Posted by: Bruce Einhorn on May 22, 2009
A few weeks ago I wrote in the magazine about ZTE, the Chinese telecom equipment maker that has come from nowhere to gain the No. 6 spot in the global rankings of cell-phone makers. With Motorola and Sony Ericsson both struggling, ZTE wants to keep up the momentum. Now comes news ZTE is getting another boost from the Chinese government. The company recently received a five-year, $15 billion credit line from state-owned China Development Bank to help ZTE develop business overseas. Today, the company got even more money, this time from China’a Export-Import Bank; the two announced a $10 billion credit line for ZTE.
The timing of the announcement, a day after Lenovo revealed a record loss for the quarter ending March, is probably just a coincidence. Still, it does help emphasize how much things have changed in China’s tech world. For years, Lenovo was China’s premier tech company, the one that Beijing’s leaders wanted to become a global player. Hence the deal for IBM’s PC business and the excitement that came after that. ZTE was respected, but focused on telecom equipment rather than consumer products and so didn’t get that much attention. Now it’s ZTE that is the hottest Chinese tech company and Lenovo is struggling. The $10 billion credit line from the Ex-Im Bank should make ZTE even hotter.