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SAP AG, the world's top business software maker, expects to spend up to 125 million euros (US$150 million) in China through 2008 as it triples its development staff to 1,500 in the country, executives said.

The German firm thinks China has the potential to overtake Australia as its second-biggest Asia-Pacific market this year, with China sales expected to grow by double the broader industry rate of 13 percent.

To support its growth in the market and show its commitment in China, the company plans to spend 40 to 50 million euros annually in 2007 and 2008 to beef up its local development team, said board member Claus Heinrich.

¡°We want to grow the location, we want to build up to 1,500 people,¡± Heinrich said on a visit to Shanghai last week. ¡°(Spending) has to be substantially higher in 2007 and 2008.¡±

SAP has invested some 30 million euros in software development in China in the last two years, and expects to spend another 25 million in 2006, said Jui Shangling, president for SAP Labs China.

The company, which competes in China with the likes of U.S. software giant Oracle Corp., is among a growing number of software makers looking to China not only as a place to sell, but also one to design software as they tap into its low costs and relatively skilled workers.