South Korean Firms Eye Eastern European Markets
Dec 9, 2003
| Print this page
Korean companies, especially electronics firms, are pushing to establish and expand existing factories in Eastern Europe to secure positions in the region, as the EU is expected to emerge as the world's largest economic bloc.
After 10 Eastern European nations join the EU, increasing the number of member countries to 25, its gross domestic product and trade will be an estimated U.S. $8 trillion and U.S. $5 trillion. The region has an estimated population of 405 million.
One of the Korean companies, Samsung Electronics Co., opened a factory in Galanta, Slovakia, in July. The 138,600-sq-m plant has an annual capacity of 6 million units of TVs, liquid crystal display (LCD) monitors, and Braun tube monitors. Samsung also has facilities in Hungary, Poland, Moscow, and other countries in the region. According to Choi Gee-sung, Samsung vice president of Digital Media, the factory will be able to post sales revenue of 1.2 billion euros (approx. U.S. $1.4 billion).
LG Electronics Inc. transformed its plant in Poland into a production base for digital TVs in October, with an annual capacity of 200,000 sets. The South Korean manufacturer invested U.S. $10 million into the factory to increase the portion of value-added products, such as plasma display panel TVs, LCD TVs, and large-size projection TVs.
"By changing our Polish plant into a state-of-the-art facility, we will increase the proportion of high-value-added TVs to the total products by 10 percentage points every year to 70 percent in 2007," an LG official said.
Daewoo Electronics Corp. is also turning analog TV plants in Poland into production bases for digital TVs and plans to raise production capacity to 10 percent. The home appliance maker plans to raise its share in the Eastern European TV market by producing more premium digital TVs.
According to Daewoo officials, Eastern European countries have the optimum conditions for becoming production bases for the Western European market because they have excellent manpower with relatively lower wages. (Yonhap)
Back to Breaking News