Reorganizing the informal sector in Tanah Abang Market

Riwanto Tirtosudarmo

One of the unintended results of Suharto's New Order economic development policy and political engineering strategy is the burgeoning phenomenon of the informal sector in Indonesia's cities. As an academic term, "informal sector" was coined in the 1970s, following the widely debated discussions on the issues of urban bias and "why the poor stay poor" prominently argued by Michael Lipton.

As part of the containment strategy and direct elimination of possible threats from rural unrest following the failed, allegedly communist-inspired coup attempt in 1965, Suharto's military government began to restructure political institutions through the so-called "floating mass" policy. This policy aimed to uproot the masses from their political basis in order to transform them into productive "human resources." This policy arrived in tandem with the introduction of the green revolution, of which programs for the intensification and mechanization of agriculture are the core.

From the early 1970s to the late 1980s, Java's population has been undergoing massive social change, transforming significantly both the rural and urban areas. In this social transformation, rural-to-urban migration has been the prominent feature, eventually leading to rapid urbanization processes in major cities, particularly Jakarta.

The failed promises of the modernization theories of the 1960s — which, among other things, manifested the failure of the urban-industrial sectors to accommodate the new labor entrants — are clearly reflected in the burgeoning of various sorts of small services and petty traders in the city, which are lumped together as the informal sector.

In Jakarta, with the exception of Ali Sadikin's governorship, successive governors generally failed to curb the growth of the informal sector. The informal sector has eventually become the major economic sector, which is more often than not loosely connected with the formal economic sectors. There is no doubt that millions of poor people spend their life in the informal sector. Tanah Abang, located in the center of Jakarta, is perhaps the largest market for textiles and garments in Southeast Asia. The informal sector has grown in parallel with the development of Tanah Abang market in the form of stalls erected along the sidewalks that sell various products, from garments to fruits. Informal parking businesses that have also sprung up along the roads have resulted in the obstruction of traffic and created a total jam.

It is only logical that Jokowi and Ahok eventually turn their attention to resolving the already accumulated problem of Tanah Abang. Apart from the legal process of reclaiming the ownership of Tanah Abang market from private hands to the city government, Jokowi and Ahok also began to negotiate with the traders and parking bosses of the informal sectors. This turned out to be a tough job for Jokowi and Ahok, as resistance is very high, given that thugs and mafias apparently control these lucrative businesses from behind the scenes. The usual direct approach through open dialogue with the respected parties, indeed, is among the strength of Jokowi’s proven strategy to win the hearts and minds of the people.

As the press has reported, the negotiating process is currently still underway between city government authorities and the representatives of the informal sector in Tanah Abang. Because the stakes are high if they lose control of the informal sector, informal sector bosses with high-level political connections are using a variety of means, including the mobilization of mass protests and attempting to bring the case into the courts, which has kept the case of Tanah Abang in the headlines — only receding with the approach of the Muslim holiday on 8-9 August, during which Jakarta will be nearly deserted as millions of inhabitants begin the exodus to their original villages, mostly in Central and East Java. Yet Jokowi, in his latest interview with the press, showed his optimism that after the Muslim holiday, he is confident that the problem of reorganizing the informal sector in Tanah Abang market will be successfully resolved.

Add new comment

Filtered HTML

  • Web page addresses and e-mail addresses turn into links automatically.
  • Allowed HTML tags: <a> <em> <strong> <cite> <blockquote> <code> <ul> <ol> <li> <dl> <dt> <dd>
  • Lines and paragraphs break automatically.

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.
By submitting this form, you accept the Mollom privacy policy.