Computer chip giant STMicroelectronics is considering the transfer of a new production line to Malta, according to the Finance Ministry, though worker representatives are unaware of the move.

The company is having talks with the government on the matter, a Finance Ministry spokesman said although he insisted it was "far too early" to comment further.

However, worker representatives said they had not been informed of the new production line and all they heard were "rumours". "What we are hearing officially is the need for more austerity measures," they said.

ST employs about 1,500 people after downsizing its workforce last year by some 450 employees to cut costs and restore competitiveness.

The opening of a new line could boost the job prospects of employees and if negotiations were successful the company could also consider employing more people, government sources said.

The talks involve a production line in Asia, which could be transferred back to Europe.

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