How to make “made in China” products not synonymous with “harmful to health” is a hard question for Chinese policy makers to answer. “Made in Vietnam” product issues may also have the same solution.

Let’s view the “answer” for this question by Dr Susan Aaronson from George Washington University Business School, source provided by Bao Binh (Hanoi).

China is fast establishing its position in global economy; in fact, it already produces one-quarter of global production. But China's advanced bound is not matched by its governance prowess. The world's political and economic stability is threatened by the Chinese government's failure to implement the rule of law. Modern China has not  complied with the international rules. Price matters more than quality and bad companies set the bad precedents, which is against the China’s economic development direction.

China's inadequate governance is everybody's business, everybody is able to supply goods. Many people and animals have died; or poisoned or made sick by Chinese low quality products. Nations have not responded effectively. Guatemala, Panama, France and the US have boosted their inspection of Chinese products and halted imports of goods such as tyres, toothpaste, shrimp and toys. Such expedient solutions that also contain  political movements could not move China towards a culture of compliance.

Meanwhile, Chinese officials have responded inconsistently. On the one hand, the government has acknowledged responsibility for some unsafe food, toys and medicines and co-operated with its trade partners on inspections. At home, it has beefed up plant inspections and warned violators that they will be punished for acting inconsistently with Chinese product safety or environmental laws. On the other hand, China has proclaimed many “protectionism” polycies. For example, it blocked the shipment of imported fruits from the US because they contained "excessive amounts of bacteria and moulds". It also banned imports of Evian water, claiming that it had too much bacteria. Clearly China and many of its trade partners are engaged in an escalating series of trade disputes. Such disputes will do little to improve China's capacity to enforce product safety or environmental laws.

Trade policymakers must think strategically to address this problem. They will find a mechanism for such action in China's WTO accession agreement. This agreement, signed in 2001, included stringent provisions. First, it required China to ensure effectively to enforce all laws and other measures related to trade. (Product safety standards are examples of regulations pertaining to trade.) Second, it required that China apply WTO rules throughout Chinese territory. Thus, China must ensure to "apply and administer in a uniform, impartial and reasonable manner all its laws, regulations and other measures of the central government as well as local regulations, rules and other measures . . . pertaining to international trade activities".

Here is how WTO members might collaborate with China in trade to. Trade organisations from member countries could not make transaction with China if it did not  administer its laws and regulations that had been distorted toward Chinese benefits. If it still is in so doing, it will deprive itself trade opportunities with other members . These organizations might collectively call on China to commence multilateral consultations to settle differences and reassure global consumers that "made in China" is not synonymous with "hazardous to your health". If talks fail, China and its trade partners might call the WTO director-general to arrange. If unable to find a mutual- agreed solution, complaining countries might formally end its trade relationship with China.

Given the difficulties for the Chinese economy, it is likely that China would try to stop such trade disputes. Chinese policymakers do not want the "made in China" label to be the equivalent of a danger sign. Chinese officials would probably not only beef up enforcement and penalties, but also try to create demanding quality requuirements for its products. It is necessary to train business managers about the importance of product safety. Meanwhile, foreign investors will put pressure on their suppliers to test their production, because they now recognise that global consumers may not only reject Chinese-made low quality goods, but may in the future sue those companies that do not ensure product safety.

China may be a behemoth, but it is not a dinosaur. If it is truly a market- oriented economy it will respond to global market pressure to improve its governance. Meanwhile, by collaborating and relying on the international rule of law, China's trade partners will be more likely to ensure that China develops a culture of compliance.