China’s ambitious plans to improve its telecommunications infrastructure look set to make it the biggest single market in the World. Yang Xianzu, vice-minister of the Chinese Ministry of Posts & Telecommunications told the audience at Expocomm China ’92 last week that he aims to have 100m exchange lines in service by the end of the […]
China’s ambitious plans to improve its telecommunications infrastructure look set to make it the biggest single market in the World. Yang Xianzu, vice-minister of the Chinese Ministry of Posts & Telecommunications told the audience at Expocomm China ’92 last week that he aims to have 100m exchange lines in service by the end of the decade, more than three times the number forecast by the authorities last year. Though Chinese politics isn’t the easiest to track, the South China Morning Post believes that Mr Yang is the likeliest successor to the current telecommunications minister, who is expected to retire in the next two years. The pressure on the country’s infrastructure is highlighted by last week’s half yearly results from Hong Kong Telecom Ltd. This showed that the number of calls to China have increased by 36% compared with the same period last year and now account for 15% of Hong Kong Telecom’s total turnover. However, while the rest of the Crown Colony’s international call charges are being reduced, those to China will remain static, according to chief executive Michael Gale, because the Chinese network is already operating close to capacity. The Chinese Ministry’s Mr Yang predicted that by 1995, there would be 48m lines in the People’s Republic as compared with the 24.3m at the end of last year. And in the kind of request that only a central planner can get away with, he called upon manufacturers in the market to increase their output. Three switch manufacturers have licences to operate in the country: Peking International Switching Systems Corp, where Siemens AG is the foreign partner, has 40% of the market, and Alcatel NV and NEC Corp have 30% each. NEC told the South China Morning Post that it plans to double the 300,000 line production target of its Tainjin-based factory which is due to open next summer. The Ministry has said that a fourth or even fifth concession will be forthcoming if the current holders cannot meet demand. Among those eyeing the market is AT&T Co – AT&T Hong Kong’s new managing director told Reuter last month that the colony is seen as a potential jumping-off point into China. L M Ericsson Telefon AB too, looks to be in a good position, following its recent large import orders. The situation for US manufacturers hoping to get a piece of the cake was improved by China’s agreement last month to open up its telecommunications market to US imports. The Chinese agreed to eliminate 75% of all existing import barriers within two years, in return for which they will be able to keep exporting to the US which makes up its biggest market. How this trade agreement fares under the new US administration awaits to be seen – President-elect Bill Clinton has pledged to be tough on countries, such as China, with poor human rights records.