No blind export curbs

Talks between the SAR government and baby formula suppliers have failed to end a milk-powder shortage in Hong Kong blamed on parallel traders and malpractices by some retailers. Secretary for Food and Health Ko Wing-man responded by announcing that the government may categorize baby formula products as "reserved commodities" through legislation, which would restrain the amount of the product to be taken out of Hong Kong.

Hong Kong currently has few reserved commodities, including rice and gasoline. The addition of milk powder to the list would be "historic", to say the least. However, it remains to be seen whether the proposed legislation would be necessary. Other ways to solve the problem should be considered first.

It has to be ascertained whether the present "panic buying" or shortage is a seasonal phenomenon with Chinese New Year around the corner. The situation could have been the result of broken links in the supply chain. Is there a hostile entity trying to monopolize the local market? It would be necessary to list baby formula as a reserved food item if some people are found trying to manipulate the market. Without such proof, enforcing legislation would be overdone.

The reality is that the supply of baby formula products remains largely healthy in Hong Kong and the shortage is only limited to districts close to the border with Shenzhen. Major importers have pledged adequate supplies of popular brands. Meanwhile, some parents have accused certain retailers of deliberately withholding baby formula products for parallel traders.

The exact cause of the baby formula crisis must first be established to restore normal supplies instead of rushing to impose export controls blindly.

This is an excerpted translation of a Ta Kung Pao editorial published on Jan 31.

(HK Edition 02/01/2013 page1)