Foreign labels such as SMA, Promil and S-26 Gold, which Nestle will get with the Pfizer deal, have a definite edge. Nestle’s products include Nan, Gerber, Lactogen and Nestogen, but are less well known in China.

“I have no choice but to buy foreign brands,” said Liu Shuo, 30, who works for a foreign company in Beijing and has a two-year-old. “Chinese milk powder brands always have food safety scandals, I don’t trust them.”

Baby milk was the foundation of the world’s biggest food company, established in 1866 when German pharmacist Henri Nestle introduced a substitute for mothers who could not breast-feed.

Fuelled by 16 million new births a year, annual growth rates for China’s baby formula market have been as high as 20 percent over the last five years. The market is forecast to double to $16 billion by 2016.

China is a promising market for baby formula, which is one of the reasons why Nestle has decided to take one of the biggest deals in their history. The Economist adds:

Business in China is also lucrative. Because Chinese mothers only want the very best for their (in most cases) one child, they mainly buy products in what is known as the “super premium segment”, meaning the most expensive baby-food. And they prefer international brands: they still remember the baby food scandal in 2008, when at least six babies died because Chinese milk producers had added melamine, a chemical, to raw milk to make it appear higher in protein.

Nestlé has been an also-ran in China, whereas Pfizer Nutrition boasts a 7.4% market share. (Mead Johnson is market leader with 11.7%, followed by Danone.) What is more, Nestlé’s reputation in China had suffered in 2008 after Hong Kong authorities found traces of melamine in the firm’s Dairy Farm milk produced by a company subsidiary in Qingdao, a Chinese coastal city.

Nestlé is unlikely to be challenged by antitrust authorities in China, but there are potential clashes with regulators in countries where Nestlé and Pfizer Nutrition overlap. Warren Ackermann, an analyst at Société Générale, a bank, assumes that Nestlé will have to dispose of about 30% of Pfizer Nutrition’s business in a dozen markets, including the Philippines, Taiwan, Mexico, Colombia, Venezuela and some Middle Eastern countries. It won’t be difficult to find takers: Danone and Heinz, an American food firm, are eagerly waiting for these businesses to come to market.

With the takeover of Pfizer Nutrition Nestlé is not entering new terrain. Henri Nestlé, the founder of the Swiss multinational, was also the inventor of the first fully artificial infant milk formula. In 2007 Nestlé took over Gerber, an American baby-food maker. Mr Schmidt, Gerber’s boss, remained in charge of the business at Nestlé and will now run the newly acquired business too. An old hand in baby food, he is very excited about China. “That’s where the births are,” he says. And just imagine the opportunity if the Chinese government were really to relax the one-child policy.

Read more about food safety and milk contamination via CDT.

© Melissa M. Chan for China Digital Times (CDT), 2012. | Permalink | No comment | Add to del.icio.us
Post tags: consumer safety, dairy industry, food safety, milk, milk contamination
Download Tools to Circumvent the Great Firewall

He recalled that his wife, surnamed Liu, returned to the family home in Changchun, capital of Jilin province, at about 8:35 pm and drank less than half a bottle of the strawberry drink before handing it to their son to finish.

“About five minutes later, my wife was on the floor, twitching and foaming at the mouth,” he said on Thursday. “Her hands were like chicken’s feet.”

It was not until the ambulance arrived that the boy also began crying in pain.

Both victims were rushed to the intensive care unit at the No 1 Hospital Affiliated to Jilin University. However, Chu’s son died five hours later.

“He’s now at the funeral parlor. His body and teeth are black,” said the father.

The drinks have been pulled from sale locally, a move attributed to local authorities by China Daily and to manufacturer Coca-Cola by The Wall Street Journal. Coca-Cola insisted, however, that the product itself was not to blame, while The Wall Street Journal noted a similar case in 2009 in which the company was cleared of responsibility for mercury contamination:

Coca-Cola spokeswoman Joanna Price said Friday that authorities in Changchun, the capital of Jilin, had pinpointed two bottles of the strawberry-flavored variety of the drink as the source of the poisoning. She declined to comment on whether the drinks may have been poisoned after bottling.

Ms. Price said Coca-Cola tested its product line and found no other contaminated bottles. Nevertheless, Coca-Cola has pulled all Minute Maid Pulpy Super Milky drinks from shop shelves in Changchun, and the strawberry-flavored variety from the entire province.

“This case does not involve a product-quality issue, and government authorities are carrying out detailed investigations at this time,” a statement from the Atlanta-based company said ….

A young man who fell ill in 2009 after drinking a can of Sprite, a Coca-Cola brand, said he was poisoned by a chemical substance in the product. Xinhua said Chinese authorities who investigated the case found that mercury was added to the Sprite after its purchase, and they exonerated Coke.

Many in China appear willing to take the company at its word on this occasion, according to The Financial Times. Instead, public anger is once again directed at China’s own food safety authorities. From The Diplomat’s David Cohen:

The Chinese public has instead turned its attention to China’s food safety administration, which issued a set of remarkably weak standards for milk in June – including, remarkably, lowering the minimum protein content of milk sold in China from 2.95 per hundred grams to 2.8 – a significant step away from the developed world standard of 3.0. The poisoning in the Sanlu scandal was caused by melamine, an industrial chemical which manufacturers used to disguise low protein contents. The new standards also allow milk to contain as many as 2 million bacteria per milliliter, some 20 times the allowable amount in the United States and EU.

The sheer audacity of lowering China’s most-watched food safety standard has raised suggestions of powerful special interests – an article in The People’s Daily quoted Zeng Shouying, vice director of the Dairy Industry Committee of China Dairy Association claiming that China’s three major dairy companies exploited their advisory role in the drafting committee to remove tougher standards proposed by experts. The Ministry of Health responded yesterday in the pages of the same paper, telling the journalist that “it was right that dairy producers, crucial to the safety of their produce, should be represented in the drafting committee.”

A recent report by The New Yorker’s Evan Osnos illustrated the long shadow of China’s melamine scandals: trust in domestically-purchased products remains so low that mainland tourists return from Macau laden with cans of baby formula.

Health concerns have also arisen in connection with the early withdrawal of a new Coke can in the West. TIME reports that the new design caused confusion between Diet and regular Coke, bringing unexpected calories to dieters and potentially more serious consequences to diabetics.

© samuel wade for China Digital Times (CDT), 2011. | Permalink | No comment | Add to del.icio.us
Post tags: Coca-Cola, dairy industry, food safety, jilin, melamine, milk contamination
Download Tools to Circumvent the Great Firewall

The report of the detention of Xu Zhiyong, a civil rights lawyer, was a reminder that, for all the attention given to Mr Ai’s release, many more activists are still being held.

The scores of formal arrests, unofficial detentions and unexplained disappearances in recent months mark China’s most intense period of repression since the crackdown following the Tiananmen protests in 1989, campaigners say ….

“There is no doubt that, after the Arab spring, the authorities launched a comprehensive effort to redefine the limits of permissible expression,” said Nicholas Bequelin, of Human Rights Watch in Hong Kong. “The government came to the conclusion that the only way to rein in criticism was to physically take the critics off the grid,” he said ….

Mr Xu, the lawyer, went missing on Wednesday, according to Human Rights Watch. A news official in the national public security bureau said she was not aware of any arrest. Mr Xu’s phone was turned off. Previously jailed in 2009, Mr Xu had been helping people trying to run as independents in local elections.

Xu himself successfully ran for the People’s Congress in Beijing’s Haidian district in 2003. He has been involved in an extremely wide range of issues, most recently the pursuit of equal education rights for students regardless of their hukou status. From a 2009 LA Times article published following an earlier detention in 2009:

Xu’s law firm was one of the few in China willing to represent the parents of the nearly 300,000 children sickened and the six who died last year as a result of dangerous milk additives.

Since its founding in 2003, the firm, also known as Gongmeng, has not shied away from sensitive topics. It challenged China’s secret detention centers, the so-called black jails, after a 27-year-old graphic designer who was arrested for failing to carry his identification card died in custody. Xu represented an editor of the hard-hitting newspaper Southern Metropolis Daily who was arrested in 2004 on what were widely seen as politically motivated bribery charges.

This summer, Xu’s firm joined the chorus of voices opposing a requirement that all computers sold in China come preinstalled with software that would filter out pornographic or controversial content.

But Xu is by no means a dissident, preferring to work within a system he has hoped to improve, not overthrow.

Xu’s organisation, like Ai Weiwei’s, was accused of tax evasion, but the charges collapsed last August. Read more about Xi Zhiyong via CDT.

© Samuel Wade for China Digital Times (CDT), 2011. | Permalink | No comment | Add to del.icio.us
Post tags: Ai Weiwei, detention, Green Dam, Haidian, human rights watch, lawyers, milk contamination, Xu Zhiyong
Download Tools to Circumvent the Great Firewall

The Beijing police department said Wednesday that Ai Weiwei has been released on bail because of his good attitude in confessing his crimes as well as a chronic disease he suffers from.

The decision comes also in consideration of the fact that Ai has repeatedly said he is willing to pay the taxes he evaded, police said.

The Beijing Fake Cultural Development Ltd., a company Ai controlled, was found to have evaded a huge amount of taxes and intentionally destroyed accounting documents, police said.

From The Guardian:

Ai’s younger brother Ai Dan told the Guardian he had no information on his brother. The artist’s wife and mother could not be reached immediately and Ai’s phone remained switched off.

NPR’s Louisa Lim, however, reported on Twitter that:

Ai Weiwei’s mother Gao Ying said she’d only heard about his release through the media, no idea when he’d be back. “We won’t sleep tonight”

…and:

Ai Weiwei’s mother Gao Ying said she didn’t want to comment on Ai’s confession until she’d talked to son, and seen his condition

Further details will be posted as they emerge.

Update: Independent confirmation of Ai’s release has come, first from his lawyer, Liu Xiaoyuan, who tweeted “I sent Ai Weiwei a text message at 11 o’clock. He just replied: he’s out!” Liu also stated (via Louisa Lim) that tax evasion need not carry criminal liability as long as due taxes are repaid.

Ai has arrived back at his studio, apparently looking thinner than before.

ITV’s Angus Walker pointed out that the release comes on the eve of Wen Jiabao’s trip to Germany and the UK; it might therefore have been intended to set a favourable tone for the visit.

There is no news of other missing members of Ai’s circle.

Update: The Telegraph recounted a carefully guarded conversation with Ai following his return home:

“I’m out, I’m back at home,” Mr Ai told The Daily Telegraph by phone, his voice notably softer than before his incarceration, “please understand, however, that I cannot accept interviews”. Asked how he was treated while in detention, Mr Ai again deferred to his bail conditions, but hinted that there were no imminent court proceedings against him. “I am out on bail for one year, that is all I can say,” he added.

Asked whether his bail would also prevent him using Twitter – a medium he used prolifically before his arrest – Mr Ai only managed a tired laugh, repeating apologetically that he was unable to speak further.

The New York Times provides more detail on Ai’s legal situation, as well as current photographs of the artist:

“Bail” is the shorthand commonly used as an English translation of the Chinese term “qubao houshen,” which means obtaining a guarantee pending trial [but see Siweiluozi's proposed alternative translation, "obtaining a guarantee pending further investigation"]. It generally means that prosecutors have decided to drop charges against a suspect on certain conditions, including good behavior, and subject to monitoring during over a period of time during which charges could be reintroduced.

“This is a technique that the public security authorities sometimes use as a face-saving device to end controversial cases that are unwise or unnecessary for them to prosecute,” Jerome A. Cohen, a scholar of the Chinese legal system, said in an e-mail. “Often in such cases a compromise has been reached in negotiation with the suspect, as apparently it has been here.”

Mr. Cohen said Mr. Ai’s release “is very good news and perhaps the very best outcome that could have been expected in the circumstances of this difficult case ….”

Mr. Cohen said the circumstances of “qubao houshen” usually meant that the detainee had agreed to limitations on his or her behavior, and that the case could be quietly dropped if the detainee adheres to that agreement and other compromises made. Legally, the police can continue to pursue the case for up to one year. During that time, the suspect is allowed freedom of movement, but the police generally hold on to the person’s travel documents.

Cohen discussed the situation at greater length on the U.S. Asia Law Institute site:

It is important to remember that, although the announcement claims Ai has “confessed his crimes”, no formal charge has ever been made against him; he was apparently not even formally arrested” (逮捕), not to mention indicted (起诉). Ai has thus not had to plead guilty to any crimes, although the term “renzui” (认罪), or admitting guilt, has been used in the press report. He can end the tax obligations by payment with interest, and perhaps a fine, as the press report says he is willing to do.

The decision to grant QBHS has little to do with the rule of law, but everything to do with the untramelled exercise of discretion enjoyed by Chinese authorities. This outcome makes clear that great international public pressure plus significant domestic and personal guanxi (关系, connections) can be a potent combination even in the case of someone who went further than anyone before him in openly thumbing his nose (and other body parts) at the Communist regime. Undoubtedly, Ai’s star talent, his family history and global support from the artistic community helped a lot.

An article in the Guardian was dismissive of suggestions that Ai’s release deliberately coincided with Wen’s Europe visit:

“I think the timing is one of coincidence rather than a deliberate signal,” said Roderic Wye, a China analyst from the Chatham House thinktank. “In the post-Tiananmen days, there was the occasional high-profile person released, but usually before a US presidential visit rather than a trip to Europe, with all due respect to our leaders. The whole point for China is: we don’t give in to pressure these days, China is big enough to make its own decisions without taking foreign pressure into account.”

Elsewhere at the Guardian, however, Human Rights Watch’s Nicholas Bequelin placed greater weight on the role of international pressure:

“His detention was political and his release is political. It is the result of a huge domestic and international outcry that forced the government to this resolution … I think Beijing realised how damaging it was to hold China’s most famous artist in detention,” he said.

Amnesty International similarly noted the timing, along with the continuing detention of Ai’s associates and the risk that his release might lead into a long and harsh period of house arrest like that of Chen Guangcheng.

“His release on bail can be seen as a tokenistic move by the government to deflect mounting criticism.” said Catherine Baber, Amnesty International’s Deputy Director for the Asia Pacific.

“It is vital that the international outcry over Ai Weiwei be extended to those activists still languishing in secret detention or charged with inciting subversion.”

Amnesty International is calling for the immediate release of Ai Weiwei’s four associates Wen Tao, Hu Mingfen, Liu Zhenggang and Zhang Jinsong, who all disappeared into secret detention after Ai was detained ….

“While Ai Weiwei’s release is an important step, he must now be granted his full liberty, and not be held in illegal house arrest as has been the pattern with so many others recently released from arbitrary detention.” said Catherine Baber.

In keeping with the “one out, one in” pattern of releases and detentions, Beijing human rights lawyer Xu Zhiyong has now been detained, according to Weibo reports. Xu has recently been quoted in connection with China’s independent candidate movement, having successfully run for the People’s Congress in Beijing’s Haidian district in 2003. He has been involved in an extremely wide range of issues, most recently the pursuit of equal education rights for students regardless of their hukou status. From a 2009 LA Times article published following an earlier detention in 2009:

Xu’s law firm was one of the few in China willing to represent the parents of the nearly 300,000 children sickened and the six who died last year as a result of dangerous milk additives.

Since its founding in 2003, the firm, also known as Gongmeng, has not shied away from sensitive topics. It challenged China’s secret detention centers, the so-called black jails, after a 27-year-old graphic designer who was arrested for failing to carry his identification card died in custody. Xu represented an editor of the hard-hitting newspaper Southern Metropolis Daily who was arrested in 2004 on what were widely seen as politically motivated bribery charges.

This summer, Xu’s firm joined the chorus of voices opposing a requirement that all computers sold in China come preinstalled with software that would filter out pornographic or controversial content.

But Xu is by no means a dissident, preferring to work within a system he has hoped to improve, not overthrow.

Xu’s organisation, like Ai Weiwei’s, was accused of tax evasion, but the charges collapsed last August. Read more about Xi Zhiyong via CDT.

© Samuel Wade for China Digital Times (CDT), 2011. | Permalink | No comment | Add to del.icio.us
Post tags: Ai Weiwei, Ai Weiwei detention 2011, detention, Gongmeng, Green Dam, Haidian, milk contamination, Southern Metropolis Daily, Xinhua, Xu Zhiyong
Download Tools to Circumvent the Great Firewall

A message posted on a blog from Mr Zhao’s account last night said he had been released and wanted to be left alone.

“I support and thank the government and I feel deeply sorry for the remarks I made against the government in the past,” he said.

Neither Mr Zhao nor his wife could be reached to confirm the contents of the note.

Mr Zhao first vowed to fight his conviction, said he would go on a hunger strike and signed legal forms for an appeal. But he later reportedly came under pressure not to appeal and abruptly dismissed his lawyers.

© Sophie Beach for China Digital Times (CDT), 2010. | Permalink | No comment | Add to del.icio.us
Post tags: activists, milk contamination, parents, Zhao Lianhai
Download Tools to Circumvent the Great Firewall

After the verdict, Zhao angrily stated his intention to appeal, according to his lawyers. The deadline for an appeal was Monday.

State-controlled Xinhua news agency said Tuesday that an appeal was not filed, but added that Zhao had applied for medical parole.

His attorney Li Fangping told AFP it was not known whether Zhao had actually been barred from appealing, saying the defence team has been cut off from him.

“Whether or not an appeal has been submitted or he has applied for medical parole is just not clear to us right now. We have been trying to get in touch with him and the court but have not been able to,” he said.

The lawyer Teng Biao reported on Twitter that Zhao had already been released, but then said those reports were unconfirmed. Read more from @siweiluozi.

© Sophie Beach for China Digital Times (CDT), 2010. | Permalink | No comment | Add to del.icio.us
Post tags: activists, milk contamination, Zhao Lianhai
Download Tools to Circumvent the Great Firewall

Zhao Lianhai had pushed for greater official accountability and compensation for victims and their families after the 2008 scandal that shocked China. His sentence appeared particularly severe because the case related to a public safety incident that the embarrassed leadership had pledged to tackle in a bid to restore consumer confidence.

“We’d expected it to be much less than that. It is such a harsh sentence,” lawyer Li Fangping said. “The crimes he was accused of were nothing more than what regular citizens would do to defend their rights.”

Zhao vowed to appeal and began a hunger strike to protest the verdict, Li said.

See also “Injuring the Injured: The Case of Zhao Lianhai” from the Duihua Human Rights Journal.

Read more about Zhao Lianhai via CDT.

© Sophie Beach for China Digital Times (CDT), 2010. | Permalink | No comment | Add to del.icio.us
Post tags: activists, melamine, milk contamination, parents, Zhao Lianhai
Download Tools to Circumvent the Great Firewall

It was almost too sudden: The brand leapt out far ahead of the product. Mengniu (which literally means “Mongolian cow”; the chairman’s surname also happens to mean “cow”) had profitably confirmed the founders’ instincts that Chinese consumers would pay more for a name brand and specialty products, including popular premium Breakfast Milk for the white-collar market, the Sour Sour Milk Beverage, which was introduced to young Super Girl viewers, and Whatever ice cream for children.

Some of these niche products have at least 35% net profit margins. But Mengniu didn’t own the supply chain for these cash cows. In fact, it didn’t even own cows. Its chief asset was the brand itself.

“They’re the Nike ( NKE – news – people ) of milk,” says Saatchi’s Sampson. “This is a masterful bit of branding, really. … For the first few years they didn’t own a single cow.”

© Sophie Beach for China Digital Times (CDT), 2010. | Permalink | No comment | Add to del.icio.us
Post tags: mengniu, milk contamination
Download Tools to Circumvent the Great Firewall

Authorities in China say they found 25,000 tonnes of milk powder tainted with melamine, the same toxic chemical responsible for the deaths of six babies two years ago, earlier this year.

Chen Rui, deputy director of the health ministry’s Food Safety and Health Supervision Bureau, said the toxic powder was discovered in February during a 10-day campaign to clean up “problem” dairy products.

“This campaign… also cleaned up a lot of milk powder that had not been completely destroyed in 2008,” Chen said, according to a transcript of a Tuesday press briefing posted on the ministry’s website.

It was not clear how much of the 25,000 tonnes was left over from 2008, when melamine, an industrial chemical normally used to make plastics, was found to have been added to milk powder to make it appear higher in protein.

© Sophie Beach for China Digital Times (CDT), 2010. | Permalink | No comment | Add to del.icio.us
Post tags: food safety, melamine, milk contamination
Download Tools to Circumvent the Great Firewall

Earlier this week China declared a new food-safety campaign after melamine-tainted milk products from an earlier scandal showed up repackaged in several places around the country, exposing weaknesses in the country’s promise to stop such problems from happening again.

“As of now, most of the tainted milk products have been recalled and destroyed, and none has entered the market or been exported,” said a statement posted on the Health Ministry’s Web site… State media reported on Feb. 8 that officials recalled 170 tons of tainted milk powder in the northern region of Ningxia and said almost 100 tons had not yet been found. Two dairies were closed… China ordered tens of thousands of milk products laced with the industrial chemical melamine burned or buried. But the government did not carry out the destruction itself.

The statement on the ministry Web site said some companies did not fulfill their responsibilities and some hid tainted milk products or fabricated test reports to avoid inspections.

See also this past CDT post from February on the search for contaminated milk.

© cschultz for China Digital Times (CDT), 2010. | Permalink | No comment | Add to del.icio.us
Post tags: food safety, melamine, milk contamination
Download Tools to Circumvent the Great Firewall