All you need to know about informal cross-border trade

By StreetNet Media
February 14, 2022
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Informal cross-border traders are extremely important for national economies, especially in Africa, but they suffer from extortion, harassment and violence. Read the key findings and testimonies of a StreetNet-led project for the rights of informal cross-border traders to know how we can change this situation!

Cross-border trade makes up for a large part of the informal economy worldwide. A lot of informal traders sell goods across borders and face obstacles specific to their situation: to begin with, they are often not registered with authorities and are not recognized by the State. Like many other informal economy workers, however, they provide a vital contribution to  their countries’ economies.

StreetNet International organized a series of webinars between March and June 2021 to discuss in depth the topic of informal cross-border trade, together with its affiliates in West and Central Africa – one of the regions where this form of informal trading is very  prevalent. The project was carried out with the cooperation of StreetNet’s partners, including SACBTA (South African Cross Border Trade Association), an experienced partner in the ICBT issues, ITUC Africa (African regional organization of the International trade Union Confederation) OTUWA (Organisation of Trade Unions in West Africa) and ATUMNET (African Trade Union Migration Network).

The goal of the webinars was to engage our affiliates in exploring the issues of cross-border trade, enabling them to identify transnational and cross-cutting problems that different trade unions and associations from various countries might have in common; as well as ascertain their particularities and differences.

We spoke with Evelyn Benjamin-Sampson, StreetNet’s organizer for Western and Central Africa and coordinator of the ICBT project. The outcome of the webinar series was satisfying, with around 70 people attending and making active contributions to the discussion. “We were able to overcome technical difficulties presented by  connection issues and the participants were engaged in the webinars. It was not only a lesson-like meeting, but a very participatory environment where the affiliates and the people working on  the field were able to share their struggles and make connections with fellow workers.”

Many workers had the chance to analyze and share the many issues they face in their daily work. First of all, the violence and harassment from authorities happening on the borders.

Why current legal frameworks don’t work for informal cross-border traders

According to Evelyn, one of the root causes of authorities’ abuse against informal cross-border traders is the extreme lack of transparency and accountability in bureaucracy.  Cross-border traders in most countries go through prolonged and complicated processes,  that are rarely clear and easy to understand. This puts officials including custom authorities in the position to ask cross-border traders for money, goods or harass them under the guise of  unclear regulations. The certificates needed to travel are also very difficult to access and obtain. The duties and procedures are further complicated by the pandemic.

Between Benin and Nigeria there are as many as 34 checkpoints” continues Evelyn. “Some people end up with all their goods confiscated, because some officials e at the checkpoints take advantage of their position of power. Harassment and violence are a day to day reality”.

According to a research carried out by OTUWA, in Nigeria alone there are  as many as 10 different security agencies, all asking  cross border traders to comply with bureaucratic fulfilments that mostly tend to be extortions and bribes . This goes hand-in-hand with a well established extortion link of custom, migration, trade and other border officers.

Trading across borders, legally or illegally, means facing violence from custom authorities, police and other related public officials. Illegal fees are routinely asked which sometimes  force some traders out of business.

During the second webinar, dedicated to the advocacy opportunities related to ICBT, it was reported that some traders are even arrested as spies – an instance is what  happened when Rwandan traders traveled to neighboring countries. Violence does not stop after the borders are crossed, it happens in markets and places of business, too. In the Nigerian town of Ibadan, close to the border with Benin, a special custom task force raided the market where food is sold. They carted away six trailer loads of foreign rice.

We were able to conduct a qualitative survey in the form of a Focus Group Discussion last December with ICBTs drawn from several border communities in Nigeria and Benin Republic. The effort yielded a lot of information about the extreme militarization and precarity imposed on these communities as result of the border closure” explained Gbenga Komolafe (FIWON). “The ban of the sale of petroleum products in the border communities adds another crippling twist to the border closure. It means residents of these communities have to take dangerous risks just to procure fuel for household use and as a source of energy at work (because of poor availability of grid electricity). The intermittent raids of homes, shops and markets by Customs men and the army in these areas was also found to be extremely traumatizing for the residents.”

In addition, around 70% of informal cross border traders in West Africa are women, which exposes them to specific forms of gender-based violence. For many of the women, ICBT is the only available economic opportunity outside agriculture. The aftermath of Covid-19 has had a very negative effect on them: due to the economic burden of the pandemic, a large part of their business capital has gone into taking care of their households as a lot of the  women engaging in ICBT activities are the breadwinners of their families.

“Informal cross border trade is just an aspect of the street vending culture dominant among poor women in most parts of Nigeria” explains Gbenga Komolafe, a spokesperson from the  Federation of Informal Workers Organisation of Nigeria , one of the participants of the workshops. “Street vending offers the only opportunity for women to enter the world of work and earn a livelihood, take care of their families and interact socially and economically with others. For most women in the border communities, cross-border trade offers the only means of earning some subsistence.”

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Members of CNTS (#Senegal) and Confederation Nationale des Travailleurs de Guinee – CNTG met in Guinea in 2021.

The solution: Simplified trade regimes

One legal way to overcome the lack of transparency connected to cross border trade and thus to protect informal economy workers are simplified trade regimes. The first webinar of the series was devoted to this type of trade regimes, their history and their use, and it was presented by Pat Horn, senior advisor of StreetNet together with A.H. Tawanda, from the South African Cross Border Trade Association (SACBTA), whose efforts in the domain of STR go back to 2004.

What are simplified trade regimes? They are specific agreements, first implemented in 2010 by COMESA (Common Market of Eastern and Southern Africa) allowing a significant reduction of the bureaucratic burdens for traders that sell up to a certain value of goods ($2000 per day) across the borders. Around 90% of beneficiaries of such simplifications are women. STRs constitute an example of sub-regional policies working in favor of small-scale informal traders that could be advocated for by informal economy workers’ organizations. Simplified and special trade regimes can succeed where standard free trade agreements for movement of goods and people fail: in protecting the most vulnerable.

Informal cross-border traders come together to have a seat at the table and voice their demands

During the webinars, there was a strong call to collaborate transnationally among like-minded organizations. This was true both for the phase of sharing common experiences and challenges and in identifying key points for negotiations with authorities and policy recommendations. It was noted that in West & Central Africa among  the main interlocutors for lobbying and advocacy work there would be ECOWAS, the Economic Community of West Africa and the African Continental Free Trade Area: these organizations could be a target for policy demands for informal cross border traders. Several practical suggestions were also made: to install information desks at the borders in order to inform traders about their rights under STFs and to place assistance hotspots for traders in need of support along the borders, to ask for new, simplified procedures to issue passports and to eliminate the request of visas upon arrival.

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Pamphlet summarising the demands of affiliates regarding ICBT

The third webinar was entirely dedicated to negotiation capacity building and techniques. Pat Horn, drawing from her extensive experience as StreetNet’s founder and trade unionist, highlighted the three golden rules of negotiating with authorities: never negotiate alone, never make a deal without agreement of members and maintain unity while negotiating.

The fourth webinar covered the topic of planning bilateral negotiations with authorities. The bilateral meetings could be organized by affiliates based in two states that share a border and respective public and custom officials. Participants presented their experiences in identifying critical borders and in moving forward with inter-organisational dialogue and official negotiation talks. The borders on which the work has started so far are Togo – Benin, Benin- Niger, Burkina Faso – Ivory Coast, Guinea – Senegal, Benin-Nigeria, DRC-Burundi-Rwanda, DRC-Congo-Brazzaville, DRC-Angola and Ghana-Togo. Meetings and talks will proceed during the second phase of the project, in February and March 2022, and beyond.

Organizations that took part in webinars were able to plan advocacy actions to improve the working conditions of their members, including FIWON.

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Members of FETTEI-CI (Ivory Coast) and SYNAVFL (Burkina Faso) meeting in 2021

“It is our plan to draw public attention to this situation through a media campaign, advocacy visits to the Customs Department, the local parliament and state government towards an urgent amelioration of the terrible situation in the border communities. We also intend to visit the ECOWAS office in Abuja as part of the advocacy effort to effect urgent changes.” said Gbenga.

According to Evelyn Benjamin-Sampson, the main results achieved include the identification of common and diverse issues, the possibility to do field research and gather information and the opportunity to form cross-border alliances for redress of ICBT issues. Madame Marcelline Adopo, from FETTE-ICI, one of Street Net’s affiliate organizations in Ivory Coast which also participated in the webinar series, agreed to the fact that initiative helped them “understand the real problems that street vendors and itinerants face at the borders, know more the experiences of other countries, and gave us a good understanding of the agreement between different countries”. FETTEI-CI also stated that they  plan to advance research in order to enter into negotiations with authorities.

Informal cross border trade is one of most challenging domains for informal economy workers, for various reasons: it is influenced by borders and international politics, it is highly risky for people working in it, and, in order to foster meaningful change, concerns should be tackled by more than one country and by several public offices.

The goal of StreetNet is to continue supporting its members in achieving their core demand: to protect vulnerable traders from the many diverse forms of violence they experience, and to make cross border trade a reliable source for decent work and stable income.