Cisco Systems Inc's combined research and development investment in China hit US$155 million by the middle of this year, fivefold compared with its original schedule, the US-based company said.

Most investment has been poured into Cisco's research center in Shanghai, which has employed more than 600 engineers compared with about 200 when it was founded in 2005.

Cisco previously expected it would invest US$32 million in local research centers within five years, according to Patrick Shao, Cisco China's vice president and general manager of East China operations.

"The business growth (in China) was far higher than the expectation and we have integrated the research ability from acquired companies, therefore it required a huge research investment," Shao said. "Today, East China has become the center region of Cisco China's research and development and Shanghai is the engine of it."

In the region, Cisco has about 1,500 research engineers mainly in Shanghai, Hangzhou, Suzhou and Hefei, parts of them from WebEx and Scientific Atlanta.

Cisco acquired Scientific Atlanta with US$6.9 billion in 2006 and it used US$3.2 billion to obtain WebEx last year.

John Chambers, the company's chairman and chief executive, announced a US$16-billion multi-year investment in China last year in Beijing, including increased research and development investment, a venture capital fund and strategic investment in Chinese companies like Alibaba.com.

Shao said the US economic recession wouldn't greatly affect China and that Cisco's would continue to develop clients in sectors such as telecom, manufacture and finance sectors, as well as small-and-medium sized firms, especially high-tech firms, in eastern China.

Cisco, which provides wireless and router products, is close to signing an agreement with the Shanghai government to offer devices for the World Expo 2010.

(Shanghai Daily July 14, 2008)