The informal economy

It can get really crazy in the supermarkets these days. Sometimes you have to fall in line for more than an hour. On bad days, you spend at least two hours for what is supposed to be a quick grocery run.

So I usually just buy food from the friendly neighborhood vegetable and fruit stand. There’s one near our place and, in this time of quarantine, it’s enjoying brisk sales.

Not far away, along a road leading to our residential district, makeshift vegetable and fruit carts have sprouted like mushrooms since the lockdown. They sell fresh fruits and green, leafy vegetables — broccoli, lettuce, eggplant, squash, bananas, lemon and what have you.

But these wooden vegetable carts come and go. Perhaps it depends on the mood of the military and police implementing the quarantine.

I could also go to the nearest sari-sari stores. We’re all familiar with these neighborhood retail stores. There’s always something in them for the average Pinoy – some basic items missing on the table or in our bathrooms – from ground black pepper to our favorite shampoo.

In slum areas, the poorer squatter communities, these sari-sari stores are an essential part of residents’ daily survival because they provide long credit lines.

But these days many of them are closed.

The informal sector

This quarantine has put the spotlight on many things, but rarely the informal economy, including sari-sari stores and makeshift markets.

Initially, they were not allowed to open during the quarantine. Now that they can operate, many of these retail stores remain closed because they don’t have the means to replenish their stocks.

In some middle-class neighborhoods, sari-sari store owners, who have private cars and can quickly run to the bigger groceries to replenish their stocks, are enjoying brisk sales. One store used to rake in P10,000 in daily sales before the pandemic. Sales have gone up to P15,000 a day during the quarantine.

The rules may vary per barangay but I believe sari-sari stores and makeshift palengkes should be allowed to operate especially during the quarantine.

They should also be allowed to go to the bigger groceries for their supply runs. Those who do not have the means should be given all the support they need. For one, their private-sector suppliers must be allowed to deliver goods to these stores to keep their shops well-stocked.

COVID-19 lessons

But more importantly, and as yet another lesson from the COVID-19, we should look at how we can make our economy more inclusive.

Since the lockdown, some cities have embraced the concept of mobile palengkes. It’s been a practice in the provinces even during our pre-COVID-19 life. In Ilocos, for instance, it’s common to see vegetable and fish vendors on foot or in open tricycles going from one house to another to sell their goods.

This is no different from allowing delivery services for groceries or fast food. But some LGUs could oppose normalizing the model post-COVID-19 because they might have to forego potential revenues in the form of rent in public markets, among others.

Yet, we should look at the bigger picture – our economy is consumption-driven and every peso earned by informal retailers will ultimately be spent on goods and services subject to taxes like VAT.

These mobile palengkes could even help ease the traffic congestion because fewer people would need to travel and their activities would be confined to internal roads or villages. It’s also pro-consumer.

If not mobile palengkes, LGUs should look into designating areas for pop-up stores. These can be near population centers but away from major roads. They can also provide presentable stalls, just like how Makati did with their Jollijeeps.

It can be an organized system.

Farm to market

The government should also provide more farm-to-market outlets.

We’ve seen Mandaluyong directly source vegetables from farmers during the quarantine. Many private companies are also doing this to help the farmers. San Miguel and Pilipinas Shell are just a few.

But we should make this permanent. LGUs must provide farmers the opportunity to sell their produce in the cities directly by organizing them into cooperatives and giving or lending them capital for trucks, for instance.

This will eliminate the middle man and would allow farmers to take a bigger cut from the sale of their produce as well as bring prices lower.

Of course, regulations should be in place to protect consumers and farmers alike. We don’t want to eliminate the middle men just to provide a bigger cut to the companies that will directly buy from the farmers.

MSMES make up more than 99 percent of business establishments in the Philippines and employ more than 60 percent of our workforce.

Just imagine the potential we can unlock, only if we start looking at sari-sari store owners and street vendors for what they actually are — people earning a livelihood – and not as eyesores, nuisance or a bunch of hawkish sellers.

We really owe it to them to integrate them better in the economy.

At the end of the day, they’re just trying to make a living, just like you and me.

Iris Gonzales’ email address is [email protected]. Follow her on Twitter @eyesgonzales. Column archives at eyesgonzales.com