VZCZCXRO4250
RR RUEHCN RUEHGH RUEHVC
DE RUEHGZ #0891/01 2200602
ZNR UUUUU ZZH
R 080602Z AUG 07
FM AMCONSUL GUANGZHOU
TO RUEHC/SECSTATE WASHDC 6355
INFO RUEHOO/CHINA POSTS COLLECTIVE
RUEAUSA/DEPT OF HHS WASHDC
RUEHRC/DEPT OF AGRICULTURE WASHINGTON DC
RUCPDOC/USDOC WASHDC
RUEATRS/DEPT OF TREASURY WASHDC
RUEAIIA/CIA WASHDC
RUEKJCS/DIA WASHDC

UNCLAS SECTION 01 OF 03 GUANGZHOU 000891 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE PASS TO USTR 
 
E.O. 12958: N/A 
TAGS: ETRD EFIS TBIO PGOV CH
SUBJECT: HHS Delegation Views Aquaculture Industry in China's 
Shrimp-Producing Capital 
 
Ref A: Guangzhou 767    Ref B: Beijing 5101 
 
¶1. (SBU) SUMMARY: Chinese officials emphasized to a U.S. Department 
of Health and Human Services (HHS) delegation touring the 
shrimp-processing industry in Zhanjiang, Guangdong province on 
August 3 their hope that the visit would help to ease or remove the 
current import alert on shrimp and other farm-raised seafood.  Their 
goal: to resume aquaculture industry exports to the U.S. as soon as 
possible.  The delegation had an opportunity to visit the 
headquarters of the local food quality and safety inspection 
department, a food quality testing laboratory, a seafood processing 
plant, and a shrimp farm, where they discussed the traceability, 
monitoring, testing, and overall quality control of the products. 
END SUMMARY 
 
Police Escorts and Red Carpets 
------------------------------ 
 
¶2. (SBU) The VIP treatment provided to the delegation during its 
whirlwind visit to Zhanjiang highlighted the importance placed by 
the Chinese on resolving the issue of Chinese shrimp importation to 
the United States.  (Ref A provides some statistics different from 
the ones in this cable.)  Though the delegation was careful to state 
that the purpose of its visit was not to inspect food-processing 
facilities, but to learn first-hand about the aquaculture process in 
South China, the local press nonetheless cast the visit as an 
"inspection and assessment visit." Semantics aside, stories in the 
Zhanjiang press were generally positive and stressed bilateral 
cooperation, which reflected the overall tone desired by the Chinese 
side. 
 
¶3. (SBU) The HHS delegation's visit drew high-level interest at the 
national, provincial, and municipal levels.  In addition to a lunch 
hosted by Zhanjiang's mayor and attended by the city's director 
general, both Vice Mayor Mai Jiaomeng and city Vice 
Secretary-general Liu Bing accompanied the traveling party 
 
SIPDIS 
throughout the day.  Import and Export Food Safety Bureau Deputy 
Director General Li Chunfeng, from the General Administration of 
Quality Supervision, Inspection and Quarantine of the People's 
Republic of China (AQSIQ), and Bureau of Fisheries Deputy Director 
Guo Yunfeng represented Beijing during the visit.  One of the most 
active participants was Guangdong Entry-Exit Inspection and 
Quarantine Bureau (Guangdong CIQ) Director General Zhong De Chang, 
who spoke passionately about his bureau's role in regulating exports 
from Guangdong province. 
 
Serious Business 
----------------- 
 
¶4. (SBU) Zhanjiang's economic reliance on shrimp exports to the 
United States is immense.  The city is the biggest prawn producer in 
China, and boasts an export market of USD 470 million annually -- 52 
percent of which is to the United States.  The U.S. Food and Drug 
Administration's import alert, along with bad press from other food 
safety scandals, has already had a dramatic effect on South China; 
one member of the delegation reported having been told that the 
ripple effect from the import alert had already affected the 
livelihoods of more than one million people in Guangdong. 
Regardless of the actual numbers, the Chinese side took special 
pains to highlight repeatedly that they take food safety seriously, 
and that inspection, certification and registration are integral 
parts of the aquaculture industry here. 
 
The Inspection, Certification, and Registration Process 
---------------------------- ---------------------------- 
 
¶5. (SBU) Inspections by Guangdong CIQ of aquiculture companies take 
several forms: 
 
--first, there is a yearly inspection to determine if the firm meets 
the requirements of CIQ certification; a producer must meet or 
exceed these standards if it wishes to engage in export activities; 
 
--second, an inspection takes place at least once each breeding 
cycle, though Guangdong CIQ's Zhong noted that inspectors 
practically live in the plants during breeding season; 
 
--third, periodic, unannounced visits throughout the lifecycle and 
processing ensure continued adherence to standards. 
 
NOTE: If a species is considered "high risk," which means that it 
has a higher rate of sickness, or that it requires more frequent 
 
GUANGZHOU 00000891  002 OF 003 
 
 
administration of drugs than most species, the duration between 
inspections is shortened. END NOTE. 
 
¶6. (SBU) The delegation visited a food testing laboratory that 
provides technical support to Zhanjiang CIQ's operations and 
inspections by testing for drug and chemical residue, heavy metals, 
and microorganisms.  The lab's 25 employees include specialists in 
chemistry, food science, and marine biology, as well as two advisors 
with doctoral degrees.  While touring the facility, at least one 
member of the HHS delegation noted that the laboratory contained 
numerous expensive -- and important -- high-tech instruments for 
testing samples similar to those seen in other international food 
processing facilities. 
 
¶7. (SBU) Zhanjiang CIQ indicated that it has strengthened its 
registration program by implementing an electronic video 
surveillance and accounting system, which allows real-time 
monitoring of some fish farms, processing plants, and packing areas. 
 The accounting system tracks all export-bound products by batch and 
identification numbers, and can be used to trace problems to 
individual producers. According to Zhong, this electronic system is 
intended to complement, not replace, the present inspection regimen, 
and reaches beyond seafood products to all types of foodstuffs. 
 
Shrimp by the Ton 
------------------ 
 
¶8. (SBU) The Guolian Aquatic Products Company processing facility 
has an area of one million square meters, of which 60,000 square 
meters are workshops.  The facility, which runs on two shifts, can 
process 300 tons of seafood -- mostly prawns and tilapia -- each 
day, and has a cold storage capacity of 10,000 tons.  Its 4,600 
employees include 400 "technicians" who direct the unskilled 
workforce and perform administrative duties. 
 
¶9. (SBU) The Guolian facility is a showcase for Zhanjiang's food 
safety and quality control system.  Employees working around food 
products pass through an elaborate decontamination process before 
beginning their shift (as did the delegation on their tour).  The 
processing facilities, which began service in 2000, appeared clean 
and well organized.  Guolian's electronic long-distance video 
supervisory system allows managers at company headquarters to 
monitor not only every aspect of operations at the processing plant, 
but also to view activity at the company's aquaculture farm from 
their desks.  Plant officials also said they could provide access to 
this video over the internet to customers in such locations as 
Japan, for example, who wished to monitor activities in real-time. 
 
And on His Farm He had a Shrimp . . . 
------------------------------------- 
 
¶10. (SBU) The Guolian Nansan Farming Base consists of 46 ponds, a 
hatchery center, office buildings and dormitories -- all spanning 
800 hectares on sandy Nansan Island.  The facility, which breeds 
over 20 billion larva annually, serves as the source of shrimp for 
Guolian's processing plant.  The farm only uses feed from 
CIQ-registered sources, and employs a system to monitor and maintain 
water cleanliness, salination, and temperature.  Employees coming 
into contact with breed-stock and the like are required to don 
protective clothes, gloves, hats, and masks, and must rinse their 
boots in antiseptic before entering the 7,000 square meter hatchery 
center. 
 
¶11. (SBU) The Farming Base performs nearly all stages of prawn 
life-cycle management.  According to Guolian's president, Li Zhong, 
the company lacks the technology to cultivate the shrimp eggs 
required for each breeding cycle, and must still purchase this 
expensive "raw material" from vendors in the United States.  Li 
noted that Guolian is currently developing this technology for its 
own use. 
 
Not-so-quiet Desperation 
------------------------ 
 
¶12. (SBU) The final meeting of the day -- held immediately before 
the delegation left for the airport -- consisted of the Chinese side 
essentially begging for the delegation's help in resolving the 
shrimp-trade issue.  The delegation reiterated that the previous 
days' talks in Beijing (Ref B) had set a framework for signing a 
Memorandum of Agreement on the food and feed safety issue, but that 
much work was still to be done before the December deadline.  As a 
parting statement, Li Chun Feng noted that, after seeing the effort 
 
GUANGZHOU 00000891  003 OF 003 
 
 
by the Zhanjiang government to make the visit a success, and 
considering the support from the central government in Beijing, he 
had no doubt that China was willing to do whatever was necessary to 
resume seafood exports to the United States. (COMMENT: Judging by 
the awkward timing and forceful presentation of his brief remarks, 
Li was almost certainly working from Beijing-approved talking points 
when he made this final statement. END COMMENT.) 
 
¶13.  The Delegation did not have an opportunity to review this cable 
before transmission. 
 
 
GOLDBERG