Quick Take: Textile Firm’s Vietnam Plans Come Unstitched

Textile-maker Huafang Co. Ltd. said it was scrapping plans for a $110 million high-end fabric factory in Vietnam after a local authority issued a notice to terminate the project, which had been in the planning stages for at least three years.

Huafang said its board voted unanimously to terminate the project (link in Chinese), which had a planned annual capacity of 50 million square meters of high-end fabric and would have been located in an industrial park in the country’s Vinh Long province.

Word of the project, which would have been the company’s first overseas, was first reported in 2015. Reports a year later said the company had received local approval and was calling the plant part of China’s Belt and Road Initiative, which encourages Chinese companies to invest overseas in countries along the ancient land and sea-based Silk Roads.

But Huafang said it had received a termination notice from authorities at the industrial park, and as a result decided against going forward with the project, according to the statement. It did not elaborate on why the park’s authorities had issued the notice, or on the nature of the notice.

“Going forward the company will carry on active discussions to try and identify a new location for this construction project,” it said, adding that it had already raised the money for the project through a private placement of shares last year.

Contact reporter Yang Ge (geyang@caixin.com)