The impact of the second-hand clothing trade on developing countries

This report examines the evidence of the impact of trade in second hand clothing (SHC) on developing country producers and consumers. Supporters of the SHC industry point out that the trade creates emaployment in the receiving country (i.e. transport, cleaning, etc.) and also provides low cost clothing for people living in poverty. At the same time, however, there are concerns that the trade may be undermining local textile and garment industries and livelihoods in some developing countries.

Findings of the study include:

• the SHC trade represents a small proportion of the global trade in clothing, but for many sub-Saharan African countries it is a dominant feature of the clothing market
• the trade has clear consumer benefits as it is very affordable for consumers, many of whom are moving away from traditional "African"–style to more "Western"-style clothing
• trade supports hundreds of thousands of livelihoods in developing countries, including jobs in trading, distributing, repairing, etc.
• it is not possible to make exact comparisons with the employment generated by domestic production but it is known that around 1,355 people work in formal sector clothing/textile industries in Senegal, for example, and 62,000 in informal textile/clothing production
• while SHC imports are likely to have played a role in undermining industrial textile/clothing production and employment, increasingly cheap imports from Asia are competing with local production
• supply-side constraints, like unreliable and expensive infrastructure, cost and availability of material, lack of access to credit, etc. undermine the efficiency of the domestic industry
• in several West African countries it is not clear that, even in the absence of SHC, local textile/garment production and employment would recover because of new imports from Asia
• the SHC trade in recipient countries is mainly informal and poorly regulated, and in some instances it has facilitated considerable custom fraud, leading to reduced government revenues.