According to Wei, of all these problematic toys, 60 percent were attributed to design flaws, 35 percent to standard differences and 5 percent to quality problems. Unlike the other two, the standards difference is an issue beyond the control of toy manufacturers and they have no other choice but to comply with them.

Feeling the impact

China's toy making industry is export-oriented and is largely based in Guangdong Province and other coastal regions. The main aspects of the industry are processing with supplied materials, processing with supplied samples, assembling with supplied parts, and compensation trade.

Currently, China has 3,000-odd export-oriented toy manufacturers centered mainly in Guangdong, Jiangsu, Shandong, Zhejiang and Fujian provinces and Shanghai. The five provinces and one municipality produce more than 90 percent of China's annual toy output, and Guangdong alone contributes 70 percent of the total production.

China-made toys account for more than 85 percent of the toys the United States, European countries and Japan import.

Yet, a majority of toy makers in China are small and medium-sized companies. Only 1 percent, or 111, exported toys worth over $10 million last year, and 90 percent of China's toy makers exported toys of less than $1 million. Toy makers in China, small and scattered, are striving to move up from the downstream end of the value chain of the global toy industry.

The frequent toy recalls this year have delivered a deadly blow to many small toy makers. A large number of them have had to quit the business and dismiss their workers because they failed to meet the higher U.S. or EU standards while keeping their costs down. Some companies even went bankrupt. Zhang Shuhong, head of the toy manufacturing company involved in a Mattel recall, for example, committed suicide on August 13 after his products were found to contain excessive lead levels.

Thresholds in sight

The AQSIQ, the quality control regulator, drawing lessons from the frequent recalls, has decided to shoulder the job of importers to educate Chinese toy contractors about the toy safety standards in North America and Europe.

A training program on safety management of exported toys, sponsored by the Ministry of Commerce and the AQSIQ, was given simultaneously in Dongguan and Shenzhen in Guangdong Province on October 11-12.

Experts were invited to give lectures on many issues related to toy quality and safety. These experts have worked on the frontline in the Certification and Accreditation Administration of China, the Bureau of Fair Trade for Imports and Exports under the Ministry of Commerce, and at local entry-exit inspection and quarantine administrations. The lectures covered the licensing and certification system on the quality of exported toys, the compulsory production certification system, inspection and quarantine policies, laws and regulations on toy exports, European requirements on toy quality and safety, crisis management on recalls involving toys containing excessive levels of lead paint or design flaws, as well as U.S. laws, rules and standards on toy quality.

The training course in Dongguan attracted many local toy makers as well as those from other cities. The organizers had to find 100 more chairs, besides the 600 already in place in the hall, to accommodate the influx.

Xu Hao, General Manager of a Guangdong-based toy manufacturing company that found its niche in Christmas gifts, attended the training program. He thought the training would help identify possible risks or problems in outsourcing contracts in the future. With knowledge of toy quality policies and standards in the target markets, he would be able to make the right decisions instead of believing whatever the importers tell him or risking products recalls just because they didn't care to warn him, said Xu.

The AQSIQ has allied with local quality control administrations to offer training for 15,000 toy makers since July this year. The AQSIQ went further by launching an investigation campaign on all export-oriented toy makers and suspended or annulled the export licenses of 1,094 companies.

As a preventive measure, the AQSIQ also required toy makers to submit records to local control administrations about their suppliers of paint and ink, and safety and risks evaluation of new products.

Relevant Stipulations in the China National Technical Code for Toy Safety (2004)

Safety Marks: It is stipulated in the code that toys not suitable for children under 3 in terms of size, performance and features should carry a warning sign of "not suitable for children under 3" and make explicit what are the possible dangers if the toy is used by a child under 3. Also toys with tiny components should carry warnings or be marked with age appropriation.

Brochure: For slide boards, swings and any toys with supporting beams and threads, brochures are required to explain the right installation process and possible risks due to inappropriate installation, and to remind the users to regularly check and maintain major components such as fixing devices and anchor devices and point out possible dangers without maintenance.

Age Appropriation: The code includes stipulations on the principle and guidance for age appropriation in detail. Toy manufacturers are not allowed to decide the appropriation at will. These stipulations help parents to choose the most suitable toys for their kids.

The age of 3 and the age of 8 are two important benchmarks. Toys intended for children under 3 are required to carry safety warnings such as "tiny components may suffocate or choke" and toys for children older than 8 should carry simple warnings and explanations for them to read and comprehend. Toy cars and rockets fueled with chemicals should be designed only for children older than 8 and carry the warning, "Adult supervision is required for safe usage."

Safety Testing: There are also stipulations on toy safety testing, demanding testing on all materials for the production. The code sets limitations on the content of heavy metals in paint, ink, wood, paper, fabric and plastic. A failure of any material in meeting the standards will deprive the product entrance into the market.