Although he admits that local toymakers are having a very difficult time, an industrial insider said that the advantages for the development of the toy industry in Guangdong province are still unmatched elsewhere in China and even in Southeastern Asian countries.

"It is a fact that many local toymakers have been weathering a very hard time," Li Zhuoming, vice-chairman of the Guangdong Toy Industry Association, told China Daily in an interview on the sideline of a press briefing on April 16 regarding the 2008 Guangzhou International Toys and Gifts Fair, which is set from May 4-6.

"The rising production costs due to the rising price of raw materials, rising labor costs and quality-control costs, the continual yuan appreciation, China's macro-adjustment policies related to the processing trade, and the negative impact of last year's three toy recalls in the United States (related to the toymakers in the province), are all among the reasons for the hard time for local toymakers," he said.

"The situation will worsen if the proposal is implemented for a new toy-testing and safety-verification system for toys sold in the US market," he said, adding that it "has been endorsed by the US Toy Industry Association and the American National Standards Institute".

Furthermore, he said: "China's quality watchdog has been gearing up efforts to guarantee the quality and product safety of toys by performing China Compulsory Certification on all toys, and it has been enforcing one regulation after another, to guarantee their quality and safety," he said.

He said that local toy makers will have to pay extra testing fees of 20 to 25 percent of the present production costs if the proposal comes into effect.

Nevertheless, he said, very few toymakers in the province will move away. He based his upbeat viewpoint on the province's obvious advantages for the very industry including the peerless industrial chain and the headway the sector has made in R&D and independent innovation endeavors.

"An industrial exhibition can be a window of the development of the very industry," he said. "The active application of the toymakers in the province for booths of the upcoming 2008 Guangzhou International Toys and Gifts Fair in early May reflects, to a great extent, the fact that the province's toymakers can still survive, despite the great pressure."

According to the vice-chairman, more than 400 toy firms, a majority of which are based in Guangdong, have booked all the booths, leaving many more "late birds catching no worms".

Li said that those toymakers with their own brands or high-tech products have been much more active than OEMs (original equipment manufacturers) in seeking business opportunities.

Official statistics indicate that the province has more than 5,000 toy firms and reported toy exports of $14.2 billion in 2007, which represented 68 percent of the nation's total toy exports.

And China-made toys occupy over 70 percent of the global market.

Editor: Yan