NEW DELHI — The sudden closure of Apple supplier Foxconn’s Henyang Hongfujin Precision Industry plant, driven by the Chinese government’s erratic policies, has exposed what a new report calls the “hollow core of China’s industrial economy.”
The factory, which once employed 30,000 workers and generated billions in output, was shut down on September 30, 2025, leaving commercial districts tied to Foxconn’s operations resembling abandoned towns, according to a report from the Daily Mirror.
Rising costs, arbitrary regulations and the chilling effects of the U.S.–China trade war created an environment where foreign firms could no longer operate with confidence, the report said.
“The once-bustling commercial districts now resemble abandoned towns, with shuttered storefronts and displaced workers forced into precarious jobs like food delivery,” it noted.
Apple, wary of Beijing’s tightening control and unpredictable policymaking, accelerated its diversification strategy and shifted Foxconn’s production capacity outward. India and Vietnam, offering policy stability and tax incentives, emerged as leading alternatives.
Foxconn contributed more than 80 percent of Zhengzhou’s export volume and over half of Henan province’s total. Once Foxconn began scaling back and moving capacity abroad, Henan’s phone exports plunged 60 percent in the first quarter of 2024, dragging overall provincial trade down 23 percent.
Microsoft’s CSS team has also shifted positions to Japan and Australia while halting rehiring in China, part of a broader trend of multinational companies increasingly overlooking China in favor of alternatives — especially India and Vietnam.
The situation, the report said, stems from corruption, an unpredictable regulatory environment and labor exploitation, with local officials chasing short-term GDP gains rather than sustainable development.
Foxconn’s departure leaves many workers vulnerable to “black factories” that thrive on lax enforcement and corruption, it added, saying the Chinese Communist Party’s failure to curb corruption, enforce fair labor practices and maintain economic stability has pushed ordinary citizens into distress. (Source: IANS)
