AsiAinspection Q2 BArometer

riots, strikes& 200,000 toxic products

Hong kong, July 10, 2014

AsiAinspectionA leAding gloBAl provider of QuAlity control services for Businesses importing from AsiA, AfricA, soutHern europe And lAtin AmericA,

today announces its 2014 Q2 Barometer, a quarterly synopsis on outsourced manufacturing and the quality control services industry.

in vietnAm, textile & AppArel exports increAsed

year-on-year between January and May, reaching $7.5 billion USD However, recent protests due to political tensions with China

sent fear into supply chains

vietnAm undeterred By rioting

18%

AI figures show May 2014 ordered inspections

to be 3.3 times higher than the previous one year average.

This is due to

increAsed concern from foreign Buyers to ensure tHeir supply cHAin

and quality have not been disrupted.

In the first months of the year

AppArel importsfrom vietnAm into tHe us sAw A

well AHeAd of rivAl cHinA At 0.9%.

12.7%increAse

C HIn A S e e S L A rge S t InDUSTrIal DISpUTeS

In LIvIng MeMory

Chinese government stimulus efforts appear to have worked in Q2,

witH mAnufActuring Activity & output up nAtionwide.

this was during the same period that

over 40,000 workers engAged in An industriAl dispute.

year over year, the largest growth in asia was Cambodia

tHen BAnglAdesH & vietnAm : 73% eAcH

indiA 63%

And cHinA 10%

up 99%

In growth by industry category, quarter over quarter across all regions,

food And food contAiner inspections were

up 55%

toXIC CHeMICALS rAMPAnt: 5% OF all aZO DYeL AB teStS FAIL

When the Australian Competition and Consumer Commission screened for azo dyes in

imported clothing over 200,000 items were recalled.AsiaInspection found

over 5%of All Azo dye lAB tests in 2014 fAiled

time and time again we see

outsourced mAnufActured productsput ting consumers At risk.

the fact that 200,000+ products made it to store shelves containing a known cancer causing carcinogen

shows the need for stricter controls and testing at the source.

tHis reflects tHe sHeer scAle At wHicH

consumers Are Being pl Aced At risk.

Sebastien Breteau, AsiaInspection Ceo.

“

”

the Sourcing Journal reported that while brands and retailers increasingly place huge importance on information in their value chains,

specific informAtion is often exceedingly HArd to oBtAin.

of respondents sAid tHAt tHey do notHAve sufficient dAtA from within their supply chain.

50%

AFrICA gAInSmOmenTUm

Ordered inspection growth in asia remained strong with 21% year over year growth. This was surpassed by africa with

31%inspection growtH

Interestingly, growth for inspections in africa was led by Swaziland which

saw 50% growth in just the last quarter.

at the same time, Swaziland is losing benefits from the United States under tHe AfricAn growtH

And opportunity Act for its fAilure to mAke progress

towards internationally recognized workers’ rights.

in di A c H A lle nge s c Hin A , Becom e s wOrlD’S 2nD largeSTteX tILeS eXPorter

India is rising as a regional power, taking up a new position as the

world’s 2nd lArgest textiles exporter witH A gloBAl sHAre of

5.2%

India’s Tex tiles minister has projected the value of exports to reach

$50 Billion usd in the current fiscal year.

tHe growtH is Being lArgely drivenBy its AppArel mAnufActuring, for wHicH

exports grew Almost 25% in mAy.

Apparel export growth is being driven by non-traditional markets such Latin America, Southern Africa, and east and West Asia.

Latin America

Southern Africa

east Asia

West Asia

BA ngl A de s H ins pection grou p s

raISe TenSIOnS

north American and european inspection groups the Alliance and the Accord

are together inspecting 2,100 of Bangladesh’s 5,600 garment factorieswhich employ some

and account for 80% of the country’s exports.

4million workers

AI data for 2014 shows that

for fActories tHAt underwent etHicAl Audits,

27% Are At serious risk

59% Are not compliAnt

the groups are involved in a debate with stakeholders over the process by which they shut non-compliant factories.

it’s feAred tHAt tHe disruptions mAy contriBute to slowing export growtH,

with buyers turning to sources they deem more stable, such as China, India and vietnam.

while the groups exist to protect workers, there are practical issues at stake –

tHe protection of JoBs And provision of worker compensAtion

during ex tended shutdowns for repairs which are often ordered without notice.

So far

14 fActories HAve Been sHut down and 5 have had their operations limited.

Factory closures should only be undertaken if employees are at immediate risk, and such scenarios are rare.

AI’s experience has shown that in the course of a properly executed audit program

mAny of tHe fAults found cAn Be fixed witH corrective Action, trAining And educAtion,contributing to the long term economic value of the factory and country.

A leAding gloBAl provider of QuAlity control services

that partners with international Brands, retailers and importersto secure and manage their global supply chain.

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Cancel or modify orders up to 4pmthe day before the inspection for free

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W W W . A S I A I n S P e C t I o n . C o M

press contAct Michael Mesarch • tel: (+86) 755 2223 9888

email: press@asiainspection.com