A record surge in Covid-19 infection has closed factories in southern Vietnam, hitting one of the world’s busiest manufacturing centers for clothing and shoes, and sending global brands looking for backup suppliers. ..

Supply chain disruptions are a blow to countries that have significantly curtailed local virus transmission in 2020. Despite the pandemic, Vietnam was one of the few Asian economies that grew last year and attracted new foreign investment.

Daily new cases in Vietnam tend to be between 7,000 and 8,000, and since the beginning of July, almost all of Vietnam’s more than 200,000 infections have been recorded.

Ho Chi Minh City, Vietnam’s largest city, was hit hardest. On July 9, strict social distance measures were imposed, including rules on the transportation and housing of workers and the placement of staff on factory floors.

Two major shoe suppliers, Pou Chen from Taiwan, which manufactures Adidas and Nike shoes, and Changshin, South Korea, which also supplies US companies, closed down last month.

Pou Chen said it would shut down production at its largest factory in Ho Chi Minh City on July 14, and the factory would remain closed until at least August 9. The company’s other Vietnamese plants were forced to reduce operations.

“Local government requirements have affected workers’ employment capacity, which has led to lower utilization rates,” the company said.

Pou Chen shipped 244 million pairs of shoes last year, 44% of which came from Vietnam.Adidas warned last week that supply chain constraints could be costly Sales of 500 million euros By the end of the year.

Another Taiwanese sports shoe manufacturer, Feng Tay, closed several factories last month. According to the company’s website, the company manufactures shoes, which make up one-sixth of Nike’s annual sales.

The Vietnam Textile and Apparel Association recently said that more than 30 percent of the country’s garment and textile factories have been closed. NS report State-owned Vietnam News quoted the association’s chairman as “still very low” vaccination rates for workers in the industry.

Vietnam has been hampered by the stuttering vaccine program after the government delayed the procurement of jabs.that’s all About 1% Of the country’s population of approximately 98 million, it is fully vaccinated.

Cases of coronavirus have been reported throughout Vietnam, disrupting other sectors, including electronics.

“Because all provinces in Vietnam have been hit by Covid, the situation is unprecedentedly uncertain and buyers should adopt Plan B or C, including offshoring production to other countries.” Said VuNgoc Khiem of Global Sources, an e-commerce platform that connects Asia with. A supplier with overseas buyers.

Source: California News Times

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