By Michael Okema
Mitumba, as imported used clothes are called, is like a bad penny that just keeps turning up! Now it is hailed as the saviour of the "little" people at the same time is threatened with a ban. These two extremes have punctuated mitumba’s existence these past 30 or so years.
This time around the Tanzanian government has decided to increase tariffs from 25 per cent to 50 per cent of the import value. There is only one good thing about this. Tanzania will now be in line with Kenya and Uganda in the context of the East African Customs Union. These latter two had earlier taken similar steps to ensure the protection of the market for local textile industries. By following suit, Tanzania is demonstrating the spirit of the East African Federation.
But that’s about the only praise the tariff hike deserves. Arguing as the government does, that the move will protect local textile industries, rings hollow. This may hold true for Kenya or Uganda. In Tanzania, the industries to be protected are yet to be created. So the logic of the argument is that mitumba, by flooding the market, is discouraging prospective textile investors.
What we are dealing with here is a situation where the reasoning started with the flooded market as the cause of the malaise. It is assumed, too, that the only reason investors have stayed away is because there is no local market.
Why would investors be afraid of a limited market? There is the whole the East Africa. Nay the whole world is open. Actually, what investors really need is infrastructure and trained manpower. Another fact to note is that whoever comes to invest in the textile industry must have already done so elsewhere. Therefore, in the context of globalisation, they could find what they produce in Tanzania competing with what they themselves produce elsewhere.
It is rare for anyone to enjoy competing against themselves. What can be hoped for is that industries elsewhere decide to relocate to Tanzania. China is a good example. Currently, textile industries are relocating to China from the rest of the Far East.
But does Tanzania have similar incentives? China has the infrastructure, trained and relatively cheap manpower, to say nothing of a massive local market. In other words, for Tanzania to lure investors, all these factors have to be more attractive than in such places as China.
There is no evidence to justify the assumption that investors are actually staying away because of mitumba. This notion comes from philanthropic organisations in Europe who believe there was a thriving textile industry in Africa until mitumba reared its ugly head. The reality on the ground is something else. As for investors, their main complaints have been poor infrastructure, high water and power tariffs and high taxes. That is not mitumba!
Mitumba is merely a scapegoat for the failure of the local textile industry. Are textile imports from the Far East not flooding the market just as much?
Making mitumba more expensive is good news for these other imports, not for local industry. Today the culprit is mitumba, tomorrow, when the new policies go nowhere, something else will have to be blamed. How about listing all the problems, then addressing them comprehensively?
Michael Okema is a political scientist based in Dar es Salaam.
E-mail: [email protected]