Embracing the Informal City
Benjamin de la Peña

Benjamin de la Peña Former Associate Director, Foundation Initiatives

October 02, 2013

Embracing the Informal City

Let’s not romanticize poverty. We live in an unprecedented age of urbanization that has consigned large segments of the population to slums that have no water or electricity or sanitation. Life in these places is hard. Health is precarious, children are at risk and violence is a daily event. Gangs rule many of these neighborhoods, with the authorities and the police entering only when armed to the teeth.

These slums are a stark reminder to many cities that, despite their booming economies, economic and social inequality seems endemic and intractable. It’s no wonder, then, that many cities want to wish away these places, move their populations back to the countryside in a vain attempt to quickly clear away the poverty and move forward toward a more appealing future. A plan for such a future exists in every mayor’s office in every city with rising ambitions—a vision that looks 10, 20, even 30 years on. And in every city that vision contains the same basic elements: Shiny buildings and broad, sweeping avenues. Big green parks and smoothly flowing traffic. Waterfront high-rises. Glittering malls.

Uniformly absent from these plans are the districts where the poor now live, the informal markets, the tianguis and the souks where vendors congregate to sell their wares to the public. High-end shops and gleaming corporate towers have replaced wet markets and slums; subways and light rail and elevated highways have overtaken matatus and trotros.

These visions of a well-scrubbed future are seductive. But they are also exclusionary and unrealistic. They imagine that the current disorder will be swept away, forgetting that while the top of the pyramid may be gilded, the bottom bears its weight.

“Despite their disorder, slums are also places of entrepreneurship and human energy.”

What these visions overlook is that, despite their disorder, slums are also places of entrepreneurship and human energy—neighborhoods that, with proper support, could one day become the vision. Walk into any slum and look past the open sewers and corrugated-iron shacks. Look instead to the stores and tool houses. There are restaurants, repair shops, barbers, tailors, hairdressers, schools and hotels. Often there are massive markets, where residents from the city’s more “respectable” districts come to haggle with the vendors in their stalls. This is capital, human and economic, actively pursuing opportunity. The slums and the wet markets host a population that is trying to lift itself out of poverty. In doing so, they lift the city as well.

Woman with fresh produce - next city informal city reader
Photo credit: Informal City Reader

This is the side of the city that The Rockefeller Foundation’s Informal City Dialogues set out to explore. In cities of the global south, the informal economy accounts for up to 40 percent of GDP. Informal settlements are home to as much as 25 percent of the urban population, and informal transport provides mobility for upwards of 60 percent of the populace. The OECD estimates that half the workers in the world—close to 1.8 billion people—hail from the informal sector, making and selling and trading off the books. To paraphrase the late C.K. Prahalad, the informal city is the bottom of the pyramid that holds up the formal city. The Foundation believes that the informal city will play an essential role in transforming our cities into engines of opportunity and social and economic mobility.

“The Informal economy accounts for up to 40 percent of GDP in cities of the global south.”

By participating in the Dialogues, the six cities involved—AccraBangkok, Chennai, Lima, Nairobi, and Metro Manila—took steps toward acknowledging this. In each of these cities, various stakeholders—from street vendors and slum dwellers to urban planners and government officials—came together to try to imagine what their cities might look like in the year 2040. They then used these visions of possible futures to devise innovations that would make their cities more inclusive and resilient in the decades to come. But the process, facilitated by Forum for the Future and documented by Next City, wasn’t just about generating an end product. It was about a form of collaboration in which everyone has a seat at the table.

We hope that the Dialogues are just the start of a larger conversation about how cities are not only the engines of the global economy, but accelerators of opportunity. Leveraging the informal city will mean finding ways to support the informal street vendor so her table of wares on the sidewalk can become a stall in the market, which can then grow into a network of stores. It will mean understanding that the roadside vulcanizing operation is the stepping stone to the auto repair shop, and that pulling a pedicab could be the prelude to owning a small fleet of vans. It will mean seeing the shack in the slum not as simply sub-standard housing, but as a means of production and an asset for investment to someone who owns little else. It will mean recognizing that the poor are attracted to cities because of opportunity, and that the city is the most efficient way to provide that opportunity that the world has today. It will mean embracing the informal city, and all it has to offer.

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