Microsoft will buy US$700 million worth of Chinese computer hardware over the next five years and invest a further US$200 million in domestic software manufacturers. As part of an agreement reached with the National Development and Reform Commission, the US company will also cooperate with the NDRC in setting up a software innovation center. The announcement follows closely on the heels of President Hu Jintao's visit to Microsoft's Seattle headquarters and the home of company founder Bill Gates. Hu offered a sweetener to his hosts by saying that domestic computer manufacturers would have to sell machines with operating systems pre-loaded, which could reduce the piracy problems experienced by Microsoft in China. Lenovo agreed to the pre-loaded software system last week and this is expected to boost Windows sales by US$1.2 billion over 12 months.