Foreign Tech Brands Junked From China's State-Approved Purchase List
Arlene Lim | | Feb 26, 2015 08:53 AM EST |
(Photo : Reuters)
Some of the world's leading technology brands have just been removed from China's state-approved purchase list.
A Reuters analysis of the data on the regular spending by China's central ministries reveals all of the products being sold by the United States network equipment maker Cisco Systems Incorporated have been stricken off the list of China's Central Government Procurement System (CGPS).
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This is in contrast to the situation in 2012, when about 60 products of Cisco Systems were in the list.
Other global brands that were excluded from China's 'shopping' list last year included mobile phone giant Smartphone and personal computer maker Apple Incorporated.
Tech builder and designer Intel Corporation and security software firm McAfee as well as network cum server firm Citrix Systems were also dropped from the roll.
In general, the number of approved foreign technology brands fell by one third.
While this is the case for imported tech brands, Reuters observes that the number of products in the state- approved purchase list still jumped from 2,000 to 5,000.
But the increase in the list of brands was due to the addition of more local manufacturers to the list.
Some analysts say China's move is meant to protect itself from widespread Western cyber-surveillance.
China's action coincided with leaks by former United States National Security Agency (NSA) contractor Edward Snowden two years ago.
Snowden exposed several surveillance programs, including those that were operated by the NSA, with the cooperation of telecom companies and some countries in Europe.
An Associate Director at the China Institute of World Trade Organization Studies in the University of International Business and Economics in Beijing says the Snowden incident has become a real concern, especially for top leaders.
He further states that "in some sense, the American government has some responsibility for that. China's concerns are legitimate."
But an official at the CGPS says there may be other reasons why the Chinese government prefers local manufacturers.
Among the reasons he cited is that many local technology firms now offer more product guarantees than their foreign competitors.
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