Q&A: Wal-Mart Asia CEO says policing suppliers key

Q&A: Wal-Mart Asia CEO says tougher policing of suppliers key to preventing factory disasters

Associated Press
Q&A: Wal-Mart Asia CEO says policing suppliers key
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Walmart Asia President and CEO Scott Price listens to questions at the Asia-Pacific Economic Cooperation CEO Summit in Bali, Indonesia, Monday, Oct. 7, 2013. (AP Photo/Wong Maye-E)

BALI, Indonesia (AP) -- Wal-Mart Asia President and CEO Scott Price is among hundreds of business leaders gathered for a conference on the sidelines of the annual summit of the Asia-Pacific Economic Cooperation forum, which promotes regional market opening and cooperation.

Despite President Barack Obama's absence from the summit due to the U.S. budget stalemate, Price and other participants said U.S.-led talks on forming a regional trading bloc are progressing as APEC leaders discuss broader efforts to dismantle trade barriers. Below, Price speaks in an interview with The Associated Press.

Q. How do you ensure your suppliers are in compliance with your requirements on worker safety and other issues?

A. The collapse in April of Rana Plaza, a garment factory building in Bangladesh, which killed 1,129 people, led Wal-Mart to step up oversight of suppliers to prevent unauthorized subcontracting, Price said. "We're thermal imaging buildings to make sure they're safe ... We take it very seriously."

"Wal-Mart has for many years had a supplier validation or auditing process in place. You're given very specific guidelines that you must follow and you're audited against those guidelines and you're given a rating. Anything less than a green puts you onto a safety list and you work a lot harder. If you ever show up red, whether it be child safety, child labor, an unsafe work environment, you're labeled a red and you're immediately terminated as a manufacturer and supplier."

Q. We know Wal-Mart is working on an expansion in India. How about the rest of Asia?

A. "Our focus right now is to continue to strengthen the markets that we're in, so obviously Japan and China are very important markets and we're very pleased by the progress. In Japan, we're the only major retailer that has made money for the last four years."

"I see a lot of angst, for whatever the reason, around China's reduction in its GDP forecast. I think most economies in the world would kill for China's reduced number. Let alone its absolute growth. We see China as a very important market and we're very optimistic about it.

Q. How important is the Trans-Pacific Partnership, a proposed free trade agreement involving 12 Asian and Pacific nations, to Wal-Mart?

A. "I think it's very important. It's because as we look at some of the initiatives we try to drive globally, all of them are dependent on the free flow of goods."

"If the regulatory and the tariff structures, if they are overly complicated, they make it overly difficult to deliver to populations the lowest cost goods to feed their families, to clothe their families, to provide a standard of living that is increasing each year."

Q. Is President Obama's absence from the APEC summit a big topic here?

A. (Noting that Secretary of State John Kerry, Commerce Secretary Penny Pritzker and U.S. Trade Representative Michael Froman are leading the U.S. delegation). "They are all well equipped to carry on the message that President Obama wanted to deliver. I'm sure he's probably more disappointed that he couldn't be here ... than the rest of us. But I have absolute confidence that we will be able to continue to drive the free trade agenda and in particular the role of Asia in the U.S.'s future growth, even in his absence.

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