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The European Union began implementing the more stringent new toy safety directive on July 20. Chinese analysts believe that this is likely to prompt China, the world's largest toy exporter, to reform its toy industry to adapt to this drastic change in the international market.
The EU claims that it has introduced and implemented new toy safety instructions for the protection of children and the environment. However, Chinese analysts pointed out that it does not rule out the EU’s considerations of increasing the technical barriers to thickening and green barriers to weaken the competitiveness of toy industries in other countries.
The directive is called the EU's "most stringent" toy safety indicator in the industry. It requires that all toys entering the EU market must be affixed with the CE mark. Manufacturers must carry out a "safety and compliance assessment" before acquiring the mark.
This directive also imposes more stringent performance requirements on toy production materials. The limit on specific heavy metals has been increased from 8 to 19, and 66 allergenic fragrances have been banned or restricted for the first time, and 15 are widely used in the production of toys. Phthalates are highly concerned.
The EU’s toy manufacturing is in the high-end position of the industrial chain, while the products of developing countries such as China are mostly in the low-end market.
Feng Fei, head of the Ministry of Industry and Economic Development of the State Council Development Research Center, told Xinhua News Agency that the threshold for the EU toy market has increased and the impact on low-end products in the short-term is very negative. “This is why advanced economies weaken the competitiveness of emerging economies. A common way."
As the world’s largest toy exporter, China’s toy exports account for 70% of global trade volume. In 2010, China exported toys to the European Union worth 2.19 billion U.S. dollars, accounting for more than 25% of China's toy exports and 87% of EU imports.
The harsh manufacturing standards and high testing costs of the European Union have already put pressure on Chinese toy exporters, especially SMEs. Chen Dachuan, head of sales of Guangdong Chenghai Boyu Plastic Toys Factory, said that the EU's "new directive" has made China's toy companies with rising production costs face a life-and-death test.
The EU's "new directive" will substantially increase the export costs of Chinese toy manufacturers and reduce the number of Chinese toy exports to the EU. This year, the rise in raw material prices and the increase in labor costs have made the profitability of China's traditional labor-intensive toy companies thin to around 2% to 3%.
"Because of the intensified competition in the international market, it is not ruled out that some Chinese companies fail to raise their prices significantly," said Chen Dachuan.
Some Chinese toy companies also stated that “the strictest order in history†will cause the cost of toys exported to the European Union to rise substantially, and this market impact will bring impact to Chinese manufacturing companies, and it will also put local consumers under some pressure.
Wu Difei, sales manager of Guangdong Meiye Electronic Technology Co., Ltd., which is engaged in exporting to the EU all the year round, said: “The 16 standards in the new regulations have soared to 57, which greatly increased the investment in testing and testing equipment. , It will increase the cost input for the packaging, materials, environmental protection and other aspects of the product."
He initially estimated the direct production cost of the company and will increase it by at least 15%. “This price will certainly not be able to bear all of the business. It will inevitably transfer some of the pressure to the downstream channels through the price increase, and ultimately to consumers.â€
The EU toy trade barriers have been continuously upgraded since 2003, including the 2003 RoHS Directive that clearly stipulates the maximum limits for six kinds of hazardous substances; on January 16, 2007, it restricted the use of toys including phthalates for children's toys. The content of the ingredients shall not exceed 1%; on June 1, 2007, the full implementation of the REACH regulation will impose further strict restrictions on toy manufacturing materials.
However, in the long run, the continuous improvement of EU toy safety standards is not necessarily a bad thing for Chinese companies because the Chinese toy industry urgently needs structural upgrades to increase the added value of its products. The EU’s “new directive†can be seen as a catalyst for change. External factors will drive the adjustment of the Chinese toy industry.
Wu Difei said that as a high-end toy exporter, they do not worry too much about the market outlook. “Because companies will continue to develop new products that meet the standards and seek a more stable market.â€
Although the new regulations reveal the color of trade barriers, this will not have a fundamental impact on the overall development of the Chinese toy industry.
Feng Fei pointed out that after more than 30 years of reform and opening up, Chinese companies have cultivated the ability to actively adapt to the international market. They have been able to adapt to new standards and form more standardized and advanced global competitiveness. "Of course, the resilience is behind the improvement of technological capabilities."
“We will see the implementation of the new EU Directive as an opportunity for companies to improve their international competitiveness.†Cai Jiechen, deputy secretary-general of the Guangdong Toys Association, told Xinhua News Agency reporters: “Even if the EU raises the bar for product exports to Europe, no country can Replace China's huge industrial supply capacity."
According to statistics from the Ministry of Commerce of the People's Republic of China, from January to May of this year, the export volume of Chinese toys increased by 35.1% year-on-year, but the export amount increased by 13.24% year-on-year, and the average unit price decreased by 16.18% year-on-year.
It is reported that from 2009 onwards, the EU has conducted many trainings and instructions for major imported toy suppliers, and Chinese manufacturers have also participated in them.
The strictest EU regulations in history have impacted my toy industry's testing equipment demand
The number of detection items soared from 16 items to 57 items of the new “EU regulations†for the “most stringent history†implementation. China's toy industry faces “winterâ€