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Dr. P.V. Viswanath |
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Trade Theory vs. Used Clothes in Africa
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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." |
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