We are often asked some very good questions by interested members of the public. Recently Alan asked us a great question about the source of our nets and whether it was possible to buy them from sources local to the distributions:
Hi,
I'm interested in your charity, but I'm wondering what companies or countries your nets are purchased from. That info was not immediately evident on your site, only that you pay very low prices for them...
Thanks,
Alan
Hi Alan-
The vast majority of the nets, long-lasting insecticide treated nets, LLINs, the only type we buy, that we have bought are from Verstergaard Frandsen (PemaNet nets) and Sumitomo Chemical (Olyset nets).
Any net we buy must be WHOPES Phase II approved (see
this page for more details).
The nets we buy are manufactured in Vietnam, Thailand, China and Tanzania. This is where the large net manufactures have their facilities. We have also bought nets in Malawi but these were manufactured in Tanzania.
As nets are a textile, manufacturing economies of scale are significant. There are relatively few, large production facilities and it is not economic, for the cost of the net, to have small or medium sized manufacturing facilities in many different, for example African, countries. Shipping costs at US$0.20-0.40 per net are a relatively small element of the total distribution cost of a net. A net is US$4-5 and an additional $1-2 (including the $0.2-0.4) can be considered the non-net distribution cost total, including pre-distribution and post-distribution follow-up costs. Beyond the Sumitomo technology-sharing that led to the Tanzanian facility (run by AtoZ Textiles), manufacturers have plans for manufacturing facilities in Nigeria and Ethiopia. When we funded 120,000 nets for distribution to some 400 boarding schools in Tanzania and 120,000 nets for Malawi, these were/are being sourced from Tanzania.
I hope this is of interest and helps.
Kind rgds
Rob
Hi Rob,
Thanks very much for your comprehensive answer. My main concern is (as I have read) that floods of foreign-sourced charitable nets have actually had the unfortunate negative effect of putting african mosquito net manufacturers out of business. As you probably know, Africa's health, environmental, social, political and economic woes are largely tied together. This concern is mentioned in Dambisa Moyo's book entitled "Dead Aid". I'm not sure if you're familiar with this argument but I felt compelled to contact you regarding this issue, since it can potentially make a difference for the lives of Africans. I would suggest that as whole it might be of greater benefit to Africans to make sure they manufacture the nets they use - that way the charity $$$ would pay dividends of creating jobs which would help lift them out of the poverty which makes them so vulnerable. What do you think?
-Alan
Dear Alan-
Yes, I think this is an important issue.
It must be a better situation if long-lasting insecticide treated nets (LLINs) are manufactured in the countries in which they are needed. That would bring two advantages. First, reduced transport costs. Second, local employment. There is a manufacturing facility in Tanzania, a Sumitomo-AtoZ textiles joint venture, so 'local' production, and the employment this brings, is possible.
We are alive to this issue and, where we can, act in a way to support local enterprise. We have bought tens of thousands of nets that way when it has been 'near-economic' to do so.
However, there are challenges to the speed of local capacity development and the number of facilities that could be developed.
First, economies of scale mean only a small number of large factories are required to produce world demand. Micro-factories, located in each net-consuming country would not be economic. The number of countries that could benefit from locally located facilities therefore would be small. Some countries benefiting would be better than none of course.
Second, domestic markets are often not enough to sustain a production facility: nets are required to be exported. This leads to a problem, or inefficiency, in that shipping and transport from some African countries to others can be more difficult and more expensive than shipping from Asia to many African countries given established shipping routes. This raises overall prices for net buyers and reduces the number of nets that can bought for a given level of funds.
Further, technology transfer is an issue with challenges around training a workforce and guarding against technology intellectual property loss, the latter being a reasonable concern of the primary manufacturer. Ensuring raw material, spare parts supply and quality control are also issues to overcome.
The first and second issues are the structural ones and present the greatest challenge. The other issues can be overcome as the Tanzania joint venture has indicated. With major capital investment required and the need to consider the long term viability of a new facility, these developments take year/s not months.
Another method of developing local capacity has been via shipping large rolls of netting from an African based manufacturing facility to another African country where the cutting and stitching of nets then takes place. This has some shipping cost savings and provides local employment. We have bought nets in this way also.
Note, we are only talking about LLINs here as that is the only sensible net to distribute. If part of the background to your comments is concern over local insecticide treated nets (ITNs, but not long-lasting, so an entirely different net), or untreated net production being threatened by the import of LLINs, the higher issue is going to be the need to protect people with LLINs rather than ITNs or untreated nets. This is because LLINs are much more effective than these other nets at protecting people from malaria. For information on different types of nets, see:
http://www.againstmalaria.com/FAQ_Bednets.aspx
Our approach, therefore, is with our priority being to buy the most nets possible for the funds available. We keep a close eye on local-sourcing options and where it is 'near-economic' to do so, we do. Economics will drive manufacturers to locally locate and we can do our bit by applying this 'near-economic' approach.
I hope this helps.
Kind regards
Rob