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Slovak area is home base for electronic products

  PLAY AUDIO

June 21,2004
Once a secluded area, the Slovakian region of Galanta is now turning into a production base for digital electronic products. Samsung Electronics built its second factory in the area early this month, completing a production system that will turn out about 7.5 million units of plasma display panels and liquid crystal display television sets a year. The facilities are sufficient to fully meet orders from European and Central Asian markets. Galanta is a typical farming region that is located about 65 kilometers (40 miles) southeast of the Slovakian capital, Bratislava. Before Samsung entered the scene, the area had the highest unemployment rate in the country, especially after the breakdown of the socialist regime in 1989. In May 2002, Samsung bought 34 acres of property that belonged to a furniture factory that had been closed for 10 years. In just five months, test production facilities were up and running, and with it the gears of the region’s economy got going as well. In the first year, Samsung only recruited 180 local employees, but increased the number to more than 1,000 during the second year. In July last year at the factory’s construction completion ceremony, Slovakia’s President Ivan Gasparovich wrote in the visitors’ book: “In a land with no hope, Samsung Electronics has lit a spark of hope.” The company has become the largest, if not most representative, manufacturer in the region. The road that leads to the factory is studded with Samsung billboards. Last year, in just the first year of operation, the factory had profits of $3 million from sales of $220 million. So far this year, the factory has achieved $1.1 billion in sales, and at the end of the year it is expected to be one of the top five companies in Slovakia in terms of sales. The vice president of the Slovakia production line, Lee Jong-chan, said the factory will become the main base from which Samsung will expand into the European market. The company had originally planned to make another production base in Eastern Europe, but after it decided last year to close factories in England and Spain, circumstances changed. Samsung decided to move most production facilities in England and Spain to Slovakia and is negotiating with local authorities on securing another site in the country. The Slovakian government will not impose corporate taxes until Samsung’s profits reach $80 million, and labor costs are only a fifth of those of Western Europe. Samsung hopes to collect the total $35 million it spent in investment sometime this year. “We are strongly demanding further support since Samsung is successfully running its factory here,” said a spokesperson for the Slovak Investment and Trade Development Agency. by Ko Yun-hee


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