A LEADING electronics firm closed one of its factories in Hong Kong and laid off 240 workers yesterday after failing to renegotiate a lease for the premises. It was the latest in a series of sackings over recent months which has seen the unemployment rate in the territory rise to 3.5 per cent. Elec & Eltek International Holdings, the largest printed circuit board manufacturer in Southeast Asia in terms of capacity, will instead shift some of the work to its plants in China and Thailand. Group executive director Canice Chung Tai-keung said: 'The production capacity of the affected plant will be picked up by our other plants in Hong Kong, China and Thailand. 'Those made redundant will receive severance and other payments above and beyond those stipulated by law. Some employees have been redeployed to jobs in other plants.' Those redeployed are about 30 technicians and supervisors. The stock market-listed group manufactures electronic products, including printed circuit boards, fax machines and liquid crystal displays, and is also involved in property investment and development. The redundant workers - about 18 per cent of the group's employees in Hong Kong - have worked for the group for an average of seven years. They join the 105,000 jobless people in the territory. Following the closure, the group has 1,100 employees locally. About 1,350 other employees work in its manufacturing plants in Kai Ping and Huangpu, in Guangdong, and it has 1,450 workers in Thailand. Mr Chung said the To Kwa Wan factory was the firm's only leased property in Hong Kong. 'We have been in this leased property since 1972,' he said. 'For over a year we have tried to negotiate with the landlord to renew the lease to no avail. In view of the age of the property - some 40 years old - the landlord has decided to regain possession of the building for other purposes.' Leung Fu-wah, a spokesman for the 210,000-strong Hong Kong Federation of Trade Unions, said he feared more factories would move across the border, laying off more local workers. 'In the past, most closed factories were plastics and garment manufacturers. They moved to China to cut production costs,' said Mr Leung. 'Electronics companies produce sophisticated and expensive items which give an impression that they can afford a higher production cost, comparatively speaking. 'But now it seems that this is wrong. It is now the turn of the electronics firms to lay off workers following garment and plastics manufacturing. The Government should do something to help local workers.' Last month, a Kwun Tong electronics company laid off 110 workers because it had to shift its production to the mainland. The Labour Department said its officers would register the redundant workers and try to find new jobs for them.