A number of African countries used the coronavirus pandemic as a reason to ban the importation of used clothing. As the thinking goes, banning imports boosts local efforts to design and manufacture new clothing. Yet government actions rarely produce the intended results. Indeed, the Third World clothing conundrum persists.
The conundrum is one of trying to balance the needs of impoverished people against the economic needs of a nation as a whole. How do you boost a nation’s ability to produce brand-new clothing if used clothing imported from overseas is so much cheaper? On the other hand, how do consumers clothe themselves in the midst of a ban if they cannot afford to buy new?
Issues of this sort often boil down to opportunity. Where opportunities exist, people thrive. Where they do not exist, people stagnate. It is no more difficult than that.
Sending Used Clothing Overseas
Third World countries like Kenya and Uganda benefit considerably from used clothing imports. Where does that clothing come from? Primarily the West. Our used clothing gets packaged and sent overseas where it is sold for a fraction of what consumers would pay for new. Third World prices are even lower than thrift store prices here.
Speaking of thrift stores, most people don’t know that the majority of clothing they donate to thrift stores and similar charities ends up overseas. Why? Because many donate items that do not have a high enough resale value to hang them on thrift store racks. What thrift stores cannot make enough money on gets sent to companies and charitable organizations that ship the items overseas.
By the way, have you ever wondered what happens to the unused apparel manufactured in advance of NFL, NHL, NBA, and MLB championships? It all gets donated and sent overseas where it is sold for pennies on the dollar.
Resisting Our Charitable Efforts
What we in the West consider charity is often considered harmful by Third World governments. They resist our efforts for legitimate reasons. And yes, it boils down to basic economics. Take Kenya, for example. The Kenyan government recently took the action of banning all used clothing imports.
Government officials say that Kenya’s textile industry currently operates at 30% below capacity. Furthermore, capacity could be increased if there were a demand for locally produced clothing. Herein lies the rub. If you are Kenyan consumer with a limited clothing budget, are you going to buy cheap, used clothing or more expensive clothing?
Kenya’s government fully understands that used clothing imports are taking customers away from domestic textile manufacturers. Their solution is to ban imports. At the same time, domestic manufacturers do not expect to see a profit anytime soon. Even though they will no longer be competing against cheap clothing, they still cannot manufacture new clothing at comparably low prices. Consumers are not going to buy clothing that costs too much.
Supply and Demand Rules the Day
When you step back and look at the situation with an unbiased eye, you realize that supply and demand rules the day. Here in the States, retailers like The Stockist in Salt Lake City exist because there is a market for them to serve. Consumers demand their products. If someone else comes along offering comparable quality at a lower price, demand will shift to that competitor.
Things are no different in the Third World. However, the solution is not to ban used clothing imports. It is to find a way to manufacture new clothing at a lower cost. If government wants to help, that is the place to begin. Find a way to help domestic manufacturers compete.