How MTN is profiting from Nigeria’s informal economyFollow @MadeItInAfrica
Robert Neuwirth, author of Stealth of Nations: The Global Rise of the Informal Economy, examines how mobile operator MTN is using hawkers and street vendors as distribution agents.
Throngs of okada – unlicensed motorcycle taxis – manoeuvred in and out of the pedestrian flow. Most of the passengers were purchasers. They made their deals and hefted their goods on their shoulders or on their heads. The bikes whizzed past kids selling tiny bags of peanuts, women carrying buckets of soda bottles on their heads, kiosks selling tools, hawkers selling mobile phone recharge cards, roadside stalls offering fried Indomie (a brand of spiced instant noodles that is a common, cheap meal here). Trucks dropped off containers straight from the port, disgorging banged-up car bodies, piles of coiled springs, used copper bushings, and mounds of dusty hubcaps. Panel trucks delivered photocopiers, computers, TVs, gaming consoles, and troves of mobile phones freezer-packed in Styrofoam cartons. The guts of global production splayed out in a series of chaotic stalls.
This is Ladipo Market in Lagos, Nigeria – part of a $10 trillion worldwide economy known as System D.
You probably have never heard of System D. Neither had I until I started visiting street markets and unlicensed bazaars around the globe.
System D is a slang phrase pirated from French-speaking Africa and the Caribbean. The French have a word that they often use to describe particularly effective and motivated people. They call them débrouillards. To say a man (or woman) is a débrouillard(e) is to tell people how resourceful and ingenious he or she is. The former French colonies have sculpted this word to their own social and economic reality. They say that inventive, self- starting, entrepreneurial merchants who are doing business on their own, without registering or being regulated by the bureaucracy and, for the most part, without paying taxes, are part of “l’economie de la débrouillardise”. Or, sweetened for street use, “Systeme D”. This essentially translates as the ingenuity economy, the economy of improvisation and self-reliance, the do-it-yourself, or DIY, economy. A number of well-known chefs have also appropriated the term to describe the skill and sheer joy necessary to improvise a gourmet meal using only the mismatched ingredients that happen to be at hand in a kitchen.
There is another economy out there. Its edges are diffuse and it disappears the moment you try to catch it. It stands beyond the law, yet is deeply entwined with the legally recognised business world. It is based on small sales and tiny increments of profit, yet it produces, cumulatively, a huge amount of wealth. It is massive yet disparaged, open yet feared, microscopic yet global. It is how much of the world survives, and how many people thrive, yet it is ignored and sometimes disparaged by most economists, business leaders, and politicians. At the same time, many major corporations make their money through System D.