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Factories closure continues in PRD Region
24 Mar '08
1 min read
According to Federation of Hong Kong Industries, 10% of nearly 70,000 factories in Pearl River Delta (PRD) region, owned by Hong Kong based enterprises, will stop production process this year.
Experts believe that, reasons for shut down are mainly rise in costs of production and strict rules which are forcing various factories to leave the region. As a result many cities in Pearl River delta region are facing widespread industrial restructuring.
According to the Federation, some manufacturers will close down their units permanently or will move either to Inland China or out of the country. This ratio of closure and shifting might be the highest in the past 20 years.
Last year alone, more than 1,000 shoe factories and suppliers in Guangdong stopped their production, who between them accounted for about 10 percent of total footwear manufacturers in the province.
According to the statistics, most footwear companies which closed in Guangdong were small scale units with investments of less than US $3 million.
Industry insiders feel that with so many production units closing down and moving from the region, it will hamper the economy.
Experts believe that, reasons for shut down are mainly rise in costs of production and strict rules which are forcing various factories to leave the region. As a result many cities in Pearl River delta region are facing widespread industrial restructuring.
According to the Federation, some manufacturers will close down their units permanently or will move either to Inland China or out of the country. This ratio of closure and shifting might be the highest in the past 20 years.
Last year alone, more than 1,000 shoe factories and suppliers in Guangdong stopped their production, who between them accounted for about 10 percent of total footwear manufacturers in the province.
According to the statistics, most footwear companies which closed in Guangdong were small scale units with investments of less than US $3 million.
Industry insiders feel that with so many production units closing down and moving from the region, it will hamper the economy.
Fibre2fashion News Desk - China
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