VIETNAMESE factories making everything from shoes to smartphones are expected to continue production despite record COVID-19 infections, reversing a policy of sweeping lockdowns last year that hobbled global supply chains for Western retailers.

One of the world’s biggest garment makers, Vietnam reported more than 26,000 new infections Sunday, or about double the peak last year, when factories supplying brands such as Nike, Zara, Apple and Samsung were shut for months.

But unlike nine months ago, when the Delta variant was spreading through a mostly unvaccinated population, now millions of factory workers have been fully vaccinated and the Omicron variant is proving less severe, the government said.

“The risk of widespread lockdowns is very low this year as Vietnam has successfully carried out its COVID-19 vaccination campaign,” said Dang Duc Anh, director of the National Institute of Hygiene and Epidemiology.

Vietnam has been relaxing curbs in recent months, with schools re-opening last week and the government saying Sunday it would lift restrictions on arriving international passenger flights.

More than 76 percent of the population has received at least two vaccine doses, up from 3.3 percent early in September last year, the health ministry says.

The American Chamber of Commerce in Hanoi, which represents U.S. businesses and last year urged the government to ease its curbs, is anticipating a better 2022, said Adam Sitkoff, its executive director.

“I do not expect to see additional countrywide lockdowns as serious cases in most parts of the country are at a manageable level and the authorities have learned that economy-crippling restrictions are not sustainable,” Sitkoff said.

The government is targeting economic growth of 6-6.5 percent this year, up from 2.5 percent in 2021.

Smooth factory operations in Vietnam, the second-biggest exporter of clothes and footwear to the United States after China, will also help free up supply chain bottlenecks that are pushing up inflation around the world.

“If Vietnam can maintain a strong production capability and factory output, this will really support the global supply chain, in particular for sectors like agriculture, textiles and electronics consumers,” said Duc Minh Nguyen, a partner at accounting firm EY.

Over the last decade, Vietnam has emerged as one of the most attractive alternative production hubs for companies looking to reduce their exposure to China. That trend is expected to continue, if Vietnam can emerge relatively unscathed from the current Omicron wave.

“Vietnam will be a key beneficiary of shifting supply chains, particularly in regards to low value-add manufacturing relocating out of China and electronics,” said Raphael Mok, head of Asia country risk for Fitch Solutions.

Vietnam won praise early in the pandemic for curbing infections with its tight controls, but a flare-up last summer caused by the Delta variant kept millions of workers at home amid lockdowns in Ho Chi Minh City and neighboring industrial provinces.

In September, at the height of the lockdowns, businesses began considering moving production elsewhere. Lululemon, a Canadian clothing retailer, shifted production out of Vietnam in September. Nike, which sources half its footwear from the southeast Asian nation, cut its 2022 sales forecast due to factory closures there.

Now, 90-95 percent of garment and textile workers have returned to work after the Lunar New Year holiday, said Truong Van Cam, deputy chairman and general secretary of the Vietnam Textile and Apparel Association. (SD-Agencies)