If Used Computer Exports are Outlawed

Only OUTLAWS will export used computers.

Here is what happens.  An African like Wahab pays $3-6K for used computers.  He then pays $7-9K to get a sea container packed, through customs, and to his place of business (or his partners place of business) in Accra.  That's the price for a wholesale shipment of computers and display devices to Africa.  

African Shop
This is $10K to $15K for a 40' high cube container, which would fit approximately 400 TVs or 1100 15" computer monitors.

To make sure that the goods he will ship are worth this cost, he is a "fly and buy" consumer - he personally inspects the goods, and packs them into the container himself.   The Watchdogs in Europe call this "waste tourism", and according to Europol, Wahab is a "criminal".  He's black, he exports.  He fits the 'profile'.

If Wahab burns or dumps anywhere close to 80% (300 TVs or 800 monitors) in primitive conditions, he will make, tops, about $3 in copper and metals on the 300 to 800 scrap (citation).   That's $900 on the TVs, $2,400 on the monitor scrap.

The remaining 100 TVs now cost $10K - $900 = $9,100 or $91 per used TV.  That's breakeven, on the best possible shipping cost ($15K would cost $141 per used TV).

The remaining 300 monitors now must sell for $30.33 to $47 each to break even.

Why do most Americans, and most journalists, believe this scenario?
  1. They never spoke to an African Importer as a source to any article.
  2. They never read the published reports (e.g. Ghana Study 2011)
  3. They believe anti-export watchdogs more than they believe the math, studies, and interviews above.
  4. They believe that the supply of display devices in the USA and Europe is because the CRTs and 15" LCDs don't work any more, rather than because they've been upgraded for newer and better and flatter displays (made in Asia)... 
Change in fashion does not equal "obsolete" to 3 billion people earning $3K per year.

The price of this is to deny Africa the path to development followed successfully by Japan, Korea, Singapore, Guangzhou, and the other "Asian Tiger" economies.  Rather than rely on "resource curse" economics, these economies are based on highly educated technicians doing reverse engineering, gray market sales, and eventually becoming contract manufacturers on behalf of named brands.

The other price is that these importing entrepreneurs have fewer choice of supplier (California is taken off the table, passing the cost of destroying working units to the California taxpayers), quality goes down.  And more junk is there to photograph for poster child campaigns.

The other price is that my ethical e-waste company must now compete with exporters who can get away with bleeding junk into their good loads, and no-exporters who raise concerns about the 22% working product we export (illegal, working or not, in most dictatorships, including China).

The other price is the access to Twitter, blogs, Facebook, and other tools of the "Arab Spring" (African Spring, it could be called, based on Egypt and Libya).  No wonder the dictatorships are banning "imports of E-waste".

Every day I wake up, and every day the west succumbs to white guilt, poster child images, and a quasi-racist description of the entrepreneurs in Africa.  I seem to always have something to write about.

Now, I'm packing my bags for a four day trip to APEC Remanufacturing Summit in San Francisco, and the 50th Anniversary party of USA Peace Corps.

Everyone building their castles of sanctimony on the 80% export story, you are all going down.  Like leaded gasoline, marijuana bans, illegal interracial marriage, history is going to grind you under its boot, and the best thing you can do right now, right now, is to embrace Fair Trade Recycling and get on our boat.

Here, meanwhile, is how Interpol describes the process in their 2009 report, Electronic Waste and Organized Crime, Assessing the Links (excerpt)

Tomorrow, I show how this report is one of the stupidest, most biased, ever to be published.  With the math in mind above, see how Interpol uses the sophistication of "profit" to imply illegality.

UK waste and crime 
The opportunities for criminal involvement in UK e-waste disposal are many and varied, as is demonstrated by Figure 1 (page 22). Criminals will exploit any weaknesses in the system, particularly where e-waste can be disguised or mislabelled so that it has the appearance of legitimacy. 
It has been claimed that many fishermen in China, unable to make a living from fishing, have reverted to ferrying cargoes of illegal e-waste from Hong Kong to the Chinese mainland, where it is disposed of illegally. 
‘Waste tourists’ is a term used to describe those individuals who visit the UK as tourists with the intention of organising the purchase and export of waste. While in the UK they will get a container filled and arrange for export, but due to their tourist status and their lack of links to customs they can avoid detection.
Some criminals exploit the need of local authorities to meet recycling targets by buying e-waste directly from municipal sites for recycling. It is alleged that often the equipment they buy is exported directly to non-OECD countries with no, or only minimal, recycling of key components.
This can be a highly profitable business. Televisions and monitors, for instance, can be bought for £2-£3 each and sold on for twice that. ... This suggests a combination of premeditation and organisation, as well as indicating the perpetrators’ awareness that the waste shipment is illegal (i.e.organized criminal activity)"

1 comment:

WR3A's Robin Ingenthron said...

Interpol report states "Televisions and monitors, for instance, can be bought for £2-£3 each and sold on for twice that." That is $3 to $4.50 each purchase price (right on the nose with the opening math, purchase price per container), and resale for "twice that" would be $6 to $9. The report itself proves that 80% exports are impossible. The math in the report indicates approximately 85% reuse (the necessary number of $9 units to compensate for primitive burning of $3 units). But the paragraph states that the income is evidence of impropriety and crime.