‘Made in China’ now a toxic label

Buried in recent China headlines -- about the gas pipeline deal with Russia, the U.S. Department of Justice’s indictment of Chinese military hackers, and saber rattling with Vietnam — was this juicy morsel: Petco and PetSmart will soon stop selling dog and cat treats made in China. Big Pet does not want your puppies getting sick from contaminated jerky. Thousands of reported pet illnesses have not been definitively linked to the Chinese-made munchies, but it hardly matters: The “Made in China” label has become toxic. Over the years, tainted milk, pork and infant formula have made people jittery.

This is emblematic of a much larger problem: China’s environmental crises are starting to drive foreign companies and expats away, along with their money and talent. Pollution numbers are piling up, and they’re scarier all the time. Nearly one-fifth of farmland is polluted, an official government study found in April, and so is three-fifths of China’s groundwater. No wonder the tea in my cupboard isn’t branded as “Grown in China” or that a Chinese food giant just bought a big stake in Israel’s largest food producer, which specializes in dairy goods — in part because Chinese consumers are looking for safer cheese products, a Shanghai analyst told the Financial Times.

For residents, the most obvious concern is the air: In smog-swamped Beijing, just 25 of 2,028 days between April 2008 and March 2014 had “good” air quality by U.S. standards. Don’t worry: China still is a great place to bring your family — just as long as nobody eats, drinks or breathes. I’ll always remember the way a top Texas energy regulator, Barry Smitherman, recounted a 2010 trip to Beijing, which happened to include the day the U.S. Embassy infamously described the air quality as “crazy bad.” “I came away from the trip concluding that I’m not really afraid of the Chinese as a competitor,” he told me.

Of course, business in China has hardly ground to a stop because of environmental concerns. Quite the opposite: Depending how you measure it, China’s economy could overtake the United States this year, and Beijing still expects its GDP to grow by 7.5 percent in 2014. Many international workers still want a stint in China, both for the experience and because they can often make more money than at home.
But the casualties are mounting. An obvious one is tourists, who are recalibrating whether the wonders of the Great Wall are worth clogged lungs. The number of visitors to Beijing fell by 10 percent in the first 11 months of 2013 compared to the same period in 2012 (other factors like the strengthening yuan were also at work). Edward Wong, The New York Times correspondent in Beijing, has written memorably about how many Chinese and foreigners, fearful for their air, food and water, feel as though they are “living in the Chinese equivalent of the Chernobyl or Fukushima nuclear disaster areas.”

It’s no surprise, then, that some people are leaving — mostly expats and wealthy or well-educated Chinese who are able to find well-paying jobs internationally. A recent survey by the Beijing-based Center for China and Globalization found that nearly 70 percent of Chinese leaving the country cited pollution as a key factor. (Many may not be leaving permanently, and pollution is not the only factor in their calculus — distaste of corruption, search for adventure, fear of arrest and desire for a better education for their children are some of the other reasons why people leave China.) But permanent emigrants will invest their assets elsewhere, to the government’s undoubted dismay. China’s one-child policy may contribute to the rush, says Daniel Gardner, a professor of history at Smith College, since couples with only one son or daughter are especially reluctant to risk their child’s health in a polluted environment. As for foreigners, a recent survey by two Chinese chapters of the American Chamber of Commerce found that 48 percent of respondents “cited difficulty recruiting or retaining senior executives in China due to pollution,” reports Bloomberg.

Foreigners who stay may be making more money than ever because of the pollution, however. Panasonic recently started offering extra pollution pay for expatriates in China. The move will be mirrored by other major international companies, but it may not be enough. The Canadian Embassy in Beijing is having problems filling slots because of pollution concerns, for example, even though staff already receives a hardship allowance similar to those doled out in Bogota or Caracas, according to Canada’s Globe and Mail. In April, the Canadian ambassador to China hinted to the paper that one day, small children could be barred from accompanying parents to China.
Galbraith writes for the Foreign Policy magazine and website.

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