Coca-Cola in China Probe After Child’s Death - CNBC
Coca-Cola, the world’s largest soft-drink maker, is co-operating with Chinese authorities in their investigation of the death of a child whom state media said fell ill after consuming one of Coke’s popular Minute Maid milk beverages in northern China.
Coke, which is one of the leading drinks brands in China, said it was taking the incident very seriously and had removed the product from shelves in Jilin province, but had tested the product line and found no problems.
“After we were notified of this incident, we carried out comprehensive internal reviews of the retention samples of the same production batches and have not found anything unusual,” it said. “All the products are safe and within standards.”
The death, which was reported on Wednesday, generated thousands of comments on Sina Weibo, the Chinese equivalent of Twitter. Concern about contaminated food and other product quality issues is high on the list of explosive political issues in China.
Foreign brands are held to a high standard in matters of food quality, and news of contamination can be harmful to their reputation. Walmart recently came under fire in the Chinese press - and was fined 2.7 million yuans ($423,000) - after it was accused of relabelling regular pork as organic in some stores in south-western China.
Johnson & Johnson, the consumer products company, attracted Chinese public criticism recently after consumer advocates complained that the company was to phase out potentially harmful chemicals from its baby shampoo later in China than in some other countries.
Coke has been investing heavily in China, but has faced some obstacles recently. Last summer, the company had to recall Coke Zero fountain syrup from Taiwan after it surfaced that the drink contained a banned preservative that is said to cause health problems. In 2006, the company had to defend itself against claims that its products in China contained high levels of benzene, a chemical that has been shown to cause cancer.
Coca-Cola, the world’s largest soft drinks company by revenues, said on Thursday it was ramping up its focus on China with a $4bn investment over the next three years.
Beginning in 2012, it will build upon a $3bn investment announced in 2009, bringing the company’s total investment in the world’s second-largest economy to $7bn across a five-year period.
Coke has about 40 factories in China, where it employs more than 48,000 workers, and sales in the country represent about 7 per cent of the company’s annual volume.
In the first half of 2011, the company sold $1bn cases of Coke products in China, doubling its rate from five years ago.
During the second quarter, sales in China of Coke’s namesake brand jumped 24 per cent from the same period a year ago.