Chinese toy maker shuts doors on 7,000 jobs
Wed, October 22 2008
Smart Union closed its factory doors in the southern Chinese export hub of Dongguan leaving its workers stranded outside the plants, the China Daily reported.
“The main reason for the closure is we are too dependent on the U.S. market, which has become sluggish,” said Xu Xiaofang, a Smart Union human resource worker, according to the China Daily.
Rising labour costs, higher raw material prices and the appreciation of the Chinese currency, the yuan, also contributed to the problems, Xu said.
Smart Union announced to the Hong Kong stock exchange, where it is listed, a loss of about $36 million in the first half of the year.
It was unclear if the factory had halted production temporarily, or if it would be closed for good.
“After losing money for the first half of the year, its cash flow finally dried up,” reported China Daily.
Chinese state press reported earlier that more than half of the nation’s toy exporters had gone bust in 2008.
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