The second-hand clothing industry in parts of Africa is big business. In fact, many charities receive substantial revenue from the sale of this clothes. Why buy a t-shirt for 10 dollars when you can buy one for 32 cents? These trends should come as no surprise to Americans because consignment shops and thrift stores are plentiful. However, the difference is that in many parts of Africa second-hand clothing is the primary means of buying clothes and is, therefore, inadvertently stifling the growth of local African economies. Sadly, charities are playing a role in killing this growth.

For example, CNN just ran a story about how Americans sending over old clothes is killing Africa’s economy:

In the beginning, it appears to be a win-win situation for everyone involved; Western charities receive much-needed revenue, African buyers with weak purchasing power get low-priced, well-made clothing, and merchants find eager customers for their merchandise.

But some experts say that the mass influx of cheap hand-me-downs from the West could have a much more negative impact.
“The long-term effect is that countries such as Malawi or Mozambique or Zambia can’t really establish or protect their own clothing industries if they are importing second-hand goods,” says Andrew Brooks, lecturer at King’s College London and co-author of a study called “Unravelling the Relationships between Used-Clothing Imports and the Decline of African Clothing Industries.”

This makes sense. At first glance, second-hand clothes are meeting immediate and legitimate needs but, in the long-run, when charities are involved at this level it does not help African economies become sustainable. Brooks rightly observes, “Your t-shirt may be quite cheap for someone to buy, but it would be better if that person could buy a locally manufactured t-shirt, so the money stays within the economy and that helps generate jobs.” According to the CNN story, designer Sylvia Owori, who’s been in business in Kampala, Uganda for more than a decade says it’s hard to compete second-hand market. “Probably 90% of the clothing people are buying in the whole country are second-hand clothes,” says Owori. “It’s a multimillion dollar industry — so, as a small fish, how are you going to start to compete with that?”

The competition question is a good one. So to try to address this many African countries are banning second-hand clothing companies from operating in their countries to eliminate the competition. Unfortunately, bans will not work either to help African economies develop but will only create a larger black market for these items. After all, people need affordable clothes.

To date, over a third of the clothing donated to charity worldwide eventually makes its way to sub-Saharan Africa. Many well-meaning NGOs and charities are complicit, then, in keeping many African nations poor. While the second-hand clothing industry as a private enterprise is not, by definition, an illegitimate business, when charities sustain this industry they are not really helping people as imagined and may only be helping themselves maintain their organization’s budget.

In the end, long-term charity-related activity is not the solution to African economic development and we need to ask better questions about how African nations can develop sustainable economies so that these charities aren’t needed, textile industries can flourish, and customers can afford to buy new clothes instead of being dependent on the second-hand clothing industry. That is, what is needed so that consumers in parts of Africa chose to buy second-hand clothing for the same reasons people do in countries like the United States? Without filling in all the details, the answer has much to do free markets, the rule of law, and flourishing mediating institutions because Africans can’t compete with free.

Anthony Bradley is an Associate Professor of Theology and Ethics at The King’s College, NYC. This commentary is taken from the Acton Institute’s Power blog and is used with permission.