LG Electronics is closing its LCD monitor plant in South Wales with the loss of over 300 jobs.

The South Korean firm said it has begun a consultation period with employees and trade union representatives over the closure of the Newport factory, which is scheduled to complete by the end of the year.

In a statement the firm said: “The decision to close was made with great regret and is based solely on the current and external conditions within the marketplace. We have greatly appreciated the hard work and commitment that the employees at the plant have given us over the past nine years and are sorry to see the plant close.”

A spokesman for the Welsh Assembly Government said it was "very disappointed with the announcement that LG Electronics intends to close its plant in Newport by the end of 2006".

"The company has assured us that this decision in no way reflects on the quality of the workforce in Newport, but has been taken as a result of the intense global conditions for their products - particularly the rapid decline in price of the products they supply," he said.

The South Wales area was one of the major beneficiaries of the UK Government's inward investment strategy of the 1980s and 90s, especially in the TV and PC monitor sector.

However, reducing margins on monitors through the past five or six years have left firms unable to continue cost-effective manufacturing in the UK.

LG.Philips closed its CRT plant in Newport in 2003 with the loss of nearly 900 jobs.

However, other investments in Newport, including more than £100m by International Rectifier to improve its wafer fab, have gone some way to mitigate the closures.

The Welsh Assembly spokesman said: "Our immediate priority is to reassure the employees at LGE that we will build on the strength of these recent investments and work strenuously with our public and private sector partners to find alternative and quality employment opportunities for those affected by this decision."