At times, customers from the United States, Europe and Japan suddenly appear at the factories, checking the premises and inspecting workers' living and working conditions to see if they meet proper standards; whether they employ child labour and if fire extinguishers are too dusty or beyond the reach of workers.

'Compliance checks are the biggest headache of mine,' Ms Ngan said. 'In poor economic times, the checks are more frequent and more thorough. If this is not protectionism, what is it?'

To counter any risk, the company's strategy is to maintain the factories at the highest standards round-the-clock.

Few would dispute that protectionism has ever faded from the radar screen in global trade; the question is whether it has worsened and to what extent.

Hong Kong toy factory owners across the border have been stunned by India's sudden decision to ban imports of Chinese-made toys for six months from January 23. No reasons were given for the decision, which was 'in public interest,' according to India's Directorate-General of Foreign Trade.

In response to the ban, Beijing was reportedly contemplating taking the issue to the WTO for mediation, a move that risks igniting a marathon arbitration battle and Sino-Indian trade frictions.

Many Chinese toy factory owners who are still on Lunar New Year holidays are unaware of the bad news, while those who have heard say the move will aggravate the gloomy prospects for the 3,500 Hong Kong toymakers in Guangdong, of which at least 500 have already been forced out of business.

'Protectionism is obviously a culprit,' said a Hong Kong toy entrepreneur who had knocked on India's door for export opportunities three months ago.

'The toy market in India is chaotic and local manufacturers find Chinese exports a threat.'

When asked if erecting trade barriers would put global trade recovery in jeopardy, Anoop Singh, a new director of the International Monetary Fund's Asia and Pacific department, said: 'It is important to guard against any move towards protectionism or beggar-thy-neighbour policies in the current global context,

'While such policies may seem appealing, they will not work in the globalised economy and are not a solution ... they will be damaging to the prospects for a recovery in global trade, which is in every country's best interest.'

If the comments by Chinese leaders were any measure of their worries, Premier Wen Jiabao's repeated warnings on 'the dangerous trend' on protectionism signalled the depth of the nation's resentment.

During his eight-day tour of European countries that ended on Tuesday, Mr Wen voiced concern about developed countries adding entry barriers on foreign trade, a move he described as 'harming others while being to nobody's benefit'.

His calls on the world's state leaders to increase confidence, co-operation and responsibility to avert a global economic disaster were timely.

Those hopeful of a joint effort to revive global trade will be disappointed as the US, the free-trade advocator, still has provisions to its US$900 billion economic stimulus package, which stipulated using domestically produced iron and steel for infrastructure investments.

Even though the Senate agreed to water down the provisions to be 'consistent with US obligations under international agreements', the package still smacked of protectionism.

The Indian ban on toys and provisions in the US stimulus package have not only fuelled worries that protectionism is gaining momentum, but have revealed a weakening of a pledge by G20 nations in November last year to refrain from raising trade barriers for 12 months.

India and the US are G20 members.

Some economists have pointed out that history appears to be repeating itself as the latest US strategy rekindles the trade-protectionism approach used in the country during the Depression of the 1930s.

Independent economist Andy Xie recently warned that 'developed economies may resort to protectionism to keep jobs at home, leading to a vicious cycle of recession and more protectionism'.

Sino-European Union trade ties have also undergone a testing time. Beijing has protested against the EU's decision in December to impose tariffs of as much as 85 per cent on Chinese-made screws, bolts and iron or steel fasteners.

The Ministry of Commerce was 'strongly dissatisfied' at the 'unfair' decision and threatened to bring the matter to the World Trade Organisation.

An element of protectionism was apparent as China supplied 60 per cent of EU's iron or steel fasteners worth Euro575 million (HK$5.73 billion) in 2007.

Some economists blamed China's massive trade surplus as the root of the trade dispute with the west. This is despite Mr Wen's reiteration that it was not a surplus that China deliberately created nor intended to maintain, as he also revealed that the mainland's surplus exceeded US$20 billion for most of last month. The latest trade figures for January are due to be released next week.

Recessions in the US, Europe and Japan - the three largest consumers of Chinese-made goods - dragged the mainland's exports into negative territory in November and December. Despite the 2.8 per cent drop in exports the trade surplus in December was 71.8 per cent higher.