Chinese company Hangeng Trade Company has laid off all its employees in Pakistan and shut down its factory, citing an “unworkable business environment” and mounting financial losses.
The firm pointed to non-commercial challenges and serious operational difficulties that made it impossible to continue operations. Although it claimed to have met international export standards, its shipments were repeatedly delayed and remained undelivered, worsening its financial situation.
In an official statement, the company expressed regret over the closure, saying it could no longer maintain normal operations due to persistent non-market issues and operational barriers.
It added that its facility complied with inspection and quarantine requirements set by Chinese authorities and met international HACCP food safety standards. However, despite fulfilling all export criteria, necessary approvals were not granted in practice, leaving exports blocked.
The company said it remained patient over the past three months, cooperating fully with authorities and attempting to resolve issues through higher-level engagement. During this period, it continued to face heavy financial burdens, including employee salaries, contractual penalties, electricity bills, and container demurrage costs.
While acknowledging the importance of regulatory oversight and food safety compliance, the firm stated that its challenges extended beyond technical requirements, highlighting execution-level uncertainties and systemic obstacles that ultimately forced it to cease operations.
Before shutting down, the company confirmed it had cleared all outstanding dues, including three months’ salaries, penalties, utility bills, and demurrage charges.
It also appreciated the efforts of the Pakistani government and the Ministry of Planning in promoting economic cooperation between the two countries. However, it cautioned potential investors to carefully assess risks and uncertainties before investing in projects based in Gwadar.
The closure comes just ahead of Prime Minister Shehbaz Sharif’s expected visit to China later this month for a major business and investment forum.
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