Taiwanese shoemaker suspends production in Myanmar amid chaos

TAIPEI: A major Taiwanese contract shoe manufacturer has suspended its production in Myanmar amid attacks against pro-democracy protests after the country's military staged a coup and seized power on Feb 1, according to Central News Agency (CNA).

In a statement Tuesday, Pou Chen Corp, which provides ODM footwear services to international brands such as Nike, Adidas, Asics, New Balance, Timberland and Salomon, said the decision to halt production in Myanmar was for safety reasons amid the political chaos.

But the suspension is unlikely to have an adversary impact on Pou Chen's overall operations because the Myanmar plant only accounts for a small fraction of the company's total production, it said.

According to Pou Chen, its plants in Myanmar, Cambodia and Bangladesh account for about four per cent of its total shoe production, and the shutdown of its Myanmar plant has not caused any shipment delays to clients.

If greater capacity is needed to meet demand, production will be increased in Vietnam and Indonesia to fill the void left by Myanmar, the company said.

Prior to the problems in Myanmar, the company's overall revenue was hurt by the COVID-19 pandemic, with revenue from its shoe contracting business falling 24.6 per cent in 2020 from a year earlier.

In addition to Pou Chen, Tsang Yi Co., another Taiwanese shoe contractor that supplies Adidas, has also halted its production in Myanmar amid the spreading violence, according to the Invest Taiwan office under the Ministry of Economic Affairs.

The office said Pou Chen and Tsang Yi suspended their Myanmar operations to protect their employees, and it is unclear when their production will resume given the turmoil in the country.

According to media reports, Myanmar's military killed more than 100 people in the streets and forced thousands of people to flee into Thailand on Saturday alone at the same time that military junta chief Min Aung Hlaing was throwing a lavish dinner party.

Since the coup, at least 510 people have been killed and many of the country's senior politicians, including Aung San Suu Kyi, have been detained, the reports said.

-- BERNAMA