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11/17/2009, When we talk about communication equipment manufactures in mainland China, we should know there are also several other big state-hold equipment companies in mainland China except Huawei and ZTE. These stata hold companies include Datang, Potevio, Fiberhome. Even nearly 50% shares of Shanghai Alcatal-Bell is in China's government's hand.
Every year, China's government will have a financial budget on all the big state-hold companies. The budget is mainly about how to spend the large profit from those companies. This year's budget was just made.
According to this budget, because of global economical recession, big state-hold companies will hand out 25% less profit to central government, that means about 41billion RMB. An important part of this budget is that China's government will use this investment to strengthen the R&D of those state-hold companies, especially those state-hold communication equipment manufactures.
According to a NDRC(national development and reform commisission) report published on November 9th, in the year 2008, Huawei and ZTE each invested 9.666billion RMB and 3.994billion RMB on R&D. But among those state-hold companies, Shanghai Bell-Alcatel and China Potevio each invested 1.147 billion and 545 million on R&D,far less than Huawei and ZTE, although their R&D investment is bigger than other state-hold companies like Fiberhome and Datang.
China's government is now focousing on the innovation of the all kinds of enterprises, especially those big state-hold companies. Without innovation, China will lose the driver for economic growth. That is the reason why government want to invest money on R&D of those state-hold equipment manufactures. It is a really good news for them.