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Chinese telecom giant extends its global footprint to Canada

Shoppers file along Beijing’s Wangfujing St. in this file photo. China Unicom announced Tuesday that it has opened an office in Toronto.

JASON LEE/REUTERS

One of China's largest telecom companies is setting up shop in Canada to capitalize on the flourishing trade relationship between the two countries.

China Unicom announced Tuesday that it has opened an office in Toronto as it embarks on the latest leg of its North American expansion. The Beijing-based company, which operates a global network that covers more than 240 countries, said Canada is a key growth market along with the United States and the Asia-Pacific region.

The company, which booked annual revenues of $33-billion (U.S.) last year, said its goal is to function as a communications "gateway" to Asia. It will provide network backbone support to help Canadian telcos connect to China, while also providing telecom services to Canadian companies expanding to China and to Chinese businesses establishing operations in Canada. Those enterprise clients include financial institutions, executives said.

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"Our sole mission and unwavering force of our Toronto operations will be to support the global network infrastructure requirements of our Canadian clients," said Yitao Wu, president of China Unicom (Americas) Operations Ltd., during a ribbon-cutting ceremony at a Toronto hotel.

China Unicom is pursuing its Canadian expansion at a time of thriving Sino-Canadian relations. China is already Canada's second-largest merchandise trading partner. In 2011, Canadian exports to China totalled nearly $17-billion, while imports from China totalled $48.1-billion. Prime Minister Stephen Harper led a trade mission to China this year to forge even deeper economic ties.

That budding bilateral relationship, plus Canada's relatively resilient economy, provided strong incentives for China Unicom to add Toronto to its global footprint, said Mr. Wu. "There are many, many Chinese companies that are coming here, so they need telecom services because they want to expand their business," he said in an interview.

The company's Canadian telecom partners include BCE Inc., Telus Corp., Rogers Communications Inc. and Manitoba Telecom Services Inc., added Mr. Wu. Internationally, China Unicom has partnership agreements with over 100 carriers.

In addition to vast global submarine cable systems, China Unicom also operates a terrestrial network that connects Europe to Asia. Within China, the company's network covers more than 600 cities and includes 320 million subscribers for its wireline and mobile services.

Nonetheless, its North American ambitions are limited to providing wireline services. Although Mr. Wu made it a point to boast that China Unicom has the largest iPhone user base outside the United States, he said the company has no plans to enter the wireless market in either the U.S. or Canada.

"The market is too competitive," he said, noting that wireless incumbents already have a lock on the mobile market in both countries. Building a new wireless network in Canada would require "a lot of investment," he added.

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