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With more and more Japanese households using digital appliances that can be monitored and controlled via the Internet and mobile phones, many firms are planning to build more plants in Japan to make components for these smart products.

In February, Toshiba Corp. marked the completion of a state-of-the-art plant in Oita that will start mass-producing next-generation semiconductors in the fall.

Built within the compound of Toshiba’s Oita plant complex in Kyushu, the new facility will produce high-quality semiconductors, known as system LSI (large-scale integration) chips, for use in products such as digital household appliances and mobile equipment.

“The company will invest about 200 billion yen here over five years,” said Toshiba President Tadashi Okamoto at the commemoration ceremony.

“Research and investment in plants and equipment should be accelerated to maintain the world’s top level in the field of semiconductors.”

Seiko Epson Corp. is building a plant that will produce components for liquid crystal projectors in Chitose, northern Hokkaido, which it aims to sell on the global market.

“Only we and Sony Corp. can produce these parts in the world,” one company official said.

Japan Research Institute said that capital investment in fiscal 2003 is expected to expand more than 10 percent from the previous year. This could boost the Japanese economy, which has been heavily dependent on exports, it said.

Many Japanese firms that have transferred their production bases to other parts of Asia awash in cheap labor are now looking homeward again.

Sony will invest 200 billion yen on semiconductors over two years, 80 percent of which will be spent in Japan.

In May, Matsushita Electric Industrial Co. will begin building a semiconductor plant in Uozu, Toyama Prefecture, at a cost of 130 billion yen. It plans to spend 280 billion yen in the semiconductor field in the coming three years.

Industry analysts say electronics makers are looking again at domestic factories to facilitate the vertical integration of digital household electrical appliances.

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