Issue 482| August 17, 2018
Upcoming Training

September 13
Factory Fire Safety
Dhaka, Bangladesh

October 9-10
Internal Auditor Course
Shenzhen, China

October 11
Factory Fire Safety
Shenzhen, China


Welcome to The WRAP Weekly newsletter.  Feel free to look around and thank you for being a loyal reader.


The WRAP Up
This week, we certified 
56 factories in  13  countries:

 Bangladesh, Cambodia, China, India, Indonesia, Mexico, Myanmar, Pakistan, South Africa, Sri Lanka, 
Taiwan, Turkey, and Vietnam.

On September 20, WRAP will be participating in the webinar "Working Hours Best Practices" in cooperation with the American Apparel and Footwear Association. For more details and to sign up for the webinar, click here
Upcoming Events

August 20-22, 2018
Toronto, Ontario

The WRAP Blog
By:
Seth Lennon

    

This Week's Headlines



Bangladesh
At least 10 workers were hurt in a gas pipeline blast in a garment factory in Mirpur on Tuesday. The city fire service confirmed that there were some injuries and stated that the incident is still under investigation. ( New Age )


According to a report released on Friday at Dhaka's National Press Club, nine in 10 workers employed by the Bangladeshi garment industry will quit their job within a few years of being hired. The report, drafted by a coalition of trade unions and university faculty, cited insufficient wages and poor working conditions as the reasons behind the high turnover ratio. ( New Age )

Brazil
Footwear manufacturing across the world has evolved into a massive industry, with each major producing country -  a list that includes Brazil - providing a unique approach to shoe design and manufacturing. Sourcing Journal examined the practices and trends within major footwear producers and how they compared to their competitors. ( Sourcing Journal
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Cambodia 
Cambodia stands to benefit from the ongoing trade spat between the United States and China, with textile exports likely to increase because of the dispute, according to the Garment Manufacturers Association of Cambodia. The U.S. and China have been involved in a tit-for-tat trade war since early last month, with the latest move from Washington being to impose 25 percent duties on U.S. $16 billion worth of Chinese imports.  ( Khmer Times )

China
ChinaChina is prepared to send a delegation to the United States in an attempt to break the trade stalemate between the two countries. Vice Minister of Commerce Wang Shouwen will lead a delegation to the U.S. in late August to hold talks on the economy and trade issues with David Malpass, Under Secretary of the Treasury for International Affairs.  ( USA Today )

Ethiopia
EthiopiaSeveral Indian garment manufacturers are now looking to Ethiopia as the newest destination for apparel production, as they struggle to cope with recent changes made to the goods and services tax (GST), along with the Indian government withdrawing several export incentives.  Several factory units from Tirupur have already set up base in Ethiopia, a country which many believe is poised to become the next Bangladesh, one of India's main rivals in garment exports.

Hong Kong
Hong Kong-owned companies that manufacture in mainland China are increasingly worried about the escalating Beijing-Washington trade war. Hong Kong was at one time a bustling center of production in Asia, but firms migrated their production to mainland China with the promise of lower overhead. Now, with the U.S. threatening tariffs on Chinese produced goods, these firms are wary of the impact. (CNBC)

India
T he Indian government has opened up discussions with garment industry stakeholders on a proposed 'Fabric Forward Policy' aimed at introducing new rules of origin for duty-free garment imports. Although India doubled the import tax on more than 300 textile products on August 7 to reduce the volume of cheap imports from China, Indian textile industry representatives claimed that their efforts were being hindered due to duty-free concessions directed towards Bangladesh .   ( New Age )

India's military is looking to shift production of its newest uniforms to domestic factories, rather than source them from Australia, Canada, Switzerland and the United States as has been done in the past. The uniforms are designed for high-altitude, low-temperature operations and the move to source them domestically represents an ongoing shift for the Indian military as it looks to purchase more goods bearing the "Made in India" label. (Better India)

Workers at a garment factory in Mylasandra have fallen ill and contaminated drinking water is suspected as the culprit. 50 laborers employed at the Wonder Blues factory began to fall ill on Tuesday, and the Indian Department of Health believes that the source of the contamination is the factory's canteen. At this time, all of the affected workers are expected to make a full recovery. (New Indian Express)

Kenya
Africa continues to be in a state of flux when it comes to the importation of secondhand clothes from the United States. Some countries, like Rwanda, remain firm on the imposition of tariffs to spur growth within their domestic apparel industry. Meanwhile, Kenya is breaking from its neighbors and electing to reduce tariffs on secondhand clothes with the goal of maintaining economic relations with the United States. ( The Standard)

Apparel and textiles are already the leading exports from Kenya into the United States, coming in at 86 percent of total exported goods. The Kenyan government is now looking to shift focus towards products in demand by American consumers, such as those made with synthetic fiber, in order to gain a bigger foothold in a market where Kenya only accounts for 0.4 percent of total apparel imports. (New Age)

Malaysia 
MalayMalaysia's apparel industry is voicing concerns that the newly proposed national minimum wage could harm the industry's ability to compete in the global apparel export market. The National Wage Council has recommended that the minimum wage should be raised to MYR 1,500 (U.S. $368) from the current level of MYR1,000(U.S. $245).  ( Just Style )
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United States
As summer comes to an end, the tradition of back-to-school shopping begins in the United States. However, this year is different as the ongoing trade war between China and the United States threatens to adversely impact American consumers and retailers and force some families to make choices on how much, if any, apparel and other school-related goods they purchase. ( NPR)

Despite rising prices in raw materials, retail apparel prices fell 0.3 percent in July from a month earlier, the Bureau of Labor Statistics reported Friday in the latest update to the Consumer Price Index (CPI). Women's apparel prices declined two percent, while the cost of menswear at retail rose 1.7 percent. Girl's clothing prices dipped 0.7 percent in the month while price tags for boys' apparel declined three percent. (Sourcing Journal)
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The importance of fashion and sustainability was a hot topic at this year's SOURCING AT MAGIC trade show in Las Vegas. Of note was the emphasis on denim at this year's show, and how to improve the practices and processes employed in production. Upcycling was a specific focus, as companies are increasingly keen to embrace used and unwanted garments in order to promote sustainability.  ( Sourcing Journal )
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U.S.After a slight decline in 2017, apparel imports into the U.S. rose in the first half of 2018. Retail apparel sales also rebounded from earlier sluggishness amid growing consumer confidence, and brands have accelerated buying activity ahead of tariffs stemming from the U.S. trade war with China. Total U.S. apparel imports increased by 2.2 percent over the first six months of the year, to U.S. $38 billion from U.S. $37.2 billion the year prior, according to the International Trade Administration's Office of Textiles and Apparel. (Sourcing Journal)
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With the trade war between the U.S. and other entities continuing to escalate, U.S. businesses are looking at workarounds such as foreign-trade zones and "tariff engineering" to help mitigate the potential impact of duties being placed onto their products. ( Bloomberg)

New York Times contributor Paul Krugman outline his feelings on the potential impact that trade wars will have on global supply chains and how the potential restructuring of industries resulting from trade disputes could impact the global economy.  ( The New York Times

Vietnam
According to a report released by the Qatari National Bank, Vietnam is the newest economic "tiger" in Asia. New data shows that the Vietnamese economy is roaring in 2018 as it emerges as one of the world's fastest-growing economies. Monthly trade statistics show exports of consumer goods to have risen up 20 percent compared to the same period in 2017.  The report cites Vietnam's ability to attract large foreign direct investment inflows into sectors such as clothing, footwear, and electronics as contributors to the rise. (Financial Tribune)
About WRAP
Headquartered in Arlington, Virginia, USA, with regional offices in Hong Kong, SAR, and Dhaka, Bangladesh, full-time staff in Europe, India and Southeast Asia (Thailand, Vietnam, and Indonesia), and for Latin America, WRAP is an independent, objective, non-profit team of global social compliance experts dedicated to promoting safe, lawful, humane, and ethical manufacturing around the world through certification and education. To learn more about WRAP, please visit  www.wrapcompliance.org .

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