In March 2016, the East African Community (EAC) Heads of State issued a Joint Communiqué from the 17th Ordinary Summit, expressing their intent to progressively phase out importation of used clothing as a means to support the region’s textile and apparel industry.* A U.S. trade association reacted to these measures by requesting an out-of-cycle review (OCR) of the eligibility of the EAC Partner States for the African Growth and Opportunity Act (AGOA) privileges, citing both loss of American jobs as well as introduction of new trade barriers in contravention of AGOA provisions.
While Kenya took active steps to be exempted from the OCR, the remaining AGOA eligible countries – Rwanda, Tanzania and Uganda – were left standing for review. The Of ce of the U.S. Trade Representative (USTR) granted the OCR request and held a public hearing in Washington, DC on July 13, 2017. Under the OCR process, Rwanda, Uganda and Tanzania stand to lose some or all of their duty-free trading privileges under AGOA.
Given an apparent lack of data on the economic signi cance of the used clothing market in the EAC, or its relative impact on the EAC’s domestic textile and apparel industry, USAID’s East Africa Trade and Investment Hub conducted this rapid assessment.
The following is a top level examination of some of the determinants and implications of the used clothing market in East Africa, including an analysis of used clothing import trends in the EAC; an assessment of the economic signi cance of used clothing to both the U.S. and EAC; a review of EAC import substitution assumptions; and some modeling of long-term outcomes if EAC Partner States maintain their current used clothing import policies. The results provided are intended to aid data-driven policy decisions and negotiations going forward.
The analysis focused on three main questions:
- What is the economic signi cance of the used clothing trade in the EAC countries?
- What is the relative impact of used clothing imports on EAC Partner States’ domestic industry?
- What are some likely outcomes if EAC Partner States phase out used clothing imports, and as a result, lose their AGOA privileges?
Download the full report here: EATIH Used Clothing in East Africa-27.07.17-Final-2