The economy doesn’t appear to be hurting ZTE too much, thanks in part to business in China. The Chinese vendor reports its net profit in the first half of the year was up 40.5 percent over last year.

Boosted by full-scale construction of 3G networks in China, operating revenue was up in the domestic market, representing year-on-year growth of 111.7 percent. The company says the performance of its wireless products was in line with expectations.

However, the company’s gross profit margin for carrier networks fell to 32.2 percent, down from 35.4 percent, reflecting competition. In a statement to the Hong Kong stock exchange, the company said competition remained “intense” in the global telecom market, according to Reuters.

In a press release, ZTE Chairman Hou Weigui said the company will seek to maintain its competitive edge in the international market and focus on large, populous countries as potential emerging markets. “We will also strengthen cooperation with key strategic carriers in high-end markets such as Western Europe and North America to unfold further opportunities for cooperation with top-tier global carriers,” he said.

Both ZTE and Huawei are seen as up-and-comers in the North American market. Earlier this month, Huawei was named among Clearwire’s WiMAX vendors, joining Cisco, Motorola and Samsung.

In its latest benchmark report, Gartner named ZTE among the top three LTE network infrastructure vendors, citing ZTE’s work to expand outside China and spending on research and development.

Besides serving the GSM/UMTS/LTE and CDMA markets, ZTE reports that its WiMAX products are in markets like Malaysia, Saudi Arabia, Japan and various European countries.