Cisco Systems, with 67 markets worldwide, expects sales growth only in China this financial year, despite piracy in the mainland, according to an official. China posted US$1 billion in sales last financial year from global sales of US$22.3 billion in 67 countries, said Scott Su, a program manager. 'In this fiscal year, we predict global sales of about US$20 billion, with sales in China of US$1.1 billion. It is the only country where we are predicting growth,' he said. Of the mainland sales, 35 to 40 per cent is for telecommunications firms such as China Telecom and China Mobile, while about 30 per cent goes to banks and the rest to big companies and government departments. Mr Su sees US$1.5 billion of sales in China in two years, despite the global slowdown. 'China has become the world's biggest market for mobile phones, overtaking the US. It has to improve its infrastructure backbone. The telecoms companies will have to invest. 'The major state banks have a great deal to do, to network their domestic systems. The Industrial and Commercial Bank alone has 150,000 branches. They have computers but much of the data is not networked,' Mr Su said. The company has 90 per cent of the market for high-end routers and management switches for the banks. Mr Su was sceptical of forecasts for growth in China. 'Many statistics are inaccurate because officials report figures that are fake and over-optimistic. There are serious problems, such as urban unemployment, which I estimate at least 12 per cent,' he said. Mr Su said China's entry into the World Trade Organisation would have a big impact on Cisco's sales, lowering the import tax on its goods and cutting the price differential between its products and those made by domestic competitors. 'It will push the government to be more open and fair. Currently, we cannot sell directly to the 3,000 counties in China because of internal regulations.' It would also help combat piracy of its products, especially by a major domestic manufacturer in Shenzhen, he said. 'Each year it buys . . . all our equipment and dissects them, like a doctor at an autopsy, and then copies them, often using a similar product name, at lower prices.'
