VZCZCXRO5086
RR RUEHCN RUEHGH RUEHVC
DE RUEHGZ #1270/01 3400818
ZNR UUUUU ZZH
R 060818Z DEC 07
FM AMCONSUL GUANGZHOU
TO RUEHC/SECSTATE WASHDC 6719
INFO RUEHOO/CHINA POSTS COLLECTIVE
RUEAUSA/DEPT OF HHS WASHDC
RHMFIUU/DEPT OF HOMELAND SECURITY WASHINGTON DC
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEATRS/DEPT OF TREASURY WASH DC
RUEAIIA/CIA WASHDC
RUEKJCS/DIA WASHDC

UNCLAS SECTION 01 OF 02 GUANGZHOU 001270 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE PASS CONSUMER PRODUCTS SAFETY COMMISSION RICH O'BRIEN/INTL 
PROGRAMS 
STATE PASS USTR CHINA OFFICE 
STATE PASS HOMELAND SECURITY COUNCIL 
STATE PASS IMPORT SAFETY WORKING GROUP 
 
 
E.O. 12958: N/A 
TAGS: ETRD EIND TBIO ECON PGOV CH
SUBJECT: Vice Premier Wu Yi's Product Safety Parade Hits South 
China 
 
REF: A) GUANGZHOU 1249, B) GUANGZHOU 1230, 
C) GUANGZHOU 1226, D) GUANGZHOU 1213, E) GUANGZHOU 1101 
 
(U) This document is sensitive but unclassified.  Please protect 
accordingly. Not for release outside U.S. government channels. Not 
for internet publication. 
 
¶1. (SBU) Summary: With teams of inspectors scouring the path ahead, 
Vice Premier Wu Yi and a cast of hundreds (320 national and 
provincial officials to be exact) visited 11 Guangdong cities last 
week as part of the four-month national campaign on food safety and 
product quality.  The Guangdong site visits and a general meeting of 
China's special product safety taskforce primarily focused on drug 
safety and import and export quality.  Wu highlighted toy safety 
concerns and problems in the pharmaceuticals industry, including the 
need to strengthen the supervision of raw materials.  During the 
visit, the Guangdong Provincial People's Congress passed new food 
safety regulations, with detailed provisions for a provincial 
food-recall system.  The question now: how will officials sustain 
momentum as the special four-month campaign winds down at the end of 
the year?  End summary. 
 
Y'all Come On Down 
------------------ 
 
¶2. (U) Vice Premier Wu Yi and 320 national and provincial officials 
descended on Guangdong Province November 29 to personally survey 
efforts undertaken as part of the government's four-month long 
campaign to strengthen China's food safety and product quality 
system.  Guangdong Governor Huang Huahua and four Vice Governors led 
10 official inspection teams on tours of 11 Guangdong cities before 
hosting on November 30 the third general meeting of the National 
Leading Group of the State Council for Product Quality and Food 
Safety, the special taskforce created to address these issues.  The 
previous meetings took place in Zhejiang and Shandong, and this 
month's site visits and general meeting primarily focused on drug 
safety and import and export quality, including toy and seafood 
exports. 
 
¶3. (SBU) Although Wu Yi did not visit any U.S.-owned manufacturers 
in south China, U.S. businesses received official requests to 
prepare for possible site visits weeks before her arrival.  Ref B 
reported on word received from Mattel that Wu would visit three of 
its factories.  Provincial and local officials oversaw significant 
cleanup of streets, gardens, and other neighborhood areas, as well 
as the hanging of large red banners emphasizing the importance of 
product quality and safety near factories identified for possible 
tours.  Media also reported extensive preparations at local markets, 
fisheries, pharmaceutical plants and shopping areas, and featured 
complaints from some business owners that such cosmetic changes are 
a waste of money for shop owners and a hassle for consumers. 
 
Spotlight on Toys and Pharmaceuticals 
------------------------------------- 
 
¶4. (SBU) Wu extended her planned 20-minute stop at Hong Kong-owned 
toy vendor Jetta Company to 90 minutes and used the opportunity to 
emphasize that all Chinese exporters must be vigilant about meeting 
import country safety and quality standards. Jetta Company is a 
major supplier of U.S. toy companies, including Mattel and Hasbro. 
Ref E reported on Congenoff and Emboff's September visit to its 
factory.  Hasbro executives have praised to us Jetta's product 
quality and safety control regime as among the best in the industry. 
 Subsequently, a small furniture factory was the site of an 
unscheduled stop where officials discussed the use of paint and the 
precautions taken against lead paint contamination. 
 
¶5. (SBU) Wu highlighted recent drug safety improvements at site 
visits and during the November 30 general meeting, but she also 
emphasized several areas of concern for the weeks and months ahead. 
These included uneven supervision at the local level; lack of drug 
procurement transparency; unfair competition in the drug market; and 
small drug companies that are more likely to use harmful chemicals 
in production processes.  Wu vowed to address these concerns, in 
addition to strengthening the supervision of raw materials, an issue 
we have raised repeatedly in our bilateral discussions. 
 
 
GUANGZHOU 00001270  002 OF 002 
 
 
Guangdong People's Congress Jumps on the Bandwagon 
--------------------------------------------- ----- 
 
¶6. (U) On November 30, the Guangdong Provincial People's Congress 
passed new food safety regulations, which will take effect on 
January 1, 2008.  Media reports describe the new law as more 
detailed and complete than previous regulations.  The new measures 
include detailed provisions for a provincial food recall system, 
clear guidelines on inspecting sources of raw materials and stricter 
rules on documents required for food production.  The new law is 
reportedly very similar to one passed by Beijing's municipal 
government the same day.  During her visit, Wu also announced that a 
draft law on food safety had been submitted to the National People's 
Congress (NPC) for review and approval.  She said the Ministry of 
Agriculture and the General Administration of Quality Supervision, 
Inspection and Quarantine (AQSIQ) will issue regulations to ensure 
food safety and product quality. 
 
Media Bangs the Drums 
--------------------- 
 
¶7. (U) South China's media set the stage in recent weeks for Wu Yi's 
visit and the November 30 general meeting by reporting on 
enforcement results of Guangdong's food safety and product quality 
special campaign.  Citing Vice Governor Tong Xing and other 
officials, local press reported 422,360 enforcement officers had 
been deployed, by November 11, to inspect 489,547 companies and 
factories in the province, uncovering approximately 8,570 food 
safety and product quality cases.  The total value of the cases 
exceeded RMB 620 million and resulted in 5,668 unlicensed companies 
and factories being shut down.  411 companies have also had their 
business licenses revoked. 
 
¶8. (SBU) In a meeting with Congenoffs, the Guangdong Province 
Technical Supervision Bureau (TSB) provided a more detailed 
breakdown of the agency's quality inspections.  The TSB looked into 
over four thousand actual cases, handling the majority itself; 
however, 23 were referred to the Public Security Bureau (PSB), 12 
cases to the Health Department, and 7 cases to the Administration of 
Industry and Commerce (AIC).  About 10 percent of all TSB-initiated 
investigations uncovered actionable information.  Similarly, the 
Guangdong branch of the China Inspection and Quarantine Service 
(CIQ) announced on November 20 that inspections of exporters during 
the four-month campaign included 1,323 toy manufacturers and 1,139 
food companies.  Of those, 366 toy companies lost their export 
permits, and 242 were suspended from operation; 122 food companies 
lost their sanitary permits and 62 were suspended for rectification. 
 
 
Comment 
------- 
 
¶9. (SBU) Enforcement action on the ground by Guangdong inspection 
agencies suggests there's real substance behind the hype of the 
four-month food safety and product quality campaign.  Recent press 
coverage of local food and product quality has also included 
identification of many local companies and products with problems. 
The widespread media coverage may in itself be an important tool in 
the campaign and more than just a public relations effort aimed at 
local consumers and foreign buyers of Chinese exports.  It is 
probably also intended as a clear warning to producers.  A local 
consumer protection NGO earlier speculated to Congenoff that this 
kind of exposure of problems would be a powerful tool the Chinese 
government would employ only if other means proved inadequate.  The 
question now is how officials will sustain momentum as the special 
four-month campaign winds down at the end of the year. 
 
GOLDBERG