Chinese companies pay up compensation due to melamine effect

A compensation amounting to nearly 1.1 billion yuan or $160 million will be provided by the companies to the victims of the contaminated milk products that sickened nearly 300,000 children and were blamed in the deaths of six, a state-run newspaper reported Tuesday.

The compensation plan was detailed after trials for 15 people on charges relation to the sale of melamine, a chemical added to milk to fake its boost in protein readings in quality tests.
 
China Daily said that there were 22 companies blamed in the scandal and these companies will make a one-time 900 million yuan or $131 million cash payment to the victims.

The 200 million or $29 million left would pay for the bills for lingering health problems; the paper reported citing an anonymous source from the China Insurance Regulatory Commission.

These details roughly matched to what the lawyers said they were seeking to the companies involved. They said most children who suffered kidney stones would get 2,000 yuan or $290 while sicker children would be paid 30,000 yuan or $4,380.Families of children who died will each get 200,000 yuan ($29,000), China Daily said.

Due to this contaminated milk, at least six babies died and around 294,000 children suffered kidney and urinary problems.

AUTHORITIES STEPPING UP

The plan and trials of those involved in the contamination is a sign that the authorities hopes to control what was seen as a national disgrace emphasizing widespread problems in food safety.

According to Xinhua News Agency, at least four of the suspects on trial would be given death penalty and that the verdicts would be announced on an unspecified date.

The four suspects are charged with endangering public safety for allegedly producing 200 tons of a mixture of melamine and malt dextrin which is a food additive made from starch, that they sold to milk producers.
From November 2007 to August 2008, they were able to sell 110 tons of milk producers for a total of 1.23 million yuan or $180,000. Xinhua said the other five on trial are charged with producing and selling toxic food, but did not provide other details.

The discovery of melamine in dairy exports such as chocolate and yogurt set off many product recalls overseas.