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– by Karim Okanla
No taxes paid: Beninese shoe shop.
Shortly after taking office in April 2016, Patrice Talon, Benin’s newly-elected President, issued several decrees annulling recent recruitments to the civil service. The reason was that some of the persons concerned had obviously bribed their way into a government job. Local media reported that they had paid corrupt officers large sums of money.
Newspapers also alleged that some recruits had submitted applications with fake degrees, while others had not even pretended to have the qualifications for a position in the civil service.
Talon’s decision to revoke the appointments was contested, nonetheless. Many people took to the streets and staged several sit-ins on the premises of the Ministry of Public Service and Labour. They blamed the new government of being unfair. They insisted that the cases were closed and that the new head of state had nor right to reopen them.
Rules often bypassed
Benin actually has clear rules concerning who may apply for a civil-service job. They must be citizens of Benin, enjoy full civic and political rights, be morally upright, understand the job and have the skills to perform well. Certificates of formal education are required. Applicants who have acquired relevant experience during internships should get preference. However, these rules are often bypassed.
Holding a government job is a rare privilege in Benin, a country of 10 million people with fewer than 100,000 civil servants. Working for government guarantees a salary at the end of the month and some bonuses, including a limited health insurance. Moreover, civil servants normally get a pension after retirement.
People are quite keen on public-sector jobs, even though most civil servants earn only modest salaries. Unlike most Beninese people, however, they have a reliable source of income. It helps them to meet the needs of their families.
According to statistics of the International Labour Organization (ILO), about 75 % of Benin’s people are economically active. Agriculture contributes up to 75 % of Benin’s gross domestic product and employs not quite half of the country’s work force. Cotton accounts for 85 % of exports. About 10 % work in the industrial sector, and 44 % provide services. Formal employment is very rare, however.
Benin is haunted by unemployment and underemployment. Therefore, the new government pledged to create 500,000 jobs from 2016 to 2021. Critics wonder how it plans to live up to this promise in view of its tight budget.
The government has announced it will hire more than 10,000 workers itself. Whether they will get new positions or replace retirees remains unclear. Another government initiative was to establish the new National Agency for Employment. Its mission is to help jobless youths to either find salaried work or set up their own businesses. To date, it seems that salaried work remains the exception.
According to the law, formal employment means lifetime employment in Benin. It goes along with various benefits and privileges, including social protection. Business owners tend to shy away from these long-term constraints.
The current economic outlook is not good, moreover. The Free Port of Cotonou, which used to be the heart of the national economy, is no longer hustling and bustling with activity as it used to five or 10 years ago. The reason is that Nigeria, Benin’s giant neighbour, has stopped using Benin as a transit corridor and is now relying on its own port facilities for most international transactions. As a consequence, maritime traffic in Benin has considerably slowed, seriously affecting the collection and amount of taxes, including import and export duties.
Skills in short supply
Most job seekers in Benin are still in their 20s or 30s. Some hold university degrees or diplomas from vocational schools. The vast majority, however, has very little formal training or no education at all. Skills are in short supply.
For all these reasons, informal employment is predominant in Benin. Those people who are not self-employed normally work for a self-employed relative or do menial jobs to earn daily wages. Most people’s work is largely unregulated and goes along with fundamental insecurity.
Most income generation takes place in the informal sector. Businesses are small and typically provide some kind of service, selling household appliances, second-hand garments or communication gadgets, for example. The economy is cash-based. Bank loans and other financial services are hard to get.
One of the main drawbacks of the informal sector is that it operates without a proper legal framework. The owners do not always have street addresses. They do not pay taxes, and their businesses do not provide any kind of social net for employees. The goods and services are cheap, but the quality is not guaranteed. Written contracts are rare. The informal economy allows people to survive, but it keeps them – and the country – poor.
Even the civil service sometimes procures what it needs from the informal sector. There have been many instances of informal businesses providing computers, printers and photocopiers to government offices.
At times, it looks like the government is maintaining a love-hate relationship with the informal sector. The authorities know that it would make sense to tax these businesses. Doing so would replenish public coffers fast. The problem is that there is no magic trick that would get informal businesses to toe the line.
Previous governments wanted to formalise the informal sector gradually. Issuing licences was a first step. The Talon administration is taking a more radical approach. It has declared that many informal businesses are occupying public space and begun to evict them. Unsurprisingly, this policy has fuelled even more heated debate than the revocation of fraudulent public-sector employment. Critics argue that the government is choking the informal sector, which provides jobs and daily wages to hundreds of thousands of people. Improving Benin’s employment situation is very difficult – as previous governments found out too.
Karim Okanla is a lecturer in media studies, communication and international organisations at Houdegbe North American University in Cotonou, Benin.