Covid-19 in Asia: latest update

Cambodia

With less than 100 cases of people who tested positive for Covid-19, Cambodia is still not impacted by the disease in a direct way.

Footwear factories continue operating in the country. The problem relies on the supply chain, as shoe factories in Cambodia are facing lack of raw materials from China. “Footwear factories in Cambodia are (basically) contracting manufacturers. We receive material from China and some other countries to make finished products. Some factories are still producing because they have materials in stock. Some factories are out of material, so they suspend the factories for few weeks until suppliers resume their work", told us the Cambodia Footwear Association.

The same source told us that the Government in Cambodia is already in talks with China, with the aim to "prioritize sending raw material to Cambodia soon after factories in China start producing the materials”.

Another problem faced by companies relates to the cancellation of some orders, which is being felt already and is leading factories to the need of having their production planning reviewed.

Companies are not yet experiencing issues with the personnel not being able to go to work; but anyone coming back from abroad, will be quarantined for 14 days before being allowed to get back to work.

To prevent the spreading of the disease, the Cambodia Footwear Association is advising factories to follow the preventive measures announced by the local government, such as checking temperature, using alcohol and advise workers to wear masks.

(Updated 25^th March 2020)

Cambodian footwear exports have been rising rapidly in the last few years, having crossed the 2 billion dollar mark in 2018, according to the World Footwear Yearbook (Available HERE). Cambodia is quickly approaching the top 10 footwear producers in the world.

Japan has roughly 1 200 cases of people infected with Covid-19 and 43 deaths were registered since the beginning of the diffusion of the pandemic.

We have spoken with the Japan Shoe Manufactures Association and with the Japan Federation of Shoe – Wholesalers’ Organizations to collect more information about the situation in the country.

They have confirmed us that most Japanese factories are operating as usual at the moment; however, there is a concern regarding the future as many orders might end up being cancelled: “It is late to produce shoes for summer season given the delay in the materials coming from China”.

Retail is already being impacted and the local associations estimate a decline of 50%, when compared to last year.

The Japanese government has announced it will support Japanese companies facing issues as a result of the spreading of the disease, which will cover footwear and leather goods businesses.

If the virus diffusion continues, the local associations anticipate issues with the consumption shrinking on one hand; and on the other hand factories won't be able to produce at the normal levels given the lack of materials.

Japan is one of the most important markets for footwear worldwide, having ranked 3^rd for volume of imports in 2018, with 670 million pairs of shoes entering the country (Source: World Footwear Yearbook). China and Vietnam

are Japan’s main suppliers.