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Cisco keen to be seen as green in China

Networking giant to invest billions of dollars into Chinese investments ranging from Networking Academies to "green" tech center.

Cisco Systems plans to significantly ramp up its investment in China, including building a green-technology center, the networking-equipment giant announced 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 to 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," Cisco Chief Executive John Chambers said in Beijing.

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

However, Cisco will have its work cut out for it when it comes to improving China's environmental footprint. A report from the Netherlands Environmental Assessment Agency in June estimated that China's carbon dioxide emissions rose 9 percent in the past year, compared with 1.4 percent in the United States. China produced 6,200 million tons of carbon dioxide pollution, compared with 5,800 million tons from the United States.

One reason for China's massive carbon dioxide 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 labor," Greenpeace U.K. executive director John Sauven recently said. "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 globalization."

Cisco's program will include an increase in local procurement, a memorandum of understanding with China Development Bank to "explore a joint investment program 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 small Chinese companies.

Cisco said that its commitments in China--worth around $8.5 billion since 2002--could almost double to $16 billion 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 $60 million for such purposes, but it could provide as much as $400 million over the next three to five years.

The company also plans to expand its Cisco Networking Academies Program 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 academies 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 Web sites deemed unsuitable by the communist government.

David Meyer of ZDNet UK reported from London.