(UPDATE) RP in talks with Samsung on chip plant


Posted at Jun 20 2008 04:52 PM | Updated as of Jun 21 2008 12:52 AM


Samsung Electronics Co Ltd, the world's largest maker of memory chips, is in talks about building a manufacturing plant in the Philippines, a senior government official said on Friday.

"There was encouraging progress in the talks with the group," Trade Secretary Peter Favila told Reuters.

He said officials of the Clark Development Corp (CDC), which oversees an industrial zone in a former U.S. military base north of Manila, have been in talks with Samsung for some time.

Asked to confirm local newspaper reports that $1 billion was the size of the possible Samsung investment, Favila said: "It's possible, given the kind of activity that they will be undertaking."

CDC president Liberato Laus and other top officials are currently in Korea for further talks with Samsung, Laus' office said.

Ahn Jae-kwang, a Samsung Electronics spokesman, said: "We are exploring various opportunities in Southeast Asia but no decisions have been made."

The company said in March it was conducting a study in Southeast Asia, including the Philippines, to possibly build an electronics plant.

Electronics, largely assembled from imported parts, account for over 50 percent of export revenues in the Philippines, which wants to expand its role as a hub for electronics firms seeking low-cost manufacturing bases.

Texas Instruments, the world's top mobile phone chip maker, has already started construction on a $1 billion semiconductor plant in the Clark industrial zone.

Local newspapers said an area in Clark had already been reserved for the Samsung project, which would be used for the design and manufacture of integrated circuits or chips, which are found in almost all modern electrical equipment, including microprocessors, audio and video equipment, and cars.

Samsung already operates an optical disk drive manufacturing plant south of Manila. It also has a unit, Samsung Electro-Mechanics Philippines Corp, which manufactures multi-layer capacitor thick film chip resistors.