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Soft toy exporters feel heat of new EU & US rules
Jul '11
Some enterprises in Shenzhen and Dongguan say that 30 percent of existing factories in the Pearl River Delta are in the danger of shutdown or semi-shutdown. The EU and the United States implement new soft toy safety standards on July 20 and August 14, which is proving to be a nemesis for Chinese soft toy export enterprises.

According to customs data, soft toy exports from Dongguan reaches about US $2 billion per year, of which over 80 percent are exported to Europe and the United States.

Insiders say that after the implementation of new standards, export enterprises are bound to be affected. After the implementation of new EU standards, other countries in South America and Russia also expected to implement new regulations.

The most deadly factor is an increase in costs. Under the new standard, soft toy factories have to provide more detailed sample testing to importing countries. The increase in testing costs will prove to be very detrimental for exporters.

Meanwhile, the implementation of more stringent safety standards demands soft toy manufacturers to improve product quality, to use good materials, and to buy good raw materials, due to which, their costs have increased by more than 5 percent. Wage costs too have risen by more than 35 percent.

It is reported that about 30 percent of the plants are feeling the heat of the new regulations.

Fibre2fashion News Desk - China

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