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Cisco keen to be seen as green in China

Tags:
Manufacturing,
China,
Programme,
Capital

David Meyer ZDNet.co.uk

Published: 02 Nov 2007 10:33 GMT

Cisco is to significantly ramp up its investment in China, including a green technology centre, the networking firm announced on Thursday.

The three- to five-year plan is "in alignment with [China's] long-term economic, societal and environmental goals," according to a statement from Cisco. The company began investing in China in 1994 and already employs more than 2,300 staff there, in divisions ranging from sales to research and development and manufacturing.

"Today's announcements underscore both China's strategic importance to Cisco's global operations and the broad range of growth opportunities presented by the China market, particularly as an innovator in the next wave of the internet's development in collaboration and Web 2.0 technologies," said Cisco chief executive John Chambers in Beijing.

The company will establish its first global "green" technology centre in China, where it will research energy efficiency, emissions reductions and the reduction of electronic waste.

However, Cisco will have its work cut out when it comes to improving China's environmental footprint. A report from the Netherlands Environmental Assesment Agency in June estimated that China's CO2 emissions rose nine percent in the past year, compared with 1.4 percent in the US. China produced 6,200 million tonnes of CO2 pollution, compared with 5,800 million tonnes from the US.

One reason for China's massive CO2 emissions is that companies in the West have effectively exported a great portion of their manufacturing to the region, according to Greenpeace. "The only thing corporations were interested in was the price of labour," said Greenpeace UK executive director John Sauven recently. "This trend kept the price of our products and inflation down, but at the cost of soaring greenhouse-gas emissions in China. In the long term, this policy has been a climate disaster. It's the downside of globalisation."

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Cisco's programme will include an increase in local procurement, a memorandum of understanding with China Development Bank to "explore a joint investment programme that would provide capital and expertise for innovative Chinese businesses", and a tie-in with the Alibaba business-to-business portal to supply collaboration products to Chinese SMEs.

Cisco claims that its commitments in China — worth around $8.5bn (£4.1bn) since 2002 — could almost double to $16bn (£7.7bn) during the next five years. Part of this commitment will include an increase in the amount of financing Cisco is making available to its customers in China. Cisco Systems Capital China has already provided $60m (£30m) for such purposes, but could provide as much as $400m (£200m) over the next three to five years.

The company also plans to expand its Cisco Networking Academies programme in China. There are already more than 200 such academies in China, but negotiations with the country's Ministry of Education have resulted in the likelihood of a further 300 being established.

Cisco has in the past come under fire from human rights groups for its close links with the Chinese government, having provided the infrastructure behind the so-called "Great Firewall of China", which aims to block Chinese internet users from accessing websites deemed unsuitable by the communist government.