Tech Boom Sweeps China, But Some Sense a Bubble – Ariana Eunjung Cha

China’s the place where everyone wants to invest…right? Its tech sector, laden with both high expectations and unclear results, calls some things into doubt. For more information on the tech boom’s status and its possible future, read on. From The Washington Post:

Over the past decade, start-ups have proliferated throughout China, thanks to an aggressive government campaign to attract private investment. Many of the new companies focus on Web sites, but there are also computer-chip and telecommunications equipment designers, biotech development labs and medical-device makers.

The state has created dozens of “new Silicon Valley” districts — glittering high-tech zones and incubators as big as cities, with such incentives as no corporate income tax for the first three years. The largest is Beijing’s Zhongguancun, home to 20,000 start-ups, most of them information-technology companies, with nearly 800,000 employees that together received more than half of the international venture capital invested in China last year.

…Some fund managers are wary of what lies ahead in the short term, however, and worry that China is creating a tech bubble similar to the one that burst in the United States at the start of the decade. But venture capitalists, entrepreneurs and competitors point out that Silicon Valley remains a prominent tech center, despite the bust. They say the tech sector in China, which has an estimated 162 million Internet users, will be a force to be reckoned with. [Full text]

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