West’s castoffs wear thin in Africa
KIGALI, Rwanda — When spring cleaning comes around in the United States, dropping well-loved clothes into a donation box can feel like an act of selflessness. Those stained sweaters, summer camp Tshirts and out-of-fashion shorts will clothe someone needier, right?
It’s actually a little more complicated. Most of America’s castoff clothes are sold by the Salvation Army, Goodwill and others to private companies. Bales of used clothing are then shipped by the containerload, mostly to sub-Saharan Africa, in what has become a billion-dollar industry.
African governments have become increasingly fed up. What many in the West think of as a gesture of generosity, they say, is preventing them from building their own apparel industries. In March 2016, four East African countries decided to raise tariffs on used clothing, in some cases to as much as 20 times the previous rate.
The American usedclothing lobby sounded the alarm, and last year, the Trump administration began investigating whether the four nations were violating an 18-year-old trade agreement with the United States. Under pressure, the East African governments lowered their tariffs to previous rates. Except Rwanda. Now, a Rwandan leader who styles himself as a proud visionary is suffering the consequences of his decision to stand up to Washington.
This week, Rwanda faces the suspension of some of its duty-free trading privileges pertaining to clothing under the African Growth and Opportunity Act. Its efforts to foster a domestic clothing industry, meanwhile, have yielded few results. And Rwandans who work in the used-clothing business are complaining that they are suffering.
The deadlock between the world’s economic giant and one of Africa’s fastestgrowing economies doesn’t exactly qualify as a trade war — it’s more like a scuffle. Rwanda’s total used-clothing imports were less than 7 percent of all of East Africa’s in 2016, according to government statistics. And its clothing exports to the United States were a minuscule $2 million.
But it reflects the difficulties that even a low-wage country like Rwanda can have developing an industry in an intensely global market.
President Paul Kagame is betting that he can kickstart Rwandan manufacturing while weaning his country off the used clothing he sees as undignified. He is one of a number of African leaders who want to stem a tide of used items — from clothes to electronics to medical equipment — that end up on the continent after someone else has gotten rid of them.
“As far as I am concerned, making the choice is simple,” Kagame told reporters last June, referring to the trade dispute. “We might suffer consequences.” However, he said, Rwanda and other countries in the region “have to grow and establish our industries.”
Rwanda, like other East African countries, used to produce most of its own competitive clothes. But in the 1980s, regional leaders worked with the World Bank and the International Monetary Fund to open up their economies and permit greater trade. That resulted in an influx of cheap imports. Political turmoil, including the Rwandan genocide in 1994, further harmed the local industry.
The clothing currently produced in Rwanda for the local market is mostly highend and aimed at urban professionals.
Kagame’s government recently launched “Made in Rwanda,” a campaign to encourage and subsidize local production. It has made scant progress so far.
Rwanda suffers from numerous competitive disadvantages. It is landlocked and far from shipping ports; its domestic market is tiny and mostly poor; and it lacks a trained workforce. It won’t become the next Vietnam or Bangladesh anytime soon.
While the Rwandan apparel industry has barely grown, the country’s usedclothing business — known as chagua, from the Swahili word “choose” — has taken a hit from the new tariffs. The business employs more than 18,000 people here.
“I’ve had to triple my prices,” said Zaetzev Sibomana, 26, who sells used clothes at Nyamirambo market in Kigali, Rwanda’s capital. “What they’ve done is kill this business and with it my savings. I still live at my parents’ house, you know?”
The owners of the shops adjacent to his have gone on to sell the cheap Chinese apparel that is now replacing American used clothing.
Isai Mugabo, one of those shop owners, lamented the change. Chagua was more dignified than the Chinese clothing because it allowed people to feel stylish, he said.
“Most of my customers leave my shop unsatisfied. They are used to finding something unique, but now everyone leaves with the same shirt,” he said. “It is like a Chinese uniform that everyone now walks around in.”
The main U.S. trade group for used clothing, the Secondary Materials and Recycled Textiles Association, called on American trade officials last year to review the East African nations’ hike in tariffs on used clothing, saying the measures were “already having a dramatic negative impact” on the U.S. industry.
The industry group said that 5,000 private-sector jobs plus 19,000 positions at nonprofits had disappeared and that ultimately, up to 40,000 American jobs could be “negatively impacted” by the tariff increases.
The group, based in Abingdon, Md., declined an interview request.
Three independent trade analysts questioned the industry’s job loss claims. “Those numbers sound absurdly high,” said Todd Moss, a former U.S. deputy assistant secretary of state for African affairs who is now a fellow at the Center for Global Development, a think tank.
He and others have criticized the Trump administration’s actions. “It’s particularly harmful to see the world’s largest economy — for tiny, irrelevant mercantilist reasons — choose to punish and bully an African partner,” Moss said.
Trump administration officials say tougher enforcement of international agreements is essential to rebalancing trade policy to benefit American workers.