China has a different business culture than the Western world. Now, let me be clear: most Chinese people I’ve met have been upstanding and honorable. And the majority of Chinese people aren’t business owners. The distinction is clear, and it’s not especially complimentary.
This is a society where bending the rules (or breaking them outright) is acceptable as long as you don’t get caught. Western moral grounding is naive. If you put lead or cadmium in toys, well, there are lots of children. China has hundreds of millions of children, but far fewer rich people, so if you’re a factory owner it’s tempting to cut corners whatever the cost. After all, it’s more RMB in your pocket. The same thing goes for melamine in the milk–after all, laws only apply if you get caught. And it’s awfully hard to get caught. Odds are you won’t, and if there’s a bullet in the back of your head as a result, well, the chances are greater you’d have been struck by lightning. Absent the most egregious cases (which are swiftly addressed) product safety complaints are largely a business dispute.
The same applies to counterfeiting. You can buy counterfeit anything in China. Everyone knows about counterfeit software, movies, music, and brand-name clothing. It’s usually easy to determine real from fake. However, have you ever heard of fake Scotch whisky? You can buy it in China, along with any other kind of booze you might imagine. I paid the equivalent of $45 for a bottle of Johnny Walker Black, but it’s not Johnny Walker. Whatever it is, it’s not bad (surprisingly) and tastes Japanese, but it’s not what I paid for. Cut-rate bars in Sanlitun (the expat bar haven) are more likely to serve rotgut, possibly laced with formaldehyde and methanol. Tsingtao is too cheap to counterfeit, and this industrial Communist beer is the safe–but unexciting–standby.
You can also buy counterfeit cell phones. The Inbocheer Pinapple PinPhone is sold in a case that is nearly identical to an Apple iPhone, but it runs a weird Linux-based operating system called MTK and is definitely not made by Apple. Want an Android-based phone? Pick up a Coogle, using the same font as the famed Google logo. Even HTC and Nokia phones–second-tier brands in the West–are faked.
More insidious are counterfeit pharmaceuticals. Scandal after scandal involves fake and/or watered down drugs. Vitamins? Fake. Even condoms have been faked, studies determining the counterfeit product to be unsanitary and ineffectual. Books sold from pushcarts on virtually every street corner? Fake. They’re mass-produced copies. Laptops? It may be running MacOS, but it’s probably not an Apple product. Even building materials are sometimes faked. Never discount the ingenuity of unscrupulous businessmen, and they’re nearly always men.
Counterfeiting was, until recently, seen largely as a problem affecting Western multinational companies. And the court of public opinion was (and to some degree, still is) not on the Westerners’ side–after all, a legitimately purchased copy of MacOS costs roughly the minimum monthly salary in Beijing. However, Chinese people (like all people everywhere) love their children, and the images of sick and dying infants in hospitals poisoned by tainted milk powder created a major uproar. Cadmium in toys has Chinese parents (like Western parents) concerned. Bad actors can get away with a lot in China, but the line, it seems, is drawn when it comes to poisoning children.
Do I expect any changes? Not really. There’s too much money to be made by being dishonest, what constitutes “dishonest” is nebulous anyway, and there’s just too little risk of being caught. When the equation changes, the market will respond. I’m not holding my breath for changes anytime soon, though. And in the meantime, ignorance is bliss when it comes to $1.50 bestsellers!