Pandemic disrupts manufacturing industry in Southeast Asia, affects global trade

Hyundai had to temporarily close its Vietnam factory in northern Ninh Binh province

Global brands which have manufacturing bases in Southeast Asia are feeling the heat from the ongoing Covid-19 pandemic amid a swathe of factory closures imposed to rein in the spread of the coronavirus.

Be it carmakers including Toyota, Honda and Hyundai, global fashion chains such as H&M, Levis or Gap, sports apparel makers including Adidas and Nike or electronics companies like Samsung and Intel, all are impacted by the current situation and forced to lock down key production sites across the region.

Countries most affected are Vietnam, Cambodia and Thailand. In Thailand, Toyota, the world’s largest automaker by sales volumes, had to suspend production last month at three factories due to a pandemic-related parts shortage and lockdowns across the country.

More than a third of apparel factories shut in Vietnam

Data from the Vietnam Textile and Apparel Association shows that up to 35 per cent of the nation’s apparel factories are currently shuttered, with Nike and Adidas being among the big brands struggling with the outages.

In the electronics industry, apart from Samsung and Intel, Apple supplier Foxconn is also reported to be worried about production blackouts due to the lockdown rules in place across much parts of Vietnam.

In Cambodia, garment workers are now demanding the world’s biggest clothing companies help recover millions of dollars worth of wages and benefits lost amid the coronavirus pandemic, Nikkei Asia wrote.

Their call comes as part of a broader movement by the region’s garment workers, underscoring the tough conditions facing the industry even as demand for clothing and shoes rebounds in the US and other major markets.

Unions demand compensation for lost wages

A collective of unions and labor rights groups from Cambodia has asked major brands producing in the country, including Adidas, H&M, Levis, Nike, Puma, Target, Gap, C&A and VF Corporation, to compensate Cambodian workers for $117 million in wages that were lost during the country’s lockdown in April and May, a figure based on a study of 114 factories undertaken by local unions and the Clean Clothes Campaign.

Overall, the group calculated that Cambodia’s more than 700,000 garment workers were owed $393 million in outstanding wages and severance payments since the start of the pandemic.

Myanmar, meanwhile, has seen the growth of its promising garment sector additionally devastated following the military takeover in February. Year-on-year exports to Europe dropped 17 per cent in the first five months of 2021.



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Hyundai had to temporarily close its Vietnam factory in northern Ninh Binh province Global brands which have manufacturing bases in Southeast Asia are feeling the heat from the ongoing Covid-19 pandemic amid a swathe of factory closures imposed to rein in the spread of the coronavirus. Be it carmakers including Toyota, Honda and Hyundai, global fashion chains such as H&M, Levis or Gap, sports apparel makers including Adidas and Nike or electronics companies like Samsung and Intel, all are impacted by the current situation and forced to lock down key production sites across the region. Countries most affected are Vietnam,...

Hyundai had to temporarily close its Vietnam factory in northern Ninh Binh province

Global brands which have manufacturing bases in Southeast Asia are feeling the heat from the ongoing Covid-19 pandemic amid a swathe of factory closures imposed to rein in the spread of the coronavirus.

Be it carmakers including Toyota, Honda and Hyundai, global fashion chains such as H&M, Levis or Gap, sports apparel makers including Adidas and Nike or electronics companies like Samsung and Intel, all are impacted by the current situation and forced to lock down key production sites across the region.

Countries most affected are Vietnam, Cambodia and Thailand. In Thailand, Toyota, the world’s largest automaker by sales volumes, had to suspend production last month at three factories due to a pandemic-related parts shortage and lockdowns across the country.

More than a third of apparel factories shut in Vietnam

Data from the Vietnam Textile and Apparel Association shows that up to 35 per cent of the nation’s apparel factories are currently shuttered, with Nike and Adidas being among the big brands struggling with the outages.

In the electronics industry, apart from Samsung and Intel, Apple supplier Foxconn is also reported to be worried about production blackouts due to the lockdown rules in place across much parts of Vietnam.

In Cambodia, garment workers are now demanding the world’s biggest clothing companies help recover millions of dollars worth of wages and benefits lost amid the coronavirus pandemic, Nikkei Asia wrote.

Their call comes as part of a broader movement by the region’s garment workers, underscoring the tough conditions facing the industry even as demand for clothing and shoes rebounds in the US and other major markets.

Unions demand compensation for lost wages

A collective of unions and labor rights groups from Cambodia has asked major brands producing in the country, including Adidas, H&M, Levis, Nike, Puma, Target, Gap, C&A and VF Corporation, to compensate Cambodian workers for $117 million in wages that were lost during the country’s lockdown in April and May, a figure based on a study of 114 factories undertaken by local unions and the Clean Clothes Campaign.

Overall, the group calculated that Cambodia’s more than 700,000 garment workers were owed $393 million in outstanding wages and severance payments since the start of the pandemic.

Myanmar, meanwhile, has seen the growth of its promising garment sector additionally devastated following the military takeover in February. Year-on-year exports to Europe dropped 17 per cent in the first five months of 2021.



Support ASEAN news

Investvine has been a consistent voice in ASEAN news for more than a decade. From breaking news to exclusive interviews with key ASEAN leaders, we have brought you factual and engaging reports – the stories that matter, free of charge.

Like many news organisations, we are striving to survive in an age of reduced advertising and biased journalism. Our mission is to rise above today’s challenges and chart tomorrow’s world with clear, dependable reporting.

Support us now with a donation of your choosing. Your contribution will help us shine a light on important ASEAN stories, reach more people and lift the manifold voices of this dynamic, influential region.

$
Personal Info

Donation Total: $10.00

 

 

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