Samsung: China smartphone factory closure leaves local community counting the cost

The South Korean firm closed its last smartphone factory in China in October after it had operated at the Jinxinda complex in Huizhou city for almost 30 years

Samsung relocated production to Vietnam and India in response in large part to the US-China trade war

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Until it closed in October, the Samsung complex in Huizhou was the South Korean company’s last smartphone factory in China. Illustration: Kaliz Lee

Published: 6:00am, 11 Dec 2019Updated: 11:14am, 11 Dec 2019

Looking out over her small restaurant in Huizhou city on the north of China’s Pearl River Delta, known to be the beating heart of China’s main manufacturing industry, Li Bing can still picture the hustle and bustle of a throng of customers from a nearby factory.

But now, as Li looks up from her sweeping brush, she is greeted only by empty tables, a sight that has been familiar for the last two months, and one that is replicated around Jinxinda complex, which is located in the city in central Guangdong province.

The reason behind the downturn is simple: the closure of Samsung’s complex in Huizhou, which until October was the South Korean company’s last smartphone factory in China.

Li’s restaurant had benefited from the thousands of migrant workers who had until recently lived within reach of the 120,000-square-metre (1.2 million sq ft) facility, which had provided the life blood for many other local businesses for almost three decades.

Before the Samsung factory moved, our turnover could reach 60,000 yuan [US$8,500] or 70,000 yuan [US$9,900] a month, but now we can only earn a few hundred yuan a day, only two or three tables a night

Li Bing

But after Samsung relocated production to Vietnam and India – in large part as a response to the trade war between China and the United States – industry insiders considered China’s changing position in the global supply chain, while businesses like Li’s were left counting the cost and wondering where to turn next.

“Before the Samsung factory moved, our turnover could reach 60,000 yuan [US$8,500] or 70,000 yuan [US$9,900] a month, most guests were employees and suppliers of Samsung, but now we can only earn a few hundred yuan a day, only two or three tables a night,” Li said.