Cisco Systems, Inc. (NASDAQ:CSCO) revealed that it is making plans to invest $1o billion in the Chinese market over the next few years.
The tech firm has plans to engage in the investment to boost performance in research development and innovation. The U.S. networking firm announced that it had signed a memorandum of understanding with the Chinese National Development and Reform Commission (NDRC) to push its level of investment in the Chinese industry.
The new investment will mark a new leaf for the company considering that Cisco had resulted in cuts in the Chinese division as a result of antitrust issues within the region a few weeks ago. The investment is expected to boost job creation, research and development, equity investment and innovation.
The announcement was made in the middle of meetings by the company heads, China’s Vice Prime Minister Wang Yang and a few other officials from the government. The meetings are being held in Beijing. The company’s existing Chairman and CEO, John Chambers and his successor, Chick Robbins are among the members involved.
Cisco executives also struck a partnership with the Association of Universities of Applied Science (AUAS) to come up with training programs for local ICT talent. Cisco also claimed that it will invest in a 4-year initiative via the Cisco Networking Academy Program. It will include 100 universities of applied science that have been recommended by the AUAS.
Cisco Systems, Inc. (NASDAQ:CSCO) has established its presence in China for over 20 years. Mr. Chambers announced that the company is looking to extending its digitization strategies in line with GDP growth opportunities and talent development. Analysts are looking forward to seeing how the tech company will handle the Chinese market, considering the heavy competition from local companies such as Huawei.
In 2014, the company invested $1.7 billion in India over an annual basis while at the same time reporting quarterly progress. The situation in China has been opposite with 20% decrease in revenues.