Sunday, January 03, 2010

LG cuts investments in Poland

From: The News
Korean company wants to reduce its biggest investment in Poland – a factory in Kobierzyce near the western city of Wroclaw.

LG intended to invest 2.6 billion zloty (620 million euro) in the plant and employ up to 12,000 people but recession thwarted the plans. Instead, the Korean giant will spend 700 million zloty (167 million euro) less on the factory in Kobierzyce and employ 4,000 fewer people than expected.

The company has already received a green light for the changes in investments from the Polish government.

“Financial crisis resulted in the fall of demand on LG products abroad,” says Iwona Dzygala from Economy Ministry. LG will receive 120 million zloty (29 million euro) of financial help from the government.

“However, the company is obliged to keep employment at the present level for five years”, adds Dzygala. Consequently, there will be no redundancies at LG but the company will employ fewer people than planned.