China's
electronics industry has woken up to the potentially negative effects
on trade of the new EU directive on hazardous electronics waste, which
came into effect July 1 and was flagged by us earlier as an issue to watch.
At a trade forum on the new Restriction on Hazardous Substances (RoHS) directive, a senior official from the ministry of information industry told Chinese manufacturers that they needed to improve their standards in the areas of health, safety and environmental impact, according to Xinhua.
That China should organise a forum dedicated to RoHS shows how seriously it is taking the legislation, which requires manufacturers and suppliers to substitute six dangerous substances with safer alternatives if they want to sell electronics products in the EU.
Next year, China will introduce similar legislation for products sold in its domestic market -- see earlier story.
RoHS follows hard on the heels of a related EU directive covering Waste Electrical and Electronic Equipment, which puts the onus on manufacturers to recycle old TVs, mobile phones and washing machines.
Taken together, the RoHS and WEEE directives affect 6,800 Chinese electronic suppliers, according to this China Watch report. The most immediate effects will be felt by SMEs at the bottom of the supply chain, which account for 30% of China's electronic product lines and already face pressure from multinationals and larger domestic enterprises upstream.
Industry sources say making electronic products compliant with the new legislation adds around 10% to production costs. So, western manufacturers that source electronic components in China and have not yet seen price increases from their suppliers should start asking them questions about RoHS compliance -- and their plans for complying with the forthcoming Chinese version.
A survey commissioned by Global Sources in December 2005 found that 98% of Chinese suppliers who were not already RoHS-compliant planned to be so before the directive came into effect. But,as we all know in China, there is big gulf between intentions and reality.
