Pakistan’s mobile phone industry is facing a massive decline. Many local manufacturers have seatback and announced that they are planning to stop their operations in the country.
The non-opening of Letters of Credit (LCs) is a primary reason behind the companies’ decision.
Smartphone Manufacturers are facing difficulties in purchasing raw materials due to the high cost of essential products. Therefore, smartphone manufacturing has become very difficult in Pakistan.
However, Transsion Techno Electronics, a Chinese venture that produces smartphones under the China-Pakistan Economic Corridor (CPEC), has also decided to stop production in Pakistan.
Transsion Techno Electronics is a joint venture company formed in 2019 between Transsion Holdings China and Tecno Group Pakistan. They are among the top 10 global manufacturers of mobile phones, with brands including Infinity, Itel, and Tecno.
In addition, the company is currently operating two plants situated in Karachi for manufacturing smartphones. The company is super efficient that it can produce 825,000 smartphones.
Though the company is super intelligent, it can quickly evolve in response to changing circumstances. But still, the company is unable to cope with the current economic situation in Pakistan.
Up till now, the company has produced around 0.3 million smartphones per month. However, it offered employment opportunities to 12 Chinese managers, 400 Pakistani engineers, and 2500 female and male employees.
However, the company shut down its operations in Pakistan due to the shortage of raw materials and components.
Azfar Ahsan, Former Chairman Board of Investment (BoI), has written in his letter to the PM of Pakistan, Shehbaz Sharif, urging him to take immediate action.
According to the news, he stated that 30 other mobile phone manufacturers, including Vivo, Xiaomi, Oppo, Nokia, Tecno, Infinity, Samsung, and Itel, are also experiencing the same difficulties.
However, he also wrote that raw materials shortage and the frozen LCs since January 2023 had put the economy and its associated things at risk.
Furthermore, he also said that “massive layouts are further exacerbating the situation, while the industry requires $100 million per month. To stay operational at even 50% capacity and to retain the 35,000-40,000 direct and indirect jobs.
Previously, it was also mentioned by the manufacturers that the situation is getting worst day by day.
Amir Allahwala, a vice-chairman of the Pakistan Mobile Phone Manufacturers Association, told the news that “smartphone manufacturing has come to a halt after manufacturers ran out of parts by the mid of February and shut down their factories.”
In addition, he also said that “12 Chinese managers were working at our facility, but now 10 have left for China due to the current economic situation”.
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