2-decade-old foreign-invested firm with over 2,600 workers to cease operations in Ho Chi Minh City

The Ho Chi Minh City Export Processing and Industrial Zones Authority confirmed on Thursday that the company operating in My Phuoc Industrial Park, Ben Cat Ward, Ho Chi Minh City, formerly Ben Cat City of Binh Duong Province, would shut down.

The company’s shutdown announcement has drawn public attention as it is well known locally and has operated in Vietnam for 23 years.

The firm was identified as Panko Vina Corporation, a South Korean-invested company, which specializes in textile processing, dyeing, and garment manufacturing.

The company currently employs 2,640 workers.

In a notice to its employees, Panko Vina stated that after careful consideration, it would officially end all production and business activities in the city from February 1.

The company explains that it has faced persistent difficulties since the COVID-19 pandemic and has been unable to secure sufficient orders.

In addition, as it also runs a factory in former Quang Nam Province, now part of Da Nang City, central Vietnam, the firm plans to consolidate production at a single location amid declining demand.

Under the announced plan, Panko Vina will continue paying wages to employees through January 31, although workers will only be required to work until January 15.

The company has been committed to paying all severance and related allowances, including those applicable during probation periods, in accordance with Vietnamese law.

The firm will provide an additional allowance of VND2 million (US$76) per employee and settle annual leave entitlements.

For employees who have already advanced annual leave, the company said it would waive the corresponding deductions and not seek reimbursement.

The authority said it is coordinating with relevant agencies to monitor the situation, ensure workers’ rights and benefits are properly addressed, and maintain security and order.

Following a review, there is no information indicating that the firm is in arrears on workers’ wages or social insurance contributions.