Chinese telecom companies have begun to invest heavily in their mobile phone networks in preparation for the launch of third generation mobile communication (3G).

Statistics with the Ministry of Information Industry (MII) show China's telecom industry reported a growth rate as high as nearly 40 percent in the first two months of this year.

Sales revenue of the industry reached 94.91 billion yuan (about US$11.9 billion) during the period with a year-on-year rise of 38.2 percent. Profits rose 59 percent to 5.9 billion yuan.

China is expected to issue its first 3G license this year, which will introduce a new mobile phone technology that will provide better reception and many new services.

Handset manufacturers also reported a rapid growth in the first two months of the year as newcomers have joined in since China relaxed rules governing phone-making licenses last year.

Statistics with MII show that China produced 62.83 million handsets in the first two months with a year-on-year rise of 55 percent. The export of mobile phones rose 69.5 percent year-on-year to 3.98 billion US dollars during the period.

China's integrated circuit industry also witnessed rapid growth in the first two months of the year as multi-nationals increased their investment in China.

Statistics with MII show that sales revenue from the industry in China reached 34.3 billion yuan (some 4.3 billion US dollars) in the January and February with a year-on-year rise of 45 percent. (1 US dollar= 8.01 yuan)

(Xinhua News Agency April 13, 2006)