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As the dominant local company, China Mobile Communications Corp is seriously seeking opportunities to tap emerging markets worldwide, said the boss of the world's top cellular carrier.

 

"If we finally make our mind up to go abroad, we will concentrate on emerging and developing markets, such as in Asia, Africa or Latin America," said Wang Jianzhou, president of China Mobile.

 

He ruled out the possibility of squeezing into the packed European and North American markets, where the penetration rate of cellular phones is already high.

 

Wang refused to disclose more details of the plan, such as a timetable, which countries may be involved and who were potential partners.

 

In July China Mobile reportedly entered a failed bid for Luxembourg-based Millicom, which has networks in 16 emerging markets including Latin America and Africa. The company has never confirmed the bid.

 

According to Wang, however, China Mobile has never stopped weighing up the pros and cons of the international market. There have always been different views within the company on whether to expand overseas.

 

Those who oppose the potential expansion argue that it is risky and besides, vast rural areas of China remain untapped and offer great potential for further growth. Why bother to take risks abroad?

 

"The reason China Mobile should start forming such plans is to secure both present and future profitability opportunities," said Wang.

 

Moreover, if China Mobile can enlarge its size and business scale, the firm can further cut operation costs, he added.

 

Wang said that as the world's largest cellular operator by value, China Mobile is experienced in setting up infrastructures and providing wireless communication services for areas and regions with harsh natural conditions, another reason why the company would be comfortable tapping less developed markets and regions.

 

China Mobile Hong Kong acquired Hong Kong's fourth-largest mobile operator China Resources Peoples Telephone early this year, and has given mobile service access to some unmanned countryside parks and areas in the special administrative region, to meet demands from tourists.

 

Yang Yuanqing, chairman of the Lenovo Group, advised that Chinese companies' international business expansion should be firmly backed by solid business growth in the domestic market. As China's top personal computer (PC) maker, Lenovo bought out IBM's PC division two years ago.

 

China Mobile's mobile subscribers totalled 274 million by the first half this year, with net profit reaching 30.17 billion yuan (US$3.78 billion).

 

The cellular carrier will further expand the capacity of its second-generation (2G) networks to cater for surging local demand. "Although the 3G era is coming, we are still attracting 4 million new 2G users per month. Therefore, we will continue expanding our 2G mobile capacity to develop the local market," said Wang.

 

(China Daily September 13, 2006)