Street Trading in Cape Town CBD: A study of the relationship between local government and street traders by Schalk Willem van Heerden Thesis presented in partial fulfilment of the requirements for the degree Master in Arts at the University of Stellenbosch Supervisor: Prof, Sybrand Eloff Donaldson Faculty of Arts Department of Geography and Environmental Studies December 2011 Stellenbosch University http://scholar.sun.ac.za ii DECLARATION By submitting this research report electronically, I declare that the entirety of the work contained therein is my own, original work, that I am the owner of the copyright thereof (unless to the extent explicitly otherwise stated) and that I have not previously in its entirety or in part submitted it for obtaining any qualification. Signature: Date: 2011-12 Copyright © 2011 Stellenbosch University All rights reserved Stellenbosch University http://scholar.sun.ac.za iii ABSTRACT The c onstitution of t he R epublic of S outh A frica ( 1996) s tates t hat l ocal g overnments a re responsible f or t he c reation of a s ocioeconomic e nvironment t hat e nables c itizens t o m ake a living for themselves. It is on t he grounds o f this responsibility that the study is based on t he relationship between street traders and the City of Cape Town within the Cape Town CBD. This relationship is inve stigated with the a im of a ssessing w hat the n ature of the r elationship is between street traders and the City of Cape Town. A survey was conducted wherein 71 s treet traders w ere i nterviewed a nd t o c omplement the s urvey i nterviews w ere c onducted w ith individuals from local government and the private sector who deal with street traders on a daily basis. The survey results indicated that there is a positive relationship between traders and the City of Cape Town, but that local government does not live up to expectation when it comes to the f acilitation of i nformal bus iness de velopment. A t t he ha nd of f t hese f indings; pol icy interventions are put forth that would lead to the creation of a facilitative relationship between the C ity of C ape T own a nd s treet t raders. P roposed pol icy i nterventions a re f ocussed on t he improvement of channels of communication between street traders and local government. The proposed policy framework places emphasis on the active participation of local government in the f ormalisation pr ocess of i nformal t raders. T he s tudy concludes b y proposing pol icy intervention that w ould pr omote a f acilitative relationship between street t raders and local government and contribute to a sustainable street trading economy in Cape Town. KEY WORDS Street tr aders, street tr ading, street ve ndors, informal e conomy, informal e conomic s tatistics, street or ganisations, street tr ade a ssociations, informal tr aders associations, informal tr ader organisation, s treet t rader pol icy, i nformal t rader pol icy, i nformal t rader pol icy a nd i nformal economic policy. Stellenbosch University http://scholar.sun.ac.za iv OPSOMMING Die grondwet van die Republiek van Suid Afrika (1996) daag elke plaaslike owerheid uit met die taak om ’n sosio-ekonomiese omgewing te skep wat dit vir landsburgers moontlik maak om ’n bestaan te kan maak. Dit is op grond van hierdie verantwoordelikheid dat die studie gebaseer is op die verhouding tussen straathandelaars, binne die sentrale sake kern, en Kaapstad se plaaslike owerheid. D ie v erhouding t ussen s traathandelaars e n di e S tad K aapstad i s onde rsoek m et di e doel om die aard van die verhouding te omskryf. ’n Vraelys is uitgedeel aan 71 straathandelaars en om die opname te komplementeer is onderhoude gevoer met individue van beide die openbare en privaat sektor wat saam met straathandelaars werk op ’n daaglikse basis. Die resultate van die vraelys het gewys op die positiewe verhouding tussen handelaars en die Stad Kaapstad, alhoewel dit aan die lig gekom het dat plaaslike owerhede nie voldoen aan verwagtinge ten opsigte van die fasilitering va n informele be sigheidsontwikkeling ni e. Beleidsmaatreëls w at ’ n fasiliterende verhouding sou bewerkstellig; sowel as ’n beleidsraamwerk word voorgestel aan die hand van die be vindinge va n di e opname. D ie voo rstelle is g rootliks gegrond op di e ve rbetering v an kommunikasie tussen die plaaslike owerhede en straathandelaars sowel as die aktiewe deelname van di e pl aaslike owerheid i n di e f ormaliseringsproses va n i nformele ha ndelaars. D eur di e implementering va n di e voor gestelde be leidsmaatreëls i s di e s tudie va n m ening da t ’ n fasiliterende verhouding t ussen s traathandelaars en pl aaslike owerhede gevestig kan word m et die doel om ’n bydra te maak tot ’n volhoubare straathandel-ekonomie in Kaapstad. TREFWOORDE Street tr aders, street tr ading, street ve ndors, informal e conomy, informal e conomic s tatistics, street or ganisations, street t rade as sociations, informal t raders associations, i nformal t rader organisation, s treet t rader pol icy, i nformal t rader pol icy, i nformal t rader pol icy a nd i nformal economic policy. Stellenbosch University http://scholar.sun.ac.za v ACKNOWLEDGEMENTS . I would l ike t o t hank everyone at t he D epartment of G eography and Environmental Studies for providing me with an opportunity to study further and teaching me how t o enjoy the research process. I would like to thank Professor Ronnie Donaldson for his guidance over the past three years as well as what I have learnt from him as a researcher. Thank you to all the street traders who participated in the study. I would l ike t o s ay t hank you t o m y pa rents a nd e xtended f amily f or their c ontinual support and interest in my post graduate studies. Lastly thank you to Theo Pauw and Byron Diergaardt without whom this masters would have be en c ompleted m uch e arlier but m aybe would ne ver ha ve be en undertaken and completed at all. Stellenbosch University http://scholar.sun.ac.za vi CONTENTS DECLARATION ..................................................................................................... ii ABSTRACT ............................................................................................................ iii OPSOMMING ........................................................................................................ iv ACKNOWLEDGEMENTS .................................................................................... v CONTENTS ............................................................................................................ vi FIGURES ................................................................................................................ ix TABLES ................................................................................................................. xii ACRONYMS AND ABBREVIATIONS ............................................................ xiii Chapter 1. STREET TRADING IN SOUTH AFRICA: A CASE STUDY OF THE CAPE TOWN CBD ..................................................................... 1 1.1 Background ...................................................................................................................... 1 1.2 Problem formulation ....................................................................................................... 2 1.3 Aims and objectives ........................................................................................................ 4 1.4 Study area ........................................................................................................................ 5 1.5 Research methods ........................................................................................................... 5 1.5.1 Fieldwork: Questionnaire ..................................................................................... 6 1.5.2 Fieldwork: Questionnaire distribution................................................................ 7 1.5.3 Analysis .................................................................................................................. 9 1.5.4 Mapping data ......................................................................................................... 9 1.5.5 Spatial data analysis ............................................................................................ 10 1.6 Research Design ............................................................................................................ 10 1.7 Conclusion ...................................................................................................................... 11 Chapter 2. THE ROLE OF STREET TRADING IN THE INFORMAL ECONOMY ............................................................................................... 12 2.1 Introduction ................................................................................................................... 12 2.2 The informal sector ....................................................................................................... 13 2.2.1 Definitional debate .............................................................................................. 13 2.2.2 Growth of the informal economy ....................................................................... 15 2.2.3 Link to the formal economy ............................................................................... 17 2.2.4 The informal economy and the regulatory environment ................................. 20 2.3 Street trading: studies and perceptions .....................................................................