Today Samsung and Sony signed a memorandum of agreement with the Korean province of Chungcheongnam-do to build a $2bn, 8th generation, factory to make 46 inch LCDs.

Construction of the plant is due to start in October in Tangjeong in Korea. Completion is slated for July next year. Management of the factory will come under the two year-old Samsung-Sony joint venture S-LCD Corporation. The new announcement comes nine months after the two companies completed their seventh generation joint venture plant.

"In the future, Tangjeong Crystal Valley will embrace facilities for manufacturing, education, and environment-friendly living,” said Lee Won-koo, governor of South Chungcheong, at the announcement. “We will apply the latest technologies and methodologies to create an urban environment with ubiquitous online access. Our goal is to make the world's most advanced LCD cluster that can generate new wealth for the Republic of Korea in the 21st century.

“The overall Tangjeong Crystal Valley complex is scheduled for completion in 2015. At that time, annual output will be worth $30bn, with exports of $24bn a year and jobs for 50,000 workers. The complex will generate Won860bn in national taxes and Won150bn in local tax revenue.”

Chungcheongnam-do and Asan City have agreed to designate the location where S-LCD is making the new investment as a foreign investment zone. The local governments have also promised to support the project with various incentives. Chungcheongnam-do is expected to create new jobs for more than 1,000 people in the region, generating yearly sales of Won2.2trn by 2008.

Chungcheongnam-do and Asan City aim to develop Tangjeong Crystal Valley into the world's largest LCD cluster. Complexes for subcontracted suppliers are being established in the area. A new four-lane access road is being built between the Tangjeong Complex and Asan City, and an eight-lane highway is being constructed between the Cheonan-Asan area and Hyeongchoong Temple.

The local governments are also building 3,700 new apartment units, expanding the availability of industrial water, and building environmental protection facilities.