VZCZCXRO5122
PP RUEHCN RUEHGH RUEHVC
DE RUEHBJ #5502/01 2322250
ZNR UUUUU ZZH
P 202250Z AUG 07
FM AMEMBASSY BEIJING
TO RUEHC/SECSTATE WASDC PRIORITY 1080
INFO RUCPDOC/USDOC WASHDC
RUEAUSA/DEPT OF HHS WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHINGTON DC
RHMFIUU/DEPT OF HOMELAND SECURITY WASHINGTON DC
RUCPDOC/DEPT OF COMMERCE WASHDC
RULSDMK/DEPT OF TRANSPORTATION WASHDC
RUEAWJA/DEPT OF JUSTICE WASHINGTON DC
RUEHRC/DEPT OF AGRICULTURE WASHDC
RHEHNSC/NSC WASHDC
RUEAEPA/HQ EPA WASHDC
RUEHOO/CHINA POSTS COLLECTIVE

UNCLAS SECTION 01 OF 02 BEIJING 005502 
 
SIPDIS 
 
STATE PASS CONSUMER PRODUCTS SAFETY COMMISSION LAURIE HOPKINS/INTL 
PROGRAMS 
HHS FOR OGHA/STEIGER AND PASS TO FDA/LUMPKIN 
STATE PASS USTR CHINA OFFICE/TIM WINELAND 
STATE PASS OMB/INT'L AFFAIRS 
STATE PASS HOMELAND SECURITY COUNCIL 
STATE PASS FOOD SAFETY WORKING GROUP 
EAP/PD FOR LLOYD NEIGHBORS 
USDA FOR FSIS/RAYMOND 
USDA FOR FAS OA/YOST, OCRA/ALEXANDER, OSTA/BRANDT 
COMMERCE FOR ITA/HIJIKATA 
STATE PASS TRANSPORTATION FOR ABRAHAM/KRATZKE 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ECON ETRD PREL CH
SUBJECT:  AQSIQ INVESTIGATING SOURCE OF LEAD PAINT IN GUANGDONG "LEE 
DER" TOY CASE 
 
REF: A. Guangzhou 887 
 
¶B. Guangzhou 911 
 
¶1. (SBU) SUMMARY: General Administration of Quality Supervision, 
Inspection, and Quarantine (AQSIQ) General Director Wang Xin told 
econoffs August 14 that AQSIQ was investigating the paint pigment 
that Foshan Lee Der Company (Li Da) acquired from a supplier for the 
manufacturing of Mattel Fisher Price toys, which were recalled in 
the United States on August 2. The pigment appeared to have been 
certified by the Swiss verification firm SGS as lead-free, but, 
according to AQSIQ, the certificate was either fraudulent or issued 
in error.  (In other reporting (Ref. A), Mattel officials indicated 
that they believed the certificate was fake.) Wang said that AQSIQ 
has issued internal guidance to local authorities to tighten 
inspection procedures, in particular by increasing the sample size 
in random checks, in order to help ensure that all products exported 
are safe. In these particular cases, he said, it was the raw 
materials that caused problems, not the manufacturer's lack of 
awareness of the greater importance of product safety. Wang assured 
Econ Mincouns that AQSIQ personnel were working hard to ensure the 
safety of China's exports, and expressed frustration about the 
continued negative portrayals of Chinese exports in foreign press. 
Regarding the September U.S.-Sino Consumer Product Safety Summit, 
Wang said that the Chinese delegation would include 15 government 
officials from AQSIQ and municipal inspection teams, as well as 22 
company representatives.  Mincouns expressed the United States' 
strong support for continued close cooperation between AQSIQ and the 
U.S. Consumer Products Safety Commission (CPSC) and for a 
successful, results-oriented Product Safety Summit. (Note: This 
meeting took place 12 hours before the August 14 CPSC press 
conference announcing a second Mattel recall, which had not yet been 
disclosed to AQSIQ.) END SUMMARY. 
 
AQSIQ INVESTIGATES LEAD PAINT 
USED BY FOSHAN LEE DER COMPANY 
------------------------------ 
 
¶2. (SBU) General Administration of Quality Supervision, Inspection, 
and Quarantine (AQSIQ) General Director Wang Xin told econoffs 
August 14 that AQSIQ was investigating the paint pigment that Foshan 
Lee Der Company (Li Da) acquired from a supplier for the 
manufacturing of Mattel Fisher Price toys, which were recalled in 
the United States on August 2. The pigment appeared to have been 
certified by the Swiss verification firm SGS as lead-free, but, 
according to AQSIQ, the certificate was either fraudulent or issued 
in error.  The investigation is still ongoing. Wang expressed 
concern that "even counterfeiters know they need a fake 
certificate," referring to the challenges that inspectors now face 
in tracking violations. 
 
¶3. (SBU) Wang insisted that "all companies" exporting products to 
the United States are checked to ensure they meet U.S. safety 
requirements, and random sampling helps ensure that. In these 
particular cases, he said, it was the raw materials that caused 
problems, not the manufacturer's lack of awareness of the greater 
importance of product safety. He assured econoffs that both the lead 
paint and the molds used to manufacture the toys at Lee Der have 
been removed from the factory premises.  Wang added that, to deal 
with this problem, AQSIQ was developing an internal document, 
"Notification on Increasing Testing of Lead Content in Toy Products 
for Export to the United States." Although he had a copy of the 
document in front of him during the meeting, he declined to share it 
with econoffs. He characterized it as internal guidance to local 
authorities to tighten inspection procedures, in particular by 
increasing the sample size in random checks, in order to help ensure 
that all products exported are safe. 
 
 
BEIJING 00005502  002 OF 002 
 
 
¶4. (SBU) Asked by Mincouns if China would expand its recall system 
to include items beyond food and automobiles, Wang Xin said that his 
own view was that China would "eventually" head in that direction, 
"but not yet." He did not indicate into which areas the recall 
system might expand. 
 
WANG REGRETS BAD PRESS 
ABOUT CHINESE EXPORTS 
---------------------- 
 
¶5. (SBU) Wang insisted that China places great importance on the 
safety of both domestic products and exports, but noted that no 
country mandates inspections for every single exported item. China 
could not possibly inspect all its outbound goods. Furthermore, Wang 
said he understood "clearly" the U.S. Consumer Product Safety 
Commission (CPSC) recall process and that recalls are commonplace. 
Still, he regretted that "Made in China" was coming to mean "recall" 
through the unconstructive attention of the foreign press. China is 
working hard to address the problem, he declared, and has the 
regulatory systems in place to do so, a fact that should be 
acknowledged. Mincouns said that he understood China was making 
great efforts in this area, and that we have common interests in 
ensuring a strong regulatory system in China. 
 
AQSIQ CLOSES FACTORIES 
IN SPITE OF JOB LOSSES 
---------------------- 
 
¶6. (SBU) Wang spoke at length about the extent to which AQSIQ had 
gone to shut down violators, noting the significant loss of jobs 
that had occurred at the Lee Der factory after the August 2 recall 
and also at the RC2 factory after the June recall of Thomas the 
Train toy sets. At Lee Der, which had a 10 year relationship with 
Mattel, over 2,000 employees were now jobless. At RC2, 1,200 
employees lost their jobs, although 500 people were still employed 
in a clean-up project. Wang also questioned the scope of the RC2 
recall, which covered toys manufactured over a two-year period. The 
lead paint, he claimed, was only used on the production line for 
five months and was only applied on the red "stop sign" piece in the 
toy set, not on other pieces.  But he acknowledged that there was no 
way to identify which sets contained the defective pieces. 
 
PARTICIPATION AT THE U.S.-SINO 
CONSUMER PRODUCT SAFETY SUMMIT 
------------------------------ 
 
¶7. (SBU) Regarding the September U.S.-Sino Consumer Product Safety 
Summit in Maryland, Wang said that AQSIQ Vice Minister Wei 
Chuangzhong, himself, and 13 others from the Chinese and local 
governments will attend, on top of representatives from 22 companies 
and industry associations.  Minister Li Changjiang will not be able 
to attend. 
 
PICCUTA