Linda Young - AHN Editor
Hong Kong, China (AHN) - Chinese workers are protesting after three large toy factories in Guangdong province, which supplied American companies, went out of business and threw more than 6,500 people out of work.
Workers complained that although they had received all their pay checks, that they hadn't received severance pay.
Liquidators have already taken control of a toymaker that supplied such major U.S. brands as Mattel and Disney.
Smart Union Group (Holdings) Limited cited the global financial crisis and said it was in the process of seeking help from Hong Kong's High Court to wrap up its affairs, with liquidators appointed to take possession of the assets of the company and its subsidiaries.
Trading on its stock was suspended Wednesday, when the factories closed. Smart Union had reported losses of $25.8 million for the six months ending June 20.
The combination of tighter manufacturing regulations and the effects of the global financial crisis are hitting at the same time in China
Industrial sector legislator Andrew Leung told Kyodo news that he expects more than 10,000 manufacturers in the province to close.
Xinhua news reports that of the 3,631 companies in China that were manufacturing toys for export at the beginning of the year, 52.7 percent went out of business in the first seven months of the year.
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