Mozambique's informal street traders strive to survive

'Car guard' Titos Ernesto represents the developing world's legions of small-time, off-the-books entrepreneurs.

The Sunday morning madness outside the Lhanguene cemetery is starting to calm, but Titos Ernesto's eyes are still hawklike as he takes in the trash-strewn parking lot.

On the far right, one of his men is washing a car. That's good. Across the way, a woman walks by selling peanuts out of a reed basket. That's fine – a complementary business, no competition. To his left, the flower sellers are down to their last stalks, which are now wilting in their dirty plastic buckets, and the phone card man weaves his way through the minibus taxis.

For the moment, Mr. Ernesto's slice of the informal economy – the generally unregulated and untaxed commercial activity that forms a huge percentage of the market here – is in order. But then, just to the side of him, two of the boys selling water start shoving each other. Plastic jugs rattle onto the ground, and Ernesto swings toward them.

"Knock it off!" he shouts at them in Shangaan, the local language. The boys start to protest, but then stop and pick up their jugs, sulking. They shuffle off, looking for more customers. "They need to learn how to behave," Ernesto says, still glowering.

He should know. He was 9 years old when he started working here, selling odds and ends to the swarms of people who come daily to pay respect to their ancestors at this cemetery – the largest in this seaside capital. By his early teens, he was washing and "guarding" cars – a profession familiar to anyone who has driven, and tried to park, in Southern Africa. Today, at age 25, he's known simply as chefe - the "boss" in Portuguese. "It is because of my experience," he says to explain how he earned that title and role.

As chefe, he explains, he is in charge of the 70 or so car guards in this expansive parking lot. He divides the lot into zones and assigns territory to all of the guards. He is also the main liaison – some whisper "informer" – for the police department, which, in 2004, frustrated with petty crime here, encouraged the car guards to organize.

"If anything goes wrong now, we're blamed," Ernesto says. Which means, of course, that they can't afford to let anything "go wrong." Clad in faded "official" vests, they watch for people stealing car mirrors – a common nuisance before the police asked them to organize. They make sure that the young hooligans from the squatter camp a few blocks away aren't staking out any of their customers. And they try to keep the peace among the various hardened, impoverished youths who come here to earn a few coins for bread. Hence the scolding of the water boys, who clean jugs they find in the trash and offer to water the flowers that Mozambicans plant on the graves of loved ones.

•••

Economists and policy officials have tried for years to define and measure the informal sector. Some say it is a sign of underdevelopment and will shrink as the economy improves. Others believe that the "secondary economy" – another name for it – is tied to the legal, commercial economy, and that aid donors should encourage informal traders with microfinance grants.

What is clear to everyone, though, is that the informal economy is huge. In sub-Saharan Africa, the informal sector makes up about 72 percent of nonagricultural employment, according to the World Bank. Most informal traders in urban areas have jobs like Ernesto's – self-employed traders of some kind or another – and many congregate together in places such as the Lhanguene cemetery parking lot.

In this city of about 1.5 million, there is a clear informal sector hierarchy. The vendors with stalls in some of the city's crowded markets are close to the top. They have to pay for their spot and are supposed to buy a government license. (They're still considered "informal" because they don't pay taxes and they don't have the same government protections as formally employed people.) Then comes the informal stalls – the people who set up rickety stands outside their houses, or along the curb near the minibus taxi stops, selling oranges, bananas, or cashews.

Sonia Alfeu, who is carrying dozens of small peanut packets in a handmade basket, as well as a baby tied to her back, is near the bottom of this pecking order. She does not have a stand or a regular customer base.

Every afternoon, after roasting about five pounds of peanuts (which cost her $3.20 wholesale) on a makeshift oven in her aluminum-walled shack, Ms. Alfeu walks 20 minutes to this cemetery parking lot market. She has sorted the nuts into little bags – she buys one big plastic sheet, then cuts it into about 150 smaller pieces – and sells the packets for a few cents each. She has been doing this for a year, she says, ever since she became pregnant and was fired from her job as a housemaid. "Sometimes the business is OK, but sometimes it's not so good," she says. Even if she sells all 150 bags, she makes about $6 - a net of less than $2 after the cost of the nuts, plastic, and oven. "I'd like to do something else, but I don't have the money."

With only a third-grade education – when her father died, she no longer had money for school fees – she says has few prospects, but that one day, she'd like to sell "in a proper place," a market.

For now, this is her main territory. She nods toward the chefe. Unlike in some places where the lower rung of informal traders gather, at least here there is some sort of order.

•••

Ernesto lives in a small cement house in one of Maputo's impoverished settlements, not far from the train tracks that shuttle official goods to and from the city's port. About a dozen relatives live with him – a collection of brothers, sisters, and cousins. Nobody in the house has formal employment, he says, but four of the boys work as car guards.

He notices a man in a dress shirt about to get into his car across the parking lot and nods toward Agostino Roberto Cumbane, one of the other guards. Mr. Cumbane jogs across the pavement, and the man pulls a few coins from his pocket before quickly ducking into the car and driving away.

Ernesto's crew usually gets a few cents for watching someone's vehicle and a dollar or more for washing it. There are no set prices, they insist.

"It's whatever people feel," says Cumbane, who has been guarding cars since he was 13. Jose Marquero, who at 22 years old is one of the older water sellers, agrees. Mr. Marquero used to be a builder, but was laid off a year ago. Now he walks five miles from his home to collect water from broken pipes around the cemetery, which he then uses to care for the plots of the ancestors of those families who were able to afford a grave in this cemetery. He hopes he can make enough money to buy bread and maybe pay the few cents for a minibus taxi ride home.

As for price, he says, "it depends on the client. Some of them don't even have the capacity to pay. But we'll help them anyway. It's community service."

Still, Ernesto says they can tell when someone is going to be a big spender or when a customer will try to leave without paying. A telltale signal is when someone avoids eye contact, or refuses to talk back. "Not everybody is honest," he says. "But we are very patient with it because that's our job."