VICE PREMIER WU YI TO VISIT MATTEL FACTORIES

UNCLAS GUANGZHOU 001230 SIPDIS SENSITIVE SIPDIS STATE PASS CONSUMER PRODUCTS SAFETY COMMISSION RICH O'BRIEN/INTL PROGRAMS STATE PASS USTR CHINA OFFICE STATE PASS HOMELAND SECURITY COUNCIL STATE PASS IMPORT SAFETY WORKING GROUP E.O. 12958: N/A TAGS: ETRD EIND TBIO ECON PGOV CH SUBJECT: VICE PREMIER WU YI TO VISIT MATTEL FACTORIES REF: GUANGZHOU 1213 (U) This document is sensitive but unclassified. Please protect accordingly. Not for release outside U.S. government channels. Not for internet publication. ¶1. (SBU) Summary: In another sign that Mattel and Beijing are working together to fix their mutual product safety image problem, Vice Premier Wu Yi, who will be in Guangdong to participate in a major product safety conference, will visit three Mattel factories next week, according to Mattel executives. In the run-up to the conference, Guangdong inspection agencies announced that they have shuttered nearly half of toy exporters in the province. End summary. ¶2. (SBU) Vice Premier Wu Yi will visit three Mattel factories and two of its vendors' factories during a trip to Guangdong next week, according to Theodore Pang, Mattel's Asia Pacific Legal Affairs Director. Pang noted these five would be the only toy factories on the schedule for Madame Wu's Guangdong visit. He said that she would go to Mattel's die cast factory in Foshan (reftel),a factory in Dongguan that made some dolls involved in the recent magnet-related recall, and a factory acquired with Mattel's purchase of Radica last year. In addition, Madame Wu will visit Wynnewood Corporation and Jetta Company, two vendors that supply Mattel. Pang told us that Madame Wu would also visit personal care product and food companies. Among those may be Procter and Gamble, though the P & G reps attending an IPR seminar at the consulate on November 20 did not venture any information regarding the potential visit. ¶3. (U) Madame Wu will be in Guangdong to participate in the third conference hosted by the State Council's taskforce on product quality and food safety. She heads the task force, which was founded in August and includes senior officials from the Ministries of Health and Commerce, the Public Security Bureau, the Administration for Industry and Commerce, and the State Administration of Taxation. The conference will take place the last week in November, but exact dates have not yet been publicly released. Pharmaceutical products will be the focus of the meeting. The first conference, held in Hangzhou, Zhejiang Province, September 26-27, centered on processed food products and restaurants. The second conference, which took place October 26-27 in Weifang, Shandong Province, focused on agricultural goods. ¶4. (U) In the lead up to the conference, Guangdong's China Inspection and Quarantine office (CIQ) announced yesterday that 46 percent of toy exporters in Guangdong had been closed. Out of 1,323 toy export manufacturers, 366 companies have lost their export permits, and another 242 have been suspended from operation entirely over the last five months. CIQ also announced that among Guangdong's 1,139 food processing companies, 122 had lost their sanitary permits and 62 had operations suspended. ¶5. (SBU) Comment: Wu's visit, the conference and announcement of factory closures all underscore China's determination to fix its product safety problem. After months of accusations and strained relations, Wu's visit to Mattel is also a clear indication that Beijing and Mattel are now working together to restore the reputations of the "made in China" and Mattel brands. They clearly recognize how closely linked those brands are in the eyes of consumers. GOLDBERG