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Lumpens Politiska Ekonomi - begagnade varor som bistånd
BACKGROUND
For a long time Siwithout compensating gains if policy changes are made precipitously.
For a long time Sida's NGO division has subsidized freight and related costs of transporting used goods to the Third World, as well as providing support of various kinds to the volunteer organizations involved. This "freight aid" has been given, both as a part of larger projects, and to organizations whose main activity is collection and distribution of used goods.
Non-governmental organizations (NGOs) aiming to collect, transport and distribute used goods have been created by the Swedish people as a manifestation of solidarity with people in less-developed countries. The work in Sweden is mostly done by volunteers, and the organizations usually have limited budgets and limited other operations.
Sida has no clear policy for "freight aid". An organization's chances of receiving state aid are mainly dependent, first, on Sida's knowledge of its activity, and then on Sida's judgment of its capacity and competence.
A number of studies (listed in the appendix) have been done of these activities, but they have not analyzed the effects of the aid to any great extent.
PURPOSE
The government has asked Sida to evaluate "freight aid" in order to improve the efficiency of Swedish development assistance in general. Based on the present study, Sida intends to adopt a suitable policy for "freight aid".
MEANS
Sida wants to know more about the development effects of "freight aid" - on income distribution, employment, institutional structure, environment, etc.
THE TASK
The task consists of survey and documentation, analysis, and recommendations, as follows:
Survey and documentation:
The extent of international flows of used goods, commercial as well as charitable. The largest exporting countries and the largest importing (receiving) countries. The dominant kinds of goods. [The extent of commercial flows of used clothes worldwide is fully documented in the text, and data regarding private charitable flows of all types of goods from the U.S. is also given; international data is not kept on flows of other used goods, but a list of their known categories is included. International data collection does not distinguish charitable from commercial shipments.]
The quality and remaining life of the products. Maintenance of received materials. [These questions, specifically with reference to used clothes, are discussed at length in the text. There is an extensive literature on the use of second-hand equipment in development, but as these are producer goods rather than consumer goods, and thus raise quite different issues, we have chosen to focus at this time on used clothes, and suggest a separate project if further study is desired in this area.]
The distribution chain in the receiving countries. Price-setting - how are prices set? [These questions, specifically with reference to used clothes, are discussed at length in the text.]
Organizations active in this field using Swedish aid. Volumes and current trends, both by types of goods and by countries receiving the goods. [We have not been encouraged to seek current information about specific projects or NGOs receiving such subsidies, but we present data on Swedish organizations active in collection and export of used clothes, and information on recent recipient countries.]
Analysis:
The value to the receiver, and effects on demand: Is the activity demand- or supply-driven? [These questions are discussed at length in the text, primarily for used clothes, but briefly regarding other goods as well.]
Effects on supply in receiving countries: Are the imported goods a complement to, or a substitute for, existing resources? [These questions, primarily with reference to used clothes, are discussed at length in the text.]
Effects on employment and income distribution. [These questions, specifically with reference to used clothes, are discussed at length in the text.]
Growth effects and other long-term effects on production and the production structure. [These questions, specifically with reference to used clothes, are discussed at length in the text.]
What role does the charitable operation play in relation to the commercial operation? [This question, specifically with reference to used clothes, is discussed in the text.]
What role does Sida's "freight aid" play? How are volumes, costs, and prices affected? [Empirical answers to these questions would require detailed analysis of the current circumstances and methodology of particular projects, which we have not been encouraged to pursue. Nevertheless, some theoretical answers, specifically with reference to used clothes, are provided in the text.]
Other questions that might come up during the course of the work and that might seem relevant; for example, the activity's effect on the environment. [In addition to the environment, other related questions such as political realities in less-developed countries and solidarity motives in Sweden have been briefly discussed.]
Recommendations:
What should Sida's policy on "freight aid" be? Discuss if a field study is needed in order to answer the questions above satisfactorily. If so, what form should this study take?* [Recommendations regarding Sida's policy on "freight aid" are made in the text. No field study is thought to be generally necessary, although if Sida provides freight aid for used-clothes exports in the future, careful monitoring of its effects is suggested. A thorough analysis of the efficacy of used clothes as opposed to new clothes in disaster relief might also prove useful. If there is sufficient interest, a separate study could also be undertaken focusing more specifically on used equipment.]
METHOD
It is expected that the task will be accomplished through:
study of existing reports and documents, including international statistics, and through
interviews with charitable organizations, aid agencies, and possibly with other relevant agencies or organizations.
REPORT
A written report in English is expected.
APPENDIX: Reference list
Following is a list of studies of used-clothes exports to less-developed countries, and related materials:
The Naked Truth: Swedish private organizations' clothing aid to Mozambique and its effects on local textile production. Area Forecasting Institute, Hans Abrahamsson, Göteborg, 1988.
Klädfrakt för projektbistånd - Studie av Sidas fraktbidrag till föreningen U-landshjälp från folk till folk i Sverige (UFF) [Clothing freight as project aid - a study of Sida's freight aid to the Swedish organization "Development Aid from People to People (DAPP)"]. Interconsult Sweden AB, 1990.
Effektivare klädbistånd för större oberoende - en organisationsstudie av Praktisk Solidaritet [More effective clothing aid for greater independence - a study of the organization Practical Solidarity]. Interconsult Sweden AB, 1990.
In Need of Clothes: Second-hand clothing for Uganda, Zimbabwe, Mozambique, Sierra Leone and Vietnam. Swedish Red Cross, 1992.
Effects of Second-Hand Clothes Sales in Developing Countries. Denconsult, 1993.
Miscellaneous data and newspaper articles.
Table A1: Twenty-four net used-clothes exporting countries, 1984-'93
|
rank |
exporting country |
total value (US$) |
share of total |
|
1 |
USA, Puerto Rico, & Virgin Is. |
$1,197,019,000 |
38.3% |
|
2 |
Germany (W. Germany before 1991) |
$571,653,000 |
18.3% |
|
3 |
Belgium-Luxembourg |
$344,818,000 |
11.0% |
|
4 |
Netherlands |
$319,143,000 |
10.2% |
|
5 |
Japan |
$167,701,000 |
5.4% |
|
6 |
United Kingdom |
$151,259,000 |
4.8% |
|
7 |
Italy |
$98,693,000 |
3.2% |
|
8 |
Australia |
$62,067,000 |
2.0% |
|
9 |
Canada |
$59,744,000 |
1.9% |
|
10 |
Mexico |
$34,930,000 |
1.1% |
|
11 |
Denmark |
$34,106,000 |
1.1% |
|
12 |
Sweden |
$27,020,000 |
0.9% |
|
13 |
Switzerland, Liechtenstein |
$19,952,000 |
0.6% |
|
14 |
Austria |
$11,157,000 |
0.4% |
|
15 |
Portugal |
$8,254,000 |
0.26% |
|
16 |
Finland |
$7,863,000 |
0.25% |
|
17 |
Norway, Svalbard & Jan Mayen |
$3,365,000 |
0.11% |
|
18 |
Panama |
$2,426,000 |
0.08% |
|
19 |
Iceland |
$851,000 |
0.03% |
|
20 |
China |
$220,000 |
0.007% |
|
21 |
Nepal |
$179,000 |
0.006% |
|
22 |
Morocco |
$67,000 |
0.002% |
|
23 |
Colombia |
$38,000 |
0.001% |
|
24 |
Oman |
$6,000 |
0.0002% |
Source: Derived from SITC2 data obtained from the United Nations
Statistical Division, International Trade Statistics Branch.
Note: Total
value for each country for the period is simply the sum of uncorrected annual
figures; correcting annual figures for inflation should have little effect on
rank or share.
Table A2: Some 1984 used-clothes
exporters (19) and importers (51), with net weights and values, and average
prices; ranked by net value of exports or imports
Table A2: Continued
Table A2: Continued
Notes: Reflecting flows of real goods, and in order to clearly distinguish net exports from net imports, net weights are negative for net exports, positive for net imports. Similarly, reflecting financial flows, net values are positive for net exports, negative for net imports. For countries with both imports and exports, if either weight is missing, no net weight is given. Total average export and import prices are based only on those values for which weights are reported. Extreme export or import prices may indicate some problem in the data, such as partial missing weights. The absence of a listing for a particular country does not necessarily indicate that no trade occurred. For instance, countries still reporting on SITC1, or not reporting at all, do not show up. More complete data (covering more countries, and including weights per capita) is provided in Tables A3-A5 and A11-A13.
Table A3: 1990 world used-clothes
gross exporters (127) ranked by value, with reported and imputed weights, value
and weight shares of total, weights per capita, and average
prices
Table A3: Continued
Table A3: Continued
Table A3: Continued
Table A3: Continued
Table A3: Continued
Notes: An asterisk (*) at the end of a country name indicates that the entire line is derived from partner data rather than from data reported by the country directly. An asterisk (*) at the end of an average price indicates that the price (only) was taken from partner data, due to lack of weights in reported data. Average prices are based only on those partner transactions for which weights are reported; thus imputed weights (based on those prices) may be higher than reported weights. Extreme average prices may still indicate some problem in the data, such as partial missing weights within partner transactions. The absence of a listing for a particular country does not necessarily indicate that no trade occurred.
Table A4: 1990 world used-clothes
gross exporters (127) ranked by weight per capita, with values, reported and
imputed weights, value and weight shares of total, and average prices
Table A4: Continued
Table A4: Continued
Table A4: Continued
Table A4: Continued
Table A4: Continued
Notes: An asterisk (*) at the end of a country name indicates that the entire line is derived from partner data rather than from data reported by the country directly. An asterisk (*) at the end of an average price indicates that the price (only) was taken from partner data, due to lack of weights in reported data. Average prices are based only on those partner transactions for which weights are reported; thus imputed weights (based on those prices) may be higher than reported weights. Extreme average prices may still indicate some problem in the data, such as partial missing weights within partner transactions. The absence of a listing for a particular country does not necessarily indicate that no trade occurred.
Table A5: 1990 world used-clothes
gross exporters (127) ranked by average price, with values, reported and imputed
weights, value and weight shares of total, and weights per capita
Table A5: Continued
Table A5: Continued
Table A5: Continued
Table A5: Continued
Table A5: Continued
Notes: An asterisk (*) at the end of a country name indicates that the entire line is derived from partner data rather than from data reported by the country directly. An asterisk (*) at the end of an average price indicates that the price (only) was taken from partner data, due to lack of weights in reported data. Average prices are based only on those partner transactions for which weights are reported; thus imputed weights (based on those prices) may be higher than reported weights. Extreme average prices may still indicate some problem in the data, such as partial missing weights within partner transactions. The absence of a listing for a particular country does not necessarily indicate that no trade occurred.
Table A6: 1994 recipients of Swedish used-clothes exports (89) ranked by weight, with values, prices, and weight-shares
|
Rank by weight |
1994 recipients of Swedish used-clothes exports |
reported value (US $1000s) |
reported weight (1000 kgs) |
share of total |
average price (US$/kg) |
|
1 |
Estonia |
568 |
1,875 |
15.8% |
$0.30 |
|
2 |
Latvia |
486 |
1,764 |
14.9% |
$0.28 |
|
3 |
Mozambique |
170 |
1,090 |
9.2% |
$0.16 |
|
4 |
Yugoslavia |
352 |
1,021 |
8.6% |
$0.34 |
|
5 |
Russia |
408 |
821 |
6.9% |
$0.50 |
|
6 |
Lithuania |
187 |
566 |
4.8% |
$0.33 |
|
7 |
Angola |
201 |
523 |
4.4% |
$0.38 |
|
8 |
Poland |
210 |
399 |
3.4% |
$0.53 |
|
9 |
Finland |
190 |
310 |
2.6% |
$0.61 |
|
10 |
Croatia |
227 |
308 |
2.6% |
$0.74 |
|
11 |
Nicaragua |
589 |
228 |
1.9% |
$2.58 |
|
12 |
Iraq |
29 |
225 |
1.9% |
$0.13 |
|
13 |
Ukraine |
170 |
201 |
1.7% |
$0.85 |
|
14 |
Romania |
110 |
186 |
1.6% |
$0.59 |
|
15 |
Tanzania |
107 |
173 |
1.5% |
$0.62 |
|
16 |
Benin |
12 |
139 |
1.2% |
$0.09 |
|
17 |
Rwanda |
72 |
133 |
1.1% |
$0.54 |
|
18 |
Ethiopia |
114 |
127 |
1.1% |
$0.90 |
|
19 |
Denmark |
178 |
108 |
0.91% |
$1.65 |
|
20 |
Germany |
212 |
100 |
0.85% |
$2.12 |
|
21 |
Hungary |
44 |
88 |
0.74% |
$0.50 |
|
22 |
Netherlands |
68 |
85 |
0.72% |
$0.80 |
|
23 |
United Kingdom |
105 |
82 |
0.69% |
$1.28 |
|
24 |
Brunei |
28 |
78 |
0.66% |
$0.36 |
|
25 |
Syria |
39 |
76 |
0.64% |
$0.51 |
|
26 |
USA, Puerto Rico, Virgin Is. |
265 |
65 |
0.55% |
$4.08 |
|
27 |
Albania |
21 |
59 |
0.50% |
$0.36 |
|
28 |
Niger |
7 |
49 |
0.41% |
$0.14 |
|
29 |
South African Customs Union |
29 |
45 |
0.38% |
$0.64 |
|
30 |
Zambia |
1 |
42 |
0.35% |
$0.02 |
|
31 |
Lebanon |
31 |
39 |
0.33% |
$0.79 |
|
32 |
Liberia |
11 |
35 |
0.30% |
$0.31 |
|
33 |
Honduras |
193 |
34 |
0.29% |
$5.68 |
|
34 |
Slovakia |
9 |
34 |
0.29% |
$0.26 |
|
35 |
El Salvador |
174 |
31 |
0.26% |
$5.61 |
|
36 |
France, Monaco |
98 |
31 |
0.26% |
$3.16 |
|
37 |
Belgium-Luxembourg |
3 |
29 |
0.25% |
$0.10 |
|
38 |
Zaire |
22 |
27 |
0.23% |
$0.81 |
|
39 |
Czech Rep. |
6 |
26 |
0.22% |
$0.23 |
|
40 |
Norway, Svalbard & Jan Mayen |
98 |
25 |
0.21% |
$3.92 |
|
41 |
Austria |
6 |
25 |
0.21% |
$0.24 |
|
42 |
Moldova |
2 |
24 |
0.20% |
$0.08 |
|
43 |
Guinea Bissau |
5 |
21 |
0.18% |
$0.24 |
|
44 |
Argentina |
7 |
19 |
0.16% |
$0.37 |
|
45 |
Ghana |
3 |
19 |
0.16% |
$0.16 |
|
46 |
Greece |
5 |
18 |
0.15% |
$0.28 |
|
47 |
Egypt |
7 |
16 |
0.14% |
$0.44 |
|
48 |
Azerbaijan |
4 |
14 |
0.12% |
$0.29 |
|
49 |
Georgia |
4 |
14 |
0.12% |
$0.29 |
|
50 |
Ecuador |
4 |
14 |
0.12% |
$0.29 |
|
51 |
Jordan |
4 |
14 |
0.12% |
$0.29 |
|
52 |
Mexico |
4 |
14 |
0.12% |
$0.29 |
|
53 |
Paraguay |
4 |
14 |
0.12% |
$0.29 |
|
54 |
Bosnia Herzegovina |
6 |
12 |
0.10% |
$0.50 |
|
55 |
Sudan |
6 |
12 |
0.10% |
$0.50 |
|
56 |
Belarus |
2 |
12 |
0.10% |
$0.17 |
|
57 |
Burundi |
8 |
11 |
0.093% |
$0.73 |
|
58 |
Portugal |
2 |
11 |
0.093% |
$0.18 |
|
59 |
Switzerland, Liechtenstein |
11 |
10 |
0.085% |
$1.10 |
|
60 |
Guinea |
6 |
10 |
0.085% |
$0.60 |
|
61 |
Sierra Leone |
9 |
8 |
0.068% |
$1.13 |
|
62 |
Chile |
3 |
8 |
0.068% |
$0.38 |
|
63 |
Tunisia |
2 |
7 |
0.059% |
$0.29 |
|
64 |
Bolivia |
27 |
6 |
0.051% |
$4.50 |
|
65 |
Uruguay |
14 |
6 |
0.051% |
$2.33 |
|
66 |
Morocco |
2 |
6 |
0.051% |
$0.33 |
|
67 |
Bulgaria |
1 |
6 |
0.051% |
$0.17 |
|
68 |
Saudi Arabia |
9 |
5 |
0.042% |
$1.80 |
|
69 |
Armenia |
3 |
4 |
0.034% |
$0.75 |
|
70 |
Brazil |
3 |
4 |
0.034% |
$0.75 |
|
71 |
Cyprus |
46 |
3 |
0.025% |
$15.33 |
|
72 |
India |
23 |
3 |
0.025% |
$7.67 |
|
73 |
Canada |
43 |
2 |
0.017% |
$21.50 |
|
74 |
Australia |
49 |
1 |
0.008% |
$49.00 |
|
75 |
China |
7 |
1 |
0.008% |
$7.00 |
|
76 |
Hong Kong |
7 |
1 |
0.008% |
$7.00 |
|
77 |
Ethiopia |
6 |
1 |
0.008% |
$6.00 |
|
78 |
Japan |
3 |
1 |
0.008% |
$3.00 |
|
79 |
Turkey |
9 |
- |
? |
? |
|
80 |
United Arab Emirates |
7 |
- |
? |
? |
|
81 |
Nepal |
4 |
- |
? |
? |
|
82 |
Singapore |
4 |
- |
? |
? |
|
83 |
New Zealand |
3 |
- |
? |
? |
|
84 |
Iran |
2 |
- |
? |
? |
|
85 |
Kuwait |
2 |
- |
? |
? |
|
86 |
South Korea |
2 |
- |
? |
? |
|
87 |
Ireland |
1 |
- |
? |
? |
|
88 |
Spain |
1 |
- |
? |
? |
|
89 |
Thailand |
1 |
- |
? |
? |
| |
total |
6,237 |
11,831 | |
$0.53 |
Source: Derived from SITC1 data obtained from the United
Nations Statistical Division, International Trade Statistics Branch.
Note: Zero weights in the data appear to indicate actual small values (less than 500 kgs), rounded-off to zero.
Table A7: 1994 recipients of Swedish used-clothes exports (89) ranked by value, with weights, prices, and value-shares
|
Rank by value |
1994 recipients of Swedish used-clothes exports |
reported value (US$1000s) |
share of total |
reported weight (1000 kgs) |
average price (US$/kg) |
|
1 |
Nicaragua |
589 |
9.4% |
228 |
$2.58 |
|
2 |
Estonia |
568 |
9.1% |
1,875 |
$0.30 |
|
3 |
Latvia |
486 |
7.8% |
1,764 |
$0.28 |
|
4 |
Russia |
408 |
6.5% |
821 |
$0.50 |
|
5 |
Yugoslavia |
352 |
5.6% |
1,021 |
$0.34 |
|
6 |
USA, Puerto Rico, Virgin Is. |
265 |
4.2% |
65 |
$4.08 |
|
7 |
Croatia |
227 |
3.6% |
308 |
$0.74 |
|
8 |
Germany |
212 |
3.4% |
100 |
$2.12 |
|
9 |
Poland |
210 |
3.4% |
399 |
$0.53 |
|
10 |
Angola |
201 |
3.2% |
523 |
$0.38 |
|
11 |
Honduras |
193 |
3.1% |
34 |
$5.68 |
|
12 |
Finland |
190 |
3.0% |
310 |
$0.61 |
|
13 |
Lithuania |
187 |
3.0% |
566 |
$0.33 |
|
14 |
Denmark |
178 |
2.9% |
108 |
$1.65 |
|
15 |
El Salvador |
174 |
2.8% |
31 |
$5.61 |
|
16 |
Ukraine |
170 |
2.7% |
201 |
$0.85 |
|
17 |
Mozambique |
170 |
2.7% |
1,090 |
$0.16 |
|
18 |
Ethiopia |
114 |
1.8% |
127 |
$0.90 |
|
19 |
Romania |
110 |
1.8% |
186 |
$0.59 |
|
20 |
Tanzania |
107 |
1.7% |
173 |
$0.62 |
|
21 |
United Kingdom |
105 |
1.7% |
82 |
$1.28 |
|
22 |
Norway, Svalbard & Jan Mayen |
98 |
1.6% |
25 |
$3.92 |
|
23 |
France, Monaco |
98 |
1.6% |
31 |
$3.16 |
|
24 |
Rwanda |
72 |
1.2% |
133 |
$0.54 |
|
25 |
Netherlands |
68 |
1.1% |
85 |
$0.80 |
|
26 |
Australia |
49 |
0.79% |
1 |
$49.00 |
|
27 |
Cyprus |
46 |
0.74% |
3 |
$15.33 |
|
28 |
Hungary |
44 |
0.71% |
88 |
$0.50 |
|
29 |
Canada |
43 |
0.69% |
2 |
$21.50 |
|
30 |
Syria |
39 |
0.63% |
76 |
$0.51 |
|
31 |
Lebanon |
31 |
0.50% |
39 |
$0.79 |
|
32 |
South African Customs Union |
29 |
0.46% |
45 |
$0.64 |
|
33 |
Iraq |
29 |
0.46% |
225 |
$0.13 |
|
34 |
Brunei |
28 |
0.45% |
78 |
$0.36 |
|
35 |
Bolivia |
27 |
0.43% |
6 |
$4.50 |
|
36 |
India |
23 |
0.37% |
3 |
$7.67 |
|
37 |
Zaire |
22 |
0.35% |
27 |
$0.81 |
|
38 |
Albania |
21 |
0.34% |
59 |
$0.36 |
|
39 |
Uruguay |
14 |
0.22% |
6 |
$2.33 |
|
40 |
Benin |
12 |
0.19% |
139 |
$0.09 |
|
41 |
Switzerland, Liechtenstein |
11 |
0.18% |
10 |
$1.10 |
|
42 |
Liberia |
11 |
0.18% |
35 |
$0.31 |
|
43 |
Turkey |
9 |
0.14% |
0 |
? |
|
44 |
Saudi Arabia |
9 |
0.14% |
5 |
$1.80 |
|
45 |
Sierra Leone |
9 |
0.14% |
8 |
$1.13 |
|
46 |
Slovakia |
9 |
0.14% |
34 |
$0.26 |
|
47 |
Burundi |
8 |
0.13% |
11 |
$0.73 |
|
48 |
United Arab Emirates |
7 |
0.11% |
0 |
? |
|
49 |
China |
7 |
0.11% |
1 |
$7.00 |
|
50 |
Hong Kong |
7 |
0.11% |
1 |
$7.00 |
|
51 |
Egypt |
7 |
0.11% |
16 |
$0.44 |
|
52 |
Argentina |
7 |
0.11% |
19 |
$0.37 |
|
53 |
Niger |
7 |
0.11% |
49 |
$0.14 |
|
54 |
Ethiopia |
6 |
0.10% |
1 |
$6.00 |
|
55 |
Guinea |
6 |
0.10% |
10 |
$0.60 |
|
56 |
Bosnia Herzegovina |
6 |
0.10% |
12 |
$0.50 |
|
57 |
Sudan |
6 |
0.10% |
12 |
$0.50 |
|
58 |
Austria |
6 |
0.10% |
25 |
$0.24 |
|
59 |
Czech Rep. |
6 |
0.10% |
26 |
$0.23 |
|
60 |
Greece |
5 |
0.080% |
18 |
$0.28 |
|
61 |
Guinea Bissau |
5 |
0.080% |
21 |
$0.24 |
|
62 |
Nepal |
4 |
0.064% |
0 |
? |
|
63 |
Singapore |
4 |
0.064% |
0 |
? |
|
64 |
Azerbaijan |
4 |
0.064% |
14 |
$0.29 |
|
65 |
Georgia |
4 |
0.064% |
14 |
$0.29 |
|
66 |
Ecuador |
4 |
0.064% |
14 |
$0.29 |
|
67 |
Jordan |
4 |
0.064% |
14 |
$0.29 |
|
68 |
Mexico |
4 |
0.064% |
14 |
$0.29 |
|
69 |
Paraguay |
4 |
0.064% |
14 |
$0.29 |
|
70 |
New Zealand |
3 |
0.048% |
0 |
? |
|
71 |
Japan |
3 |
0.048% |
1 |
$3.00 |
|
72 |
Armenia |
3 |
0.048% |
4 |
$0.75 |
|
73 |
Brazil |
3 |
0.048% |
4 |
$0.75 |
|
74 |
Chile |
3 |
0.048% |
8 |
$0.38 |
|
75 |
Ghana |
3 |
0.048% |
19 |
$0.16 |
|
76 |
Belgium-Luxembourg |
3 |
0.048% |
29 |
$0.10 |
|
77 |
Iran |
2 |
0.032% |
0 |
? |
|
78 |
Kuwait |
2 |
0.032% |
0 |
? |
|
79 |
South Korea |
2 |
0.032% |
0 |
? |
|
80 |
Morocco |
2 |
0.032% |
6 |
$0.33 |
|
81 |
Tunisia |
2 |
0.032% |
7 |
$0.29 |
|
82 |
Portugal |
2 |
0.032% |
11 |
$0.18 |
|
83 |
Belarus |
2 |
0.032% |
12 |
$0.17 |
|
84 |
Moldova |
2 |
0.032% |
24 |
$0.08 |
|
85 |
Ireland |
1 |
0.016% |
0 |
? |
|
86 |
Spain |
1 |
0.016% |
0 |
? |
|
87 |
Thailand |
1 |
0.016% |
0 |
? |
|
88 |
Bulgaria |
1 |
0.016% |
6 |
$0.17 |
|
89 |
Zambia |
1 |
0.016% |
42 |
$0.02 |
| |
total |
6,237 | |
11,831 |
$0.53 |
Source: Derived from SITC1 data obtained from the United Nations Statistical Division, International Trade Statistics Branch.
Note: Zero weights in the data appear to indicate actual small values (less than 500 kgs), rounded-off to zero.
Table A8: 1994 recipients of Swedish used-clothes exports (89) ranked by price, with values and weights
|
Rank by value |
1994 recipients of Swedish used-clothes exports |
reported value (US$1000s) |
share of total |
reported weight (1000 kgs) |
average price (US$/kg) |
|
1 |
Australia |
49 |
1 |
$49.00 | |
|
2 |
Canada |
43 |
2 |
$21.50 | |
|
3 |
Cyprus |
46 |
3 |
$15.33 | |
|
4 |
India |
23 |
3 |
$7.67 | |
|
5 |
China |
7 |
1 |
$7.00 | |
|
6 |
Hong Kong |
7 |
1 |
$7.00 | |
|
7 |
Ethiopia |
6 |
1 |
$6.00 | |
|
8 |
Honduras |
193 |
34 |
$5.68 | |
|
9 |
El Salvador |
174 |
31 |
$5.61 | |
|
10 |
Bolivia |
27 |
6 |
$4.50 | |
|
11 |
USA, Puerto Rico, Virgin Is. |
265 |
65 |
$4.08 | |
|
12 |
Norway, Svalbard & Jan Mayen |
98 |
25 |
$3.92 | |
|
13 |
France, Monaco |
98 |
31 |
$3.16 | |
|
14 |
Japan |
3 |
1 |
$3.00 | |
|
15 |
Nicaragua |
589 |
228 |
$2.58 | |
|
16 |
Uruguay |
14 |
6 |
$2.33 | |
|
17 |
Germany |
212 |
100 |
$2.12 | |
|
18 |
Saudi Arabia |
9 |
5 |
$1.80 | |
|
19 |
Denmark |
178 |
108 |
$1.65 | |
|
20 |
United Kingdom |
105 |
82 |
$1.28 | |
|
21 |
Sierra Leone |
9 |
8 |
$1.13 | |
|
22 |
Switzerland, Liechtenstein |
11 |
10 |
$1.10 | |
|
23 |
Ethiopia |
114 |
127 |
$0.90 | |
|
24 |
Ukraine |
170 |
201 |
$0.85 | |
|
25 |
Zaire |
22 |
27 |
$0.81 | |
|
26 |
Netherlands |
68 |
85 |
$0.80 | |
|
27 |
Lebanon |
31 |
39 |
$0.79 | |
|
28 |
Armenia |
3 |
4 |
$0.75 | |
|
29 |
Brazil |
3 |
4 |
$0.75 | |
|
30 |
Croatia |
227 |
308 |
$0.74 | |
|
31 |
Burundi |
8 |
11 |
$0.73 | |
|
32 |
South African Customs Union |
29 |
45 |
$0.64 | |
|
33 |
Tanzania |
107 |
173 |
$0.62 | |
|
34 |
Finland |
190 |
310 |
$0.61 | |
|
35 |
Guinea |
6 |
10 |
$0.60 | |
|
36 |
Romania |
110 |
186 |
$0.59 | |
|
37 |
Rwanda |
72 |
133 |
$0.54 | |
|
38 |
Poland |
210 |
399 |
$0.53 | |
|
39 |
Syria |
39 |
76 |
$0.51 | |
|
40 |
Hungary |
44 |
88 |
$0.50 | |
|
41 |
Bosnia Herzegovina |
6 |
12 |
$0.50 | |
|
42 |
Sudan |
6 |
12 |
$0.50 | |
|
43 |
Russia |
408 |
821 |
$0.50 | |
|
44 |
Egypt |
7 |
16 |
$0.44 | |
|
45 |
Angola |
201 |
523 |
$0.38 | |
|
46 |
Chile |
3 |
8 |
$0.38 | |
|
47 |
Argentina |
7 |
19 |
$0.37 | |
|
48 |
Brunei |
28 |
78 |
$0.36 | |
|
49 |
Albania |
21 |
59 |
$0.36 | |
|
50 |
Yugoslavia |
352 |
1,021 |
$0.34 | |
|
51 |
Morocco |
2 |
6 |
$0.33 | |
|
52 |
Lithuania |
187 |
566 |
$0.33 | |
|
53 |
Liberia |
11 |
35 |
$0.31 | |
|
54 |
Estonia |
568 |
1,875 |
$0.30 | |
|
55 |
Azerbaijan |
4 |
14 |
$0.29 | |
|
56 |
Georgia |
4 |
14 |
$0.29 | |
|
57 |
Ecuador |
4 |
14 |
$0.29 | |
|
58 |
Jordan |
4 |
14 |
$0.29 | |
|
59 |
Mexico |
4 |
14 |
$0.29 | |
|
60 |
Paraguay |
4 |
14 |
$0.29 | |
|
61 |
Tunisia |
2 |
7 |
$0.29 | |
|
62 |
Greece |
5 |
18 |
$0.28 | |
|
63 |
Latvia |
486 |
1,764 |
$0.28 | |
|
64 |
Slovakia |
9 |
34 |
$0.26 | |
|
65 |
Austria |
6 |
25 |
$0.24 | |
|
66 |
Guinea Bissau |
5 |
21 |
$0.24 | |
|
67 |
Czech Rep. |
6 |
26 |
$0.23 | |
|
68 |
Portugal |
2 |
11 |
$0.18 | |
|
69 |
Belarus |
2 |
12 |
$0.17 | |
|
70 |
Bulgaria |
1 |
6 |
$0.17 | |
|
71 |
Ghana |
3 |
19 |
$0.16 | |
|
72 |
Mozambique |
170 |
1,090 |
$0.16 | |
|
73 |
Niger |
7 |
49 |
$0.14 | |
|
74 |
Iraq |
29 |
225 |
$0.13 | |
|
75 |
Belgium-Luxembourg |
3 |
29 |
$0.10 | |
|
76 |
Benin |
12 |
139 |
$0.09 | |
|
77 |
Moldova |
2 |
24 |
$0.08 | |
|
78 |
Zambia |
1 |
42 |
$0.02 | |
|
79 |
Turkey |
9 |
- |
? | |
|
80 |
United Arab Emirates |
7 |
- |
? | |
|
81 |
Nepal |
4 |
- |
? | |
|
82 |
Singapore |
4 |
- |
? | |
|
83 |
New Zealand |
3 |
- |
? | |
|
84 |
Iran |
2 |
- |
? | |
|
85 |
Kuwait |
2 |
- |
? | |
|
86 |
South Korea |
2 |
- |
? | |
|
87 |
Ireland |
1 |
- |
? | |
|
88 |
Spain |
1 |
- |
? | |
|
89 |
Thailand |
1 |
- |
? | |
| |
total |
6,237 |
11,831 |
$0.53 | |
Source: Derived from SITC1 data obtained from the United Nations Statistical Division, International Trade Statistics Branch.
Note: Zero weights in the data appear to indicate actual small values (less than 500 kgs), rounded-off to zero.
Table A9: 1994 sources of Swedish used-clothes imports (16) ranked by value, with weights, prices, and value-shares
|
Rank by value |
1994 recipients of Swedish used-clothes exports |
reported value (US$1000s) |
share of total |
reported weight (1000 kgs) |
average price (US$/kg) |
|
1 |
Germany |
200 |
29.9% |
93 |
$2.15 |
|
2 |
Netherlands |
117 |
17.5% |
129 |
$0.91 |
|
3 |
Poland |
96 |
14.3% |
89 |
$1.08 |
|
4 |
Denmark |
65 |
9.7% |
99 |
$0.66 |
|
5 |
USA, Puerto Rico, Virgin Is. |
53 |
7.9% |
7 |
$7.57 |
|
6 |
Norway, Svalbard & Jan Mayen |
51 |
7.6% |
91 |
$0.56 |
|
7 |
France, Monaco |
40 |
6.0% |
9 |
$4.44 |
|
8 |
United Kingdom |
15 |
2.2% |
3 |
$5.00 |
|
9 |
Indonesia |
8 |
1.2% |
- |
? |
|
10 |
China |
7 |
1.0% |
- |
? |
|
11 |
Austria |
5 |
0.75% |
10 |
$0.50 |
|
12 |
Finland |
4 |
0.60% |
- |
? |
|
13 |
Canada |
3 |
0.45% |
1 |
$3.00 |
|
14 |
Hong Kong |
3 |
0.45% |
- |
? |
|
15 |
Saudi Arabia |
1 |
0.15% |
- |
? |
|
16 |
Singapore |
1 |
0.15% |
- |
? |
| |
total |
669 | |
532 |
$1.21 |
Source: Derived from SITC1 data obtained from the United Nations Statistical Division, International Trade Statistics Branch.
Note: Zero weights in the data appear to indicate actual small values (less than 500 kgs), rounded-off to zero.
Table A10: Ninety net used-clothes importing countries, 1984-'93
|
rank |
importing country |
total value (US$) |
share of total |
|
1 |
Pakistan |
$250,133,000 |
16.8% |
|
2 |
Hong Kong |
$170,204,000 |
11.4% |
|
3 |
Tunisia |
$141,910,000 |
9.5% |
|
4 |
Chile |
$97,812,000 |
6.6% |
|
5 |
Indonesia |
$92,726,000 |
6.2% |
|
6 |
Malaysia |
$91,581,000 |
6.2% |
|
7 |
Jordan |
$83,696,000 |
5.6% |
|
8 |
France, Monaco |
$74,278,000 |
5.0% |
|
9 |
Spain |
$55,072,000 |
3.7% |
|
10 |
Bangladesh |
$38,090,000 |
2.6% |
|
11 |
Poland |
$29,379,000 |
2.0% |
|
12 |
Djibouti |
$29,054,000 |
2.0% |
|
13 |
Ethiopia |
$25,708,000 |
1.7% |
|
14 |
Senegal |
$24,443,000 |
1.6% |
|
15 |
Papua New Guinea |
$21,188,000 |
1.4% |
|
16 |
Ghana |
$18,175,000 |
1.2% |
|
17 |
Bolivia |
$17,197,000 |
1.2% |
|
18 |
Togo |
$16,459,000 |
1.1% |
|
19 |
Hungary |
$16,393,000 |
1.1% |
|
20 |
Singapore |
$14,714,000 |
0.99% |
|
21 |
Brazil |
$13,225,000 |
0.89% |
|
22 |
Nicaragua |
$11,695,000 |
0.79% |
|
23 |
India |
$11,476,000 |
0.77% |
|
24 |
Syria |
$11,313,000 |
0.76% |
|
25 |
South African Customs Union |
$11,160,000 |
0.75% |
|
26 |
Guatemala |
$9,832,000 |
0.66% |
|
27 |
South Korea |
$9,381,000 |
0.63% |
|
28 |
Malawi |
$8,644,000 |
0.58% |
|
29 |
Thailand |
$7,216,000 |
0.48% |
|
30 |
Honduras |
$7,186,000 |
0.48% |
|
31 |
Greece |
$6,156,000 |
0.41% |
|
32 |
Fiji |
$5,756,000 |
0.39% |
|
33 |
Romania |
$5,682,000 |
0.38% |
|
34 |
Paraguay |
$5,127,000 |
0.34% |
|
35 |
El Salvador |
$4,593,000 |
0.31% |
|
36 |
Argentina |
$4,441,000 |
0.30% |
|
37 |
Costa Rica |
$4,190,000 |
0.28% |
|
38 |
Philippines |
$3,788,000 |
0.25% |
|
39 |
Mali |
$3,738,000 |
0.25% |
|
40 |
New Zealand |
$3,689,000 |
0.25% |
|
41 |
Peru |
$3,017,000 |
0.20% |
|
42 |
Madagascar |
$2,992,000 |
0.20% |
|
43 |
Reunion |
$2,516,000 |
0.17% |
|
44 |
Congo |
$2,243,000 |
0.15% |
|
45 |
Israel |
$1,972,000 |
0.13% |
|
46 |
Saudi Arabia |
$1,936,000 |
0.13% |
|
47 |
Ireland |
$1,413,000 |
0.095% |
|
48 |
Kenya |
$1,341,000 |
0.090% |
|
49 |
Ecuador |
$1,322,000 |
0.089% |
|
50 |
Sri Lanka |
$1,275,000 |
0.086% |
|
51 |
Sierra Leone |
$1,211,000 |
0.081% |
|
52 |
Zimbabwe |
$1,104,000 |
0.074% |
|
53 |
Central African Republic |
$1,063,000 |
0.071% |
|
54 |
Solomon Islands |
$1,035,000 |
0.070% |
|
55 |
Croatia |
$708,000 |
0.048% |
|
56 |
Jamaica |
$690,000 |
0.046% |
|
57 |
Liberia |
$560,000 |
0.038% |
|
58 |
Venezuela |
$473,000 |
0.032% |
|
59 |
Barbados |
$413,000 |
0.028% |
|
60 |
Bulgaria |
$376,000 |
0.025% |
|
61 |
Martinique |
$359,000 |
0.024% |
|
62 |
Belize |
$315,000 |
0.021% |
|
63 |
Guadeloupe |
$307,000 |
0.021% |
|
64 |
St. Pierre and Miquelon |
$304,000 |
0.020% |
|
65 |
Macau |
$301,000 |
0.020% |
|
66 |
Kuwait |
$242,000 |
0.016% |
|
67 |
Grenada |
$221,000 |
0.015% |
|
68 |
Faeroe Islands |
$213,000 |
0.014% |
|
69 |
Slovenia |
$209,000 |
0.014% |
|
70 |
Trinidad and Tobago |
$198,000 |
0.013% |
|
71 |
Brunei |
$196,000 |
0.013% |
|
72 |
Kiribati |
$182,000 |
0.012% |
|
73 |
Benin |
$164,000 |
0.011% |
|
74 |
Qatar |
$164,000 |
0.011% |
|
75 |
St. Lucia |
$158,000 |
0.011% |
|
76 |
Uruguay |
$126,000 |
0.0085% |
|
77 |
Mauritius |
$124,000 |
0.0083% |
|
78 |
French Guiana |
$116,000 |
0.0078% |
|
79 |
Vanuatu |
$80,000 |
0.0054% |
|
80 |
Cyprus |
$72,000 |
0.0048% |
|
81 |
Turkey |
$69,000 |
0.0046% |
|
82 |
Yugoslavia |
$50,000 |
0.0034% |
|
83 |
Egypt |
$44,000 |
0.0030% |
|
84 |
Seychelles |
$27,000 |
0.0018% |
|
85 |
Cameroon |
$20,000 |
0.0013% |
|
86 |
Algeria |
$17,000 |
0.0011% |
|
87 |
Greenland |
$11,000 |
0.0007% |
|
88 |
Malta |
$10,000 |
0.0007% |
|
89 |
Niue |
$1,000 |
0.0001% |
|
90 |
St. Kitts-Nevis |
$1,000 |
0.0001% |
Source: Derived from SITC2 data obtained from the United Nations Statistical Division, International Trade Statistics Branch.
Note: Total value for each country for the period is simply the sum of uncorrected annual figures; correcting annual figures for inflation should have little effect on rank or share.
Table A11: 1990 world used-clothes
gross importers (181) ranked by value, with reported and imputed weights, value
and weight shares of total, weights per capita, and average prices
Table A11: Continued
Table A11: Continued
Table A11: Continued
Table A11: Continued
Table A11: Continued
Table A11: Continued
Notes: An asterisk (*) at the end of a country name indicates that the entire line is derived from partner data rather than from data reported by the country directly. An asterisk (*) at the end of an average price indicates that the price (only) was taken from partner data, due to lack of weights in reported data. Average prices are based only on those partner transactions for which weights are reported; thus imputed weights (based on those prices) may be higher than reported weights. Extreme average prices may still indicate some problem in the data, such as partial missing weights within partner transactions. The absence of a listing for a particular country does not necessarily indicate that no trade occurred.
Table A12: 1990 world used-clothes
gross importers (181) ranked by weight per capita, with values, reported and
imputed weights, value and weight shares of total, and average prices
Table A12: Continued
Table A12: Continued
Table A12: Continued
Table A12: Continued
Table A12: Continued
Table A12: Continued
Notes: An asterisk (*) at the end of a country name indicates that the entire line is derived from partner data rather than from data reported by the country directly. An asterisk (*) at the end of an average price indicates that the price (only) was taken from partner data, due to lack of weights in reported data. Average prices are based only on those partner transactions for which weights are reported; thus imputed weights (based on those prices) may be higher than reported weights. Extreme average prices may still indicate some problem in the data, such as partial missing weights within partner transactions. The absence of a listing for a particular country does not necessarily indicate that no trade occurred.
Table A13: 1990 world used-clothes
gross importers (181) ranked by average price, with values, reported and imputed
weights, value and weight shares of total, and weights per capita
Table A13: Continued
Table A13: Continued
Table A13: Continued
Table A13: Continued
Table A13: Continued
Table A13: Continued
Notes: An asterisk (*) at the end of a country name indicates that the entire line is derived from partner data rather than from data reported by the country directly. An asterisk (*) at the end of an average price indicates that the price (only) was taken from partner data, due to lack of weights in reported data. Average prices are based only on those partner transactions for which weights are reported; thus imputed weights (based on those prices) may be higher than reported weights. Extreme average prices may still indicate some problem in the data, such as partial missing weights within partner transactions. The absence of a listing for a particular country does not necessarily indicate that no trade occurred.
The following notes relate specifically to the discussion in Chapter 1.
The practice of netting imports and exports, and correlation of prices
Net exports are shown in Table A2 (in Appendix 2) because some countries, notably Belgium-Luxembourg and the Netherlands, import as well as export large quantities of used clothes, probably due to their historical involvement in recycling textiles and textile fibers. Thus they are presumably large-scale re-exporters of used clothes, and counting their gross exports would overstate their real contribution to world trade flows.
However, net figures can also obscure the true extent of world used-clothes trade. The practice of netting exports (or imports) - subtracting one from the other for any given country, as was done in preparing both Table A2 and Table 4 (in Chapter 1), to get the number of net exporting countries and their total net export values - is somewhat misleading, because closer analysis reveals that imported used clothes and exported used clothes are frequently not the same commodity, as judged by import and export prices. Thus a country which exports a lot and imports a little (or vice-versa) is still an importer (or exporter), not just a net exporter (or net importer).
The prices of used clothes imported into a given country, and of used clothes exported from the same country in the same year, are quite different, and the difference generally does not seem to indicate value-added that might be characteristic of re-exports. Comparing these differences across countries, export prices show no general tendency to be proportionally higher (or lower) than import prices (see Table A14, below). In fact, there is almost no correlation at all between import and export prices in the decade under study.
Table A14: Correlation of import and export prices, 1984-'93
| | | | | | | | | | |
average |
average |
|
1984 |
1985 |
1986 |
1987 |
1988 |
1989 |
1990 |
1991 |
1992 |
1993 |
1984-'93 |
1984-'92 |
|
0.07 |
0.07 |
0.18 |
0.00 |
-0.01 |
-0.03 |
-0.07 |
-0.12 |
0.03 |
0.69 |
0.08 |
0.01 |
Source: Derived from SITC2 data obtained from the United Nations Statistical Division, International Trade Statistics Branch.
Correlation of import and export prices during the period is quite low - in some years, it is actually negative. Leaving out 1993 as an outlier (and probably incomplete), average correlation for the previous nine years is virtually zero.
This relationship - or lack thereof - can also be seen in the following 1987 data (in Table A15 below), chosen because correlation of import and export prices in that year was in fact actually zero. The trading countries are ordered in the table according to their import/export price ratio, so that those with low import and high export prices (possible re-exporters) appear first, followed by those with high import and low export prices. A dashed line in the middle indicates equal import and export prices.
Table A15: Comparison of 1987 import and export prices by
country (US$/kg)
|
trading country |
import price |
export price |
import/export price ratio |
|
Mexico |
0.24 |
8.18 |
0.03 |
|
Mali |
0.72 |
9.00 |
0.08 |
|
India |
0.57 |
5.23 |
0.11 |
|
China |
0.25 |
2.04 |
0.12 |
|
Portugal |
0.55 |
3.23 |
0.17 |
|
Sri Lanka |
0.001 |
0.006 |
0.19 |
|
Guatemala |
2.78 |
9.00 |
0.31 |
|
Netherlands |
0.38 |
0.98 |
0.38 |
|
Indonesia |
4.92 |
12.75 |
0.39 |
|
Chile |
1.25 |
3.00 |
0.42 |
|
Belgium-Luxembourg |
0.46 |
0.93 |
0.50 |
|
South Korea |
1.32 |
2.37 |
0.56 |
|
Pakistan |
0.43 |
0.75 |
0.57 |
|
Spain |
0.83 |
1.33 |
0.62 |
|
Kuwait |
0.65 |
1.00 |
0.65 |
|
Syria |
1.00 |
1.50 |
0.67 |
|
Malaysia |
0.95 |
1.39 |
0.68 |
|
Italy |
0.64 |
0.93 |
0.69 |
|
Togo |
0.53 |
0.74 |
0.72 |
|
Senegal |
0.73 |
0.82 |
0.89 |
|
Tunisia |
0.68 |
0.71 |
0.96 |
|
France, Monaco |
0.96 |
0.97 |
0.99 |
|
Singapore |
1.12 |
0.87 |
1.29 |
|
Switzerland, Liechtenstein |
1.06 |
0.79 |
1.35 |
|
United Kingdom |
1.93 |
1.29 |
1.50 |
|
Sweden |
1.19 |
0.78 |
1.53 |
|
Thailand |
3.60 |
2.29 |
1.57 |
|
Ireland |
3.77 |
2.28 |
1.65 |
|
West Germany |
1.46 |
0.68 |
2.13 |
|
Finland |
2.37 |
0.99 |
2.40 |
|
New Zealand |
4.50 |
1.50 |
3.00 |
|
Norway, Svalbard & Jan Mayen |
1.74 |
0.54 |
3.22 |
|
Denmark |
4.22 |
1.21 |
3.48 |
|
Hong Kong |
1.23 |
0.31 |
3.90 |
|
El Salvador |
1.99 |
0.50 |
3.97 |
|
Ethiopia |
3.19 |
0.30 |
10.47 |
|
Japan |
6.24 |
0.58 |
10.72 |
|
Austria |
2.72 |
0.18 |
15.38 |
|
Iceland |
25.00 |
0.96 |
25.96 |
|
import/export price correlation: | |
0.00 | |
Source: Derived from SITC2 data obtained from the United Nations Statistical Division, International Trade Statistics Branch.
Note: The U.S. and Canada, among others, do not show up in this table because of missing weight data, which meant that we could not calculate prices.
Only a few countries have import and export prices roughly equal (in the center of the table, around the horizontal dividing line). The remainder diverge very quickly from this point: roughly half the countries have import prices lower (often very much lower) than export prices, while the other half have import prices higher (often very much higher). Leaving aside re-exporters (whom we would expect to find in the first group), we can hypothesize that less-developed countries might have one pattern (lower import prices if they are importing lots of low-quality clothes for very poor people, on the one hand, but on the other hand they might be exporting some exotic and expensive traditional costumes, for example); and that industrial countries might have the reverse pattern (lower export prices if they are exporting large quantities of low-quality clothes to LDCs, but they might be importing limited quantities of high-quality used clothes for domestic use, either from LDCs, or from other industrial countries).
But the patterns actually seem rather mixed: It is true that our two major presumed re-exporters, the Netherlands and Belgium-Luxembourg, are found in the first group, but so are Portugal, South Korea, Spain, Kuwait, Italy, and France. The rest of the first group (with import/export ratios lower than 1) might be considered LDCs, and perhaps they are following the pattern suggested (large quantities of cheap imports, and small quantities of exotic exports), or perhaps some of them are re-exporting as well. But the second group (with import/export prices ratios higher than 1) is even more startling: While it contains many industrial countries which we might expect to be following the second suggested pattern (large quantities of cheap exports, and small quantities of exotic imports), it also includes Thailand, El Salvador, and Ethiopia.
Miscellaneous minor problems
Great variation in prices was apparent in Table A15 above. Unfortunately, some of this variation (at least on the high side) may have been caused by statistical errors due to missing weights in some transactions. Using data broken down by partner-transactions, as we do for the gross export and import tables in Appendix 2, allows us at least to eliminate, for any given country, partner transaction totals with missing weights. Thus we have been able to calculate average export and import prices based only on those partner transaction totals in which weights were reported to the UN. This does not guarantee that the resulting prices are correct, because the partner transaction totals themselves may have been made up of more than one actual transaction, and some of those weights may have been missing; whether this is the case, or not, is not apparent from the data available to us.
Another problem is that, in an attempt to correct for possibly misreported data, we have inadvertently introduced another source of error, by occasionally using partner-reported data in place of directly-reported data. The problem is that export data is reported free-on-board (f.o.b.), whereas the partner country's corresponding import data would be reported cost-insurance-freight (c.i.f.); that is, reported export values would naturally be lower than the corresponding import values reported by the partner country (and vice-versa: reported import values would naturally be higher than the corresponding export values reported by the partner country), because of additional insurance and freight costs. Thus when, in an attempt to correct for misreported data, we occasionally used the higher partner-reported import value in lieu of the lower directly-reported export value, we introduced an upward bias into our export figures; but in the reverse situation, if partner country export figures were higher than directly-reported import figures, then in substituting the higher export values we may have been at least partially correcting for misreported import values, without introducing any new bias. Whether we corrected more overall, or introduced more new bias, is unknown, but in any event such substitutions affected only a few countries.
The following notes relate specifically to the discussion in the first half of Chapter 3.
The origin of markets, and their social and political context
The modes of distribution of goods and services can generally be classified in three ways: They can be taken by force or threat of force (for instance, "Pay your taxes, or else!"); they can be exchanged ("I will do this for you if you will do that for me"); or they can be given willingly (for instance, "I provide for you because I identify with you as part of my family").
Understanding the first and third of these modes involves one primarily in an analysis of politics and sociology, respectively, while exchange and resulting markets are the primary province of economics. According to evidence from primitive and peasant economies, markets appear very early in economic development - in response to social scarcities - with goods markets generally appearing first, then labor and credit markets, and finally land and land rental markets. Many people are quite skeptical about markets, however, and prefer social and/or political modes of distribution instead.
Market exchange must also find its place in the social and political world, of course. For instance, tastes and preferences (which determine demand for various goods and services) are not formed in the marketplace, but are brought from one's experiences in the social world; and the market itself could not exist - certainly not the complicated market structures we know today - without the regulatory and enforcement mechanisms provided through social mores and political processes.
In any event, one's basic predisposition towards markets may largely determine how one views evidence regarding the effects of used-clothes imports into less-developed countries (LDCs). If one prefers political and social modes of distribution, for instance, one may consider it quite natural to construct rules governing who may purchase used clothes under what circumstances, how they may be used (whether they may be resold), etc., whereas economic analysis may wonder whether a market could achieve the same or similar ends more efficiently.
Doubts about the "evils" of the used-clothes trade, and about proposed solutions
In much of the literature on the evils of the used-clothes trade, there seems to be an obsession with the idea that one should always be able to purchase the product of one's own work, as though a diamond cutter or the manufacturer of a jumbo jet might not rather be content to ride occasionally on the jumbo jet, perhaps even to wear fake diamonds, and then to use most of the purchasing power acquired from producing the diamonds or the jet for something more important.
In this literature, few if any identify the textile industries in less-developed countries as working "for profit", though of course they are; and one can call what the factory worker takes home at the end of the day "profits" as easily as one can use that epithet for what the used-clothes seller takes home; perhaps even the union "profits" when it has more members or higher wages, and has "losses" when it loses members.
It is naturally an employer association's job to act on behalf of its member firms, and a union's job to act on behalf of its worker members, but one is perhaps entitled to wonder if it is really the entire country that is suffering because of used-clothes imports, or whether it is just the garment industry. There is a striking lack of awareness of, and lack of analysis of the effects of, providing cheaper goods for consumers, which may cause increased employment and increased production in other industries. Nevertheless, there may be a strong theoretical argument in favor of protecting the garment industry as instrumental in the development process; we examine this issue carefully in Chapter 5.
Regarding the suggestion that all used clothes should be distributed free to the poorest of the poor, it is not clear where it is being proposed that this should happen. Although there is certainly some demand for used clothes in industrial countries, supply undoubtedly far exceeds that demand. In any event, as we have seen, LDCs export vast quantities of new clothes to industrial countries, so the mere fact of some of them coming back as used clothes should not be objectionable in itself (except possibly for cultural reasons).
But if we assume that the proposal on the table is to "distribute free of charge" in less-developed countries much of the used clothes collected in industrial ones, then we are talking about major subsidies indeed. We not only have to get the clothes there, but we have to get them cleaned, sorted, repaired, even restyled, and then perhaps the biggest job: We have to find needy recipients and match the clothes to their needs.
Now one might think that it is easy to find needy recipients, because we are talking about poor countries, so almost everyone is relatively poor, and we can just give clothes to almost anyone. But we cannot do so, because many of those people would have bought new clothes from the domestic manufacturers, and now if we have given them suitable used clothes, they do not need new clothes, so they will not buy new clothes, or at least not as much as before. So we cannot protect jobs that way.
It is true that people will still have in their pockets whatever money they had there before, and not only that, they may feel richer now for having clothes as well, so they may be even more willing than before to spend some of what they have. But it likely will not be for clothes, it will be for something else. So we will have a restructuring, where garment industry jobs are lost, while new jobs are created, producing other goods and services. But the garment workers' union probably is not too interested in creating jobs in other industries, even if the whole country is getting richer in the process.
But suppose that we can find those proverbial individuals who are "too poor to enter the market", and we give the clothes to them. Now we may think that we have not affected demand for local production, because they would not have bought any clothes anyway. But then suppose, for instance, that they need food more than they need clothes. There is an active market in used clothes (or, if it has stopped temporarily because we have cut off the commercial supply, it will soon exist again). So will they not sell their clothes? Steven Haggblade reports that this is often exactly what happens, even with most food-for-work - it is usually exchanged for something else, perhaps for some other food, maybe even for clothes! When used clothes are thus available on the market, we have negatively affected demand for local production, so to that extent we have not protected jobs.
This is not to say that free distribution to the poor would be an inherently bad thing to do. It would result in a large transfer of real wealth to less-developed countries, first in the used clothes themselves, and then magnified (at least to some extent) by the subsidy required. In Chapter 9 we will look at whether this would be the most efficient way to help the poor. In the current era of fiscal restraint, it is difficult to imagine it happening, however.
The following items relate specifically to the discussion in the first half of Chapter 3.
ILO draft resolution on increasing world trade in clothing (except used clothing)
"Considering the importance of the clothing industry to employment in manufacturing in many developed and developing countries, and in particular its role in overall economic and social development,
"Stressing the significance of trade to the clothing industry,
"Believing that the industrialized world must do justice to its particular responsibility to developing nations by supporting the expansion of world trade, particularly in clothing items, under fair social conditions for all parties as a meaningful development policy,
"Further believing that trade has to take place on the basis of respect for workers' rights and that agreements on trade matters and particularly on the clothing trade should include provisions guaranteeing minimum social standards... including the right of freedom of association, the right to organize and bargain collectively...
"Rejecting all forms of trade protectionism...
"Noting with concern the development of an extensive market in used clothing - originally donated for charitable purposes - particularly in developing countries, which is leading to a downturn in the domestic clothing industry in these countries, with a consequent loss of employment...
"[the meeting requests the ILO] to call on member States which are clothing-exporting countries to take steps to cooperate so as to ensure a better return for their clothing exports and to ensure that the workers concerned share the increased wealth thus created which would lead to the expansion of domestic markets, to improved economic and social conditions in these countries and to further growth in world trade in clothing...
"and requests the Director-General to carry out an investigation on the impact on employment in developing countries of the trade in used clothing originally donated for charitable purposes in the industrialized world, and to convey the results to the major international charities concerned and to the governments of all member States."
A labor media (Free Labour World) image of the used-clothes trade
"The mid-day Zambian sun is hot! Eunice holds up one hand to try to protect herself as she sits on a Kitwe pavement tending a pile of peanuts with the other. Her two babies play at her feet. She knows she must attract some customers for all three now depend on the few cents such sales will bring. Life was different before. Until three months ago, Eunice was a sewing machinist in a local factory producing clothing for the Zambian market. Now the factory is closed - shut down for a number of reasons but principally because of a dramatic upsurge in imports of second-hand clothing from Europe and the U.S.... [E]very... second-hand item on sale here and elsewhere in the developing world is destroying desperately needed local jobs. Zambia, for example, has lost 8,500 textile and clothing jobs in the past year. Neighbouring Zimbabwe has lost nearly 12,000. The livelihoods of as many as 150,000 people have disappeared... The local textile and clothing industry has been devastated by large scale importation of second-hand clothes, mainly sourced from developed countries and resold locally at dumped prices...
"Zimbabwe has taken steps to curb second-hand clothing imports, so too has South Africa. A number of other African countries are following suit. Pressure is growing for action in the Americas...
"[S]hrewd groups of used-clothes dealers in Europe and the U.S. have turned generosity into a multi-million dollar business. They buy tons of clothing donated to leading charities... for perhaps 5 to 10 cents [U.S.] a kilo. When sold in developing countries these items are marked up at between 600 and 3,000% over what the wholesalers paid for them... Used clothing exports from the U.S. earn US$150 million a year... It is a scavenging trade, where companies get their product practically for free before converting it into cash. In the U.S., many of the companies concerned employ the cheapest possible labour to sort piles of clothing into a range of categories - none of the clothing is washed or repaired, simply compacted into 50 kg bales and loaded into containers... Few Europeans or Americans realise where their cast-offs end up. But many know where they should. As one New Yorker said confidently, "The dresses I give to Goodwill are distributed to the poor, free of charge, or sold in their local shop." Little does she know that her donation, for which she can claim a tax-rebate, ends up on a mini-mountain of other donated clothes, now flooding the markets of the developing world. Nor can she imagine the misery that her well-intended donation is causing to those losing their livelihoods as a result...
"[U]nions will be increasing their campaign to ensure that used clothing donated for the poor is used for that purpose and distributed free of charge, thus avoiding the damage recently caused in developing countries... We must work to eradicate the international trade in used clothing."
While this is the perspective of a special interest - a particular union speaking for a particular sector of industry and labor, not for consumers in LDCs, nor necessarily for their national interest as a whole - it is nevertheless an influential view, loaded with compelling images. Many of those images have also been picked up in the wider media.
A Canadian media (Ottawa Citizen, 1993) image of the used-clothes trade
The following examples appeared in the Ottawa Citizen in 1993 (we also quoted briefly from them in the Introduction). The language and the images used are again quite powerful (some possible weaknesses in the images and arguments are footnoted):
"Used clothing is flooding... through a shadowy trading network... Well-meaning donors provide the fuel... resold at markups of 3,000%... [Charities are quoted:] 'We are aware that we are selling to for-profit businesses...' Economists say tens of thousands of garment and textile workers have lost jobs... Extra layers of middlemen, import tariffs, bribes to get shipments across borders... - all add to profit-taking along the way... A continent-wide economy of dependency has been created... It has been a blow to... pride to be driven into buying other people's old threads...
"Almost anything is available - jeans and jackets, T-shirts, blouses, shirts, sweaters and slacks - all well-made, all inexpensive and all from the West... The clothes are shipped thousands of kilometres and dumped in the Third World for a fraction of their original cost... The prices are so low, in fact, that economists say local industries cannot compete... In 1990, Third World countries accounted for 53% of new clothing exports to developed nations... but the only way sweatshop laborers can afford the items they produce is when North Americans and Europeans pass the clothing on to charity organizations that raise funds through bulk sales to the international scavenging trade... The quality is first-rate... Some clothes look as though they have never been worn... To buy clothing from the West, even if it is second-hand, imparts a sense of status... Women and children [in less-developed countries]... churn out cheap shirts and pants for western department store chains...; the modern garment industry, geared entirely for export, has left most [workers] too poor to buy the wares... Prices are so low [for used-clothes imports] that making clothes for domestic consumption makes no economic sense... Trade liberalization, drastic social spending cuts and economic policies that valued resource-based exports over local production ravaged industries serving the domestic economy... cheap imports of new and hand-me-down goods were the only things most people could still afford... The imports may be costing jobs, but the availability of low-cost clothing has been a boon to hard-pressed consumers...
"[Charities] selling to big-city brokers... The clothes are later sold in the Third World for inflated prices... [A Salvation Army officer says] he is concerned the clothing may eventually be resold in Third World countries for a pittance and undercut local industry... Salvation Army branches... are considering ways they can ship used clothes directly to other army agencies around the world: 'We would like to have some control over what happens to our products...' [The officer] would like to ship clothes directly to countries where local labor can set up small industries for handling and distributing them to the poor. Other local charities say they cannot yet afford to ship directly to poor countries because the sorting, handling and shipping costs are too high. 'I would certainly prefer that because I would get more personal satisfaction from it,' said [a local charity manager]...
"[A charity manager says that, for lack of supply] he turns down 15 requests a week to supply small entrepreneurs wanting to enter the game. Typically, these would-be dealers are recent Asian and African expatriates hoping their family and business connections back home can be parlayed into lucrative export-import contracts. 'It is really a price game, it is really a cutthroat business,' [says the manager].
"[The] used-clothing exporter... slaps on a mark-up of 3,000% to cover bribes, pay middlemen and generate vast profits... Remember that the process starts with Western unwillingness to support higher wage manufacturers at home..."
In an effort to be balanced, an Ottawa Citizen editorial ends up by pointing out that "sale [of used clothes] gives charities needed revenue. And profits notwithstanding, impoverished Africans and Asians end up clothed at an affordable price." It then recommends that "charities must think about cutting profit-makers out of the game, and take over the... export business themselves. That way, the profits could be plowed back into Third World development, with an eye to combating the poverty at the heart of the problem."
This may be a reasonable suggestion; it is discussed in Chapter 4.
The following information relates specifically to the discussion at the end of Chapter 3. Most details here come from the U.S. Department of Commerce, and thus over-emphasize information on specifically American exports, and American commercial assessments and points of view, simply because the sources were readily available. Trade policy information regarding each importer should apply to all exporters, however, so our conclusions should apply generally.
Spain and some former Spanish colonies
According to the U.S. Department of Commerce (USDOC), among the Western European and other industrial countries, Spain is the only one which imposes any unusual restriction on used-clothes imports: "Phytosanitary certificates are required..." along with "prior administrative approval (import license)... [which] is generally denied." Nevertheless, on the average, over the previous four years, about a third of a million dollars worth of used clothes annually was imported into Spain from the U.S. alone, and on the order of ten to thirty times as much from other - possibly EU - sources. Spain is also a significant exporter of used clothes, over a third of a million dollars according to partner data for 1990, for instance.
Of the few other countries worldwide which actually do impose trade restrictions on used clothes, more than half of them are former Spanish colonies. For example, Mexico "requires a permit from the Mexican Health Department. It is not easily granted. [If it is granted, there is a 20% duty.] This measure was adopted [at least ostensibly] to prevent infections." Mexico's import data - submitted by Mexico to the UN - when compared to U.S. export data, understates Mexican imports by a factor of ½ to 5/6. If U.S. data is to be believed, imports from the U.S. have increased progressively and dramatically, from US$3.8 million in 1990, to $58 million in 1993. Mexico is also a significant exporter of used clothes, almost two-thirds of a million dollars according to partner data for 1990, for instance.
Even though Mexico has joined the North American Free Trade Agreement (NAFTA) - which has as one of its explicit purposes to "progressively eliminate [all] customs duties on originating textile and apparel goods" on internal trade between the U.S., Canada and Mexico - nevertheless Mexico insisted upon establishment of a "Committee on Trade in Worn Clothing... [to] assess the potential benefits and risks that may result from the elimination of existing restrictions... A Party may maintain restrictions in effect on the date of entry into force of this Agreement... unless the Parties agree otherwise..." This essentially provides a veto for Mexico over any change in the current rules regarding used-clothes imports. According to the U.S. Government Accounting Office, as of late 1994 the committee had not met; in fact, the committee is not expected to do anything.
Chile is now also negotiating to join NAFTA. Currently Chile merely "levies a surcharge on second-hand goods, such as used clothing and imports of 'fabric seconds'. The rate is 5% above the duty applicable to new goods... All merchandise used as seconds has to be classified and labeled in the country of origin according to quality, size, and fabric composition..."
Several other Latin American countries have restrictions on used-clothes imports, or have had them recently. "Venezuela has a strong local industry which has resulted from years of prohibition on all foreign textiles," and has now "lifted all prohibitions except for [code] HS63.10 'used rags, scrap twine, etc.'" Used clothes (code HS63.09) are apparently okay.
Colombia, however - "to stop dumping, unfair competition, and to avoid possible damage to a rather well-developed textile industry, and acting under pressure from one of the most influential manufacturing sectors - has restricted imports of used clothing and textile articles... Imports of old or used clothing; closeouts; irregulars; both new and used rags; and scrap cordage of textile material wastes; are all subject to prior import license approval. Licenses are valid for six months with one three-month extension. Extension processes are complicated and expensive... Approvals of licenses are subject to numerous considerations including availability of local substitutes, foreign exchange, and the national interest... No tariff categories for textiles and apparel now appear on the prohibited import list, except for used bags and sacks of vegetable fibers. Items once prohibited are now permitted under license." According to partner data, Colombia imported US$133,000 and was itself the exporter of $87,000 worth of used clothes in 1990.
According to USDOC 1995, in Ecuador "in 1992, imports of apparel experienced a large growth over 1991 due largely to the importation of used clothing, principally from the U.S. Large amounts of used clothing were imported in anticipation of an import prohibition subsequently imposed... Local manufacture covers 30-40% of the national market, while formal imports contribute 25-30%. The rest consists of contraband of used and new clothing, mostly from the U.S. Competition from Colombia has not hurt the U.S. share of the market [in Ecuador]. Industry leaders predict a growth in the manufacture of apparel [in Ecuador] to fill the demand of the domestic Colombian market neglected by Colombian manufacturers who are exporting to the U.S. and Europe."
The International Textiles and Clothing Bureau in Geneva also reports that "Peru has suspended 'the imports of products from any source, intended to meet clothing, footwear, or cleaning needs'." According to partner data, Peru imported US$354,000 and was itself the exporter of $58,000 worth of used clothes in 1990.
Guatemala is one of many Latin American countries (and former Spanish colonies) which have not imposed special restrictions on imports, despite the fact that "due to the economic crisis in the country... the [used-clothes] market has shown a growth of approximately 45% a year during the past three years," culminating in total used-clothes imports of US$3.3 million in 1992.
The other former Spanish colony which does maintain restrictions on used-clothes imports is the Philippines. "The import of used clothing, remnants, and used textiles is banned." Nevertheless, according to U.S. data, annual imports of used clothes from the U.S. are growing fairly consistently, currently around a million dollars per year, and other partner-reported data indicates total imports of generally three to six times that amount. Total used-clothes import data reported by the Philippines to the UN ranges from a high of more than twice the amount coming from the U.S. alone, to lows of only about 1/10 that amount. According to partner data, the Philippines itself was the exporter of US$98,000 in 1990.
Other industrial, transitional, and new industrial economies
No other industrial country besides Spain maintains any unusual restriction on the used-clothes trade, and most have imports as well as exports (although as we have seen, it is most likely not the same goods coming out that went in). Japan, for instance, had annual used-clothes imports over the last few years in the neighborhood of US$10 million from the U.S. alone. Swedish imports from the U.S. ranged recently from over US$1 million (before the recent recession) to less than $50,000 (in 1993).
Among transitional economies, only Bulgaria and Hungary have unusual restrictions. Bulgaria merely maintains a tariff rate about 60% higher than its tariffs on other fabric and apparel, while Hungary has an unusual quota system, not just for used clothes, but for all imports of consumer goods. Both have recently had annual used-clothes imports from the U.S. alone in the neighborhood of US$100,000.
To mention a few other transitional economies, Poland and Russia have had annual imports of used clothes from the U.S. in the range of US$2-10 million recently. In Russia, "the great demand for foreign-made apparel started in the beginning of 1992, and was soon filled by Chinese, Korean, U.S. and European (used) inexpensive products. Later in the same year, the demand shifted to better quality European and U.S. new clothing."
None of the new industrial economies of East and Southeast Asia impose any unusual restrictions on used-clothes imports in particular, although tariffs may be quite high on apparel and related products generally. In Thailand, "the textile industry has over the past decade become [the] most important manufacturing industry, in terms of export earnings, employment, and contribution to gross domestic product," and tariffs on apparel imports run as high as 100%. The tariff on used clothes is 60%.
"Although 37% of Turkey's total exports are comprised of textiles and apparel, the country also imported approximately US$1 billion in this sector in 1992, about 25% [of which] was apparel." Very little used clothes was imported, however, despite relatively low tariffs and no special restrictions.
Other less-developed countries
While India has rather high tariffs on fabric and apparel products generally, the U.S. Dept. of Commerce lists no particular restrictions on imports of used clothes, and annual imports from the U.S. ranged from US$4-10 million recently.
"Pakistan is one of the world's largest manufacturers and exporters of apparel. The textile industry is Pakistan's largest industrial and revenue-earning sector," and it is highly protected. Imports of many textile products are banned, but used clothes are allowed: "Imports are largely confined to worn clothing; shipments of used clothes may not contain traveling rugs, blankets, or footwear." According to UN data, Pakistan has been the world's largest net importer of used clothes during eight of the past eleven years.
"Egypt is a net exporter of cotton yarn and cotton textiles, and most textile and garment imports [including used clothes] are banned... In 1992 the output of Egypt's textile manufacturing sector reached US$2 billion [and] Egypt's exports of [new] ready-made garments and knitted products totalled $500 million." Despite some leakage, actual recent used-clothes imports from the U.S. have been trivial, although according to partner data Egypt had total imports of US$2,434,000 in 1990, and also itself had exports worth $33,000 that year.
Despite the fact that Israel has free trade agreements with the EU, EFTA, and the U.S. - and is, incidentally (with Egypt), one of the largest recipients of U.S. aid (and the U.S. is the largest single exporter of used clothes, as we have seen) - nevertheless, "used apparel items are not allowed" there either. Nevertheless, according to partner data, Israel imported US$400,000 in 1990, and exported $107,000.
"Used apparel is currently the eighth largest [U.S.] export to Sub-Saharan Africa. In 1992, [it] was among the top 35 U.S. exports to 28 of 47 [individual countries]. In nominal terms, the trade has grown from US$35 million in 1989 to over $72 million in 1992, one of the largest relative increases." Despite that, and the fact, as we have seen, that Zimbabwe recently imposed a high tariff on used-clothes imports, the momentum in Africa seems to be towards greater liberalization.
It is true that in Nigeria the "import of [virtually all] textile materials, apparel and used clothing are banned," but nevertheless "Nigeria tolerates informal trade and smuggling." According to partner data, Nigeria imported US$10,865,000 in 1990, and also exported a small amount ($2,000).
In Cameroon, "the ban on used apparel imports was lifted in late 1991. 'Used clothing' imports must show signs of appreciable wear and must be packaged in bulk. Exporters are required to provide documentary proof of sterilization for each shipment... Duty rates are approximately 85-90%..."
"In October 1992 the Chadian Chamber of Commerce reported to the U.S. Embassy that used apparel imports were no longer prohibited... [In Cote D'Ivoire] the ban of used clothing imports was lifted in February 1992."
In Tanzania, "the import of various textile products (especially second-hand clothes) has been allowed since the partial trade liberalization in 1984 and further relaxation in 1988." USDOC 1995b notes that "many importers will not accept bales that have not been sorted... Exporters should be cautious of the widespread cheating in Tanzania."
USDOC 1994 mentions no bans and no specific restrictions on used-clothes imports into South Africa, but USDOC 1995b reports that "South Africa allows used-clothing imports for charitable purposes only." USDOC 1995c confirms this, saying that "second-hand clothing can be imported if for charity or church organizations, and [if it is] not sold but rather given away... The South African clothing industry has been highly protected... Locally produced clothing is generally of reasonable quality and styling, and aimed at the middle and upper ends of the market... There is a gap in low cost clothing... There is a definite gap in the market for good and reasonably priced clothing for the smaller person... The market caters more for the larger women... Current retail prices are excessive [because] clothing and textile industries do not work together to produce lower priced products... The emerging pattern is a rapid rise in volume of lower priced clothing imports... and vastly increased export opportunities. It appears that the local clothing industry is poised to become a significant supplier to the middle/upper price/quality market in many developed countries... The clothing and textile industries' main focus should therefore be on becoming internationally competitive."
USDOC 1995b also indicates that Kenya maintains a ban, but USDOC 1995a states that "imports of apparel, both new and used, are assessed a 40% duty, down from 118% a few years ago. This is meant to protect the infant local textile industry... Locally manufactured high quality apparel competes well in the local market and Kenya is starting to export apparel to the U.S. Quality apparel from the U.S. is respected in Kenya. Kenya is a major market for U.S. used clothing, but it is intentionally misclassified in customs declarations, which keeps it from showing up in statistics."
In other African countries, tariffs on used clothes generally seem to be in the range of 45-90%, and as we have noted, trade is brisk nevertheless. In the Gambia, "small businesses constitute the vast majority of used apparel traders. Most traders purchase their product directly while on travel to the U.S." In Gabon, "about one-half of all import of used apparel comes from France." In Ghana "there is a significant and growing demand for used clothing from the U.S., which is prized for its fashion content, good condition, and variety of denim garments. Orders may fluctuate because of changing credit conditions, not necessarily because of changes in demand. Requests for credit may arise after several shipments (financed by the importer), and should be evaluated with caution." In Liberia, "because of the recent civil war and resulting inflation, demand for used clothing is particularly high." "Used clothing is the largest U.S. export to Rwanda. The Rwandan population is predominantly agricultural workers who depend upon used clothing as it is the most affordable... No restrictive regulations are likely to be imposed as the government is implementing a World Bank/IMF market liberalization program." "Togo is an important market for used apparel, as much of their import is trans-shipped to neighboring countries. The used-clothing sector is very fluid, with companies being created and dissolved continually. Exporters are cautioned to arrange payment conditions which minimize risks."
The textile industry in Senegal
To conclude this section, we will look briefly (but in a bit greater depth) at the entire textile industry in an African country (including a current U.S. government view of it) - in this case, Senegal. USDOC 1995d comments that "the textile industry is now enjoying competitive gains that only a coherent and cohesive industrial policy can reinforce... Commercial opportunities exist for U.S. firms specializing in the procurement of used equipment for open-end spinning factories... The cotton sector is dominated by... the parastatal company which... is 70% owned by the government... The government's strategy of vertically integrating the textile industry is based on the development of cotton cultivation and ginning in Eastern Senegal. This cotton is to supply the local spinning and weaving firms which would, in turn, supply thread and raw cloth to the final stage producers... [The parastatal] exports 90% of the fiber at US$2.40/kg, and reluctantly allocates 2,000 tons each year to the local textile mills, at a subsidized price of $1.07. Textile manufacturers complained that the quota did not cover their annual cotton needs estimated at 3,500 tons..."
"The basic textile industry consists of factories specializing in spinning, weaving, dyeing and finishing activities... [O]ne of the largest textile firms in Senegal... [had] a total output of 18 million meters in 1992... Mismanagement and the spectacular rise of smuggling and fraudulent importation led to the collapse of this empire in 1993. [It] was bought out by an Indian group... in association with... a Senegalese bank owned by... a French tycoon who holds important interests in Senegalese industry (sugar, wheat, banking)... [It] has the status of a 'free point'. This status is specifically granted by the government to export-oriented companies that abide by special tariff regulations and comply with on-site customs inspection procedures. To continue to benefit from this preferential regime, [it] must export at least 60% of its production. [Its] main target market is the U.S. Afrocentric market. Professionals in the sector argue that [the Indian] stake... underpins a delocalisation strategy to circumvent quotas imposed by the U.S. on the Asian textile industry..."
Another firm's "growth strategy relies also on the acquisition of a second-hand spinning mill to increase the factory's spinning capacity... [Still another firm's] objective is to increase production through another open-end spinning factory equipped with used machinery..."
"Knitting and garment-making firms... were first owned by Lebanese entrepreneurs and French expatriates. The subsector knits cloth from locally spun yarn and tailors articles such as sportswear and children's clothes. Massive imports of second-hand clothing and illegal textile imports by the informal sector destroyed this [market]... leading to the collapse of the ten companies... The quota imposed on used clothes (2,000 tons annually) and the positive effects of the devaluation constitute a gulp of air for a sector in dire straits... A terrycloth factory which hung on by a thread, so to speak, has started a small production..."
"Structural weaknesses of the textile industry... stem from the government's ad-hoc measures to overprotect the industry, from manufacturer's loss of control over domestic markets due to fraud and rising imports of second-hand clothes, and finally from the industry's uncompetitiveness. Before the liberalization of the textile sector in 1994, the government's overprotective policy sheltered local textile manufacturers from outside competition, hence creating rent-seeking situations. The absence of competitive pressure on textile mills was reflected in the failure to make productivity-enhancing investments. Failure to renew and modernize equipment made the textile industry extremely inefficient. Much of the equipment used in the industry was purchased second-hand in France in the 1950s. French manufacturers were replacing this machinery precisely because it was antiquated and obsolete..."
"The rise of used clothing imports and fraud have introduced competitive pressures that no textile mill could withstand, thus undermining the foundation of the industry. Imports of used clothing have transformed the market for textiles and sent the knitting and garment-making firms reeling. Used clothing provides some relief from inflation and the general erosion of purchasing power that affects the local population. For the price of one meter of the simplest locally-produced cloth, a man can outfit himself completely, and for the same price three children can be dressed in imported used clothes. Textile manufacturers sounded the alarm in 1983, which led the government to reduce the quota from 6,000 tons in 1984 to 2,000 tons in the early nineties."
The "president of the Senegalese Federation of Textile Mills summarized prospects for the sector in two concepts: vertical integration using the cotton fiber produced locally, and reconquest of the local market."
The following reviews relate specifically to the discussion in Chapter 4; the studies reviewed are also summarized briefly there.
Are Swedish NGOs effectively targeting "the poorest of the poor"?
The Riddell study (Promoting Development by Proxy: The Development Impact of Government Support to Swedish NGOs) quotes an earlier study (Albinson and Åhlström) to the effect that: "A major reason to increase NGO aid is the ability of the organisations to reach the real target groups of Swedish aid - the poorest people in the poorest countries - and to build up mutual cooperation." However, the Riddell report comments that: "This statement was not based on analysis or scrutiny. It was merely a boldly stated assumption."
After extensive field evaluations, the Riddell report concluded that Swedish NGOs often (naturally) tend to work with similar organizations in less-developed countries. The organized at home tend to work with the similarly organized overseas - that is, Swedish churches tend to work with overseas churches, labor unions with labor unions, consumer cooperatives with their counterparts, etc. - and thus only rarely are the poorest of the poor actually targeted effectively. The poorest of the poor are not organized, and are thus inherently difficult to reach and work with.
This is not to say that Swedish NGO projects with such overseas counterpart organizations may not be quite useful and even worthy of Sida support, but it does call into question the appropriateness specifically of Sida subsidies for used-clothes exports as part of such projects, since one of the main justifications for such subsidized exports is usually that they are reaching the poorest of the poor. Given the relative status of the probable targets of most such projects, used clothes, while certainly of value and probably salable on the market, are probably not really what they need most. And, if the clothes are going to end up on the market anyway, such subsidies are not generally necessary, given functioning domestic used-clothes markets in LDCs as we have seen.
The Riddell report did not specifically review any projects involving distribution or sale of used-clothes, and without much greater knowledge of the current use of Sida freight subsidies (going much further into the details of receiving organizations and projects), we do not know which aspects of that report may be most relevant to this study. Nevertheless we would like to call attention to certain parts that we believe may be most relevant, and suggest that Sida and the relevant NGOs themselves consider them carefully in this regard, if they have not done so already.
To cite some examples, the report concludes that "insufficient attention is placed by many Swedish NGOs on thinking strategically and realistically about the development opportunities in the areas in which they are working... The NGO projects often did not reach the poorest, and not even necessarily the very poor. It was quite common for the NGOs to assume that they were working with the very poor." If we applied this approach to used clothes, it could perhaps be characterized as, "the country is poor, someone must get benefit from the clothes" - and that would undoubtedly be true, but it does not answer the question whether someone else might be harmed, or whether the used clothes and subsidy funds might be used in a more efficient way.
The Riddell report goes on to say that: "All the case studies conclude that there is little evidence to suggest that the work of Swedish NGOs has made much of an impact on poverty. In many ways this is because many Swedish NGO projects do not begin from a conceptualisation of poverty: of what it is, of what causes it, and of how to address it. Without a theory of poverty, it is largely going to be a hit and miss affair as to whether a project will address poverty... NGO impact on poverty tends to be greater where the state is strong. Similarly, it is likely to be greater where the regional economy is dynamic. This implies that when NGOs work in areas of economic decline and stagnation, then their work is likely to be focused mainly on alleviating poverty and easing some of the pains of economic transition. Their work is only likely to have a sustained development impact in areas where the economy is relatively dynamic. Thus, one's expectations of NGO poverty impact should not be exaggerated, certainly not as exaggerated as they sometimes are. By the same token, NGOs should not claim to have the degree of poverty impact that they often claim to have - in most cases, they simply do not have this impact."
The report goes on: "There are many reasons for the state of affairs just described... [T]hey reflect a situation common not only among Swedish NGOs but elsewhere too. Quite simply, the staff and experience of Swedish NGOs do not equip them well, nor predispose them, to focus on analytic issues related to income and employment generation, or markets and market analysis... The challenge of generating income and employment in stagnant economies where markets are weak or absent surpasses the resources and capacities of many Swedish NGOs." So, how do Swedish NGOs deal with poverty? They "respond to its symptoms rather than to its causes." "The case studies suggest that NGO work is most likely to have an impact when it directly addresses the social relationships that underlie poverty - such as land-holding relationships, territorial conflicts, or having greater power to influence the distribution of profits - and which increases the organisational, political and entrepreneurial capacities of the poor to tackle these relationships for themselves... Conversely, service delivery programmes [perhaps including distribution of used-clothes] are not likely to make much of a difference, although they are easier to implement, less politically charged, and are more visible in the field... They are also easier to monitor: Bureaucratically they are more attractive projects to support, but developmentally their potential contribution is likely to be far more limited."
The report also comments on "the tendency of Swedish funds to lead to a centralisation of authority, either at headquarters or, more narrowly, in the power of one or two individuals... Such trends are the very opposite of participation." Similarly, one may wonder about the effects of shipments of used clothes, the power to decide who may buy or sell them, and how, for what purpose, etc.
Thus it is not necessarily the case that NGOs - by the fact of good intentions, for instance, or even considerable knowledge and experience - know best how to use resources such as used clothes and freight subsidies to effectively reach and help the very poor.
Two 1992 studies of Swedish Red Cross used-clothes practices
In 1992, 30-50 countries were receiving used clothes primarily for distribution to refugees, but the two studies focused on Uganda, Zimbabwe, Mozambique, Sierra Leone, Vietnam, and Poland, which were the countries involved in selling used clothes. The reports are now somewhat out of date because policies and practices have changed, but we review and discuss them here because it may still be instructive, especially in view of some of the generalizations about NGO attitudes and behavior made in the Riddell report, to understand some of the situations and problems that were encountered with SRC used-clothes distribution activities at that time.
The report on second-hand clothing for Uganda, Zimbabwe, Mozambique, Sierra Leone and Vietnam points out that "proper monitoring and reporting" of clothing assistance is important, and it reports an IFRC recommendation that "it is important to have clear guidelines for how the clothes are to be used so as to reduce the risk of misuse." The Zimbabwe Red Cross Society (one of the recipient organizations) was aware of this need: the stated goal of its policy statement was to create "a system which ensures that employees do not misuse the privilege of buying clothes on credit from source," and it states: "With proper record-keeping for individual employees, it is hoped that this system will close all loopholes." It is explained that "initially, employees were allowed to purchase clothes not exceeding one-quarter of their salaries," but now "all staff members [will] be allowed to purchase clothes worth Z$500 per quarter regardless of different salary levels."
That was section 2.1 of the Zimbabwe policy. We have previously suggested the likelihood that subsidized used-clothes distributions will be resold; but point 2.9 addressed that issue, stating clearly that "All clothes purchased are strictly not for resale."
The local Red Cross societies often priced the used-clothes rather generously, "30-40% cheaper than market prices" in Sierra Leone, for instance. "The reason for this is to enable the poorer sections of the community to buy clothes. It also creates a certain amount of goodwill towards the Red Cross." But it may have also created good opportunities for resale, including by employees who had first pick. Resale by employees may create an appearance of corruption (theft) to outsiders, or it may give the impression (whether true or not) that employees are being paid "in kind", which is not historically unprecedented - as witness the history of 18th century Britain in Appendix 9 - but it is generally frowned upon nowadays.
This was a commercial operation which was not being run commercially, and which was thus opening itself up to distractions and to various forms of corruption. The report comments that in Mozambique the "MRCS is allowed to import second-hand clothes without paying customs duty, provided they are not sold. The sale which nevertheless takes place is regarded as 'fund-raising'." The report comments that in Uganda, "if exemption [from tax] has been granted for a consignment of second-hand clothes, it is difficult to sell them immediately at fixed prices at permanent sales outlets. URCS would in that case risk being 'discovered' and having to pay customs duty and tax. At present some of the clothes are [nevertheless] used for fund-raising purposes, and in this way the Red Cross is able to generate a certain amount of income without needing to pay tax."
Often entire bales of used clothes or other apparel were simply missing or unaccounted for. A bale is generally worth more than one month's salary for a local employee, so it could represent a sizable temptation, either to employees or others, especially if the goods were perceived as "free" and "surplus" and were thus not tracked very carefully. For instance: "It is not known whether 96 bales of shoes [in Sierra Leone] were distributed free or sold." Seven bales of clothes "disappeared". In Zimbabwe, "the handling of second-hand clothes was problematic until the end of 1990, and it was difficult to obtain detailed information regarding the use of clothing bales during the period 1987-1990... 21.80 tonnes sent in 1989 and 18.79 tonnes of the 1990 consignment are missing from the general records of clothing received." Each ton is more than 20 bales, so this represented more than 800 salary-months. In Mozambique: "It has not been easy to obtain reliable statistics as to how clothing consignments have been used, particularly for the period 1982-1989."
Given that these activities were not being handled as commercial operations, it may not be surprising that the relation of value to price was not well understood. The reports seek to establish "the value of the clothes themselves", as though clothes (or anything else) have any economic value apart from their value to someone, which means their value relative to something else that someone is willing to give up. It was first asserted that the SRC's costs (including monetized volunteer collection and sorting efforts) amounted to only SEK 7.50/kg to get the clothes shipped, and then it arbitrarily ascribed a true value of SEK 50/kg to the clothes. But the SRC's figures showed that the average sale price in LDCs in the period 1987-'91 was SEK 11.45/kg, and in Poland it was only SEK 6.50/kg, and of course both of these prices had to cover many additional distribution costs in those countries. Then the question was asked: "What would the alternative be if these clothes were not available... Buying new clothes?" There was no mention of the commercial used-clothes market as an alternative, despite the fact that it was frequently mentioned as part of background information for the various countries. In an open market, used clothes sent by the SRC could not be valued (priced) any higher than similar products brought in commercially, and in fact most used clothes are sold in the market far below SEK 50/kg.
There was a lot of concern expressed in the reports for how the funds received from the sale of used clothes were used, but relatively little concern was paid to each Red Cross society's overall budget, agenda, menu of projects, investment schedule, etc. Funding is fungible, so it makes very little difference whether an organization says it is using this money for that and that money for this, or vice versa; the results can be tailored to please the reviewer.
Going into the review process, the reviewer reported a lot of concern that perhaps the recipients found used-clothes shipments demeaning. But, as was quickly pointed out by recipients, re-using items previously used by others is as common as sleeping in a hotel, where the sheets have certainly been used before. What might be demeaning, however, is giving used clothes as aid, and putting guidelines and restrictions on how they can be used. As an Indian NGO commented in the Riddell report, "when you are at the receiving end, you cannot be an equal partner..."
There was a lot of concern for giving clothes to those most in need, but little awareness of whether used clothes were what they needed most. It is pointed out that, when clothes were sold in Poland, sales receipts were often used to fund soup kitchens, for instance, and the report raises the question, "What is most important, money for... soup kitchens, or clothes for the needy?" But the report did not provide an answer; it merely comments that funding social programs from sales of Swedish used clothes makes the social programs dependent on Swedish clothing assistance - although distribution of Swedish used clothes to the needy could perhaps be considered equally dependent.
Food is similar to clothes in many ways. Both are primary consumer goods, yet both food and [used] clothes are resources that can be used as inputs in the production of more refined goods (for instance, repaired and restyled - or even remanufactured - clothes). Both food and clothes can be produced in a decentralized manner; both are normally produced to some extent and in some form or fashion in all countries. And there are frequently stocks of both commodities in industrial countries, available as possible aid at little additional cost: food, in the form of surplus mountains and lakes which have been purchased by governments to raise prices and rural incomes, and whose production has thus been subsidized; and clothes, in the form of used clothes which have been donated to charitable organizations.
If these goods are shipped overseas as parts of development projects, the subsidies embodied in them can have effect in a number of ways, depending on how the goods are subsequently distributed. The extensive food aid literature classifies these possible distribution modes, along with carefully thought out arguments for and against such aid, a great deal of thoroughly debated analysis of effects, and some guidelines for use.
What follows is a brief look at some of the products of this food aid debate. We want to stress that the food aid literature is voluminous, and what follows is in the nature of a somewhat random sample.
Possible types of food aid (or used-clothes aid)
In the mid-1970s, food aid was most frequently simply sold on the market as "program aid" (about 66% of the time), to extend supplies and generate funds for other developmental purposes. Other uses included emergency relief (7%), and project aid: food for work (16%), and supplementary feeding programs (11%). By 1994 the proportions had changed significantly: Program aid was now only 41%, and emergency relief was 35%, while project aid remained about the same.
Used clothes can of course be used in all the same ways: Between the extremes of simply selling them on the market to increase supplies, or giving them away in a disaster situation where supply has ceased or where insurance or emergency stocks are inadequate, they can also be given away - either for free, or in return for work, or at some below-market price - to those who are particularly in need at any given time, and are perhaps without employment.
Arguments for and against food aid
In favor of such aid, it is said that it can:
1. Provide real resources for growth and development
(output)
2. Improve the employment and income of disadvantaged groups
(distribution)
3. Provide extra aid that otherwise would not have been given
(additional)
4. Aid vulnerable groups in an emergency (disaster relief)
5.
Provide support for restructuring (safety-net)
Against such aid, it is said that it:
1. Reduces prices, production and employment
(disincentives)
2. Is supply-driven rather than demand-driven
(misallocation)
3. Distorts consumption patterns (increasing
dependency)
4. Undermines efforts to mobilize domestic resources (fiscal
imbalance)
5. Is second-best, bureaucratic and irregular, often inappropriate
(inferiority)
An empirical study of food for work in Kenya
As one can see from the arguments pro and con, food aid is a complex topic, and the results are not at all clear. We will look next at a few studies which develop some of these arguments in greater depth. In considering similar arguments for and against used-clothes aid, one may want to bear in mind that, even without the further subsidy of freight aid, used-clothes imports - even commercial imports - already represent very cheap goods, comparable to surplus food.
A recent empirical study of "Food Aid Impacts in Rural Kenya" (Bezuneh, Deaton, and Norton, 1988) begins by asserting that "evidence to substantiate [many various] claims [such as the arguments for and against, given above] is uneven and inconclusive. Policy measures used to avoid the most severe negative effects and to encourage economic development have rarely been identified. They likely are specific to social and political conditions in individual countries. The effectiveness of food aid in promoting development clearly depends on the conditions under which it is disseminated and administered."
Nevertheless, this study ends by concluding that "food for work (FFW) in the study area increased agricultural production, income, capital investment, employment (including hired labor), and marketable surplus. It caused a production shift from the more nutritious maize to higher-priced millet. This suggests that food aid may increase food security sufficiently to alter the market orientation of the farmers."
"Participants in FFW increased own-farm production in year 2 compared to year 1, reducing the hours devoted to FFW activities. This decline may continue in future years as the opportunity cost of their time increases with the generation of additional capital for farm investments. Accordingly, the FFW program may encourage a transition from FFW dependence to greater own-farm production."
"On the consumption side, FFW increased the food demand of participants. Much of this increase is simply the consumption of those items received in compensation for labor provided to FFW projects. The estimated effects on quantity and quality of food consumed indicate that the program had positive nutritional implications."
"The FFW program helped households meet their minimum nutritional requirements, improved food security, and increased their response to market price changes. The majority of participants [were] from low-income strata in the population, which implies that the program also may be narrowing the income gap between participants and nonparticipants."
"The results indicate that FFW can contribute positively to local development efforts in terms of both employment and nutrition, and it can lead to longer-term income growth through facilitating own-farm investment. Other potential effects [are] longer-term nutrition and on-the-job training benefits," as well as returns on public capital investment funded in part by FFW. "Better nutrition can lead to higher quality of life generally and to improved quality of the labor force, as can the skills acquired on FFW projects."
These results sound quite positive, and it is not difficult to imagine that it might be possible to get similar results with used-clothes aid, albeit on a much smaller scale due to the much lower quantity of clothes normally consumed, compared to food. This much smaller scale may itself be a problem, however, because the effort required to identify and enroll targeted individuals may be about the same for programs incorporating food or used clothes as project aid, but the return effort that can be elicited for the clothes must be relatively much smaller.
Disincentive effects of food aid
The study above focused only on the immediate effects, and did not explore the possibility of broader disincentive effects on local production. An earlier study which did address this issue directly (Isenman and Singer, 1977) asserts, somewhat surprisingly, that "the disincentive risk of food aid is far more complex, and location and time specific, than some analyses have suggested. Even where there is an observed or likely disincentive effect, food aid should not necessarily be reduced until these costs are weighed against the employment, nutritional, export, or other benefits... To ask only 'Is there a (risk of a) disincentive effect?' is to consider any drop in production to be an infinite cost, and to ignore entirely other benefits."
This study goes on to assert that "most of the issues... are, with only minor modifications, relevant to all forms of aid, not just food aid. While the disincentive risks of non-food aid are more dispersed, and hence less readily apparent, all financial aid ultimately could (ceteris paribus) have theoretical negative effects on the prices of capital and foreign exchange and on savings and trade policies. But... the ceteris paribus assumption is entirely hypothetical. For non-food aid, as for food aid, it is up to recipient and donor to ensure that any disincentive risk is offset by using the aid as a basis for additional output and employment... In any event, to single out food aid for criticism on disincentive grounds seems a case of the fallacy of misplaced concreteness."
Further, "in several ways the distorting effects of food aid are more acceptable... than those of other forms of aid, when looking at the demand side rather than just the supply side. This point is clearly brought out when comparing food aid with non-food aid, which results in the import of additional capital and intermediate goods (i.e., the usual and conventional case of aid designed to lead to increased investment). Where non-food aid reduces the price of capital and foreign exchange, there is an incentive for more capital-intensive and import-intensive methods of production. Where supplies of food are increased, and as a result food prices are lowered, this makes it possible to attain a given level of real wages at a lower level of money wages. Thus, there is an incentive for more labor-intensive methods of production or composition of output. Also, unlike aid for capital equipment, food is not tied to the particular (generally highly capital-intensive) technologies embodied in equipment imported from developed countries. In the interests of employment policies... it seems clear that the 'distortion' introduced by food aid is in some respects less undesirable than that of conventional financial aid."
"A related point is that the lowering of food prices is likely to benefit the poorer sections of the population, both urban and rural... A lowering of the price of capital goods, on the other hand, will improve the relative position of the upper-income groups. Hence food aid - assuming the same degree of 'incentive' impact of food aid and financial aid - is likely to lead to more equal income distribution as well as to greater employment."
This study summarizes by saying that "food aid, balanced with non-food aid, [can] contribute to increases in investment, employment, and output." We may remark again that, in general and on a necessarily smaller scale, it seems possible to read these arguments as they could apply to used-clothes aid, or indeed, to the commercial import of cheap used clothes.
Another point of view on food aid
Another study (Dawson 1985), interestingly titled "In defence of food aid: Some answers to its critics", nevertheless points out many of the problems with food aid - and by extension, of used-clothes aid - starting with emergencies: "The first problem with food aid is its bulk... Where food is needed in a hurry, e.g. for emergency relief, it is too costly for most donors to send it by air... Much food aid arrives (by surface) far too late to be of help in emergencies, and it is often more by luck than by design if its arrival coincides with a remaining need for food associated with rehabilitation works."
This study also compares project food aid (such as food for work, or by analogy, clothes targeted towards "the poorest of the poor") with bulk supply food aid (or perhaps, by analogy, with commercial used-clothes imports). The latter "seems less open to criticism than project food aid in terms of bulk and perishabilitybecause it is handled by much the same distribution and marketing facilities as normal commercial supplies, with more or less comparable efficiency. Project food aid has to be carried to project sites far and wide, through non-commercial, less experienced channels, and distributed under administrative control to specified beneficiaries, rather than through the market to any buyer."
This study later describes "another problem with food aid, which applies particularly to project aid, what might be called the 'surplus disposal mentality'. It is tempting to think that a surplus product...has little value of any kind and can be treated as such... This attitude can be seen all the way down from the project manager who loses his copy of the project agreement to the warehouseman or dockworker who handles cans of meat roughly, considering that if they are dented or punctured there is little loss because they are 'free'. Another manifestation of the surplus disposal mentality is that projects prepared simply in response to the availability of food aid are generally weaker in conception, design and execution than are projects prepared in response to the availability of financial aid. The effectiveness of project food aid can therefore be enhanced as a rule if it is more frequently combined with financial aid."
This study lucidly describes how disincentive effects from food aid can be avoided or mitigated, however, and with some imagination one can understand a similar argument with regard to used-clothes aid, or even commercial used-clothes imports: "Any factor lowering prices, or rendering them unstable, will be most discouraging to marginal [producers] - those with above-average production costs and least resources. They will not, however, readily give up farming [or tailoring] unless they have some other source of livelihood to turn to; they may be able to switch to other [products] not competing with the [imported] commodities in the market. Of course, they may seek employment in... other sectors receiving higher priority for investment... If other sectors are expanding, the employees there will increase their demand... and help to keep up prices; it is when the proceeds from [the imported] commodity sales have not been invested in employment-expanding ways that [imports] can have their most injurious effect on local [production]."
The study concludes with "a grave note of warning...in regard to pure relief distribution of food aid commodities in emergency situations without charge to the recipient. Such humanitarian aid is vital to the poor who are very young, old or infirm, to widows with young families, and to the able-bodied whose chances of earning a living are temporarily dislocated by the emergency. But if aid is provided on a long-term basis in situations which are not urgent but chronic, and is channelled through governments that could make their economies less vulnerable... the incentive to individuals and governments to make a maximum effort to provide for themselves will be dangerously blunted. Free distribution of food without a quid pro quo should be minimized and provided for short periods following exceptional, serious and non-chronic disasters. All other food aid commodities should either be sold to fill food deficits and alleviate balance-of-payments and financial problems, or be distributed free only in return for some effort which is the best the recipient can make."
Some suggested guidelines for food aid
While the studies above are far from totally negative, they show an awareness of widespread criticism and of many potential problems even beyond those that they especially highlight. Thus, at best, we can conclude that food aid is troublesome, requiring very careful planning and implementation in the best of circumstances. Some previously suggested guidelines for the use of food aid include the following:
1. Is there a great need for food relative to other development needs, such that food is a constraint on growth or on a more equal income distribution?
2. Is the food substitutable for commercial imports, thus releasing foreign exchange for other purposes?
3. Is it incorporated in a poverty-reducing, production-increasing development plan?
4. Is continued availability guaranteed?
5. Is it complemented with other aid, such as financial aid and technical assistance?
6. Does it provide normal products for the indigenous diet?
7. Are sales receipts available for development?
8. Is there high income-transfer efficiency, that is, is there a
high ratio of the value to the recipient
to the total acquisition and
delivery cost?
The evidence from analogy with food aid should probably cast some doubt on the advisability of subsidized used-clothes aid. Food is a generally higher value commodity (per volume or weight) than used clothes, is more homogeneous and exchangeable, is consumed in larger quantities, and is thus of even more basic use. If it is not clear that food aid is useful in most circumstances, how much less so must used-clothes aid be, given that administrative costs must be similar?
Lemire's book extracted here is also summarized briefly in Chapter 7.
"The demand for new clothing, textiles, pottery, metal-ware, and other consumer goods extant in Britain [in 1700] was not the total sum of the consumer impulse. An equally powerful market-demand was manifested not through the purchase of new commodities, but through the sale, trade, and purchase of second-hand merchandise... British men and women routinely assuaged their needs and wants with the purchase of used merchandise. Demand was two-tiered. At the top was the open and apparent consumer demand... Beneath this lay the most numerous of Britain's families, with an income of less than... £50 per annum.., the minimum that would enable intermittent participation as a consumer... Throughout Britain there [was] a well-established, organized system of redistribution, founded on the demand of those in more straitened circumstances. The trade existed because the needs of the whole population could not yet be met within the existing structure of production... The second-hand trade was a key intermediate trade, using barter as well as cash sales, in the movement of goods through the nation... The influence of this largely hidden trade and of those who sustained it are fundamental factors at work in the development of the cotton industry and in the diversification of its products to meet the needs of the whole of Britain's population.
"Undoubtedly the second-hand trade existed, at least in major centres, for generations or even centuries before it came to the notice of commentators... The second-hand trade developed as a source of substitutes, enabling millions of lesser folk to make do with second-hand as long as the cost of new materials kept those items out of their reach. The scope of the second-hand trade was dependent on the time it took for industrialized production to lower costs sufficiently to offer fashionable new clothing to the mass of the population at prices they could afford...
"The second-hand trade was a commonplace to people of the eighteenth century, requiring no explanation, accepted as a familiar component of everyday life... Used apparel was frequently the most practical alternative, providing the poor with cheap covering and offering the ambitious or the more prosperous with the opportunity to dress in clothes that bespoke a higher station.
"The appearance of clothing [was] important.., as too [was] the cost of a garment; both requirements could be met through the purchase of a second-hand article from a clothes-broker, pawnbroker, itinerant hawker, or local salesman. Second-hand clothing was sold by specialist dealers, as well as by many other traders large and small... The latest London dress was not always appropriate in rural communities, but clothes a year or two old would not offend. Thus, clothes outmoded by the calculations of one group would be in demand and thought desirable by another...
"Much of the trade in used clothing remains uncharted, though some points of this process are well known and well documented, such as the making of routine gifts of [used] clothing and linens to servants, and the lively clothing trade along Monmouth Street, Rosemary Lane, and Petticoat Lane in London... It was a vital conduit for the people of this era, both as an avenue through which they could barter or sell their used items and as a source of inexpensive garments of every sort, at every price. The mountains of gowns, jackets, aprons, stockings, and breeches brought to the salesmen or brokers, were not seen as valueless, fit only for charity, but as articles of varying worth that would bring a profit to the trader and add to the assortment of clothing available to the consumer. The trade in used clothing and textile items developed precisely because of the value and utility of these items... and the high level of demand at all levels of society... This trade operated on the fringe of the textile and clothing industries and began where the involvement of all first-phase manufacture and sale ended, after the consumer had bought and worn... new clothing and then, for whatever reason, decided to sell it. When fashions changed, when fortunes waned, or when new clothes became imperative, tradesmen were ready to buy the soiled, shabby, or passé, redistributing them in a trading network that spanned Britain, her colonies, and Europe.
"Britain was well served by retail tradesmen, whether they were chapmen or shopkeepers, while many fairs and markets continued to function as additional centres of commerce throughout this period... [Various authors] have uncovered the extensive interwoven grid of middlemen that operated in the early modern period, wherein chapmen, retail shops, and fairs all served to distribute goods among tradesmen as well as carry goods directly to consumers... As retail distribution spread throughout Britain, so too would tradesmen profit from the unwanted articles of an increasingly prosperous society, redirecting apparel to satisfy the demand of a less affluent segment of the population.
"... aside from the sporadic sale of used apparel, shopkeepers in the provinces may also have participated in the collection of used textiles from their consumers... The London and national market as a whole exerted a strong demand for used clothing... tradesmen operat[ed] nationally, buying and selling wardrobes and used clothing. The gentry and middling ranks bought clothes for reasons other than necessity, and when no longer needed these clothes found their way back on to the market.
"...crockery sellers... exchange[d] new goods for old, a process as old as the tale of Aladdin's lamp. The crockery sellers walked their routes around London and its environs, crying 'any old clothes to sell or exchange' - a cry that had been familiar to residents of London for centuries...
"... customers were offered the opportunity to buy new... textiles through cash payments or the exchange of old goods... for new... The exchange of new for old persisted through the Industrial Revolution as a remnant of an older barter system; an antique appendix to a rapidly changing economic structure, but still of use in this intermediary period. The persistence of this method, like the non-cash payments and perquisites among employees, extended the capacity of the common people to participate in this advancing consumer society... The hawkers, peripatetic dealers in rags, and the like, bridged the cash-based system that was becoming the norm and brought a greater range of products within the reach of common people, putting a significant level of purchasing-power within their grasp.
"Tailors regularly sold their client's superfluous garments and with the proceeds produced new goods at reduced cost for the customer... The nature of a tailor's business would require some channel to dispose of used or unsatisfactory garments, bringing some sort of earnings back to the business. Thus, discounts on new items were probably available through tailors in towns and cities throughout Britain, simply because a return on the used garments was so assured, whether the tailor resold the goods locally or to the passing wholesalers who toured the country. The refund granted customers on their old clothes encouraged the purchase of new clothing and contributed to the stock of used apparel that would then circulate through the lower levels of society.
[Thus] "middlemen... traveled through Britain buying goods as they went, peddlers exchanged new items for old clothes, rag-gatherers and local shopkeepers played their part in the accumulation of stocks of second-hand clothes, and tailors accepted old suites of clothing in part-payment. In addition to these measures, pawnbrokers operated as buyers of used clothing... Laborers, artisans, and servants usually owned few items that could more readily be turned into cash than their clothing. Pawnshops offered small sums at times essential for a family budget; in exchange for a coat, bonnet, or shawl, a vital sixpence might be loaned the customer...
"Shopkeepers, pawnbrokers, chapmen and tradesmen all contributed to the collection of second-hand clothing, at the same time providing cash or goods in exchange. Some of the merchandise accumulated would have been transported to London, the heart of the British trading network in used clothes, while the rest would have been dispersed through local or regional distributive networks... Through circuitous or direct routes, vast stocks of second-hand clothes circulated, a great portion of which were brought to London to be sorted, graded, and resold yet again in a further specialization of the rag trade.
"The retail portion of the second-hand trade was equally diverse, and it was in this segment that the traders obtained their [ultimate] profits. The sale of [used] gowns, breeches, aprons, waistcoats, and caps, repeated thousands of times over, at market-stalls or tailor's shops, salesmen's stores or London's Rag Fair, was a constituent part of the clothing trade in this period - public demand met by second-hand merchandise... Advertisements for auctions appeared with some regularity in eighteenth-century London newspapers, auctions both for unclaimed pawned apparel [frequently including clothes] and for entire wardrobes... [In 1843 came] the formal establishment of an Old Clothes Exchange.
"Among those who came to London to supplement their stocks of used apparel were clothes-brokers or salesmen from provincial towns and cities. Unlike their London confederates operating shops and stalls in the metropolis, they did not have access [in the countryside] to the wholesale supplies of used garments available in London. Thus, some with an expanding trade would look to the London second-hand market to supply those goods in greatest demand. Whether provincial dealers in second-hand clothes relied on local supplies or obtained stock from London, they ensured that used apparel could be bought throughout Britain. Shopkeepers designated as dealers in old clothes, salesmen, clothes-brokers, slop-sellers, and old-clothes men could be found in ports, industrial centres, and market-towns large and small throughout Britain.
"Aside from the unknown numbers of anonymous dealers in second-hand clothes, there were hundreds [of larger dealers] listed in the many directories of the late eighteenth century. Over 250 shopkeepers and traders were catalogued as dealers in second-hand clothes in the four-volume Universal British Directory; in addition, almost 330 pawnbrokers were listed in that and other contemporary directories...
"The sale and exchange of used clothing appears as an intermediary trade characteristic of a society in the throes of expanding production, wherein volume and variety are increasing, but productive techniques do not yet allow prices to fall [or wages to rise] to the level that permits generalized access to new goods. As a result of this flourishing commerce, patterns of buying were altered: The poorer segments of the population could become accustomed to more frequent buying and selling as a consequence of this trade. The challenge for the cotton industry was to manufacture greater numbers of inexpensive, even cheap textiles, to tap the second tier of demand, to bring the majority of British society into the interplay of production and consumption that would come to characterize industrial Britain."
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