Food Security and the China Trade

I think we have reached a point unfortunately where ‘made in China’ is now a warning label in the United States. – U.S. Senator Richard Durbin (D-IL) June 1

Food security problems have impeded Chinese agri-products and food many times in international trade, and damaged our national credibility and image… mass food safety incidents will continue to occur frequently, with the rural food safety situation in particular causing us to not be optimistic...Food safety accidents and individual cases will not only affect the healthy development of the industry but could also impact local economies and social stability. – Sun Xianze, Director, Food Safety Coordination, China State Food and Drug Administration. July 9

The Food and Drug Administration’s decision in late June to bar entry to several Chinese seafood products confirmed the risks involved with the economy’s increasing reliance upon food and consumer products from China. The rising tide of unsafe Chinese products has severely challenged America’s domestic capacity to ensure the security of the nation’s food supply.

The country’s exposure to risks from Chinese imports can be measured in part by understanding how China’s share of U.S. imported foodstuffs has grown with the country’s total trade deficit. Implicit in this relationship is a looming question regarding how America manages the costs and benefits of globalization. Since 2002, the value of Chinese food imports to the United States has increased by 125 percent. Last year, however, Chinese products accounted for 68 percent of recalled or rejected imports to the United States. Safety has clearly not kept pace with growth.

Seafood offers a useful microcosm of the China trade and America’s yawning appetite for imports. The National Fisheries Institute, the trade association for the U.S. seafood industry, reckons that 70 percent of the seafood on American tables comes from abroad. In 2003, the U.S. imported $8.6 billion of foreign seafood; by 2006, that figure had grown to $10.2 billion. Imports of Chinese seafood in 2006, meanwhile, had grown to $1.4 billion, supplying fully 10 percent of the nation’s seafood.

The new FDA ban on Chinese catfish and eels carries a tacit acknowledgment that the domestic inspection and safety regime has been taxed to the limit by expansive import volumes. In April 2007 alone the Food and Drug Administration rejected some 257 Chinese food shipments for containing banned ingredients and seized more than 1,000 shipments of tainted cosmetics, food supplements and counterfeit medicine from China. This spike in rejections, however, implies a false sense of security; FDA annually inspects 0.7 percent of the food arriving in America’s ports and customs houses. As FDA officials themselves recognize, given the sheer volume of food imports, even doubling the current rate of inspections would be ineffective. The recent FDA enactment of a temporary ban may be indicative of further actions on other tainted products, and appears to be the only surefire, near-term way to ensure public health.

Sweet & Sour Irony

Interestingly enough, China has been among the forefront of U.S. trading partners wielding alleged food safety standards for protectionist purposes. China appears to have stretched the application of World Trade Organization standards, banning many U.S. farm exports from entering the Chinese market. China has barred pork and poultry exports over the past two years in a manner inconsistent with international standards; rejected WHO-approved additives in thousands of agricultural commodities; perpetuated a ban on American beef despite U.S. measures against BSE; and requires quarantine inspection permits for the import of most any U.S. agricultural commodity to Chinese shores. The U.S. policy response thus far has not challenged Chinese abuse of WTO principles, but sought, unsuccessfully, to persuade the Chinese to implement standards based on sound scientific and regulatory practices. In the meantime, China appears to wield a capricious and unchecked ability to close its borders to American farm products.

The Politics of Food Safety

The belated U.S. government action on Chinese seafood may not stem a barrage of political initiatives seeking to address the public health aspects of the China trade. Sustained media attention to tainted products has renewed a push by consumer groups to end a five-year delay in enforcing mandatory country-of-origin labeling rules created by the 2002 farm bill. Senior Democratic Senators Durbin and Schumer, meanwhile, have launched efforts respectively to boost the FDA’s resources and to create a new “import czar” position within the Department of Commerce to exercise authority over the safety of all imports to the United States.

Surprisingly, Washington has yet to see an organized effort among the many groups disadvantaged by the China trade to leverage the food safety issue into a broader assault on Chinese imports. Similarly, the presidential candidates have been slow to capitalize on the seemingly easy political calculus of public health, tainted Chinese imports, and rising protectionism among the general public. Increased attention is probably inevitable, however, as the campaigns steer their way toward state fairs and members of Congress return home for the late summer recess. Should new discoveries of tainted Chinese products turn up during Washington’s traditional summer slumber, individual FDA actions will prove insufficient to the task, and we’ll expect the autumn session to bring a raft of new trade legislation aimed at securing the American dinner table.