Diversity - gtkp.com

IRF, gTKP, TARA Convention on Rural Roads, Arusha, Tanzania, 26-27 November 2009

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Rural roads and employment: the importance and growth of the informal transport sectorby Paul Starkey [email protected], [email protected]

Paul StarkeyTransport Consultant

University of [email protected]

Rural roads and employment: the importance and growth

of the informal transport sector

Presentation outline

• Road construction / maintenance• Roads, markets, economic growth • Buses and rural taxis• Intermediate means of transport• Motorcycles and three-wheelers• Transport regulation

‘Tragedy of the commons’ / transport services

• Conclusions

Employment in relation to

Diversity

Rural roads and employment

Employment through the construction and

maintenance of rural roads

Develop sustainable labour-based roadsPolicy priority

The construction and maintenance of roads provides some employment

Labour-based systems provide most local employment and are increasingly

appropriate in carbon constrained world

Lesotho


Low requirement for fossil fuel

El Salvador


Provides significant and important employment, benefiting the rural poor

Lesotho

Increases local ownership and responsibility for basic infrastructure


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Women often benefit from employment due to their availability, their reliability

and/or labour-based contract conditions

Lesotho

Develop sustainable labour-based roadsJustifies investments in animal power

and/or tractors (helps agriculture)

Policy priority

Employment of local people to transport materials for road maintenance facilitates their investment in

animal-drawn transport or tractors. This also benefits farm production and rural employment.

Tanzania


Eg Lesotho 2008:Transport policy: labour-based access roads

Local government practice:New public sector bulldozers and graders

BUT some decision-makers:‘an inferior, second-class technology’

Lesotho

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Employment through the economic benefits of roads

and access to markets

Importance of roads and transport servicesfor marketing and access to employment

Tanzania

Madagascar

Access to markets and employmentPresent reality

Rural trucks (freight and passengers)


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Burkina Faso

Rural markets stimulate transport and employment. This market access road had 750

carts on market days and 40 on other days

Roads stimulate employment through better access to markets and improved labour mobility

Tanzania

Dominican Republic

Transport from rural market to town

Niger

DominicanRepublic

Cambodia

Transport from rural markets to town

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Employment through formal and informal transport services

Inter-city buses and minibuses operate on national roads. They may be important for rural people, but they are not typical of the

rural transport operating on rural roads

Inter-city services tend to be formal sector businesses

Fiji


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Inter-city trucks operate on national roads. They may be important for rural people, but

they are not typical of the rural transport operating on rural roads

Inter-city freight services tend to be formal sector businesses

Nepal

Ensure suitable transport servicesPolicy priority

Rural transport services often mix freight and passengers. They tend to be informal sector enterprises. Many vehicles

are owner-operated or rented from private individuals.

BurkinaFaso

Lesotho

Timor Leste

Cameroon

Nepal

In some countries, 2-wheel and/or

4-wheel tractors are used for rural freight transport services (and passengers)

Ghana

Sri Lanka

In some areas animal-drawn carts are used for passenger and/or freight services

Burkina Faso

Some rural roads have no motorised transport services. On this Zambia road the only transport services are bicycle taxis (70 km to a national road).

Bicycle taxis operate up to 120 km

80 bicycles / day

Bicycle taxis provide employment and access to markets and services

100 pedestrians /day

0 vehicles / day

Zambia

Bus transport

Regulated rural bus services used to be important, in many countries. A large number have ended due to deregulation, lack of subsidies, competition with smaller vehicles and the deteriorating condition of rural roads.


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‘Rural taxis’Most motorised rural transport services between villages, market hubs and district centres are now

provided by ‘rural taxis’, including multipurpose trucks, 4x4 pickups, minibuses, old cars and three-wheelers.

The choice of vehicle depends mainly on road conditions and the

transport demand

Burkina Faso

Cameroon

Rural taxis and minibus transport

Where road conditions are good, minibuses are becoming the main

form of rural transport

Lesotho

Zambia

Some characteristics of buses and minibuses(all relative and depends on local conditions)

Large buses and minibuses may compete for passengers.They both consider the other to be ‘unfair’ competition.

Buses have cheap fares, while minibuses are faster, leave more regularly and are more flexible (may match fares).

Minibuses may leave just before a bus departure.

Fiji

Minimal tax paymentsPay tax and VAT

Formal sector Informal sector


Medium employment More employment

Fiji

Difficult to negotiate withEasy to negotiate with

Highly organised More anarchic and individual

Comply with regulations Often ignore regulations


Fiji

Less predictablePredictable

Work to timetables Queue for full load


Fiji


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Faster journeysSlow journeys

Good safety Accidents due to speeding


Low fares (if full loads) Higher cost but competitive

Relative comfort varies

Fiji


All rural transport services provide employment through the drivers, assistants, maintenance

services and the benefits of the mobility provided.

FijiWhile smaller vehicles generally create more local employment, the advantages and disadvantages of

different forms of transport are very complex.

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Employment through the use of intermediate means

of transport (IMTs)

Intermediate means of transport (IMTs) include motorcycles, bicycles and animals (carts, pack

loads). IMTs provide many transport services and are increasing in most rural areas. They generally

create significant employment opportunities through their provision and maintenance.

Cambodia

Burkina Faso

Stimulate diverse use of IMTsPolicy priority

Some IMTs are for owner use only or for owner use plus some extra freight and/or passengers.

Tanzania

Note parking for bicycles

Some IMTs are for owner use only or for owner use plus some extra freight and/or passengers.


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Some IMTs are dedicated transport services, with operators gaining livelihoods from

carrying passengers and/or freight. Service types and standards vary greatly. Cycle-basedtransport services include bicycle taxis (boda-

bodas) and cycle-rickshaws.

Zambia

Rwanda Nicaragua Loads on bicycles

LaosLoads carried on bicycles increase capacity and reduce drudgery

Vietnam

Laos

Employment is created and livelihoods enhanced by people using bicycles for transporting their own goods or

the goods of others

Cambodia

Nepal

Tanzania

Uganda

Bicycles can transport quite heavy loads

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Motorcycles andmotorcycle taxis

Motorcycles increasingly used for rural transport

Motorcycles surprisingly good in water and mud and able to get

through when roads are blockedPhotos © Paul Starkey

Timor Leste


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Motorcycles increasing used in many countries for rural transportTibet

CM

RW

CMCM

TH

Cambodia

While motorcycle growth is often in towns, motorcycles have become the

most frequent vehicle type on rural roads in some countries

Thailand

Burkina Faso

NigeriaMotorcycles can be used by men and women to

achieve income and livelihoods through trading

In the past decade, motorcycles have increased rapidly in many countries

including Cameroun, Colombia, Nepal, Nigeria, Rwanda and Timor Leste.

Cameroon

Motorcycle taxis carry men, women and children and

their goods and link poorly-served villages with

traditional transport services on main roads. Rwanda

Motorcycles offer young men an attractive way of earning a living in rural areas. They provide a

valuable transport service and create employment.

Increase in motorcycles• Chinese imports half Japanese prices• Initial urban use (personal/taxis)• The intrinsic profitability of motorcycle

services led to similar private finance models in several countries often withurban funds for rural transport

Investor buys motorcycle for $ 600Hires to operator for $ 4-5 a dayRecovers capital within six monthsSells at half price after six monthsBuys one or two replacementsOperator profits by eg, 8 x $1 journeysRural people get available transport service

• Critical mass of users/services develops• Many safety issues (helmets, loading) • Growth in rural motorcycles will

increase, help rural transport and provide employment

Recenttrend

CM

Cameroon

The owners, the operators, the passengers and the support services all benefit.

This creates a critical mass, momentum of rapid adoption and employment for operators, suppliers and supporting services.

It also leads to an active second-hand market causing diversified adoption and more widespread maintenance services, creating more employment. Tanzania


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Motorcycle taxis present many problems of safety and regulation.

Those countries with few motorcycles (including Tanzania, Zambia and South Africa) might

consider the implications of possible rapid spontaneous

adoption in the coming years.

Arusha,Tanzania25 Nov 09

Sri Lanka

NepalThree-wheelers (motor tricycles, tuk-tuks) are widely used in many

countries for urban transport.They are increasingly being deployed for rural transport

Tanzania

Tanzania

Ethiopia

Three-wheelers provide employment and transport services and are safer than

motorcycles

In Timor Leste three-wheelers have recently been introduced and are proving extremely profitable

Timor Leste

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Importance of regulation

The tragedy of the commonsThere is some

‘common ground’ where anyone can graze their animals

Some people start to graze their animals which

become fat

More people graze their animals and

there is not enough grass

Now all the animals are thin and something must be done

But it is no one’s interest to remove their own animals

It is in everyone’s interest that there is

de-stocking

There will be tragedy unless there is:

External regulation Self-regulation


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The tragedy of transport servicesThere is a good transport market

where anyone can operate

Some people start transport

operations which are very profitable

More people start transport services until there is not

enough work for all

Now the vehicles are old and not

replaced

It is in everyone’s interest that there is

‘de-stocking’

But it is no one’s interest to remove their own vehicles

There will be tragedy unless there is:

External regulation Self-regulation

Regulation of transport services

Where transport is profitable, an oversupply will develop in the absence of self-regulation or government regulation. This may lead to low

individual profitability and lack of investment in safety and vehicle renewal. Employment will suffer

Loading at formal or informal transport terminals can be

regulated by associations or local authorities Similarly public

authorities and/or transport associations

can agree route allocation and fair prices

Nepal

Transport associations• All transport services need

regulation for quality, safety, reconciling supply and demand and meeting consumer needs

• Different transport operators form associations (eg, buses, taxis, cycle taxis, mule operators, freight trucks) for self-regulation and support for members

• These reduce anarchy at terminals by controlling loading and queuing

• They can agree prices and route allocation and route or rotation

• Competing associations can stimulate improved services

Ethiopia

Policy issue

Neither transport associations nor public regulators can be effective without some

form of agreed enforcement

Associations can become exclusive, anti-competitive cartels that restrict growth and

employment opportunities within the sector. This must be addressed through sensitive, participative local public-sector regulation

Weak and/or corrupt regulation by public authorities can lead to unhelpful oversupply

and/or anti-competitive practices

Transport associations can organise the efficient self-regulation of transport services and should work in close

collaboration with regulatory authorities and user-groups to provide safe and improving services

Nepal

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Conclusions

Conclusions

• Roads create employment through their construction and maintenance, their opening access to markets and through the transport services that operate along them

• Informal transport sector provides most rural transport. Minibuses are important where roads are good

• Transport services provide employment directly (drivers, support services) and indirectly (employment, markets)

• Motorcycle services may continue to grow and spread due to employment prospects and profitability

• Three-wheelers may also increase and spread• Quality and safety of motorised transport is often poor,

but needs sensitive intervention not blanket prohibitions• Regulation (public authorities and private associations)

is important to avoid chaos and raise standards

Policy priority

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