Cabinet rivals fight for Koreans

The rivalry between two British Cabinet ministers last night was claimed to be putting at risk plans by a Korean company to invest pounds 1bn in a microchip plant in Britain, creating 4,000 new jobs.

Posturing by William Hague, Secretary of State for Wales, and Michael Forsyth, Secretary of State for Scotland, is alleged to have delayed a decision by LG International (formerly Lucky Goldstar) on investment in a new semi-conductor plant.

Mr Hague, on the wet wing of the Tory party, has been trying to entice the company to invest in Wales. Mr Forsyth, a Thatcherite right-winger, was yesterday using his rival charms in Korea to persuade the investors to plump for Scotland.

"There is some political posturing going on which is getting in the way of the question of LG's inward investment in the UK," a source close to the project said.

The stakes were raised two weeks ago when it was reported on the BBC that LG had decided to site their proposed plant in Wales. That was seen by the source as a "politically motivated" leak. The source said there were "unhelpful" signs of tension between the rivals.

The company has not been in touch with either the Welsh Development Agency or Scottish Enterprise since the BBC report, although a decision was expected a month ago.

Mr Forsyth has been in the Far East since last week, when he secured two Japanese business investment schemes offering 200 jobs in Scotland. He was able to clinch a deal for investment by another Koreanindustrial group, Shin Ho Tech, to build a pounds 9m computer monitor assembly plant in Scotland. Announcing the deal, Mr Forsyth appeared to fire a shot across Mr Hague's bows. He said he was "determined" that it would be followed by other Korean firms.

However, Mr Hague and Mr Forsyth may fight each other to a draw. There were reports that LG may split their plans with a microchip plant in Scotland and a manufacturing and assembly plant in Wales.