Multiple Pakistani Companies Shut Down Amidst Economic Disturbances
Multiple companies in Pakistan have been shut down due to economic disturbances, including import curbs and a massive shortage of raw materials and mobile phone components. Among them is Transsion Tecno Electronics, a mobile phone production facility initiated under the China Pakistan Economic Corridor (CPEC) project.
Despite surviving a prolonged period without access to necessary materials, the company has finally announced that it can no longer continue manufacturing mobile phones. Transsion Tecno Electronics has been producing smartphones since 2017, offering employment to 12 Chinese managers, 400 Pakistani engineers, and 2500 male and female employees.
Former Board of Investment (BoI) chairman Azfar Ahsan has warned that Transsion Tecno Electronics is not the only company facing such issues. In fact, 30 other mobile phone manufacturers, including global brands such as Samsung, Xiaomi, Vivo, OPPO, Nokia, Tecno, Infinix and Itel, are also struggling due to the same circumstances.
Ahsan has sent a letter to Prime Minister Shahbaz Sharif, highlighting the government’s inability to open letters of credit since January 2023, which is putting the economy at risk. He also mentioned that massive layoffs are creating a further negative impact on the industry, which needs USD 100 million per month to stay afloat at even 50% capacity and to retain the 35,000-40,000 direct and indirect jobs created by the same.
The shutdown of Transsion Tecno Electronics is a significant blow to Pakistan’s economy, especially as it was established under the CPEC project, which was meant to be a significant driver of growth and development in the country. The situation is further complicated by the fact that other mobile phone manufacturers are also struggling, which could have a severe impact on the industry and the broader economy.
