Issue 478 | July 20, 2018
Upcoming Training

July 25-26 
Internal Auditor Course
Shanghai, China

July 25-26
Lead Auditor Course
Phnom Penh, Cambodia

September 13
Factory Fire Safety
Dhaka, Bangladesh

October 9-10
Internal Auditor Course
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 22 factories in 9 countries:

 Bangladesh, Cambodia, China, Egypt, India, Indonesia, Mexico, Sri Lanka and Vietnam .

In his op-ed for  Sourcing Journal, WRAP President and CEO Avedis Seferian discusses the need for continuing compliance audits within the apparel sector despite calls by some in the industry to look "beyond compliance", and do away with audits in favor of other social compliance methods such as training, remediation, and capacity building.  
( Sourcing Journal)
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August 12-15, 2018  
Sourcing@MAGIC 
Las Vegas, Nevada

August 20-22, 2018
Toronto, Ontario

The WRAP Blog
By:
Seth Lennon


This Week's Headlines


Australia 
Individuals looking for ethically sourced fashion now have another tool at their disposal. Good on You, an app created by a pair of Australian developers, shows consumers the production practices of individual brands. The brands are rated on their performance when it comes to environmental sustainability, child labor, and animal welfare. ( Metro

Bangladesh
BangladeshThe Bangladeshi government will not be seeking an extension to the Accord and Alliance, citing the readiness of its own internal entity to take over monitoring of workplace safety in the garment sector. The Remediation Coordination Cell (RCC) was set up through the collaboration of the Bangladeshi government, the Bangladesh Garment Manufacturers and Exporters Association, and the Bangladesh Knitwear Manufacturers and Exporters Association, with technical support from International Labour Organization. The Accord had reached out to the government for an extension but was denied. ( The Daily Star)

According to the United States Green Building Council, Bangladesh is home to some of the world's most environment-friendly apparel factories. Of the top 11 LEED Platinum-certified factories in the world, eight are from Bangladesh. So far, 67 garment factories within the country have achieved LEED certification. Of those, 17 are platinum rated and 37 gold rated. Some 280 factories are currently in the process of obtaining LEED certification. ( The Daily Star)

Bangladesh, the world's second-largest apparel exporter with U.S. $30.61 billion in earnings and a sourcing hub for global retailers, is not known for the trade shows that other apparel-producing nations host in order to boost investment in their domestic marketplace. However, the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) is looking to change that dynamic and create an atmosphere which is more conducive for these kinds of expos. 

Rohingya refugees from Myanmar have sought refuge in Bangladesh's apparel industry, viewing it as a safe haven from persecution at home. However, many of the refugees, a large number of whom are living in rain-swamped refugee camps, are now having to obscure their identities in order to protect their families from harassment. 
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Cambodia 
Apparel manufacturing has long been a way for laborers in the developing world, including countries like Cambodia, to lift themselves out of poverty through the wages these jobs provide. Now, with automation beginning to take hold in many of these very same factories, the question must be asked: "what will happen to these jobs?" ( Foreign Policy)

China
With China and the European Union embroiled in a trade war with the United States, the two powers are now engaging in an unprecedented level of cooperation in order to mitigate economic harm resulting from the trade conflict with the U.S. Both entities are at the forefront of a movement to revamp and modernize the World Trade Organization along with finalizing a new treaty designed to boost bilateral investment.  ( The Wall Street Journal)

Designers from major brands in the United States and Europe are entering the Chinese apparel sector with the hope of taking advantage of a nascent market whose potential isn't fully realized. These designers are looking to encourage Chinese brands to embrace the flexibility of social media and to be willing to pivot to new trends.  ( Xinhua)

China's trade surplus with the United States swelled to a record in June as overall exports grew at a good pace. However, concerns exist that exporters were simply rushing shipments before tariffs went into effect in the first week of July and that once the tariffs take hold, Chinese exports will struggle in the global marketplace. ( Reuters)

Fast fashion has become a booming industry in China, and the resulting waste is now a major environmental concern, especially considering the sheer volume of products being consumed. However, there is a growing counter-movement urging recycling of clothes into everyday products that benefit citizens.  (South China Morning Post)

Germany 
Adidas German footwear giant Adidas made the commitment that by 2024, only recycled plastics will be used in the manufacture of their footwear. Since 2012, Adidas has been experimenting with the use of recycled materials in apparel production and their announcement is the latest step by an industry continuing to adopt the notion of environmentally sustainable production practices.  ( Financial Times)

Guatemala
U.S. yarn maker Unifi has ended talks that were intended to set up a joint production venture in Guatemala. The venture was intended to further expand the geographic footprint of Unifi's recycled fibers but was unable to come to terms with the government on the implementation of the strategic partnership. ( Just Style)
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India
Citing a need to protect the domestic textile industry, the Indian Finance Ministry has elected to raise the customs duties on 76 imported apparel and textiles commodities. The order will raise duties on these commodities from 10 percent to 20 percent. These particular commodities make up 26 percent of the U.S. $1.6 billion worth of apparel items imported into India during the 2017-18 timespan. ( Fibre2Fashion)

Japan
Kenya
Kenya's domestic textile market, which thrived until disease and pestilence wiped out multiple Kenyan cotton crops over a period of several years, is rebounding thanks to government action and scientific research. When the domestic textile market began its downturn, imported secondhand clothing took over a large portion of the clothing market in Kenya. Now, with the Kenyan textile industry becoming vibrant once again, secondhand clothes are no longer the hot commodity they once were. ( The Nation)

Morocco
The textile and clothing industry has been thriving in Morocco, with over 1,600 manufacturers currently producing more than 1 billion pieces per year. More than 180,000 people work in this sector, and another 100,000 will be added by 2020. One-quarter of Moroccan exports is attributable to the apparel industry, and 15 percent of Morocco's gross national product is generated in the clothing sector. ( Drapers )

Philippines
Garment manufacturers in the Philippines have asked their government to intervene in order to revive the nation's lagging apparel industry. Producers noted that the Filipino education system needs to place a renewed emphasis on teaching the skills needed in the apparel production sector. In addition, the industry is looking for government assistance in reducing the high costs of exporting goods. ( Business Mirror)

Russia
While the United States is taking steps to correct what it perceives as trade imbalances with entities such as China and the European Union, there is no indication of action towards the nation that possesses the  most rapidly growing trade deficit with the United States: the Russian Federation. While trade with Russia is relatively small when compared with China and the European Union, the deficit continues to grow at a rate that is double of imbalance currently existing between China and the U.S. ( Forbes )

South Africa
SouthAfricaThe strike that has paralyzed the South African footwear production market enters its second week as three major unions continue to advocate for raise increases within the industry. However, accusations are now being levied that manufacturers are not acting in good faith to resolve the labor dispute, instead choosing to resort to physical intimidation in order to break the strike.  ( Just Style )
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Sweden 
H&M is implementing a new wage-management system that it claims will result in better working environments and fairer wages at 500 supplier factories worldwide. According to H&M, wages must be commensurate with a person's individual skills and experience. Previously, employees at a factory might receive the same basic wage, minus compensation for overtime, independent of their aptitu de on the job. ( Sourcing Journal )
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United States
The North Carolina textile sector has made a slow climb back from extinction roughly a decade ago and is now a growing, vibrant center of the U.S. textile industry. According to the Economic Development Partnership of North Carolina (EDPNC), the state's diverse textile workforce encompasses more than 42,000 skilled professionals. 
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U.S. Trade Representative (USTR) Robert Lighthizer said last week that the Trump Administration wants to move swiftly to start talks on a free-trade agreement that goes beyond the African Growth and Opportunity Act (AGOA). According to the Sandler, Travis & Rosenberg Trade Report, it is noted that the U.S. is "not abandoning AGOA for either the short term or the long term." However, the report also stated that conditions are favorable to increasing investment in Africa by U.S. companies of all sizes. ( Sourcing Journal)
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The American textile industry is supporting the Trump Administration's tariffs against imported Chinese goods, seeing it as an opportunity to reorient U.S. trade policy in a manner that will reinvigorate U.S. domestic textile production. This places them in direct conflict with major U.S. brands and retailers who are campaigning against the Administration's policies, citing the harm that could come upon their own businesses. ( Bloomberg)

U.SThe United States filed trade cases with the World Trade Organization (WTO) against Canada, China, the European Union, Mexico, and Turkey. This action comes in response to all five entities imposing tariffs on imports from the United States after the Trump Administration enacted tariffs on steel and aluminum imports. ( The Hill)

Getting new apparel designs from the drawing board to the assembly line is becoming faster than ever before as brands pivot to adapt to the fact that trends are changing at an unprecedented pace. Brands have designers sketching on high-resolution tablets with software that can email 3-D renderings of garments with specifications straight to factories. The goal is to reduce to six months or less the time it takes to get to store shelves.  ( Los Angeles Times )

The "Make America Great Again" hat, long the symbol of the campaign of U.S. President Donald Trump, may not be spared from the pending trade war between China and the United States. Manufacturers of the hats, which are sourced abroad, are warning that they may be forced to double their prices if tensions between the two countries do not relax. (ABC)

Vietnam
The Vietnam Textile and Apparel Association (VITAS), the Sustainable Apparel Coalition (SAC) and the Hong Kong-based apparel firm TAL Group are moving ahead with plans to introduce the Higg Index for Vietnam's apparel industry. The Higg Index is a tool designed to score a company for its sustainability performance, ranking it on a scale that incorporates worker safety and environmental well-being. ( Just Style)
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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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