THE biggest textile exporter in southern Philippines, located in the Autonomous Region in Muslim Mindanao (Armm), is heading towards a shutdown.

Officials said the firm is set to lay off hundreds of workers as a consequence of the global financial crisis.

"The Manny Pacquiao Blog". Click here for stories and updates on the Filipino boxing champ.

Lawyer Ishak V. Mastura, Armm deputy executive secretary, said the regional government has suggested to Mindanao Textile Corp. (Mintex) that it converts its facilities into an industrial estate.

This is in case the firm, which plans to retrench more than 300 workers, shuts down operations in Datu Odin Sinsuat, Maguindanao due to lack of orders.

“We are asking Mintex to look together with Reza (Regional Economic Zone Authority) into the possibility of converting its facilities into an industrial estate and special economic zone that will bring new productive activities and new investments not just in the garments sector,” he said in a phone interview.

In April 23, Armm Governor Datu Zaldy U. Ampatuan created Reza’s management committee headed by Mastura. The body is composed of senior regional government officials and a representative from the business sector.

Its creation came a day after Lo Hing Woon, Mintex plant manager, informed Armm's Department of Labor and Employment (Dole) they will be retrenching workers starting May 15. Woon said they have not received new orders for shirts as a result of the global financial meltdown.

Lo, in his letter, said the company is working hard to get product orders to avoid shutting down operations.

"The situation in the garments industry has worsened this year as a result of quota phase-out and the existing global financial crisis that we have encountered. We have no orders received for woven shirts (in the) months of May to August 2009," Lo said.

Those in the cutting section will also be affected by the lay-off, he added.

Mintex, whose main office is in Hong Kong, is a major investor in Armm. It has been around for more than two decades, supplying clothing lines to the United States and Canada, among others. The autonomous Muslim region, composed of five provinces, is the poorest region in the country.

Among Mintex's clients are popular US apparel brands GAP, Timberland, and Arrow, said Mastura, previously the autonomous Muslim region's trade secretary, adding the company is the "biggest exporter in Armm in terms of volume."

Although clients in the United States have stopped ordering, Mastura said the company is still producing for this month until June from an earlier commission.

Mastura noted that because of the financial crisis, buyers are looking for the cheapest source of garments and China has beaten the Philippines and other countries in such search.

Antonio F. Mariano, Dole acting secretary, said Mintex may totally shut down within July to September, if no new orders come.

"(At the moment), management is negotiating with foreign buyers for more orders of shirts, polos, and pants [to avoid closure]," he said.

Mariano said one measure thought of to prevent the company from closing is for Mintex to produce uniforms of public and private institutions in the country.

Some 1,313 Mintex workers were also displaced last year, data from the Regional Board of Investments said. Mintex is registered with the board.

Companies in the country and elsewhere have felt starting last year the effects of the economic crisis triggered by the financial crunch in the United States. (BSS)