Hon Hai China Investment Tops $1B

The world’s largest contract maker of electronics products, including the iPod, lifted its investment in China to more than US$1 billion over the weekend, ensuring users will continue to see low-cost IT products rolling out of the country in coming years.

Hon Hai Precision Industry on Saturday unveiled seven new China investment plans that will raise the total value of its China investments to $1.11 billion.

The company already owns the largest IT exporter in China, Hong Fujin Precision Industry, which suffered intense media scrutiny earlier this year due to allegations it mistreated workers at an iPod factory.

Apple Computer investigated the claims but found little wrong at the site.

Although users may not like some of the facts that surfaced about Hon Hai and its Chinese subsidiary, such as that it pays workers about $50 per month to assemble the digital music players, its continuing investment in China is an important factor in continuing to keep the cost of IT products low for users. And for many of the workers at the iPod factory, mainly young women from China’s poorer rural areas, a monthly salary of $50 plus room and board is more than they can earn at home.

Hon Hai said it has actually spent $887.6 million of the investment total so far, while planning for the rest of the funds has already been finalized.

Hong Fujin exported $14.47 billion worth of IT products from China last year, making it number one in that category, according to China’s Ministry of Commerce.

-Dan Nystedt, IDG News Service (Taipei Bureau)

Related Links:

• Why Apple Isn’t Biting Into China

• Apple Looks Into iPod China Sweatshop Report

• Apple Finds Few Violations at Chinese iPod Factory

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