Cisco Systems plans to spend US$16 billion in China over the next five years, nearly double the US$8.5 billion it spent between 2002 and 2007, the Financial Times reported. The company, which is the world's largest manufacturer of internet switches and routers, didn't give precise details as to how the funds would be allocated. Thomas Lan, president of Cisco China, said procurement was likely to account for 70-80% of expenditure, which tallies with the US$7 billion spent on China-sourced components and services over the last five years. The substantial increase highlights China's growing importance as a base for electronic goods manufacturing and assembly. Cisco has agreed to collaborate with internet company Alibaba in selling services and software to Chinese small and medium-sized enterprises and also buy a US$17.5 million stake in Alibaba.com. The company has spent about US$700 million on private equity and venture capital investments in China over the "past several years."