Sending Clothing to Africa

March 27th, 2012
ea, econ
When we give our old clothes to thrift stores there's too much for them to sell here. They sell the rest [1] to companies that ship it overseas and sell it there. While some goes to South America and Asia, most goes to Africa where it competes, quite successfully [2], with locally produced clothing. In some ways this is good (people get cheaper clothing), but in other was it's not (fewer jobs in clothing manufacturing).

This is often compared to food aid dumping, where rich countries subsidize their farmers and then send the resulting surplus to poor ones, where it displaces local production. But we could also compare it to the Walmart model: make stuff in poor countries where wages are low and sell them in rich countries, where it again displaces local production.

In all three of these cases we have something that's cheap in one place moving to another, and in that place out-competing what was being made there before. Classic globalization. In fact, the food dumping example is the odd one out: it only exists because the rich country is subsidizing its farmers, and without that subsidy it wouldn't be economically viable to grow corn in the Midwest and ship it to Africa.

When I first read that used clothing imports "have a negative impact on apparel production in Africa" I thought "more dumping" and was going to write about how aid starting with "what we want to give" is much less productive than starting with "what they need". Now I think I was looking at it wrong: the people who are going to wear it are paying shipping costs to bring in clothing that would otherwise be wasted. This isn't aid, this is the global used clothing market. It reduces the amount of cotton and other raw materials we use, and it makes clothing cheaper for people willing to buy used. We need more jobs and stronger industry, but producing stuff that would be cheaper to import is a jobs-for-jobs-sake employment strategy.


[1] Well, half of it isn't in good enough condition to wear and is sold as rags. I'm just talking about the wearable stuff. According to this piece, the good condition clothes are split one-third two-thirds between domestic thrift stores and resale to companies that will sell them overseas.

[2] Used-Clothing Donations and Apparel Production in Africa: "Used-clothing imports are found to have a negative impact on apparel production in Africa, explaining roughly 40% of the decline in production and 50% of the decline in employment over the period 1981-2001." Their interpretation of the data is that of the 11.1% average annual drop in African per-capita apparel production, 4.7% (42%) is due to used clothing imports. (p25)

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