Cisco Systems unveiled an ambitious $10 billion plan to invest in China s tech industry Wednesday, lining up with other U.S. tech giants that are bowing to the growing prowess of China s vast market.
This marks a new chapter for Cisco, the company said in the announcement, which promised to invest the $10 billion over the next several years.
The San Jose networking colossus signed a Memorandum of Understanding with China s National Development and Reform Commission that will focus investment on innovation, equity investment, research and development and job creation.
The goal: to promote the development of a high tech industry in China.
That s important to Cisco and other U.S. tech companies because China is one of the leading markets for their products. It s critical to China, because it has launched an ambitious plan to spend $100 billion by 2020 to make its tech sector a world class competitor.
A separate memorandum was signed with the Association of Universities of Applied Science, a wing of China s Ministry of Education that is charged with fostering domestic tech development,
Under this agreement, Cisco will invest in a four-year program with 100 universities of applied science in China.
Over the past 20 years, China has been one of the world s most important growth markets, Cisco s announcement noted.The new initiatives will combine Cisco s strengths with the direction of China s industrial transformation, helping the country innovate and globalize.
Cisco recently trimmed several top executives in China, partly as a strategy by incoming CEO Chuck Robbins to lean out the upper tier to foster faster communication, and partly because of declining sales.
Robbins said that With these new partnerships and initiatives, Cisco is investing in the next generation of Chinese technology innovation that he said will ensure success together.
Robbins and outgoing CEO and chairman John Chambers met in Beijing with Chinese Vice Premier Wang Yang and officials at other government agencies.
Owen Chan, chairman and CEO Cisco Greater China, said Cisco would work closely with the government and local partners on national development programs.
Cisco headquarters (Paul Sakuma, Associated Press)
