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Toshiba Corp. announced Monday it will slash 17,000 jobs in Japan — 12 percent of its domestic workforce — by the end of March 2004 amid the worldwide slump in the information technology sector.

The electronics maker also announced it would lower its earnings forecast for the year to March 31 from a group net profit of 60 billion yen, to an estimated group net loss of 115 billion yen.

Under the restructuring plan, Toshiba, which employs 144,000 in Japan alone, will slash its worldwide workforce of 188,000 by 10 percent by the end of fiscal 2003.

Toshiba’s decision follows similar restructuring plans announced by its rivals, including NEC Corp., Fujitsu Ltd. and Matsushita Electric Industrial Co.

Fujitsu Ltd. recently announced it will cut 16,000 jobs, in response to waning demand in the information technology sector. NEC Corp. plans to cut 4,000, while Hitachi Ltd. has disclosed a plan to slash around 20,000 jobs worldwide, company sources said on Monday.

Toshiba said its plan will make use of natural reduction and retirement, in addition to a voluntary retirement program the firm will set up before the end of the fiscal year. Toshiba will set aside some 60 billion yen for the program, it said.

The firm will also shift 10,000 employees in Japan throughout the group by the end of fiscal 2003.

Under the restructuring plan, Toshiba will close or streamline 30 percent or six of its 21 domestic production plants. The firms to be closed will be decided after talks with labor unions.

The company will also reduce the number of affiliated domestic manufacturing and engineering companies by 25 percent from the current 98 by fiscal 2003.

Toshiba said it plans to become more competitive globally by expanding overseas manufacturing plants and cutting group procurement costs by 20 percent, or 560 billion yen over the next two years.

To achieve that goal, the company will establish a procurement promotion division, expand group-wide joint procurement programs and reduce the number of suppliers to half the current 6,750, Toshiba said.

It will also reorganize its headquarters in October 2001 by reducing staff by 10 percent by March 31.

Other measures the major electronics maker will take include reducing its assets by more than 450 billion yen, in addition to a previously announced cut of 350 billion yen, which will add to a total reduction of 800 billion yen in assets.

Of that total, a cut of 100 billion yen will be implemented during the current fiscal year, it said.

Toshiba’s revised earnings forecast for the current fiscal year predicts a group pretax loss of 190 billion yen against an earlier projection of 110 billion yen, on group sales of 5.75 trillion yen, down from the 6.44 trillion yen estimated earlier.

Toshiba also said it plans to pay no interim dividend for the first half of this fiscal year ending in September.

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