We must formalise Gikomba market for prosperity

Gikomba market in Nairobi is the epitome of entrepreneurial informality. Here, very few businesses are registered, pay taxes or have a trading license.

It is famous as the largest source market for used clothing, the so-called mitumba. But the range of available second-hand items goes beyond clothing to all manner of goods.  It is a hodgepodge of every manner of enterprise, covering virtually every sector and organised in several clusters.

Although our visit there last Monday with Anne Mutahi, the presidential advisor on SMEs and her team was to understand the fish supply chain, our attention was diverted to discussing other issues.

Samson Wanjohi, the chairman of the Quarry Market Association was eager to show us the progress made in the new facility built for those who lost property to the recent fires. 
The tour around the imposing modern facility was a blessing since it took us around several clusters. It has textile manufacturers, shoe dealers, and fishmongers, to mention but a few. Then there are the used clothing dealers and their streams of customers. To say that Gikomba was busy is to understate things. If it were not for masking, no one would tell there is a pandemic in this part of world. Traders and customers appeared to be more concerned about their economic survival than their health.

The stark reality of thousands of people interacting in close proximity momentarily distracted my mind and I found myself starting to ask myself questions like: Are there studies we are not doing to enrich the search for Covid-19 therapies? Why has Covid-19 been so lenient to poorer countries? Should Gikomba act as a laboratory to the re-opening of schools?

Many of the traders work literary on what used to be a dumpsite, with water still stagnant and posing the risk of cholera. God is perhaps on their side owing to their humility. Rarely does anyone complain for lack of space as they gingerly walk in crowded paths. They share ideas and help one another to replicate a new idea. It is a philosophy that is more than the concept of open innovation (“the use of purposive inflows and outflows of knowledge to accelerate internal innovation, and expand the markets for external use of innovation, respectively”).

The practice of replication is evident everywhere. The style of the newly manufactured masks is the same and only differentiated by colour. The children’s clothing tailored here are similar and so are the shoes as well as everything else. Susan, in her mid-30s, tells me that their competitiveness is not dictated by the sales they make within the market but the wider social networks they have created.

The entrepreneurial activities in the market are no longer a one-man show as it used to be. Many have progressed and now have employees working for them. The problem is that many of these employees have neither social protection nor job security. With better policies, the situation could change to guarantee a better future for everyone.

Anne is optimistic that change will eventually come. She tells me that we should never rush with policies like stopping the importation of used clothing abruptly. Instead, with the participation of stakeholders, we must have a transitional strategy to move the players here into a formidable local textile industry involving the entire supply chain. The import landscape is changing slowly into inputs for local production. If the fashion industry embraces the emerging development, you will quickly develop a vibrant textile industry.
In the midst of a chaotic environment with frequent fires from unknown arsonists, the building that the national government is hoping to resettle those who have suffered the fire tragedy is almost done. The Quarry Market Association members are hopeful that their leadership will navigate through political, social and economic interests that often delay projects meant for the poor.

Mr Wanjohi and his vice chairman Paul Oimba, also the chairman of the fish traders, are both archetypal leaders that Kenya misses today. They manage people of all political persuasions, with different social and economic backgrounds without fear or favour to maintain calm in a seemingly chaotic environment. Without them, Anne’s work would be a nightmare and she acknowledges that.

Leadership is critical. Neighbouring Kariokor has had a fully equipped government supported shoe factory but has never produced a single shoe. Reason: city politicians want credit where they never sowed any seed. They want a story to tell when the election comes that they built the place and because so and so did not like it, it has never been operational. Poverty is a great asset for politicians and to fight it, there must be strong leadership from the grassroots.

Failed leadership

Studies show that entrepreneurial informality undermines scalability of enterprises. It is often a direct consequence of failed leadership that is driven by selfish motives on political, social and economic environments.  Informality, therefore, is not a curse or culture as is often assumed. Digitisation of the supply chains for example could quickly formalise informality. This could benefit the employees, the government and the investors.

As stated earlier, the purpose of our visit was basically to understand the problems encountered by fish dealers. Their major concern was safety and quality since fish has become one of the most internationally traded food commodities. In Kenya, we consume close to 1 million tons a year with some of the supplies coming from as far away as China.

To enhance safety, they need cold storage from source to their destination in Nairobi. They also wanted predictable supplies in order to engage in pre-selling to customers. In summary, they wanted improvement in the fish supply chain to ensure predictability in their trade.

Their requirements went beyond the provision of cold storage in the new facility that is just about to be completed.

In Gikomba, there is great hope that the famous market will emerge from the ravages of neglect to offer hope for everyone if the government sustains interventions that it is currently implementing. With emerging technologies, the many informal enterprises in Gikomba could one day be formalised.