China breakthrough for C&W

CABLE & WIRELESS has announced a breakthrough in its drive into the Chinese market with joint ventures in mobile telephony and fibre optic cabling. The projects are expected to involve an investment of dollars 300m by Hongkong Telecom, in which C&W has a 57.5 per cent stake.

Hongkong Telecom is to develop the mobile communications network in Peking in co-operation with the Beijing Telecommunications Administration. Separately, the company will work with China's Ministry of Posts and Telecommunications on a 3,000km fibre optic cable system linking Peking and Hong Kong.

James Ross, C&W chief executive, said the pace at which the group can proceed in China depends on regulatory and telecommunications policies as well as issues including finance and skills.

'There are a whole number of other projects under discussion. What we are seeing is a clear acceleration of the pace at which talks are now proceeding,' he said.

C&W views China as the main driver to the growth of Hongkong Telecom. There are 40 million telephone lines in China and the plan is to expand that to 120 million by the end of the decade.

Last year HKT's turnover rose by 26 per cent to pounds 2.08bn. Calls between Hong Kong and China have grown by 35 per cent a year for the past five years.

Linus Cheung, who became chief executive of Hongkong Telecom on 1 March, is to become an executive director of C&W next January. He will be the first Asian appointed to the board.