South Korean high-tech giant Samsung Electronics plans to relocate its main mobile phone factory to Vietnam because of rising wage costs at home, a report said Tuesday.

Chosun Ilbo newspaper, quoting industry sources, said Samsung had this year suspended recruiting for its main plant at Gumi, 260 kilometres (160 miles) south of Seoul.

The Gumi factory accounted for some 60 percent of total production of mobile phone handsets last year, it said.

"As part of its new (global outsourcing) strategy, Samsung has decided to build a bigger plant in Vietnam than the one in Gumi in the fourth quarter of this year," one of the sources said.

The Vietnam plant, whose site has yet to be decided, will eventually produce 100 million units per year, according to the source.

"Samsung Electronics has concluded that its domestic factories no longer have merit because the labour cost is 10 times higher than in Southeast Asia," another source was quoted as saying.

Samsung said no decision had yet been made. "Vietnam is just one of the emerging markets we are thinking of as a new global production base," spokesperson Chae Suyeon told AFP.

"The Gumi plant will remain as a key production facility."

The Chosun Ilbo expressed concern at what it saw as accelerating global outsourcing by Samsung and other firms, and its effect on local industry and unemployment.

Last year, Samsung produced 130 million mobile handsets -- 80 million from the Gumi plant, 45 million from its factories in China and the rest from production facilities elsewhere, it said.

Source: Times of Oman