Seoul, Sept 19: South Korea's Samsung Electronics Co Ltd, the world's biggest memory chip maker, said on Friday it planned to move most of its personal computer manufacturing operations in Korea to China by 2005 to slash costs. Rising labour costs have been biting into profits of companies operating in South Korea and keeping foreign investors away, analysts say, fanning fears the trend would hurt Asia's fourth-largest economy in the longer run.
"We plan to transfer most of our domestic PC manufacturing operations to China by 2005 to cut costs," a Samsung spokesman said. "But we will continue to make PCs for domestic supply in Korea."
The move is aimed at making the firm better able to compete with bigger rivals such as Apple Computer Inc, Dell Inc and Hewlett-Packard Co, he said.
Samsung has one million annual PC manufacturing capacity in Korea and two million overseas including one million from its China plant. Samsung sells about 90,000 PCs a month on average.
Bureau Report