June 12, 2013
BEIJING - How difficult is it to find safe milk in China? The answer is: really, really hard.
That does not stop dairy producers from swearing their products are top quality. The China Dairy Industry Association recently announced that domestically produced baby formula was of higher quality than imported formula. China’s new standards for baby formula, the association claimed, are the strictest in the world.
Meanwhile government regulators have intensified a crackdown on violations linked to the milk-powder industry, threatening that unscrupulous businessmen would be severely punished. The government also announced that it would tighten supervision of baby milk quality to the same standards used for pharmaceuticals.
However, despite of all these guarantees, the majority of Chinese try to avoid buying local milk for their babies.
It stands to reason that since dairy farming is not a strategic industry for China, it can follow market principles. The public can vote with their feet and buy foreign milk if they don’t trust Chinese products. The problem is that the rest of the world isn't prepared for the massive and sudden increase in Chinese demand. Several countries have been forced to put in place limits for Chinese travelers, to prevent them from buying up all their powdered milk stock.
The order by the Hong Kong government restricting the quantity of milk formula that Chinese people can buy over-the-counter has created a spat between Mainland China and Hong Kong.
It’s no surprise that the Chinese dairy industry has become concerned about the issue. This is not because they regret that Chinese children are not drinking local milk, but rather because they are concerned about the market being occupied by imported milk.
Lowered safety standards
In 2008 China imported around 140,000 tons of milk formula, while in 2011 this number soared to over 650,000 tons, and this is not even counting imports through private overseas purchasing services. This has led dairy producers to urge Chinese consumers to “give up their blind faith in foreign formula brands.”
The question is that if they are not to "blindly trust" imported than who can consumers trust? Since the 2008 melamine-tainted milk scandal, apart from the Sanlu group which was directly involved in the scandal, and was consequently forced into bankruptcy and its top managers sentenced to prison terms, there has been a string of scandals involving milk of dubious quality. The public has simply lost all faith in Chinese milk formula.
Meanwhile, China Dairy Industry Association is extremely anxious. This is why they recently announced that Chinese milk followed stringent standards and had the best quality in its history. As a trade association, it is their role to save the industry from crisis. But what it fails to say is that in reality, it has lowered its standards so that all milk producers can pass. Wang Dingmian, president of the Guangzhou Dairy Association, says the new standards are a retreat to standards that haven't been used in 25 years and that they are the weakest of their kind in the world.
As world's second economy, China should be committed to improving the wellbeing of its population, however it isn’t even able to provide infants with safe milk. Five years after the tainted-milk scandal that affected 300,000 infants and killed six of them, most of the government officials who were held accountable for the scandal have resurfaced, and even been promoted.
Recently, the government announced that milk powder quality would be monitored using the same standards used for drugs. It also announced that a three-month milk powder safety campaign would be launched to weed out unqualified producers and boos consumer confidence.
This news conveys two messages: First, there are still industry vulnerabilities that need to be threatened and loopholes that need to be dealt with. Second, there are companies that still do not follow quality and safety standards, and they will be eliminated. Why is it that after all these years these issues persist? And is Chinese government capable of establishing a long-term monitoring mechanism for baby formula?
Currently, the Ministry of Industry also plans to orchestrate alliances, mergers and acquisitions between the country’s biggest baby milk formula producers so to achieve industrial concentration. However, we are not convinced that there is a connection between the milk quality and concentration. Case in point the fact that the Sanlu Group was the largest infant formula seller in China.
In the end it is not that difficult to provide our children with safe milk. They key for the government is to decide what comes first: children or the dairy industry? If the government chooses the health of its children, then it will enforce strict regulations and force the industry to stick with them, regardless of whether the producer is domestic or foreign. Only milk that meets these stringent standards should be allowed into Chinese households. And if no Chinese companies can comply, and domestic milk prices collapse – so what?
The Chinese milk industry has to go through the process of rebirth that comes after sinking so low. The melamine-tainted milk scandal should have been a turning point for Chinese producers. But because they were protected by the government, they missed the opportunity, which has resulted in the corruption that is prevalent today in the sector.
And one final point to consider: if the government loosened control over imported milk, our domestic milk might even become safer.
The Economic Observer is a weekly Chinese-language newspaper founded in April 2001. It is one of the top business publications in China. The main editorial office is based in Beijing, China. Inspired by the Financial Times of Britain, the newspaper is printed on peach-colored paper.
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The Saudis may be awaiting the outcome of Iran's nuclear talks with the West, to see whether Tehran will moderate its regional policies, or lash out like never before.
October 21, 2021
LONDON — The Iranian Foreign Ministry spokesman Saeed Khatibzadeh said earlier this month that Iranian and Saudi negotiators had so far had four rounds of "continuous" talks, though both sides had agreed to keep them private. The talks are to ease fraught relations between Iran's radical Shia regime and the Saudi kingdom, a key Western ally in the Middle East.
Iran's Foreign Minister Hossein Amirabdollahian has said that the talks were going in the right direction, while an Iranian trade official was recently hopeful these might even allow trade opportunities for Iranian businessmen in Saudi Arabia. As the broadcaster France 24 observed separately, it will take more than positive signals to heal a five-year-rift and decades of mutual suspicions.
Agence France-Presse news agency, meanwhile, has cited an unnamed French diplomat as saying that Saudi Arabia wants to end its costly discord with Tehran. The sides may already have agreed to reopen consular offices. For Saudi Arabia, the costs include its war on Iran-backed Houthis rebels fighting an UN-recognized government in next-door Yemen.
The role of the nuclear pact
Bilateral relations were severed in January 2016, after regime militiamen stormed the Saudi embassy in Tehran. Amirabdollahian was then the deputy foreign minister for Arab affairs. In 2019, he told the website Iranian Diplomacy that Saudi Arabia had taken measures vis-a-vis Iran's nuclear pact with the world powers.
It's unlikely Ali Khamenei will tolerate the Saudi kingdom's rising power in the region.
He said "the Saudis' insane conduct toward [the pact] led them to conclude that they must prevent [its implementation] in a peaceful environment ... I think the Saudis are quite deluded, and their delusion consists in thinking that Trump is an opportunity for them to place themselves on the path of conflict with the Islamic Republic while relying on Trump." He meant the administration led by the U.S. President Donald J.Trump, which was hostile to Iran's regime. This, he said, "is not how we view Saudi Arabia. I think Yemen should have been a big lesson for the Saudis."
The minister was effectively admitting the Houthis were the Islamic Republic's tool for getting back at Saudi Arabia.
Yet in the past two years, both sides have taken steps to improve relations, without firm results as yet. Nor is the situation likely to change this time.
Iranian Supreme Leader Ali Khamenei in 2020commons.wikimedia.org
Riyadh's warming relations with Israel
Iran's former ambassador in Lebanon, Ahmad Dastmalchian, told the ILNA news agency in Tehran that Saudi Arabia is doing Israel's bidding in the region, and has "entrusted its national security, and life and death to Tel Aviv." Riyadh, he said, had been financing a good many "security and political projects in the region," or acting as a "logistical supplier."
The United States, said Dastmalchian, has "in turn tried to provide intelligence and security backing, while Israel has simply followed its own interests in all this."
Furthermore, it seems unlikely Iran's Supreme Leader Ali Khamenei will tolerate, even in this weak period of his leadership, the kingdom's rising power in the region and beyond, and especially its financial clout. He is usually disparaging when he speaks of Riyadh's princely rulers. In 2017, he compared them to "dairy cows," saying, "the idiots think that by giving money and aid, they can attract the goodwill of Islam's enemies."
Iranian regime officials are hopeful of moving toward better diplomatic ties and a reopening of embassies. Yet the balance of power between the sides began to change in Riyadh's favor years ago. For the kingdom's power has shifted from relying mostly on arms, to economic and political clout. The countries might have had peaceful relations before in considerably quieter, and more equitable, conditions than today's acute clash of interests.
If nuclear talks break down, Iran's regime may become more aggressive.
Beyond this, the Abraham Accord or reconciliation of Arab states and Israel has been possible thanks to the green light that the Saudis gave their regional partners, and it is a considerable political and ideological defeat for the Islamic Republic.
Assuming all Houthis follow Tehran's instructions — and they may not — improved ties may curb attacks on Saudi interests and aid its economy. Tehran will also benefit from no longer having to support them. Unlike Iran's regime, the Saudis are not pressed for cash or resources and could even offer the Houthis a better deal. Presently, they may consider it more convenient to keep the softer approach toward Tehran.
For if nuclear talks with the West break down, Iran's regime may become more aggressive, and as experience has shown, tensions often prompt a renewal of missile or drone attacks on the Saudis, on tankers and on foreign shipping. Riyadh must have a way of keeping the Tehran regime quiet, in a distinctly unquiet time.
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Kayhan is a Persian-language, London-based spinoff of the conservative daily of the same name headquartered in Tehran. It was founded in 1984 by Mostafa Mesbahzadeh, the owner of the Iranian paper. Unlike its Tehran sister paper, considered "the most conservative Iranian newspaper," the London-based version is mostly run by exiled journalists and is very critical of the Iranian regime.
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