LG. Philips builds $21b LCD plant
LG. Philips builds $21b LCD plant
Lim Chang-Won, Agence France-Presse, Seoul
LG.Philips LCD unveiled a US$21 billion investment plan on Thursday as the world's largest flat panel screen manufacturer held a ground-breaking ceremony for its new plant.
The joint venture between South Korea's LG Electronics and Dutch group Royal Philips Electronics NV said 25 trillion won ($21 billion) would be poured into flat panel displays in the next 10 years.
The plan was announced as LG.Philips held a gala ceremony, led by Prime Minister Goh Kun, for the construction of its new LCD (liquid crystal display) plant in Paju, 30 kilometers (18 miles) north of Seoul.
The plant, near the heavily fortified inter-Korean border, will help South Korea secure a firm competitive edge in the sector, said Goh, who serves as interim leader after President Roh Moo-Hyun was impeached and suspended from office last week.
The plant is within artillery range of North Korea, which has eased the military confrontation with South Korea to boost economic exchanges since a landmark inter-Korean summit in 2002.
"The government has a masterplan to develop this area as an advanced base for inter-Korean economic cooperation," he said in a statement.
Goh also said his government would nurture the LCD industry as one of South Korea's new growth engines to help firms head off challenges from competitors in Taiwan and China.
He said the government would build a 1.65 million-square meter complex around the plant to serve as a global hi-tech base with the world's largest LCD research and development center.
Goh said the government would offer free roads and other incentives, describing the plant as the first government- corporate joint project since Roh took office in early 2003.
Major LCD makers have been increasing capacity to meet booming demand for flat-screen televisions and computer monitors to replace traditional cathode ray tube screens.
Samsung signed a contract last week with Japan's Sony Corp. to build a $1.78 billion joint venture plant for flat panel televisions in Tangjeong, 100 kilometers south of Seoul.
Samsung officials say the partnership will help the world's top microchip maker strengthen its position in the world's fast- growing flat panel market.
LG.Philips and rival Samsung Electronics led a 61 percent surge in global shipments of LCDs in the fourth quarter of last year.
LG.Philips, which took up the largest share of the TFT-LCD market with 21 percent last year, said the Paju plant would be put into operation in the first half of 2006 focusing on 42-inch or larger flat panels.
"We plan to develop the Paju region into a core site for the TFT-LCD industry," LG.Philips vice chairman Koo Bon-June said in a statement.