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China declares 'special war' on shoddy goods

International Herald Tribune

China declares 'special war' on shoddy goods

By David Barboza
Tuesday, September 4, 2007

SHANGHAI: China has stepped up its campaign to restore confidence in the
"Made in China" label over the past week while also striking back at
critics who have called its goods shoddy or dangerous.

Responding to a series of high-profile recalls and product safety
scandals this year, Beijing introduced a new food and toy recall system
last week and also announced what it called a "special war" to crack
down on poor quality products and unlicensed manufacturers.

Moving swiftly with an army of inspectors, the government said it had
begun nationwide inspections of farms, groceries, restaurants and other
manufacturing operations in an effort to root out fake and substandard
goods.

Regulators claim that in recent months, they have busted up scores of
counterfeit drug makers and unlicensed toy producers, and criminal
networks that make everything from fake bird flu medicine and sham
Viagra to counterfeit toothpaste.

Indeed, beginning last weekend, regulators here also said food packages
that did not contain a quarantine label certifying them as safe were
blocked from being exported.

"This is a special war to protect the safety and interests of the
general public, as well as a war to safeguard the Made in China label
and the country's image," Deputy Prime Minister Wu Yi said at a news
conference Friday.

Trying to persuade the international community of its commitment to
improving consumer product safety after a series of scandals involving
everything from tainted pet food ingredients and toxic toothpaste to
toys coated with lead paint, the government even offered foreign
journalists escorted tours Tuesday of a toy factory and toy testing lab
in southern China's Guangdong Province, where most of the country's toys
are produced.

The government hoped the tour would demonstrate that safeguards had been
put into place.

The bold moves and tough rhetoric suggest that China is growing
increasingly worried about the possibility of trade sanctions or further
damage to its international profile heading into 2008, when Beijing is
host to the Summer Olympics.

But the government has also shown its resolve to fight back against
critics of its booming exports, many of whom Beijing has labeled trade
protectionists.

Last week, for instance, China said it had blocked imports of American
wood packaging material after finding them contaminated with what
inspectors said were "worms and other creatures."

Earlier this year, Chinese regulators rejected imports of American meat,
Indonesian seafood and other products from the Philippines, South Korea,
Germany, France and Spain, saying those countries also shipped shoddy
and tainted goods, even Evian water tainted with high levels of bacteria.

Experts said that not since the SARS, or Severe Acute Respiratory
Syndrome, hit China in 2003, has the government moved so aggressively to
respond to critics with such a forceful global public relations campaign.

But experts say regulators here are facing daunting challenges in trying
to overhaul a corrupt and ineffective regulatory system that is ill
equipped to control a marketplace teeming with unlicensed operations and
entrepreneurs willing to cut corners to make a fatter profit.

"They're very concerned about the reputational damage to the China
brand," said Arthur Kroeber, a longtime China observer and publisher of
China Economic Quarterly, an economics research outfit based in Beijing.
"But the reality is this is a vast problem, involving hundreds of
thousands of factories, which are hard to police."

The government has also begun a campaign aimed at the domestic market or
Chinese citizens who face the greatest risk of being exposed to
substandard goods.

In recent weeks, Beijing's largest state-run television network has been
broadcasting a special called "Believe in Made in China," which features
interviews with regulators, in-depth reports on China's biggest
companies and segments on "foreigners who buy Chinese goods."

A promotion for one special called it "fighting to save the reputation
of Made in China."

Still, most of China's efforts have been aimed at the international
community. And so in recent weeks, government officials and diplomats
have called news conferences, held high-level talks with Western
officials and also briefed foreign reporters on the drastic changes they
say are under way here.

"The government is really, really serious, and you will see concrete
results by the end of this year," Kuang Weilin, China's deputy consul
general in New York said at a U.S. news conference last Thursday.
"Officials will be held accountable for what happens."

Chinese officials are likely to take such a threat seriously, given the
execution in July of China's former top food and drug regulator for
taking bribes to approve untested medicine.

Beijing insists that improvements are already being seen. And while
China has long insisted that 99 percent of the country's exports to the
United States, Europe and Japan are safe, the government has at times
acknowledged huge problems in product safety.

After government investigators found that Chinese companies had exported
tainted pet food ingredients and toys coated with lead paint, they
closed factories and even detained managers.

But the recalls continue to come, not just from the United States but
from a growing number of other countries around the world.

Two weeks ago, for instance, New Zealand said it was investigating
reports about what some called "chemical pajamas," Chinese made clothing
that some scientists said contained dangerous levels of toxic formaldehyde.

And late last week, Canada announced it was recalling thousands of
pencils made in China because of fears they were coated with too much lead.

Beijing, however, has made food safety one of its first initiatives. The
government says it plans to spend $1.1 billion to improve food and drug
safety supervision by 2010. The government also said that under the new
recall system announced last week producers would be held accountable
for products that posed a danger to public safety.

The government even issued a lengthy "white paper" on food safety last
month and said it would begin offering rewards to those who blow the
whistle on bad producers.

Regulators have unleashed a flood of new regulations and initiatives in
recent months, including a promise to create national standards to
govern things like cooking oils and the fillings of moon cakes.

And if anyone has doubts about food safety during the Olympics, Beijing
said it was already acting: White mice will be used to test most foods
served to athletes, and pigs are already being bred organically, in
secret locations. Global position system, or GPS, technology is being
employed to track the whereabouts of some animals.

At home, however, consumers seem to be suggesting they have heard it all
before. When China Daily, the country's English language newspaper,
recently asked consumers whether they believed most food in China was
safe, 41 percent answered: "No."

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