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Orchard-Formit, which manufactures kitchen cabinet surfaces in Carmiel, is expected to close down next month and let go its 89 employees. The owners cited an inability to compete with imports from China.

After operating for the past 27 years, the business ran into financial difficulties following the bankruptcy four years ago of its parent company Sefen, Israel's leading manufacturer of decorative surfaces.

The Carmiel plant avoided closure at the time after being purchased by A.P. Formica Center.

Two months ago the plants new owners informed the Histadrut labor federation chairman in the region, Yoav Klein, they were unable to compete with Chinese imports and would soon be closing down the plant.

After failing to interest other companies in buying Orchard-Formit, Klein said he was close to signing an agreement with a competing factory in the area to hire a third of the plant's workers.

Klein and the workers' union conducted negotiations with the owners of Orchard-Formit over the past month to ensure the workers receive their social benefits. The owners also agreed to give 130 percent severance pay to employees who worked at the plant for over two years.

"It's very sad that such an old plant, employing residents of Carmiel and the area, is closing down," Klein said yesterday. "Other plants that employ numerous workers are finding it difficult to compete with products being imported from China."