GUANGZHOU - Despite a huge market demand for "green" business in China's larger cities, Siemens will step up its expansion in rural markets, because the country's energy-saving strategy is not limited to the bigger cities, said Cheng Meiwei, the president of Siemens Ltd, China, part of the German group Siemens AG.

"We see vast business opportunities for the green industry in China, as the country is making great efforts to conserve energy both in large cities and small towns," Cheng said during the China International Innovative Products and Technologies Show, which was held in Guangzhou, the capital of Guangdong province, earlier this month.

The company exhibited a number of environmentally friendly products and solutions at the event.

According to Cheng, the sales revenues of Siemens' green-business sector will reach 40 billion euros ($53 billion) by 2014, most of which will come from the Chinese market.

"Siemens will also increase its investment in the research and development (R&D) of green products tailored to rural markets, and speed up the localization of production to reduce the purchasing cost to customers," he added.

Last month, the company signed an investment agreement with the Chengdu High-Tech Development Zone to set up a manufacturing and R&D base for industrial automation products in the city.

The facility will be Siemens' largest digital factory in China and the third R&D center for its industrial automation products worldwide, following plants in Germany and the United States.

Scheduled to be operational by first half of 2013, the planned Electronics Works Chengdu (EWC) will have a large production capacity for high-end Programmable Logic Controller products for the industrial market, both in China and globally.

"We are building a modern digital factory in China, setting global standards in manufacturing efficiency and productivity, and providing individualized products to customers," said Marc Wucherer, president of the Industry Sector of Siemens North East Asia, adding that this will help drive the industrial upgrading of the region and cultivate high-caliber professionals in the long run.

"Localized production bases like that in Chengdu make products affordable to customers in small cities and towns and the products we make here are also popular in the third- and fourth-level markets in foreign countries," Cheng said.

Over recent years, Siemens has increased investment in China to expand its manufacturing and R&D facilities for energy-efficient products and solutions to improve productivity.

"The proposed manufacturing base and R&D center will supplement and further enhance Siemens' manufacturing and development capacity in China," Wucherer said.

"In the long term, Siemens Industry Sector will try to focus on offering technologies and services for efficient industrial manufacturing in terms of automotives, chemicals, pharma, food and beverages and minerals, all of which are booming in both the developed and rural markets in China, in an attempt to push forward industrial upgrading and energy saving, especially in the central and western regions of the country," Wucherer added.

China aims to cut energy consumption per unit of gross domestic product by 16 percent by 2015, thereby saving 670 million metric tons of coal equivalent. It achieved a figure of around 20 percent in the past five years.