Clothing donations undercut entrepreneurs in world’s poorest economies

Americans give away a lot of clothes. Whether it’s that raggedy old pair of cutoff jeans, the wine-stained dress shirt or those out-of-style sneakers, there is a lot we don’t want. But well-intentioned charitable donations of old clothes may be undercutting the market for struggling entrepreneurs in some of the world’s poorest countries.

To raise funds and reduce the huge influx of clothing donations they receive on a daily basis, U.S.- and Western-based charities are selling large portions of their inventory to textile and apparel companies that recycle the clothes and resell them to vendors abroad. The results, according to a systematic study, could be damaging to the very people who were supposed to benefit.

Andrew Brooks, a lecturer in development geography at King’s College in London, argues that the reselling of secondhand clothes is hurting local businesses and production in low-income countries, particularly in sub-Saharan Africa.

“Donating your used garments might be well-intentioned, but the situation on the ground means they may be doing more harm than good,” Mr. Brooks wrote recently in Britain’s Geographic magazine, summarizing the thesis of his recently published book, “Clothing Poverty: The Hidden World of Fast Fashion and Second-Hand Clothes.”

Far from clothing the poor and needy in countries such as Malawi or Mozambique, Mr. Brooks says, the sale of secondhand goods from charities in the U.S. and other developed countries actually undercuts domestic sellers and stunts the local economy.

Secondhand clothes from an array of developed countries “dominate local market stalls in sub-Saharan Africa,” he said. “Across the African continent, secondhand clothes are a mainstay of informal traders, even accounting for the majority of clothing sales in some countries. In Nigeria, they are known as ’kafa ulaya’ (the clothes of the dead whites) and ’roupa da calamidade’ (clothing of the calamity) in Mozambique.”

Reliance on Western clothing providers leaves African industries struggling with slowed development. In Uganda, some 81 percent of all clothes sold are secondhand, according to data collected by Mr. Brooks.

Although many donors assume their clothing is given away free, charitable organizations typically sell what they receive in overseas markets, a practice they fully disclose but is not widely understood.

Abingdon, Maryland-based Secondary Materials and Recycled Textiles (SMART) is the trade group representing some of the largest companies in the secondhand clothing trade. As part of an estimated $1 billion industry, SMART represents one of the most lucrative clothing traders in the world, but officials say they are also sensitive to the impact their work has on local economies.

“Respected non-governmental organizations like Oxfam applaud the second-hand industry because its clothing sales create jobs and affordable apparel in numerous lesser developed countries,” SMART says on its website.

A 2005 Oxfam report on the effects of secondhand clothing exports on developing countries concluded that there was a positive side to the recycled-clothing industry.

“On one hand, the increase in second-hand clothing imports is often held responsible for the decline of domestic textile and/or clothing production,” the report says. “On the other, the second hand clothing trade generates employment as people repair and distribute clothing.”

SMART and its members also say the secondhand imports contribute to good conservation practices and to the funding of charities.

“We aid many charitable organizations by purchasing clothing and textiles that cannot be resold through second-hand thrifts and consignments — this material would otherwise end up in landfills, and charities put the hundreds of thousands of dollars back into funding their programs,” SMART communications strategist Josie Hankey wrote in an email.

SMART also said many developing African countries benefit from the trade because they face “challenges having less to do with the used clothing trade and more attributable to governance and supply constraints, with unreliable and expensive infrastructure, high-cost and low-availability materials and inadequate training and management skills.”

Because of the poor economic conditions in developing countries, Ms. Hankey said, it is important for the clothing trading industry to step in and help.

“There is significant demand for affordable clothing in Africa and the second-hand clothing industry supplies this demand,” she said.

Distorting presence

But the presence of secondhand clothing in Africa and its distorting impact are undeniable, Mr. Brooks said. Roughly 24 percent of American worn-clothing exports end up in Africa. Last year, total U.S. exports of used clothing was valued at $710 million, according to the Commerce Department.

The lack of clothing production and industrialization in developing countries has many clothing-recycling companies in high-income countries eagerly eyeing the opportunity to provide business in low-income countries, creating a culture of dependency, according to one economist.

“Anytime anyone imports anything from anywhere, the argument is made, ’Well, we could’ve made it locally and if we buy anything from anywhere it will make us dependent.’ In this case, it’s true,” said Timothy Taylor, the managing editor of the Macalester College-based Journal of Economic Perspectives, who blogs as The Conversable Economist and discussed Mr. Brooks’ research.

But Mr. Taylor also acknowledged that this dependency isn’t necessarily bad in the case of some low-income countries, at least for the time being, because secondhand clothes are more affordable than new ones.

“It’s good in the short run, but in the long run it might be a bad idea,” he said, suggesting that reliance on Western clothes may not be a sustainable economic strategy for developing countries.

Some recipient countries, including Argentina, Namibia, the Dominican Republic and South Africa, have gone so far as to impose a blanket ban on secondhand clothing imports.

Countries that import secondhand clothing say it provides for their people.

“There are countries that are sympathetic to their clothing manufacturers because they have to think of the millions and millions of people who have access to quality clothing that they otherwise wouldn’t have,” Mr. Taylor said.

After the decolonization of Africa, countries that once survived off their colonial power’s economic system had a chance to devise one of their own, but Mr. Brooks said Western powers hindered them in the 1980s and 1990s.

“African leaders were forced to liberalize their economies under political pressure from banks and governments in the West who had earlier lent them money, and to whom they owed massive interest repayments,” he said.

This led to an entire industry of secondhand clothing, mainly perpetuated by high-income countries in the West. Poor African nations became reliant on clothes from abroad, impeding progress for the development of their own businesses. But there is also a social component to secondhand clothing imports that should be taken into account, Mr. Brooks noted in his Geographical article.

“Market traders have been banned from selling secondhand underwear in Ghana, while North American jeans sold in Mozambique are often too large in the waist to fit local body types,” he wrote.

Sometimes, these imported clothes are just unsuitable for the local people, their culture and possibly for the future of their economy.