The complex, located in Hangzhou in eastern Zhejiang province, will serve as a global production base for information technology-related goods and other products, a company spokesman said. The facilities will come on stream next year.

"Toshiba's long-term strategy will see several businesses establish production sites in China," the company said.

"Positioning Hangzhou as the common center for all of them will promote a highly efficient, optimized Chinese production network and reinforce global competitiveness."

Japan's electronics makers are steadily moving manufacturing operations to China from high-cost domestic factories and other sites in Asia, aiming to take advantage of low wage costs and to bolster their position in the potentially huge Chinese market. Toshiba currently has personal computer (PC) manufacturing plants in Japan, the Philippines, Germany and the United States.

Last year, it sharply scaled back its US PC operations and shifted much of that output to the Philippines to cut costs.

The new complex in China will start making notebook PCs in April 2003 at the rate of 750,000 a year, expanding to 2.4 million in 2004, and will serve as a global supply center.

That would be equivalent to nearly two-thirds of the 3.8 million PCs that Toshiba, which has been battling Dell Computer Corp (DELL.O) for the number-one spot in the global notebook PC market, aims to ship in the business year to next March.

Toshiba, like Japan's other semiconductor and electronics conglomerates, is trying urgently to bolster its competitiveness after the recent IT slump and pressure from aggressive foreign rivals pushed it deeply into the red in the last business year.

(China Daily May 18, 2002)