Although Europe and the U.S. have issued all kinds of recalls targeting China-made toys over the past two years making them a common phenomenon, such a high intensity of recalls has nevertheless surprised many people. According to industry experts, with the peak season for toy exports approaching, China-made toys will inevitably face more technical barriers due to the global economic downturn.

A report released by the Guangdong Entry-Exit Inspection and Quarantine Bureau shows that the world's major toy export markets including the U.S. and the EU are promulgating more and increasingly strict laws, regulations and technological standards relating to toy quality and safety.

In July, a new EU toy safety directive (2009/48/EC) and a U.S. toy safety certification program came into effect. The new EU directive restricts the use of toxic and harmful chemical substances, and the new regulation adopted by the U.S. stipulates that China-made toys shall be subject to repeated tests. This will result in a 25—30 percent rise in costs for Chinese toy exporters.

Particularly worthy of note is that the development of tougher standards for toys has started to spread to emerging markets.

Li Zhuoming, executive vice chairman of the Guangdong Toys Association, told reporters that Malaysia, one of China's largest toy importers among countries from the Association of Southeast Asian Nations (ASEAN), also recently announced that new standards for children's toys will be implemented in February 2010. The country will increase testing requirements for imported toys, which will undoubtedly increase export costs for enterprises exporting toys to Malaysia. Meanwhile, a possible "domino" effect being triggered among other ASEAN countries has caused concern.

The increasingly high technical barriers set by Europe and the U.S. have led to inspection and testing fees soaring for Chinese toy enterprises, which has become a heavy burden on them.

"Between October and December last year when the toy industry was in its most depressed period, we still paid a third-party testing fee 10 percent higher than the previous years with normal exports," said Xue Xiaowei, head of a toy factory in Shenzhen. Judging from the current trend, certification and testing costs will continue to increase this year. With the export situation still sluggish, enterprises will undoubtedly feel less able to bear the high cost.