Factories in Vietnam's export hubs face weeks of disruption after typhoon

Factories in Vietnam's export hubs face weeks of disruption after typhoon

By Francesco Guarascio, Phuong Nguyen and Khanh Vu

Typhoon Yagi caused severe damage to many factories and flooded warehouses in northern Vietnam's export-oriented industrial hubs, with some shuttered plants expected to need weeks to return to full operation, executives said.

Asia's strongest typhoon this year was still causing deadly floods and landslides on Wednesday, killing dozens and ravaging infrastructure such as power networks and roads, after it hit the coast on the weekend.

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The disruptions could affect global supply chains as Vietnam hosts large operations of multinationals that mostly export their products to the United States, Europe and other developed countries.

"Many of them are gone with the wind," said Calvin Nguyen, head of Vietnamese logistics firm WeDo Forwarding Co., referring to products that were to have been delivered to the United States and the European Union, but without saying which.

The company's three warehouses in the coastal city of Haiphong had their roofs blown off and were still flooded on Wednesday, he said.

The industry ministry did not reply to a request for comment.

In Haiphong, one of the areas worst hit by the typhoon, 95% of businesses had been expected to resume some activity by Tuesday, the body managing its industrial zones said.

"Many businesses had their roofs blown off, some walls collapsed, gates, fences, signs, camera systems, garages and sliding metal doors were overturned, water flooded into factories," it said on its website.

In industrial zones hosting factories in Haiphong and the neighbouring province of Quang Ninh, 20 of 150 investors' plants will be out of service for at least a few weeks, said Bruno Jaspaert, head of the zones.

He expected power consumption there to stay a third below normal for weeks or months, as many companies were busy rebuilding damaged factories, he said, citing a damage survey.

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Among those hit was Jupiter Logistics, part of a group co-owned by Japan Airlines Co Ltd, said one official familiar with the survey.

Damage to Jupiter's warehouse was minor, a spokesperson for JAL said on Thursday, noting the cargo stored there had to be moved to a different location.

In another industrial park in Haiphong, South Korea's LG Electronics said it had partly resumed work on Tuesday after a factory's walls were crushed on Saturday and a warehouse of refrigerators and washing machines was flooded.

POWER CUTS

As state-owned power distributor EVN works to restore dozens of damaged electricity lines, power outages are still crippling several areas in the north.

In Quang Ninh, north of Haiphong, many factories still lacked electricity or water, Jaspaert said.

Chinese solar panel maker Jinko Solar's factory there was severely damaged, one of its workers said, as windows had been smashed and the roof blown away, keeping work from being resumed on Tuesday.

Jinko officials were not immediately available to comment.

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Far from the coast, the industrial hubs of Thai Nguyen and Bac Giang, home to large factories of multinationals, such as Samsung Electronics and Apple supplier Foxconn, also faced the risk of floods.

However, a Reuters witness said there were no signs of flooding on Wednesday at Samsung's large facilities in Thai Nguyen, about 60 km (37 miles) north of Hanoi, as water was receding, though more rain was expected.