A factory in Iran’s Isfahan producing polyester and acrylic yarn is on the verge of bankruptcy and complete shutdown.

According to ILNA, Alireza Khorrami, who represents the Polyacryl Isfahan workers, said the current condition is the result of government mismanagement and a petrochemicals price hike.

Khorrami detailed that a government decision last September to adjust feedstock prices in the textile industry, coupled with an increase in the base price of petrochemical products has pushed raw material costs by 30 percent. This sharp rise has seriously destabilized the financial foundations of the factory.

“The situation has risen to the point where continuing the production is economically unjustifiable and has a deep impact on the liquidity of the company,” added Khorrami.

Polyacryl Isfahan, founded in 1974, was once considered among the most flourishing Iranian industrial complexes but years of managerial neglect and the impact of international sanctions crippled its operations. The factory was previously shut down and was revived in 2017.

The government's unresponsiveness had compounded the current predicament of the factory despite repeated appeals for intervention.

With the looming closure of the factory, Khorrami said that at least 2,000 workers would become jobless and the closure marks a loss for the country in terms of its industrial capacity, mainly in the textile sector.

Over the past few years, skilled workers in Iran have also voiced their frustrations over the widening gap between their earnings and soaring inflation.