Companies plan to spend 15 percent more on factories and equipment for fiscal 2005, the largest increase since 1988, when there was a peak in stock and land prices, according to a Development Bank of Japan survey released Tuesday.

The investment plans come amid robust sales of cars, large-screen television sets and liquid-crystal panels for computers and mobile telephones due to the nation's economic recovery and a strong demand overseas.

The corporations' capital investments stood at 22.4 trillion yen for fiscal 2005, compared with 19.4 trillion yen the previous year.

The demand for more investment rose in most industries, according to the fall survey of 1,732 firms.

Manufacturers plan to invest 22.7 percent more, marking the third consecutive year of double-digit increase since the economic bubble.

Nonmanufacturers will invest 10.6 percent more, a double-digit rise for the first time in 14 years.

The biggest factor contributing to the sharp rise in investment is firms' aggressive spending on existing facilities. They hope to beat global competition by raising their productivity and product quality.

Of the companies "that replied to the survey, more than 25 percent of their overall spending is in" facility improvement, said Hayao Watanabe, director general of the DBJ's economics and industrial research department.

The DBJ sent questionnaires to 3,592 companies and received responses from the 1,732 firms in and around November.