AUGUST 19TH 2015
TIGHTER REQUIREMENTS AND INSPECTION A LIKELY OUTCOME OF TIANJIN BLAST
Last Wednesday, people around the world turned their attention to the massive explosion in the Binhai New Area of Tianjin, China. Although neither the precise cause of the explosion nor the volume of damages has been identified and made public, some of the developments taking place in the past seven day (including government announcement by government officials) outline several important implications of the incident on the owners’ accountability, quality control and standards as well as on business in China (especially business with unusual and dangerous goods).
Last week, as journalists dove deeper into the details regarding the explosion, the owner of the storage area and the goods stored there, it was revealed that the storage site (i.e. the explosion site) was clearly build contrary to Chinese safety rules.
Chinese regulations stipulate, that warehouses stocking dangerous materials (such as the one exploding in Tianjin and owned by Ruhai International Logistics) must be located at a distance of least 1 km away from any public buildings and main roads. However, in the case of Tianjin, there were two residential complexes as well as a couple of main roads located closer to the storage site that the prescribed 1 km.
According to the People’s Daily newspaper, two hospitals were also located in close proximity to the blast epicenter. The BBC hints to the clear violation of regulations by stating that the usage permit for the storage site was given to Ruhai International Logistics when the nearby residential complex has already been completed and up for sale.
To further illustrate the apparent oversight failure of local authorities, an environmental expert interviewed anonymously by People’s Daily was quoted saying «the warehouse should not have passed the environmental assessment under normal circumstances».
In addition, the BBC brought about the information that there were discrepancies found between accounts and documents by the company and the customs officials, which proved to be a contributing factor to the difficulties of determining the volumes and type of the stored goods.
What do these clear failures that have been receiving significant media attention mean for the future?
Last Saturday, Chinese President Xi Jinping said that the explosion in Tianjin showed serious problems in workplace safety and urged authorities to he to learn from the “extremely profound lessons paid for with blood» and make every effort to avoid such accidents in the future. The president is demanding improvements to workplace safety and thus we can expect more strict regulations (and adherence thereto).
What this means is one hand harsher punishment in case of failing to fulfill all that is stipulated by the law (earlier this week,the CCTV reported that both the President and the VP of Ruhai International Logistics were detained by the police). On the other hand, this clearly shows the incentive to aim high when it comes to quality control and compliance with standards as it may save your company considerable resources. Being on top and up to date with the regulations is key and after the tragedy in Tianjin, more frequent and more thorough inspections by the authorities will be just a logical response.
SOURCES:
“China explosions: Fears hundreds of tonnes of dangerous chemicals still at Tianjin blast site” ABC News
“China explosions: Fires still burning after Tianjin blasts”. BBC Asia http://www.bbc.com/news/world-asia-china-33924501
Huang Jin, “Li Keqiang: Tianjin blast must be thoroughly investigated” People’s Daily Online
http://en.people.cn/n/2015/0817/c98649-8937068.html
Yuan Can, “Profound lessons must be learned from Tianjin blasts: Chinese leaders”. People’s Daily Online
http://en.people.cn/n/2015/0816/c90000-8936711.html
Annex Asia Publishing
Image: ITV.com
