Issue 479| July 27, 2018
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July 25-26 
Internal Auditor Course
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July 25-26
Lead Auditor Course
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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.

This week, we certified 79 factories in 20 countries:

 Bangladesh, Cambodia, China, Dominican Republic, Egypt, Guatemala, Honduras, India, Indonesia, Laos, Lesotho, Mexico, Myanmar, Pakistan, Philippines, South Africa, Sri Lanka, Thailand, United States, 
and Vietnam.

In an op-ed for Sourcing Journal, WRAP President and CEO Avedis Seferian discusses the need for continuing social compliance audits within the apparel sector despite calls by some in the industry to look "beyond compliance."
Upcoming Events

August 12-15, 2018  
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August 20-22, 2018
Toronto, Ontario

The WRAP Blog
Seth Lennon


This Week's Headlines

Finance ministers and central bankers from the G-20 came together to discuss how to address rising economic tensions. Specifically, the bloc looked to address the burgeoning trade war between China and the United States. The G-20 representatives said that while the short-term growth of the global economy continues to be strong, the current uncertainty makes longer-term prospects unclear at best. ( Time)

Mostafiz Uddin, Founder & CEO of the Bangladesh Apparel Exchange (BAE), discusses why he believes the productivity of the Bangladeshi apparel manufacturing sector struggles compared to other apparel-producing nations. Uddin surmises that this is mostly due to the fact that Bangladesh simply does not have the skills development infrastructure necessary to produce workers who are as adept as laborers from other nations. ( The Daily Star )

HotlineAmader Kotha, the 24/7 worker hotline founded by the Bangladesh Alliance for Worker Safety (Alliance) will be transitioning over to an independent safety monitoring organization. With this change, the hotline will expand its reach beyond those factories who are a part of the Alliance. Amader Kotha was founded in 2014 with the intent of providing workers with a safe and confidential means to bring workplace concerns to the attention of the appropriate entities.  

Beijing's decision to reduce tariffs on consumer goods has prompted luxury brands to cut prices on those products sold within China. As May was winding down, China's State Council slashed tariffs on clothing, shoes, and headwear from 15.9 percent to 7.1 percent starting on July 1. An example of this measure was the lowering of tariffs on leather bags to under 10 percent, down from the previous high of 20 percent.  This move is designed to stimulate imports as trade-war tensions with the United States continue to escalate. ( Sourcing Journal)
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Discussing his recent experiences in China, apparel sourcing expert Jeff Clark lays out what he believes brands need to do to maintain maximum visibility within their supply chains. He believes that a hands-on, ground-level approach where managers are personally invested in the supply chain is the most ideal way to ensure that ethical practices are indeed being maintained. ( Sourcing Journal)
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Spanish garments retailer Inditex, owner of international fashion brand Zara, is set to pilot test its at-home pickup service for recycled garments in China this September. The initiative, which currently operates nationwide in Spain, is a central part of the group's strategic commitment to the so-called 'circular economy.' It has enabled the collection of more than 25,000 tons of garments in 21 markets since launching in 2016. (Inside Retail)

ChinaTextile  Chinese fabric producers are preparing for the damage that could occur should the trade war between China and the United States continue. During the recent Texworld USA Expo, Chinese producers were surveyed on what they are anticipating in terms of impact. Most agreed that it was a real possibility that they would have to raise prices in the near future. Industry representatives also understood that any rise in prices would trigger a decline in the volume of orders.  ( Sourcing Journal )
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ChinaChinese President Xi Jinping's visit to the African nations of Mauritius, Rwanda, and Senegal is only the latest indicator of China becoming more invested in African markets. All three nations are interested in additional Chinese investment in their apparel industries. Senegal recently hired a Chinese firm to build a new special economic zone near Dakar, and Chinese factories are producing apparel and other goods in a special economic zone within Rwanda. Meanwhile, Mauritius is negotiating a free-trade agreement with China, potentially making it the first African nation to have such an agreement in place. ( The Washington Post)


Garment exports decreased for the ninth month in a row, and there are few signs that the Indian government will intervene directly to curb this decline. India's Revenue Department has shown little to no interest in raising duties on imported cotton garments from the current 3.7 percent to 11 percent as requested by representatives of the Indian garment industry, a move viewed as necessary by textile producers in order to remain competitive. 

In India, as in a lot of developing countries, garment factories generally don't have air conditioning. Central air is only just beginning to spread to some homes and offices as the country has grown more prosperous. But it's still considered prohibitively expensive to install in many factories, given the tight margins many operate on. With heat having a noted adverse impact on worker productivity, Indian factories are examining the lighting of their facilities to potentially bring the temperature down on the shop floor. ( NPR)

Viscose is currently the third most commonly used textile fiber in the world; however, its use comes at a significant environmental risk, especially to the water supply of surrounding communities. Recent investigations highlighted which brands are sourcing viscose ethically and which ones are lacking the transparency necessary to ensure the safe use of the material. With these facts in mind, seven retail brands have committed to make ethical viscose sourcing a top priority moving forward. ( Just Style)
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The fast fashion phenomenon has come under fire in Japan as more light is being shed on the industrial waste generated from their production and the inhumane practices being employed to manufacture these products. Factories located within Japan itself have come under fire for long working hours and poor wages for foreign workers who migrate to the country in search of a better life. Many are also becoming alarmed by the volume of unsold garments which are often sent to incinerators for disposal, estimated to be a total of one billion garments a year. ( Asahi Shimbun)

Fashion for Good, an organization focused on enhancing sustainability within the apparel sector, is working with Spinnova, a Finnish fiber technology company, to enhance the development of its eco-friendly fiber. Spinnova's new fiber is due to enter full production by the end of the year and, if it succeeds, will significantly reduce the environmental footprint of the apparel production process. ( Just Style)
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Pakistan's readymade garments exports totaled U.S. $2.578 billion between June 2017 and June 2018, an improvement over the previous 12-month period where exports totaled U.S. $2.318 billion. Pakistan's Bureau of Statistics noted that that growth in exports of knitwear, bed-wear and cotton yarn helped drive the increase in trade as all three sectors reported substantial growth. ( The Nation)

South Africa
The leaders of Brazil, Russia, India, China and South Africa, the emerging economies who make up the bloc known as BRICS, are gathering in Johannesburg this week for their annual meeting. Likely on the agenda is how to react to the ongoing trade war involving China, the European Union, and the United States. BRICS has rarely acted in a unified fashion, but the global trade upheaval could spur on a new level of cooperation. ( CNBC)

Concerns are growing that the World Trade Organization (WTO) is heading towards irrelevance, especially considering the Trump Administration's pursuit of protectionist trade policies. The editorial staff of The Economist discusses how to revitalize the WTO in the face of growing U.S. opposition, along with increasing outrage towards what is perceived as Chinese mercantilism. ( The Economist)
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United Kingdom
One of the last fashion manufacturers in the United Kingdom is taking matters into its own hands when it comes to developing the skills of their workforce. David Nieper opened its own internal Sewing Academy in 2015 within its UK facility with the intent of improving the quality of on-boarded employees. The benefits have already been reaped from this approach as David Nieper's production team is mostly sourced from this internal development program. ( Just Style)
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United States
At a global sourcing panel at Texworld USA, panelists pointed out that while each country has its own challenges, everyone will feel some type of impact due to ongoing global trade strife. Demand in Central America, for one, continues to increase at a rapid pace. This is a result of North American companies not only looking for faster turnaround time for products, but also to reduce dependence on nations who are the targets of new levies and/or tariffs.  ( Sourcing Journal )
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A new textile maker, Vidalia Denim, announced Tuesday that it has secured its initial funding to produce yarns and fabrics in the heart of the cotton-producing region of the Mississippi Delta. Located in Vidalia, Louisiana, the 900,000-square-foot former Fruit of the Loom distribution center will have the capacity to produce 15 million yards of denim a year when it ramps up full commercial operations in 2019. The mill will specialize in lighter fashion weights, with an emphasis on stretch and dual-core stretch denim. ( Sourcing Journal)
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Brands are working to increase their adeptness in using social media to drive up interest in, and consequentlysales of, their products. Platforms like Facebook, Instagram and, to a lesser extinct Twitter, give brands a means to place their goods front and center to consumers, while providing a portal to identify and track trends as they develop. While this is not a new phenomenon, tracking social media trends is no longer a niche pursuit, as it is becoming a vital aspect of any successful business model for apparel brands. ( Sourcing Journal)
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Hardwick Clothes, which claims to be America's oldest tailor-made clothing manufacturer, is supporting tariffs of 25 percent on imported apparel. Hardwick is voicing its support for protectionist trade policies to create what it terms as a "level playing field for American apparel producers." ( Just Style)
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The calendar may read July, but U.S. retailers are gearing up for the oncoming holiday season and are having to factor in what the impact of the trade war will be on what is normally the most profitable time of the year for apparel manufacturers and retailers.  ( Forbes)

EUEarlier this week, the United States and the European Union agreed that they would work to relieve tariffs and avoid escalating the trade war between the two entities. During a press conference at the White House, European Commission President Jean-Claude Juncker and U.S. President Donald Trump announced that they would hold off on the imposition of further tariffs and work to resolve those that were already in force. ( The Washington Post)
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 .

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