I was lucky enough to hear the reaction of the Chinese administration to the recent tainted milk crisis, right from the horse’s mouth. I had the opportunity to attend the official press briefing by the Chinese Foreign Ministry, in reaction to the recent happenings over the milk crisis issue.

It does seem there is much room for blame and accusation as the negligence of the many parties involved has lead to the tragic situation it is in now, over 50,000 sickened and 4 children dead.

The problem was first brought to the attention of the Sanlu Company in December 2007 due to consumer complaints and even after knowing the truth, Sanlu tried to hush it up by paying the victims’ families and the media up until the time it submitted a report to the Shijiazhuang Municipal Government on 2 August 2008. Shijiazhuang is the capital city of Hebei Province.

After the Shijiazhuang government received the report, it did not, as protocol requires, relay the report immediately to its superior body, the Hebei provincial government. It was only on 9 September that the provincial government finally received the report from the municipal government. But the provincial government, which was supposed to turn the report to the central government immediately, failed to do it as well.

Finally the central government received the report and took immediate action in September. They gave instructions to the various involved parties and handled the situation. They put in place emergency response mechanisms, supervisory bodies and carried out a thorough clean-up. They made the results of the inspections and information public and they kept international organisations and important trade regions well-informed. Since then expert teams have been working on effective treatments for the sickened children and no effort has been spared in treating them. Free nation-wide medical examinations for the affected, as well as free treatment for the children have been made available.

But damage control may just not be enough anymore. We must go with the notion “prevention is better than cure”. However effective China is in reaction and remedy of the situation, it has damaged the trust of the many millions of customers China had. For days to come, customers are going to ask themselves at the supermarket shelves, can we really trust this milk, if it’s made in China? Not only milk and dairy products, in fact any product from China is going to be bought after some resistance or at least mild contemplation.

It is in building the lost confidence and strengthening the measures of addressing information asymmetries that China can raise from the pit it has fallen into. People trust the authorities, who set the standards, decide on the quality and ensure safety. Once people lose their faith in the mechanisms or systems put in place to ensure the acceptable levels of standards and quality, it is a fool’s mission to try and regain the confidence that’s lost, without institutionalizing the mechanisms and strengthening them first. Hence together with damage control and remedy, it is in the best interest of China to invest in improving food safety regulations, strict production measures, intensify quality monitoring, strengthen supervision and ensuring the proper judiciary and legal procedures in
bringing the negligent parties to justice when necessary.

One’s might is not defined by what they do, rather it is defined by how well they rise from the fall.

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