Street Vendors: Menace or Blessing?

It’s a common sight to see officers from Tehran Municipality’s “Urban Disciplinary Team” arguing with vendors to clear the sidewalk.

Most vendors have resorted to this job as a last option.

Ahmad (name withheld), a vendor, says, “Any job is better than no job.”

He earns an average of 500,000 rials ($12) per day, adding up to about $360 per month. Hardly enough to make ends meet in a metropolis like Tehran, but still higher than the minimum monthly wage for workers set by the government for this year (about $240).

Ahmad denies having had to pay any sort of fee to authorities or to the notorious street mafia, for being allowed to do their job. He must be among the lucky ones then, as the existence of street mafia who rent out public spaces to street vendors in Tehran’s crowded junctions is now an open secret.

  Municipal Efforts

Shahrban (city watch) Company, is an affiliated company of Tehran Municipality in charge of guarding Tehran’s public spaces.

In a telephone interview with Financial Tribune, Sadeq Zamani, the head of public relations at Shahrban Company, said the street mafia charge vendors between 900,000 ($23) and 1,200,000 rials ($31) a day for allowing them to occupy only four pavement tiles at popular junctions. “They do this by bullying and harassing the vendors,” he said.

But, harassment of street vendors is not limited to street bullies. Over the last two decades, clashes have periodically broken out across Iran between street vendors and municipal authorities who have tried to forcefully remove them from streets.

Last year, Tehran municipal authorities declared 48 spots, mostly crowded streets and popular junctions, off-limit for vendors. Instead, they encourage vendors to book permanent or temporary stalls in markets set up by the Shahrban Company.

  Rehabilitation Program

Tehran Municipality has been running a program themed “Rehabilitation of street vendors” for the past three years.

The program is aimed at keeping part of the large crowd of Tehran’s vendors, mostly daily migrants from the city’s outskirts, off the streets during the shopping frenzies ahead of the new Iranian year as well as the start of the new school year, in March and September respectively.

To achieve this, municipal authorities have been providing low-cost stalls in temporary markets set up across the city.

According to Zamani, these markets run during the one and a half months leading to the new calendar year and the school year, and can accommodate up to 20,000 vendors in each season.

These efforts, though still far from sufficient, could be indicative of a shift in the long-held notion that street vendors are harmful to the economy and must be eliminated altogether. After all, most vendors are decent breadwinners who, unable to afford the heavy costs of renting a shop, have resorted to the street to earn a living.

In Iran, the authorities’ efforts have for years been focused on eliminating street vending, rather than seeking sustainable solutions that acknowledge their existence. This is while many studies confirm the benefits of recognizing the vendors’ contribution to urban economies.

Last year, a group of 10 Iranian economists from prominent universities wrote a letter to Tehran’s then mayor, Mohammad Baqer Qalibaf, asking him and Tehran’s City Council to stop confronting street vendors and instead improve their working conditions.

The letter drew attention to the role of small businesses in creating employment and encouraging entrepreneurship.

  Potential Economic Benefits

Financial Tribune interviewed Hamid Padash, a professor at Tehran University’s Faculty of Entrepreneurship, and one of the signatories to the above letter, for his views on the economic role of street vendors.

The expert regards the economic activity carried out by vendors as a sort of micro business which, if given proper support, could grow to form small and medium enterprises.

“These are micro businesses, created by the financially weak members of the community who cannot afford to rent a permanent space for their business. But, at a time when the country is battling economic recession, the sector accounts for a significant proportion of employment,” he said.

The economist is of the opinion that the presence of street vendors helps create a competitive economic environment, which ultimately benefits the customers.

“Not all customers are looking for high-quality products offered in shops. If street vendors have sustained, it means there is demand for their products,” he said.

Padash believes vending plays a role in supporting other economic entities, as they provide a direct channel for their products to reach the customers.

“All these indicate that we cannot deny the existence of street vendors, but rather we must seek sustainable methods that enable them to work without fear of harassment,” he said.

Asked about his opinion regarding the municipality’s initiatives with regard to day markets and seasonal markets, he approved of the plan as a necessary provision, but said it is not enough.

“After implementing these plans, studies must be conducted on their effectiveness to determine whether they have been successful or not,” he said.

The economist stressed that this requires an all-out effort by all concerned bodies, including the municipality, the Cooperatives Ministry and the chamber of guilds.

While street vendors, with their meager incomes, cannot be expected to have considerable impacts on the national economy, they could, in their own small way, help municipalities establish a sustainable source of income by renting out spaces and issuing work permits.

“Recognizing street vendors as an inevitable part of urban organism and giving back to them their long-lost dignity, has many indirect social benefits. Allowing these people to work legally, by issuing permits and so on prevents them from resorting to other illegal activities,” he concluded.