Official: China to Surpass U.S. on Tech
01/25/2003 15:10
DAVOS, Switzerland, Jan 25, 2003 (AP Online via COMTEX) -- China will soon become the world's largest Internet and information economy, surpassing the United States, the president of one of the Chinese government's two main telecommunications companies predicted Saturday.
By 2008, China will have between 200 million and 300 million Internet devices and millions more users, said Edward Tian, China Netcom Corp.'s chief executive and a pioneer of the country's Internet revolution.
He spoke at a panel on "China's Rise: Regional and Global Impacts" at the World Economic Forum in this snow-covered Swiss Alpine resort, an annual meeting of top business and government leaders who have singled out China as one of the few economic success stories in the past year.
In China, Internet use has grown from a few thousand seven years ago to more than 60 million today, putting China ahead of Japan and only second to the United States, which has about 200 million users, Tian said.
"China can soon become the world's largest Internet and information economy, in both telecommunications and the traditional IT (information technology) sectors," he said.
Last year, China was the only country where information technology continued to grow and it has become a key market for Western technology companies - No. 1 for Nokia, and number two for Ericsson and IBM, he said. China was also the only country to see growth for the telecom equipment market in 2002.
"In the past 10 years, most investment has been in hardware to build infrastructures, fiber networks," said Tian, whose company bought key undersea fiber-optic networks in November from Asia Global Crossing Ltd., which filed for bankruptcy to facilitate the sale.
"In the next five to 10 years, I think investment will focus ... more to the software side and service sector," he said.
China's economy grew by more than 8 percent last year, and panel members predicted continued growth.
"I don't think China can build an economy if we just rely on manufactured goods. We must play a very important role - a leading role in the technology side," Tian said.
In November, he said, the Communist Party congress adopted a "very, very important policy - that in the next 10 years China has to build a new type of economy, an information-led new economy.
As a result of popular support for the Internet and strong government backing for the new policy, he predicted that "the Internet will transform not only the new economy but the traditional economy." He noted that small companies engaging in e-business were now his company's top users.
"What does it mean for the rest of the world?" Tian asked.
"China will become a very important player in the information industry," he answered.
As China becomes "a world-class player," the question and the challenge is whether it can build up its technology standards and its marketing "and export not only low-cost labor intensive goods but ... software and services to the Western world."
Cheng Siwei, vice-chairman of the National People's Congress' standing committee, stressed the government's commitment to improving its technology and software sectors. Answering criticism of rising unemployment, corruption, stagnating state-owned enterprises and other weaknesses, he said China was working to improve its legal system and generate more jobs.
Victor Chu, chairman of the First Eastern Investment Group in Hong Kong, said the domestic challenges that China faces "will help calm some of the fears of our Asian neighbors that China could become such a big, domineering bully in the region."
"I think Asia will have to learn to manage with China, and China will have to appreciate the sensitivites and manage some of the fears from our Asian neighbors," he said.
Chu suggested that China work with Thailand and other countries in the Mekong region to promote tourism - and join forces with Japan and South Korea on infrastructure projects in the Persian Gulf region.
"Korea and Japan - have brands, technology, and management marketing skills and China has raw materials, a huge market, and a desire to learn," he said.
Australian Foreign Minister Alexander Downer said Southeast Asian nations should worry more about restructuring their economies than about foreign investment being diverted to China.
"If I could be slightly rude here, I think in Japan some of the paranoia about the Chinese economy which I regard as unjustified is really an excuse for lack of reform within Japan," he said.
"Politically, I think the sense in the region is that China is not a threat," Downer said.
Copyright 2003 Associated Press, All rights reserved
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