U.S. Water News Online
DONGGUAN, China -- Last summer, Chinese government
investigators crawled through a hole in the concrete wall that
surrounds the Fuan Textile Mill in southern China and launched a
surprise inspection of the plant. What they found caused alarm at
dozens of American retailers, including Wal-Mart Stores Inc. and
Lands' End Inc., that use the company's fabric in their clothes.
Villagers had complained the factory, owned by Hong Kong-based
Fountain Set Holdings Ltd., had turned their river water dark red.
Authorities discovered a pipe buried underneath the factory floor
that was dumping roughly 22,000 tons of water contaminated from its
dyeing operations each day into a nearby river, according to local
In the two decades since U.S. companies began turning to Chinese
factories to churn out the inexpensive T-shirts, jeans and sneakers
that millions of Americans wear daily, China's air, land and water
have paid a heavy price, critics say. China has faced harsh criticism
in recent months over the safety of exports ranging from tainted
toothpaste to toxic toys. But environmental activists and the Chinese
government are increasingly pointing to the flip side of the problem
-- the role multinational companies play in China's growing pollution
by demanding ever-lower prices for Chinese products.
For instance, prices on fabric and clothing imports to the U.S.
have fallen 25 percent since 1995, partly due to the downward pricing
pressure brought by discount retail chains. One way China's factories
historically have kept costs down is by dumping wastewater directly
into rivers. Treating contaminated water costs about 13 cents per
metric ton, so large factories can save hundreds of thousands of
dollars a year by sending wastewater directly to rivers, in violation
of China's water- pollution laws.
'Prices in the U.S. are artificially low,' says Andy Xie, former
chief economist for Morgan Stanley Asia, who now works independently.
'You're not paying the costs of pollution, and that is why China is
an environmental catastrophe.'
Toxic runoff from China's booming textile industry is one reason
many of the nation's largest rivers resemble open sewers and 300
million people lack access to clean drinking water, environmentalists
say. Now, U.S. retailers are scrambling to prevent environmental
issues from creating the same kind of consumer backlash as the
anti-sweatshop campaigns of the past decade.
Fountain Set hasn't lost any major customers since the government
crackdown, but some U.S. retailers sent inspectors to the Fuan plant
and tightened oversight of the company.
'After labor issues, the environment is the new frontier,' says
Daryl Brown, vice president for ethics and compliance at Liz
Claiborne Inc., which uses Fountain Set cotton in some of its
products. 'We certainly don't want to be associated with a company
that's polluting the waters.'
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