WHEN Samsung, no longer able to resist the might of Far Eastern rivals, threw in the towel on Teesside earlier this year, the writing was on the wall for workers further up the A19.

At LG Electronics, in Washington, 170 workers had endured a torrid few years, with waves of redundancies and a complete change of working practices.

The staff, pushed to making microwave ovens in only ten seconds, could go no further. They had worked with management and unions to pare the production line to the bone, but it was not enough.

LG yesterday joined a list of failed ventures that has left people scratching their heads in disbelief.

Many are asking how many Samsungs, LG Electronics or Circatexs it will take before the Government addresses the problems facing manufacturing in the North-East.

But just how great is the threat from Far East competitors? And how much is being done behind the scenes to counteract it?

George Cowcher, chief executive of the North-East Chamber of Commerce, said: "Competition from the low-cost countries, of which China is the biggest example, is ferocious.

"No company is going to beat that competition on price alone. Any company that thinks they can be a low-cost manufacturer in the North-East is being unrealistic.

"Everybody has to look at why any customer would want to source products from a company here in the North-East."

Mr Cowcher said companies needed a "China strategy" - analysing what aspects of their business put them ahead of the competition.

Whether it be next day supply, greater sensitivity to customer requirements or better service, he said, companies needed to grab every possible competitive edge.

But Mr Cowcher believes there is a responsibility to be borne by the Government to help companies find that edge.

"It is extremely important that the Government does value manufacturing," he said.

"This Government was guilty in the early days of going down the same route as the Conservatives, of saying that this is a post-manufacturing era.

"That has now changed; they are looking at policies that are manufacturing-friendly."

The feeling that the Government is becoming more in tune with manufacturing was echoed by Alan Hall, regional director of The Engineering Employers Federation.

He said: "The Government is taking it seriously. They are not oblivious to what is going on, but they have not done enough with the indigenous business.

"It needs to invest in training and invest money in the right areas. The Government cannot come along with some big golden bag of handouts - I do not think the sector is looking at that - but I think the Government has walked past opportunities to help manufacturing."

In the North-East, three initiatives in particular are being championed that address these issues on a number of levels.

Demands from business for a better skills base have led to the creation of the Regional Skills Partnership. Consisting of public and private sector influences, it will analyse areas of skills shortages and look at ways to fill the gaps.

It will be chaired by John Cuthbert, of Northumbrian Water, and will have its first meeting in the next three weeks.

Another joint initiative is Aspire. Led by the Confederation of British Industry and the North East Chamber of Commerce, it is a five-year programme to raise the enterprise and aspirations of schoolchildren.

The project, funded by regional development agency One NorthEast, the Learning and Skills Council and other partners, aims to overturn the commonly-held belief that there is little opportunity for school leavers in the region.

Pat Ritchie, director of strategy at One NorthEast, said: "It is a campaign to get young people to realise that if they work hard at school and gain qualifications, there are loads of opportunities for them in the North-East."

One NorthEast is also trying to forecast the region's economic future through its Shine (Shaping Horizons in the North-East) project. Since last year, the agency has worked with the Henley Centre think-tank and a range of organisations to develop future strategic thinking for the North-East.

A consultation programme is being carried out, the outcome of which is expected to shape the direction of next year's regional economic strategy review.

Margaret Fay, chairwoman of One NorthEast, said: "We are trying to pull together a strategy for dealing with issues, looking at potential outcomes and looking at what we need to do for the future."

But there is a long way to go before the region can move out of China's shadow.

Ms Fay said: "We have got to recognise that the agency five years ago predicted that thousands of manufacturing jobs would go.

"We are more susceptible to global pressures now.

"But I think there is a better future for companies that can produce products at the higher end of the markets and look at niche markets."