Japan’s AGC Display Glass Taiwan Co (旭硝子顯示玻璃) has reportedly decided to hold back on investing in a new plant in the Ma Chou Hou Industrial Park (馬稠後工業區) in Chiayi County because of uncertainties created by the government’s decision to relax restrictions on Taiwanese companies’ investment in China.
AGC, the world’s second-largest maker of glass for liquid-crystal displays (LCDs) after Corning Inc, had planned to invest NT$10 billion (US$0.3 billion) in a production facility in Ma Chou Hou, which was expected to create 400 jobs, the Chinese-language Liberty Times (the Taipei Times’ sister paper) reported.
AGC refused to comment on the report yesterday when contacted by the Taipei Times.
Bloomberg, however, quoted a spokesman for parent AGC Group, Hiroyuki Wakasugi, as saying the Liberty Times report was “speculation.”
“We have no concrete plans, but we are considering” expansion in Taiwan, Wakasugi was quoted as saying.
The LCD glass produced by AGC’s plants in Taiwan is supplied to global panel makers, including AU Optronics Corp (友達光電) and Chi Mei Optoelectronics Corp, AGC’s Web site shows.
The government has said Asahi plans to invest NT$42 billion (US$1.3 billion) in Taiwan over the next three years to meet growing demand for glass from Chi Mei and AU Optronics.
AU Optronics and Chi Mei have expressed interests in expanding across the Taiwan Strait and AGC has decided to delay its investment to determine if these two companies would still place enough orders to justify a new factory in Taiwan.
The Liberty Times quoted Vice Minister of Economic Affairs Huang Jung-chiou (黃重球) as saying that panel makers have to retain the most advanced facilities at home and their Chinese facilities were required to remain one generation behind those of Taiwan.
Demand from local panel makers would still be strong, he said, so he expected AGC to boost its investment in Taiwan in the near term.
AGC moved into Taiwan in July 2000 and had about 1,500 employees as of last May, the company’s Web site shows.
The company has two factories in Yunlin County, one in Tainan County, and operational offices in Tainan and Taoyuan.
Meanwhile, the Ministry of Economic Affairs’ Investment Commission said it has not received any formal applications for chipmaker’s China-investment since the new regulations took effect on Monday.
Several companies have expressed interest, but the commission said it expects only a handful of projects to get the green light this year because of the stringent approval process.
ADDITIONAL REPORTING BY BLOOMBERG
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