Mozambique: Second-Hand Clothing Industry and Economic Impact

March 19, 2025 /Mpelembe Media/ — A recent report highlights the critical economic and social role of the second-hand clothing (SHC) industry in Mozambique, a low-income nation. The study reveals the sector provides substantial employment, supports millions of livelihoods, generates significant tax revenue, and meets the basic clothing needs of the majority of the population.
It argues against policies that might negatively impact this industry, emphasising the importance of considering the economic realities of developing countries in global sustainability debates. The report debunks the notion of SHC dumping, stressing its integration into local culture and its positive impact on marginalised groups. Ultimately, it advocates for a balanced approach to SHC trade that acknowledges its vital contribution to poverty reduction and economic growth in Africa.

The second-hand clothing (SHC) industry is highly significant to Mozambique’s overall economic and social well-being. A recent report highlights its vital role in the daily lives and economy of the country.

Economically, the SHC industry provides:

Over 200,000 formal and informal jobs, directly supporting over 1 million livelihoods. This is particularly important given that around 25% of the country’s population is currently unemployed.

An average monthly income of $650 for well-established vendors, which is significantly higher than the national minimum wage of approximately $90 per month.

Approximately $35 million in taxes contributed towards the country’s budget, which helps fund crucial social programmes like education and healthcare.

It supports economic diversity, which is considered important for Mozambique’s and Africa’s growth.

Socially, the SHC industry is crucial because it:

Provides basic clothing needs for at least 85% of the population. Given that Mozambique is one of the poorest countries globally, ranking 183rd out of 191 on the UN Human Development Index, this access to affordable clothing is essential.

Is considered a source of dignity and opportunity, sustaining families and creating jobs.

Has a transformative effect on the prospects of many families, especially among marginalised groups such as women and youths, offering employment opportunities and upskilling the labour force.

Aligns with the local culture focused on clothing reuse, with items often passed down through families or repurposed. This debunks the idea of SHC dumping.

The report underscores that any negative disruption to this sector could have devastating consequences for a population already facing widespread poverty. It argues that when considering the global trade in second-hand clothing, the economic realities of the Global South must be taken into account. Policymakers are urged to balance environmental sustainability goals with the crucial role the SHC sector plays in frontier economies. The report suggests that global sustainability efforts should be informed by a clear understanding of the SHC value chain in low-income recipient countries. Embracing the SHC trade is even seen as potentially central to achieving Africa’s objectives of poverty reduction, sustainable development, and inclusive growth. Furthermore, restricting the trade could inadvertently benefit other large exporters like China, which focuses on inexpensive, low-quality fast fashion.

The SHC sector in Mozambique contributes to the national budget through taxes, amounting to approximately c.$35 million. This revenue then helps support vital social programmes within the country, such as education and healthcare. This contribution is highlighted in the report “Current Status of Mozambique’s Second-Hand Clothing Market: Opportunities and Challenges” by Consulting For Africa (CFA) and Abalon Capital Limitada. As previously mentioned, this financial input is considered significant for a country like Mozambique, which ranks low on the United Nations Human Development Index and has a high unemployment rate. Therefore, the taxes generated by the SHC industry play a role in funding essential public services.

The argument against restricting the second-hand clothing (SHC) trade, as supported by the provided report on Mozambique, centres on the potentially devastating economic and social consequences for low-income countries like Mozambique. The report strongly advocates for a balanced approach that considers the critical role the SHC sector plays in these economies.

One of the primary arguments is the significant contribution of the SHC industry to employment and livelihoods. The sector provides over 200,000 formal and informal jobs in Mozambique, directly supporting over 1 million livelihoods. With around 25% of the country’s population unemployed, any negative disruption to this industry could have severe consequences for a large number of people already grappling with widespread poverty. Furthermore, well-established vendors in the SHC sector earn an average of $650 per month, which is substantially higher than the national minimum wage of approximately $90 per month, highlighting its importance for individual and family financial well-being.

Economically, the SHC sector also contributes significantly to public finances through approximately $35 million in taxes, which helps support vital social programmes such as education and healthcare. Restricting the trade would jeopardise this crucial revenue stream, potentially impacting the funding of these essential services. The report also underscores the importance of economic diversity for Mozambique and Africa’s growth, suggesting that embracing the SHC trade can be a part of this.

Beyond the direct economic impacts, the SHC industry is crucial for meeting the basic clothing needs of the majority of the population, with at least 85% relying on it for their clothing. In a country ranking 183rd out of 191 on the United Nations Human Development Index, access to affordable clothing provided by the SHC sector is essential for basic well-being and dignity. Madame Luisa Diogo, the former Prime Minister of Mozambique, highlights that this sector isn’t merely about clothing; it is a source of dignity and opportunity, sustaining families and creating jobs.

The report also debunks the idea of SHC dumping, emphasising that the local culture in Mozambique is focused on clothing reuse, with items often passed down through families or repurposed. This highlights that the trade is not simply about offloading unwanted items but rather fulfilling a genuine need and supporting local practices of reuse and repurposing.

Furthermore, the report argues that restricting the SHC trade in Europe and Africa could inadvertently benefit other large exporters, particularly China, which has a growing presence in the global apparel market with inexpensive, low-quality ‘fast’ fashion. This suggests that restrictions might not achieve their intended environmental goals and could instead shift economic benefits to other regions with potentially less sustainable practices.

In conclusion, the argument against restricting the SHC trade in Mozambique, as presented in the report, is rooted in the sector’s vital role in providing employment, supporting livelihoods, contributing to the national budget, meeting basic needs, aligning with local cultural practices, and the potential for unintended negative consequences and benefits for other global players. The report urges policymakers to have informed debates that balance environmental sustainability with the critical economic realities of developing countries and to ensure global sustainability efforts do not become a zero-sum game. Embracing the SHC trade is even seen as potentially central to achieving broader African objectives of poverty reduction, sustainable development, and inclusive growth.