28 Sept 2007

by Hardev Kaur - Columns

MORE than two million toys were recalled in a span of five weeks by the world's largest toy maker, Mattel. The toys, ranging from Barbie dolls to toy cars, were made in China and distributed around the world. The recalls damaged China's reputation and were seen as proof that Chinese-made products were not up to international standards.

China had been under scrutiny by American and European policymakers. The European trade commissioner and American leaders were hectoring the Chinese because of the growing trade deficit. Thus, the recall of toys made in China for their “poor quality” and “endangering children” was a “clear sign” and reason to put greater pressure on Beijing.

Many joined in the chorus condemning China for poor quality products made by workers who earn a fraction of what their counterparts in the developed world take home. China has also been accused of unfair trade practices, and there is constant pressure for Beijing to appreciate its currency to reduce “unfair competition” with its “cheap labour".

Thus the recall of millions of toys in such a short span of time provided more ammunition to those who were bent on making China a scapegoat and blaming it for the growing US trade deficit. There were calls in the US and the European Union for a ban on other products “Made in China", such as toothpaste and seafood.

This lent credence to the arguments of those who had been lobbying for a probe into production practices in China following the toys recall. They were therefore disappointed by the personal apology delivered to the Chinese by a high-ranking Mattel executive.

China-bashing, in particular with regard to the poor quality toys, came to an abrupt end with a sudden turn of events last Friday. The problem, as it turned out, was not the quality of Chinese workmanship and manufacturers but design flaws by the world's largest toy maker, the American company - Mattel itself.

The unprecedented and extraordinary apology from Thomas A. Debrowski, Mattel's executive vice-president for worldwide operations, to Chinese product safety chief Li Changjiang, must have caught many by surprise.

“Our reputation has been damaged lately by the Chinese recalls,” Debrowski said in Beijing. “Mattel takes full responsibility for these recalls and apologises personally to you, the Chinese people and all of our customers who received the toys.”

He added that he realised the damage that had been done to the reputation of Chinese goods. “But it is important for everyone to understand that the vast majority of those products that we recalled were the result of flaws in Mattel's design, not through a manufacturing flaw by Chinese manufacturers.”

A total of 17.4 million toys were recalled because of loose magnets, while 2.2 million toys were recalled over impermissible levels of lead. As it turned out, Mattel in a statement clarified that the magnet-related recalls were due to the design and had nothing to do with the toys being manufactured in China.

The American toy giant added that it had also recalled more toys than was justified, adding that was because it put safety first. “Mattel is committed to applying the highest standards of safety to its products. Consistent with this, Mattel's lead-related recalls were overly inclusive, including toys that may not have had lead in paint in excess of the US standards.”

Follow-up inspections confirmed that some of the toys recalled complied with US standards. The company's mistake, he added, was in not overseeing sub-contractors in China.

Debrowski said Mattel was committed to manufacturing in China and was investing US$30 million (RM100 million) in a Barbie store in China. Some 65 per cent of Mattel's toys are manufactured in China, accounting for the bulk of its profits.

The apology was delivered to the Chinese in the presence of the media. But with Mattel being criticised for its “apology” by some politicians in the US, the company is reported to be challenging the news accounts of Debrowski's meeting in Beijing. A company spokesman said the reports had “mischaracterised” his remarks, adding that the executive went to China to apologise to consumers in China, not to manufacturers there.

The remarks were not intended to address the harm done to the reputation of Chinese-made products.

Li said the admission was “unacceptable", telling the American executive, “you cannot recall 10,000 products just because one is sub-standard". But Li added: “I appreciate your objective and responsible attitude towards the recalls and your sincere attitude towards our future co-operation...I really hope Mattel can learn lessons and gain experience from these incidents.”

Some in the US are not happy with the apology, accusing Mattel of kowtowing to the Chinese. Senator Charles E. Schumer of New York is quoted as saying that the apology was like “a bank robber apologising to his accomplice instead of the person who was robbed".

Others accuse the toy maker of focusing on public relations rather than fixing its problems. Yet others argue that the unprecedented apology could raise legal issues.