GO
Loading...

WPP CEO: Look to China for leadership on technology

Rather than criticize China for copying intellectual property, investors in the West should look to China for leadership in the tech sector, the CEO of British advertising giant WPP told CNBC on Tuesday.

Martin Sorrell's comments follow the company's purchase of U.K. based digital consultancy Cognifide and the acquisition of Shanghai-based gift specialist Egift Design and Production by its subsidiary JWT, both announced on Monday.

"Others in the West tend to decry China [and say] that they copy or even, should I say, steal IP. We used to say the same thing about Hong Kong, South Korea and Japan, and look what's happened in those markets," he said.

(Read More: China moving closer to unleashing fresh stimulus)

"The same thing is true of China, what we're seeing is that China has leadership in technology," he added.

China is WPP's third-largest market. The firm employs 16,000 people there and last year generated $1.6 billion in revenue, Sorrell said.

Sorrell told CNBC he expected his firm's China business to grow between 6 and 7 percent in 2014, compared with growth of 6 percent in 2013.

"Our Chinese business is very strong… I often wish that other parts of our business in other parts of the world were as good," he added.

Last month WPP reported an 18.7 percent rise in pre-tax profits to 1.29 billion pounds ($2.13 billion) for 2013, outpacing rivals Publicis and Omnicom, whose upcoming merger is set to eclipse WPP as the biggest player in the market.

(Read More: WPP CEO: Facebook's huge WhatsApp acquisition 'potty')

Bloomberg via Getty Images | Getty Images

Sorrell said there were huge opportunities in technology and internet firms in China. He made references to the likes of Baidu, Tencent and Alibaba, the e-commerce site that is expected to list its shares in New York.

"The last time I checked in terms of market cap – these are all leaders in terms of technology and technological approaches," he said. "Even legacy companies as well as the new companies have an understanding of tech that often surpasses [the one] that we have in the West," he added.

Sorrell gave an example of how Chines tech firms are steps ahead of the West in terms offering financial services.

(Read More: I'm very bullish on Russia: WPP CEO)

"Alibaba, Tencent, and I think Baidu, all have banking licenses and will be building financial transaction platforms. And that's a really international development that we haven't seen in the West yet, but I'm sure will come," he added.

Talking about the outlook for China's economy, Sorrell said it was important to have perspective.

Weak economic data and news this month of the country's first corporate bond default have stoked concerns about the outlook for China's economy.

"In my view, it's [a case of] be careful what you ask for, as China is the driver of the global economy… If we had 7 or 6.5 percent [growth] in the U.K. we would be over the moon," Sorrell said.

China's economy grew 7.7 percent last year, while the U.K. economy grew 1.9 percent.

(Read More: Fraudsters wait in the wings for Alibaba's IPO)

By CNBC's Katie Holliday: Follow her on Twitter @hollidaykatie