Dec. 22, 2009 (China Knowledge) - Taiwan's flat panel makers and chip producers will likely increase their investment in mainland China next year, said an officer of the public relations department of Taiwan's Ministry of Economic Affairs.

The Taiwan government previously said that at the end of this year it will hold conferences to discuss lifting restrictions that bar Taiwanese flat panel producers from setting up plants. The government will also consider allowing its chip firms to set up plants with more advanced technology on the mainland.

Taiwan-listed flat-panel TV producer AU Optronics Co, a strong competitor to Samsung and LG Display Co, may build a mainland plant if it receives approval from the local government, said spokesman Xiao Yawen.

Reportedly, AU Optronics will initially inject more than NT$80 billion to set up a 7.5-generation LCD panel plant capable of producing 40-inch or larger TV panels. Li Xiefen, an officer of the sales department of the company, yesterday said that a site has not been chosen, but that possible locations include sites in Shanghai, Jiangsu Province, Guangdong Province and Shandong Province.