Here is the compensation standard for those tainted-milk victims:
In a letter sent to victims last month, Sanlu and 21 other dairy companies offered 200,000 yuan for families whose children died, 30,000 yuan for serious cases such as kidney stones and acute kidney failure, and 2,000 yuan for less severe cases.
According to this Xinhua's report, a couple in Gansu province has accepted RMB200,000 (USD 29,247) as the compensation for the death of their 5-month-old son because of melamine contaminated baby milk powder, under the condition of giving up their rights to sue manufacturer.
Those who do not accept the one-time compensation can still pursue legal settlement.
12/27/2008
how much the tainted-milk victims will be compensated?
At last, the case of the tainted-milk has entered into the compensation phase.
China's Diary Industry Association, the organization that includes 22 diary producers, announced on Saturday that the tainted-milk victims will be compensated. It's a one-time cash payment, but the report gives no specific amount of compensation and the schedule of payment. The compensation package also includes the coverage of medical bills for any related after-effects.
The latest figure: 294,000 babies are affected, 6 are dead.
So far, none of the lawsuits brought up by the families of the victims have been accepted by courts.
Sanlu group, the major diary producer in the scandal, has been declared bankrupt.
10/29/2008
melamine, the revenge of the abject
Ubiquitous! Probably it is the best word to describe the usage of melamine in China. As the milk scandal hasn't faded away from the public eyes yet, its trace has been discovered in eggs. How safe the food in China now?!
Many topics have been discussed since the milk scandal broke out. Lack of efficient supervision, loopholes in the chain of quality control and law enforcement, corruption, and degeneration of morality, all of those factors are linked with this melodrama unprecedented in the public sphere.
Suddenly, a lot of city dwellers who are used to purchasing fresh milk and egg in supermarket have realized that those basic products in our daily menu are polluted in a uncanny way, that inside those polished and well-advertised food packages, the real stuff that will enter into their bodies are tainted!
So, as an ordinary consumer, what can I do? To avoid such processed food as much as possible? Anyway, it's ridiculous to pay those basic products with the price that are largely to cover the cost of food processing, marketing and distribution, and other fees not related to the food itself. Quite unlikely, as long as I'm a city dweller, without means to produce those food by myself. Turning to organic food? Too expensive, and who can guarantee its quality.
No wonder nowadays, a lot of city dwellers in China, especially those with private cars will go to rural areas at the weekend, to enjoy not only fresh air and scenic spots, but a meal made by local farmers in their courtyard with their own produces. 农家乐, happy as we go!
In a world that the fake and faulted food keep popping up, such a meal, made directly from freshly picked vegetable from backyards of farmers and their own preserved rice or maize are supposed to be organic and authentic, healthy without additives, safe because they are not sold in the market but being preserved for self-consumption.
The best way is of course DIY from the bottom, so it's trendy now in some advanced countries for a city dweller to return to the rural area. Living in a idyllic self-sustained way of life sounds attractive for those being disillusioned by the playful cosmopolitan city. That's the decoupling process, isn't it, from the world of modern consumerism, to a simple and frugal, but real and down-to-earth life, just like what the financial crisis teaches us not to trust those fanciful derivatives saturated in the virtual world, but be more prudent and realistic on money issue.
However, such a prospect is quite unimaginable in China, as the development of the rural area in general is far lagged behind the urban area. For those who are concerned too much about when China will enter into the club of the first world, and ignoring reality in its rural development, perhaps the best and direct refutation is to say only when Chinese city dwellers want to be farmers.
It is from this stand point, that one will see something more than itself in this melamine havoc. Those who add it into animal feed, thus leaving its trail in eggs and meat, those who taint milk with it, and those who put whatever illegal material into food without having been detected, are obviously criminals. However, there are so many of them, given the scale of its usage. It must have become a subculture, largely unnoticed but nevertheless having been existed for a while.
Those who turn to such loathsome means to own their livings and probably even make fortunes, who are they? Which social stratum are they in?
Doesn't this chemical stuff that is now permeating everywhere in our daily life embody the revenge of our ignorance of the abject poverty at the bottom of our society?
Many topics have been discussed since the milk scandal broke out. Lack of efficient supervision, loopholes in the chain of quality control and law enforcement, corruption, and degeneration of morality, all of those factors are linked with this melodrama unprecedented in the public sphere.
Suddenly, a lot of city dwellers who are used to purchasing fresh milk and egg in supermarket have realized that those basic products in our daily menu are polluted in a uncanny way, that inside those polished and well-advertised food packages, the real stuff that will enter into their bodies are tainted!
So, as an ordinary consumer, what can I do? To avoid such processed food as much as possible? Anyway, it's ridiculous to pay those basic products with the price that are largely to cover the cost of food processing, marketing and distribution, and other fees not related to the food itself. Quite unlikely, as long as I'm a city dweller, without means to produce those food by myself. Turning to organic food? Too expensive, and who can guarantee its quality.
No wonder nowadays, a lot of city dwellers in China, especially those with private cars will go to rural areas at the weekend, to enjoy not only fresh air and scenic spots, but a meal made by local farmers in their courtyard with their own produces. 农家乐, happy as we go!
In a world that the fake and faulted food keep popping up, such a meal, made directly from freshly picked vegetable from backyards of farmers and their own preserved rice or maize are supposed to be organic and authentic, healthy without additives, safe because they are not sold in the market but being preserved for self-consumption.
The best way is of course DIY from the bottom, so it's trendy now in some advanced countries for a city dweller to return to the rural area. Living in a idyllic self-sustained way of life sounds attractive for those being disillusioned by the playful cosmopolitan city. That's the decoupling process, isn't it, from the world of modern consumerism, to a simple and frugal, but real and down-to-earth life, just like what the financial crisis teaches us not to trust those fanciful derivatives saturated in the virtual world, but be more prudent and realistic on money issue.
However, such a prospect is quite unimaginable in China, as the development of the rural area in general is far lagged behind the urban area. For those who are concerned too much about when China will enter into the club of the first world, and ignoring reality in its rural development, perhaps the best and direct refutation is to say only when Chinese city dwellers want to be farmers.
It is from this stand point, that one will see something more than itself in this melamine havoc. Those who add it into animal feed, thus leaving its trail in eggs and meat, those who taint milk with it, and those who put whatever illegal material into food without having been detected, are obviously criminals. However, there are so many of them, given the scale of its usage. It must have become a subculture, largely unnoticed but nevertheless having been existed for a while.
Those who turn to such loathsome means to own their livings and probably even make fortunes, who are they? Which social stratum are they in?
Doesn't this chemical stuff that is now permeating everywhere in our daily life embody the revenge of our ignorance of the abject poverty at the bottom of our society?
10/09/2008
the first legal case of milk scandal
A couple in Guangdong has decided to sue Sanlu Group for producing adulterated milk powder, which has resulted in kidney stone of their child, this report says. It is the first legal case since the milk scandal broke out in August.
The couple has appealed to claim financial compensation worth RMB 900,000.00 from Sanlu Group and China Diary Industry Association, but the case hasn't been accepted immediately by the middle-level people's court in Guangzhou as the amount is less than 50 million RMB - the entry-level for such a case. According to the report, after the lawyer made some effort on emphasizing the uniqueness of the case, the local court finally received the legal file, and promised to reconsider whether or not it will be formally entering into legal procedures.
It's an open end for the first step. Could it be rolled into a collective lawsuit against Sanlu Group and other manufacturers? Let's see.
9/22/2008
The Systematic Problems of the Milk Scandal
More than 50,000 babies are affected, of which more than 12,000 have been hospitalized. So far, 4 children have died, and more than 100 babies are in serious condition. The number of victims of harm milk is piling up. The practice of adding melamine and other harmful materials into diluted milk now in the dairy industry has become a well-known matter of fact. This dirty open secret within the diary industry has finally been exposed to the public in China, only at an extremely high human cost.
In addition to Sanlu Group, Mengniu and Yili, another two famous brands of diary products have failed the test of melamine. Those two brands have more media exposure on the state media, generally employing celebrities to be advertising spokespersons. In fact, the manufacturing facilities in those factories can be called state of the art, which have attracted tourists in the cities like Hohhotm, and site visit of those modern factories easily leaves trustworthy impression on visitors.
The big picture is that China is in high demand of diary products, ranking the third in the world regarding diary products consumption, which understandably resulted from the improvement of common people's living standard. However, the current supply of diary products is lagged behind the demand. According to some projections, milk production is expected to grow at the 6%-9% annually, and it's quite obvious that individual dairy farmers as the primary suppliers of raw milk couldn't cope with such a growing demand.
According to this SCMP report, only one out of 90 cows is fed at the modern farm park in Hohhot alone, and most of cows are raised in the ragged backyards of dairy farmers. This should be a typical case as Hohhot is the hub of China's dairy industry. The problems such as lacking technical know-how, and the support from both the government and manufacturers are still prevailing. Safety loopholes are actually quite easy to be identified as this insider's account recalled the malpractice before the scandal broke out :
"Whenever my milk failed the quality test, they [used to] direct me to a different place and ask me to unload my milk into a factory milk container" (Wu Tianhua, a milk dealer from Licheng county in Hohhot)
The fundamental issue is the quality of raw milk, and manufacturers are directly responsible for allowing contaminated milk to enter into production lines.
As a result, the chief quality inspector Li Changjiang, head of the General Administration of Quality Supervision, Inspection and Quarantine resigned today, and so far several officials accountable for the problem both at the city level have been sacked, including Wu Xianguo, the Communist Party chief, Mayor Ji Chuntang and Vice Mayor Zhang Fawang of Shijiazhuang city, where Sanlu Group is located.
This report says 'under the Civil Servants Law effective as of 2005 and the State Council Regulations on the Punishment of Civil Servants of Administrative Organs enacted last April, heads of administrative organs who fail to fulfill their duties and cause avoidable severe accidents to happen will face removal and severer punishment.'
However, for those directly involved in the scandal, including diary farmers, manufacturers and the third party officials in charge of quality inspection, the ultimate legal reference should be the Food Safety Law that which the draft version was publicized in April, and thereafter has been submitted to the legislature for the rectification.
According to the draft version, manufacturers who produce harmful food could be jailed for life, but it does not cover food products from the farm to the final consumers, observed by WHO China's representative Hans Troedsson.
The Ministry of Commerce and State Administration for Industry and Commerce (AQSIQ) also worked out an important measure which requires food product to carry a code allowing consumers to trace back their place and time of origin. It's supposed to be implemented by the end of June, but was postponed to the end of this year.
So far, it's not clear when the draft of the Food Safety Law will become the law, but the latest milk scandal offers a rare opportunity for the legislative members to review the draft more thoroughly. The final version should cover the complete chain of food products from the farm to the final consumers, and basic agriculture products such as rice need to be covered as well.
In addition to Sanlu Group, Mengniu and Yili, another two famous brands of diary products have failed the test of melamine. Those two brands have more media exposure on the state media, generally employing celebrities to be advertising spokespersons. In fact, the manufacturing facilities in those factories can be called state of the art, which have attracted tourists in the cities like Hohhotm, and site visit of those modern factories easily leaves trustworthy impression on visitors.
The big picture is that China is in high demand of diary products, ranking the third in the world regarding diary products consumption, which understandably resulted from the improvement of common people's living standard. However, the current supply of diary products is lagged behind the demand. According to some projections, milk production is expected to grow at the 6%-9% annually, and it's quite obvious that individual dairy farmers as the primary suppliers of raw milk couldn't cope with such a growing demand.
According to this SCMP report, only one out of 90 cows is fed at the modern farm park in Hohhot alone, and most of cows are raised in the ragged backyards of dairy farmers. This should be a typical case as Hohhot is the hub of China's dairy industry. The problems such as lacking technical know-how, and the support from both the government and manufacturers are still prevailing. Safety loopholes are actually quite easy to be identified as this insider's account recalled the malpractice before the scandal broke out :
"Whenever my milk failed the quality test, they [used to] direct me to a different place and ask me to unload my milk into a factory milk container" (Wu Tianhua, a milk dealer from Licheng county in Hohhot)
The fundamental issue is the quality of raw milk, and manufacturers are directly responsible for allowing contaminated milk to enter into production lines.
As a result, the chief quality inspector Li Changjiang, head of the General Administration of Quality Supervision, Inspection and Quarantine resigned today, and so far several officials accountable for the problem both at the city level have been sacked, including Wu Xianguo, the Communist Party chief, Mayor Ji Chuntang and Vice Mayor Zhang Fawang of Shijiazhuang city, where Sanlu Group is located.
This report says 'under the Civil Servants Law effective as of 2005 and the State Council Regulations on the Punishment of Civil Servants of Administrative Organs enacted last April, heads of administrative organs who fail to fulfill their duties and cause avoidable severe accidents to happen will face removal and severer punishment.'
However, for those directly involved in the scandal, including diary farmers, manufacturers and the third party officials in charge of quality inspection, the ultimate legal reference should be the Food Safety Law that which the draft version was publicized in April, and thereafter has been submitted to the legislature for the rectification.
According to the draft version, manufacturers who produce harmful food could be jailed for life, but it does not cover food products from the farm to the final consumers, observed by WHO China's representative Hans Troedsson.
The Ministry of Commerce and State Administration for Industry and Commerce (AQSIQ) also worked out an important measure which requires food product to carry a code allowing consumers to trace back their place and time of origin. It's supposed to be implemented by the end of June, but was postponed to the end of this year.
So far, it's not clear when the draft of the Food Safety Law will become the law, but the latest milk scandal offers a rare opportunity for the legislative members to review the draft more thoroughly. The final version should cover the complete chain of food products from the farm to the final consumers, and basic agriculture products such as rice need to be covered as well.
9/12/2008
Melamine, again!
An unfamiliar word suddenly has become hot in town talks. Melamine, a stuff that is supposed to be used in non-food industry, has been found in Sanlu baby milk powder in China, and so far has caused one infant death and kidney stones in dozens of babies. The contamination is confirmed by China's Ministry of Health on Friday.
This latest case of food safety scandal reminds me of Anhui Fuyang baby milk powder scandal in 2004, in which harmful milk powder caused hundreds of babies suffer from malnutrition. Sanlu's case is far more serious than the previous one, because Sanlu is a famous brand in China and its distribution channel is nation wide, so it's not a surprise to see more reports about kidney stone baby popping out in different places as time goes by.
Since the questionable baby milk powder had enjoyed the privileging status as an quality-inspection-free product before the safety problem was detected, the scandal will damage the reputation of the national accreditation system for food quality as well, and it will take a lot of effort and longer time for the authority to restore the confidence of consumers.
Wiki provides a thorough description of this material, and it's updated to the latest development of Sanlu milk powder scandal. From the existing reports, the diary farmers add melamine into diluted milk to pass the test of protein content.
This harmful material has been used discreetly in manufacturing animal feed, as a cheaper alternative to real soy bean protein. The issue was addressed last year in the case of pet food being exported from China to the US, and this NYT report provides detailed background.
In retrospection, if that pet food scandal was highlighted in the food industry last year, probably some preemptive measures would be taken to improve the method of testing protein content.
The question is how come those diary farmers can simply add melamine to diluted milk and pass the quality check? Punishing those who are directly responsible for providing fake milk is just the first step. Sanlu group and the quality accreditation authority must also be held accountable, and a thorough investigation should be conducted, followed by the improvement of the testing method.
This latest case of food safety scandal reminds me of Anhui Fuyang baby milk powder scandal in 2004, in which harmful milk powder caused hundreds of babies suffer from malnutrition. Sanlu's case is far more serious than the previous one, because Sanlu is a famous brand in China and its distribution channel is nation wide, so it's not a surprise to see more reports about kidney stone baby popping out in different places as time goes by.
Since the questionable baby milk powder had enjoyed the privileging status as an quality-inspection-free product before the safety problem was detected, the scandal will damage the reputation of the national accreditation system for food quality as well, and it will take a lot of effort and longer time for the authority to restore the confidence of consumers.
Wiki provides a thorough description of this material, and it's updated to the latest development of Sanlu milk powder scandal. From the existing reports, the diary farmers add melamine into diluted milk to pass the test of protein content.
This harmful material has been used discreetly in manufacturing animal feed, as a cheaper alternative to real soy bean protein. The issue was addressed last year in the case of pet food being exported from China to the US, and this NYT report provides detailed background.
In retrospection, if that pet food scandal was highlighted in the food industry last year, probably some preemptive measures would be taken to improve the method of testing protein content.
The question is how come those diary farmers can simply add melamine to diluted milk and pass the quality check? Punishing those who are directly responsible for providing fake milk is just the first step. Sanlu group and the quality accreditation authority must also be held accountable, and a thorough investigation should be conducted, followed by the improvement of the testing method.
9/04/2008
colossal CDB shows its appetite, but is it healthy?
This murky state-owned business world. Tactics, strategies, national interests and corruption, how CDB's involvement in an acquisition case has become a complex issue.
It's quite obvious that Dresdner is in trouble, and Allianz wants to sell it. CDB's bid to buy is favourable to some German, as this FT story reports,
'The Chinese pitch appealed to German unions, Dresdner management and some German politicians because CDB was prepared to keep all the bank’s staff, whereas Commerzbank has announced plans to cut 9,000 jobs at the two banks.'
However, even CDB hasn't submitted a formal bid, its intention already made some patriotic observers in Germany ring the alarming bell. Andreas Nolting once gave two reasons in this article that why German should prevent CDB from buying Dresdner,
'Firstly, a takeover by CDB would have placed yet more of Germany's banking sector under foreign ownership. Secondly, the Chinese never said or even hinted at what they planned to do with Dresdner and why they wanted to buy it. Such secrecy should not be rewarded.'
Interestingly, even Andreas realizes the serious problems that Dresdner is facing, as trade unions 'lobbied and demonstrated in favor of a takeover of Dresdner by CDB', the answer is still no.
Stay cool! Since the deal is not promising, the decision of China's state council to hold back the approval is a reasonable one. Judging from CDB's past track record in foreign acquisition, prudence and close scrutiny from the State Council is certainly necessary.
Besides, CDB is also in trouble.
'It has also been rocked by scandal after the arrest of vice-chairman Wang Yi in June and his continued detention as part of a probe into alleged corruption and a report from the state auditor that the bank extended billions of renminbi in illegal and irregular loans last year.'
Better to improve its performance from within before allowing it to take any ambitious overseas acquisition, like another one into the Polish telecoms market, simply because it sounds good.
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