Made in China now a warning sign?

Editorial comment piece from the August Issue of Manufacturers' Monthly.As China’s manufacturing industry booms, quality and safety appear to be suffering as a growing number of Chinese made products are found to be substandard.

HAVE you heard the story about a set of Chinese manufactured railings? A Queensland company ordered a large number of painted industrial-type railings from a Chinese manufacturer.

As well as all the dimensions and type of steel required, the order clearly stipulated that lead-free paint must be used.

The railings duly arrived and all looked OK until someone in the office opened the invoice. Under the total cost was a little note saying “no charge for the paint”.

Sure enough the paint was full of lead, but it was free!

My insider swears it’s a true story. And judging by recent reports from the US and China itself, I have no doubt to question its validity.

This month’s tyre story on page ten is just one example.

China is now facing a global crisis of consumer confidence, both domestically and internationally. Even the country’s own food safety watchdog has acknowledged that almost a fifth of the domestic products it inspects fail to reach minimum standards.

According to the General Administration of Quality Supervision, Inspection and Quarantine, over 19% of products made for domestic consumption were found to be substandard in the first half of this year. Apparently, the failure rate for products made by small firms was even worse; close to 30%.

Reports of substandard products include hundreds of bottles of fake human blood protein found in hospitals, and excessive amounts of additives and preservatives discovered in children’s snacks. Last year, 11 Chinese died after taking antibiotics that contained diethylene glycol, an industrial toxin.

And while export standards are higher than for products sold locally, there have been a number of contamination scandals in the US, with Americans increasingly wary of anything with a Made in China label.

For example, earlier this year there was baffling spate of cat and dog deaths in the US that was later attributed to tainted pet food from China. After that came a major recall in the US and the UK of over one million Chinese made toy train sets that were found to be painted with poisonous lead paint.

There have been numerous other such events regarding Chinese made products, including unpredictable fireworks, tubes of toothpaste with diethylene glycol, and fake birth control pills and HIV retroviral drugs.

In an attempt to stamp out substandard products, the Chinese government has shut down close to 200 factories so far this year, and seized tonnes of lollies, pickles, crackers and seafood tainted with formaldehyde and illegal dyes.

Recognising the damage these reports are doing to China’s reputation overseas, the government has announced major plans to improve food and drug safety.

According to reports, the former head of China’s food and drug agency was recently sentenced to death for accepting bribes from pharmaceutical companies to expedite the approval of new drugs!

Good news for SA

Australia is to get three new air warfare destroyers and two landing ships – all Spanish designed – for a total cost of $11bn over the next 30 years.

The three Navantia F100 air warfare destroyers will be assembled in Adelaide by an alliance of Navantia, ASC (formerly the Australian Submarine Corporation), the Defence Materiel Organisation and Raytheon.

While the hulls of the two new Navantia-designed amphibious landing ships will be built in Spain, their superstructure and other equipment will be fitted out by defence company Tenix at its Melbourne shipyard.

The Spanish contract is good news for local industry, with the deal expected to generate thousands of jobs all over Australia, and not just directly in shipbuilding. With modern ships built in modules, there is no reason why the modules can’t be made anywhere in Australia; made by one company or a cluster of companies.

The concern with the US alternative, as well as price, was how much the Americans would have allowed to be made in Australia; the US’s Buy America policy is very powerful.

With the Spanish ships, ICN (Industry Capability Network) will have a person actually in Spain promoting Australian manufacturers. Visit www.icn.org.au for more details.