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China urged to spend 20b yuan on Internet infrastructure

By Li Weitao (chinadaily.com.cn)
Updated: 2009-03-07 15:03

China should spend about 20 billion yuan ($2.92 billion) in Internet network infrastructure to bolster its economy, a Chinese People's Political Consultative Conference (CPPCC) member proposed.

Such expenditure should be used for infrastructure such as FTTH (fiber-to-the-home), broadband Internet access and Internet security, the China Securities Journal quoted JP Morgan China CEO Fang Fang as saying.

The spending could help boost the productivity of traditional industries and produce a new industry chain which would eventually boost the sagging economy, Fang said.

China last November announced a 4-trillion-yuan pump-priming package and later introduced stimulus plans for several key industries.

China urged to spend 20b yuan on Internet infrastructure

However, some industry observers said the government has overlooked the roles of the information and telecommunications technology in bolstering the economy.

Wu Hequan, vice president of the Chinese Academy of Engineering and also a CPPCC member, said the government should give equal attention to road networks and Internet networks in reviving the economy.

About 45 percent of the 4-trillion-yuan stimulus package is expected to be spent on roads, railways, airports and power supply networks.

Wu said the government needs to work out a national broadband strategy and subsidize operators in expanding broadband Internet networks in rural areas.

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China urged to spend 20b yuan on Internet infrastructure