July 4 (Bloomberg) -- China said one-fifth of its consumer products don't meet government safety and quality standards, underscoring the nation's challenge in restoring confidence after scandals ranging from tainted pet food to defective toys.

About 19 percent of products sold locally in the first half didn't meet Chinese standards, according to a survey of 7,200 types of food, farm products and consumer goods from 6,362 companies, posted today on the Web site of the General Administration of Quality Supervision, Inspection and Quarantine.

The survey, the second published this week, highlights the gap between the government's assurances that its products are safe and the reality in domestic markets. China, the world's biggest exporter of consumer products, faces pressure to improve safety standards as its trade surplus widens.

``It's still quite a high percentage of products with risk, it should be much, much lower,'' said John Wang, Shanghai-based manager of food services for Intertek Group Plc, the world's biggest tester of food, toys and chemical products. ``Five percent of substandard products would be reasonable.''

Chinese regulators face a fragmented manufacturing industry that strains enforcement even as intense competition leads to unscrupulous behavior. The supervision agency said in a separate statement today that it will crack down on oil factories after a report that a company in Sichuan province was selling waste oil from restaurants and other businesses as edible oil.

Bigger is Safer

The findings showed that products from large manufacturers have a better safety record: about 93 percent of products from large producers met standards, while small companies' pass rate was 73 percent. In the U.S., the rejection rate of substandard consumer products is about 5 percent, said Intertek's Wang.

In the last five years, 46 categories of products including beer, juice, fans and wooden flooring showed improving quality, according to the survey. The pass rate for beer rose to 89.3 percent, an improvement of 5.2 points, according to the statement.

Bottled drinking water, canned fruit and 24 other categories fluctuated in quality or had low pass rates. The biggest problem with food products in this group was excess bacteria, according to the report, citing random tests.

The Chinese government pledged last week to step up scrutiny of domestic manufacturers even as officials insisted Chinese exports pose no hazard to human health.

Promise and Reality

``There's no problem with Chinese exports, especially where human safety is concerned,'' Wang Xinpei, spokesman for China's Ministry of Commerce, said at a June 28 press conference in Beijing. ``The quality of Chinese exports is assured.''

China has confiscated $26 million of fake or poor-quality food and shut 180 illegal factories since December. Authorities in the past year found industrial dye in duck eggs and carcinogenic fungicides in turbot fish.

Melamine, used to make plastics, was found in pet food that was blamed for killing cats and dogs in the U.S. this year. Contaminated toothpaste and drugs in South America linked to Chinese producers contained industrial coolant and the toxic solvent diethylene glycol.

Earlier this month, Toys ``R'' Us Asia Ltd., a unit of Hong Kong's Li & Fung Ltd., recalled ``Thomas & Friends'' toy trains from stores in Asia after a report the toy contained lead paint.

A separate survey of children's snacks in southwest China's Guangxi province found that 40 percent of the samples failed tests for containing excess or illegal additives.

Blame the Media

Two types of preserved fruit contained cyclamate and sodium saccharine, exceeding China's allowable levels of sweeteners by 63 times, according to yesterday's statement on the government's Web site. Eight kinds of jelly and deep-fried snacks breached a government ban on the use of preservative sorbic acid and sodium benzoate, the statement said.

Still, the Chinese government's spokesman said global concern about the quality of Chinese products has been caused by ``misunderstanding'' and ``media sensationalism.''

``There are some unscrupulous businesses in China and abroad which disregard quality and safety, but they are among the minority,'' Foreign Ministry Spokesman Qin Gang said yesterday at a regular press briefing. ``China's government highly values the quality of Chinese food exports. We always maintain a very strict attitude and guidelines, whether in manufacturing, cleanliness, safety or quality.''

To contact the reporter on this story: Dune Lawrence in Beijing at dlawrence6@bloomberg.net

Last Updated: July 4, 2007 06:43 EDT