Slump shuts more than 3,000 Hong Kong-owned factories in China
More than 3,000 Hong Kong-owned factories in southern China have been idled or closed as the global economic slump takes its toll, an industry leader said in an interview Monday.
Around 3,200 factories have remained closed since the Chinese New Year holiday because of a lack of business, according to Danny Lau, chairman of the Hong Kong Small and Medium Enterprises Association.
The factories, many of them toy and clothes factories employing thousands of people, account for 5 per cent of the 65,000 Hong Kong- invested factories in China's Pearl River Delta.
"These factories have halted operations because they have no orders," Lau said in an interview with Monday's South China Morning Post.
"Some may have their bosses or a few staff returning to the factories to guard machinery. ... In some streets, there are only 20 to 30 per cent of factories operating."
Forty per cent of all Hong Kong-owned factories in the region had resumed production at 50 per cent of capacity with orders plunging by 50 per cent since last year, according to Lau.
Hong Kong businesses were the first to open factories in the 1980s in the Pearl River Delta, once known as the world's workshop, and remain the biggest investors in the industrial region.
Hundreds of thousands of migrant workers who returned home for the Chinese New Year holiday at the end of January have not returned because of the massive slowdown in business, reported dpa