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World Vision: What are you seeing?

PDT is throwing its hat into the ring on the World Vision NFL T-Shirt debate. @good_intents (via @saundra_s) has an aggregated listing, thanks Saundra!

There are several reasons why donating unwanted T-shirts to developing countries is not smart aid. But it all boils down to the fact that it distorts the local economy by killing competition. Why would anyone buy a T-shirt in Zambia or Nicaragua when they can just get one for free? The local T-shirt manufacturer and seller is now out of business, at least temporarily, and in a developing economy it is imperative that money is kept circulating with the buying and selling of basic goods.

Donating unwanted goods may seem appealing to many.  But how many are informed about how donated goods dilute a local market place and hurt the economy?  Still, we see these incidents keep popping up constantly (sending shoes, sending bikes, sending books). Tales from the Hood, a blogger, and our friends at Aid Watch have given these types of efforts the title “Stuff We Don’t Want” (aid to be) – along with this spiffy tagline: “SWEDOW – ‘cause good aid is just too complicated.”  (There’s an awesome chart to boot.)

Smart aid is complicated. But one no-brainer is that an aid organization’s end goal is to cease being needed in that country. Sending unwanted goods to be sold for free actually creates a dependence on those free goods. Here at PDT central, we see this creation of dependence a lot: aid organizations come into a country, donate goods or services there while spending hundreds of thousands of dollars outside of the recipient nation – paying international consulting and security firms, bringing in their own people and getting needed supplies shipped in from outside the country.  This system is inefficient and focuses too much on donor priorities instead of in-country first procurement. In other words, it’s important to make sure that aid money spent on a country is also spent in that country.

It’s a simple concept, one that is endorsed by the Paris Declaration on Aid Effectiveness. This concept has worked well in Afghanistan with NATO’s “Afghan First Policy.” So instead of dumping T-shirts into a local market, lets help people realize their “full potential,” which I see is World Vision’s mantra.

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  1. […] World Vision: What are you seeing? – Peace Dividend Trust – Discusses how donated goods focus more on the needs of the […]

  2. peteremcc says:

    Yep, just like domestic aid – welfare.

  3. […] VISION: WHAT ARE YOU SEEING? This article originally appeared at the Peace Dividend Trust blog on February 15, […]

  4. Its too bad you boiled down your argument to “it distorts the local economy by killing competition”. That’s the weakest argument against this kind of GIK silliness (or SWEDOW as we have taken to calling it these days). It assumes that the shirts are actually crowding out local products, which assumes a number of things:

    (1) that there are locally-manufactured shirts that directly complete with these crappy t-shirts. I’ve seen locally-manufactured clothes in several African countries and they are in a whole different league of cool. Beautiful and complex clothes that you wear when you want to look good, not when you want to pound cassava out back, weed the vegetable plot or kick around a soccer ball. For these activities, you might want a cheap t-shirt, something that apart from the tourist printing shops which only print on shirts made elsewhere, is hard to find as a locally-manufactured good.

    (2) disposable income and consumer choice were such that had these free t-shirts not been available, the person would have instead purchased a locally-produced one. Free stuff sometimes comes along just when you were thinking of buying that very thing, but not very often. Even if 1 in 20 people who got a free shirt will now purchase 1 less locally-manufactured shirt this year, you are talking about 5,000 shirts – hardly a market distortion to get excited about.

    (3) If you happened to be one of the people who got a free shirt and are now NOT going to be buying one as planned, you now have a bit of extra money in your pocket to spend. You’re probably going to spend it at the local market on something you might now have purchased before – maybe some shoes for the kids or some meat or … – so the money still circulates in the local economy (another point you lamented) and you get to meet more of your needs or consumer desires than you were previously able to.

    Now, I’m not applauding the 100k NFL shirts thing, I’m just saying that there are probably better arguments (or ones with more sound economic theory underneath them) to boil your case down to. I think others have done this. Like analyzing the cost of shipping these shirts and distributing them vs. their actual market or practical value vs. cost of buying and distributing local t-shirts if they are such a big need; or looking at the incentives that make organizations like WV do this kind of stuff that seems so contrary to their development philosophy (GIK pads the program budget helping keep overhead % lower because claimed value is the tax value is the value the t-shirt would have had if sold new IF the NFL team had won, which they didn’t, thus effectively reducing the real value of the shirt to near $0, thus the whole claimed donation value for the company and the income/program cost for the organization is a sham and only exists on paper.)

    I know this comment comes WAAAYYY late and that the discussion is as cold as an Antarctic rock, but I’m willing to bet that another big packet of shoes or shirts or expired medicine will be on its way to the developing world soon enough and we’ll all be writing about this again. So, something to think about when you boil your next argument down.

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