US tobacco giant Philip Morris will invest RM126 million to establish a new factory here, an official said today.

Vince Abejo, the company's corporate communication manager, told AFP construction of the plant begun recently and was expected to be completed by early 2004.

It is being built near the company's existing plant in Negri Sembilan, he said.

"This investment will decrease our dependence on imported tobacco materials and increase the overall output of our manufacturing operations in Malaysia, he said.

Besides the RM126 million, Abejo said the company had spent an additional RM11.8 million in the first nine months for its entire Malaysian operations.

The present facility in Malaysia is the US giant's first and biggest tobacco manufacturing plant in Asia. In Malaysia, Philip Morris has about 17 share in the RM4 billion tobacco market.

"The whole investment is to complement our tobacco production in Malaysia for the local and for export markets," he said. AFP