tribe (a small town) and the next step is the connection to other neighbour tribes (see it as as county/province). It's a very hiargical system. We (Europeans) and the UN came there and decide to devide the continent and brought our way of thinking there, which was the biggest mistake. From their hearts, they still think the same. It's the closest to socialism in combination with liberalism. I hope one day, we and they understand what the advantages of both our ways of life are and implement it that way that fits for every society.