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Trade Theory vs. Used Clothes in Africa
June 3, 2004
By CARTER DOUGHERTY
KAMPALA, Uganda - Today's globalized economy boasts few
unrepentant protectionists, but Eyasu Sirak does not deal
in gentle euphemisms of "fair trade" or "level playing
fields." He wants his government to ban imports of used
clothing simply so he can sell more apparel and make more
money.
His business, Eladam Enterprises, makes safari suits and
police and army uniforms, which he sells out of a small
shop in downtown Kampala. But Mr. Sirak looks longingly at
Ugandans who buy their clothing at bustling markets stocked
with European and American castoffs.
"As long as these clothes are here," he insists, "no
textile industry can survive."
The rich world's hand-me-downs offer visitors some of
Africa's more peculiar sights. One afternoon in Kampala,
Uganda's lively, diesel-fume-laden capital, a young man
wore a black T-shirt that boasted: "I am what you fear the
most: United States Marine." Another proclaimed its owner's
allegiance to the "Watkins Warriors," presumably some
small-town sports team.
The scene repeats itself in towns and villages across
Africa, from Mozambique in the south to Mali in the north,
thanks to donated clothing from the West that is sold by
the charitable entities that receive it to exporters,
pressed into bales and shipped to Africa. Though it starts
as charity, the declared value of American secondhand
clothing exported to Africa was $59.3 million in 2002,
according to the International Trade Commission.
About $2.3 million of that went to Uganda, where mivumba,
as used clothing is known in the Luganda language, accounts
for about 81 percent of garment purchases, according to the
Uganda Manufacturers Association.
Yet Mr. Sirak's proposal - banning mivumba - falls on
incredulous ears in much of Kampala. Importers and
consumers of used garments, who far outnumber the
manufacturers, have castigated the idea of an import ban,
giving rise to a lively debate about whether domestic
industries should get a helping hand before facing
international competition.
The old arguments for protective tariffs retain some
intellectual currency, said Gary Hufbauer of the
Washington-based Institute for International Economics. But
he said they usually masked a desire to charge more to
consumers who would otherwise have access to cheaper
imported goods.
"Protection might create a local industry that can compete
in world markets, and the subsequent gains might be large
enough to pay back the costs incurred on account of the
protection," Mr. Hufbauer said. "In practice, however, not
more than one case in 10 meets these two conditions."
American policy here has been against trade barriers. The
Africa Growth and Opportunity Act, passed in 2000, seeks to
integrate the continent into the world economy. By offering
easy access to the American market, the act preaches growth
through exports, not through national self-sufficiency, and
accounted for $1.2 billion in apparel exports from Africa
in 2003, according to the Commerce Department.
Washington has little sympathy for banning secondhand
imports, and contends that new and used clothing appeal to
very different consumers. "The reason this market is so
huge is because most people live on a dollar a day," said a
United States trade official.
South Africa, the continent's economic powerhouse, has
thrown its lot in with protectionists. Bowing to pressure
from local manufacturers and labor unions, its government
cut off imports of used clothing in 1999. Nigeria, Ethiopia
and Eritrea have imposed their own prohibitions, while
Kenya has flirted with a ban.
"The scourge of secondhand clothes from the United States
and Europe deprives us of jobs and food on the table for
the family," said Brian Brink, executive director of the
South African Textile Federation.
But Mr. Hufbauer's skepticism of trade restrictions
resonates at the Owino market in Kampala.
Covering 25 acres, the bazaar, one of the largest of its
kind in Africa, thrives on the mivumba trade, but includes
many other products, like the dried fish that give Owino
its distinctive odor. The densely packed clusters of stalls
with corrugated metal roofs attract enough backpacking
vagabonds to merit mention in the popular Lonely Planet
guide for the region.
Owino testifies to the mivumba industry's sophistication.
Traders open bales of garments each morning, grade them
into three categories, and ship the lowest-quality items to
impoverished villages in the countryside. On a good day,
retailers move enough clothing to fill a 40-foot shipping
container, and Godfrey Kayongo, who runs a wholesale
business in secondhand clothing, estimates that Owino
employs 50,000 people.
"Let the clothing industries produce alongside mivumba," he
said. "If people choose them, then that's fine."
Mr. Kayongo pours scorn on manufacturers who seek a ban on
the garments, ostensibly to build a Ugandan industry. They
often import used machinery for their factories, he points
out, and drive used cars from abroad.
"This is not patriotism," he snorted. "It is hypocrisy."
The Ugandan government has so far equivocated in the battle
over mivumba. In 2003, it raised the import duty on mivumba
from 10 to 15 percent, but has held steady since.
Regulators have announced a ban on used undergarments,
which will put an end to at least one sector of the market.
Aggrey Awori, a member of Parliament who represents a
cotton-growing constituency in Uganda near Lake Victoria,
is pushing a three-year phase-out of mivumba, a plan he
calls "a way of phasing out the culture of used clothing."
And Charlotte Kukunda, an official with the Ugandan
Manufacturers Association, said: "The secondhand sector
employs enough people to make this a chicken-and-egg
question. Who should government policy work for?"
Yet Ms. Kukunda's secondhand white synthetic blouse showed
mivumba's enduring appeal. She paid 5,000 Ugandan shillings
- about $2.50. A new one would cost four times that.
Little hard evidence exists to answer the question of
whether secondhand imports actually lead to the demise of
local industries.
In 1997, Texaid, a Swiss-based association of charities
that deal in secondhand garments, studied the market for
used clothing in Ghana and concluded that it complemented,
rather than displaced, the indigenous industry, which dealt
mostly in traditional African fabrics, like Ghana's
well-known kente cloth. But Ghanaian companies still
complain that used clothing boxes them out of their own
market.
In Uganda, few would pin the absence of a domestic clothing
industry purely on economics. The country's turbulent
politics, notably Idi Amin's cruel dictatorship in the
1970's, undoubtedly fostered a steep economic decline.
But Mr. Sirak still yearns for the days of old. Through the
early 1970's, cotton plantations set up by British
colonialists on the banks of the Nile formed the backbone
of Uganda's economy. First they produced high-quality
cloth, then manufactured garments. But a decade of
political strife flattened them all, and in the late
1980's, as calm returned, mivumba arrived.
"This beautiful industry has gone," Mr. Sirak said with a
wistful sigh. "In its place have come" - he spits out the
words venomously - "secondhand clothes."
http://www.nytimes.com/2004/06/03/business/worldbusiness/03clothes.html?ex=1087397549&ei=1&en=6d0375d2b267b20c
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