Global thumbs-up for business development

The inclusion of nine Shanghai companies among the 133 Chinese firms on the 2020 Fortune Global 500 is a sign of the city’s emerging importance and competitiveness in global commerce. 

The Chinese companies on the newly released list, which ranks companies based on their revenue, include those based on the mainland, in Hong Kong and Taiwan. Shanghai companies increased from seven on the list last year. 

The two newcomers are Shanghai Construction Group, a building and engineering company that ranks 423 on the list, and retail pharmacy firm Shanghai Pharma, which ranks 473. 

The threshold for making this year’s Global 500 list was US$25.39 billion in revenue. The average revenue of the nine Shanghai companies totaled US$68.56 billion. 

The local Fortune Global 500 companies are the “ballast” for the city’s economy, a barometer of its growth and a reflection of core competencies, according to the Shanghai authorities. 

Pressure on the city’s economy has been rising since last year amid the shock of trade tensions between China and the United States. 

Despite that, many enterprises in Shanghai have bucked the trend, with steady economic growth even in face of the coronavirus pandemic. 

The city’s biomedical industry, for example, reported an increase in production to 132 billion yuan (US$19.1 billion) last year and was one of the few industries showing expansion in the first half of this year. 

Also of note, China Baowu Steel Group jumped up 38 places in the Global 500 to rank 111. The company has set itself the goal of becoming the world’s largest steel producer and being placed in the top 100 companies on the list. Greenland Holding Group Company, meanwhile, moved up 26 places to break into the top 200 for the first time. 

SAIC Motor Corp, a state-owned automotive design and manufacturing company based in Shanghai, ranked 52nd on this year’s list, down from 39 last year. It still remained the highest-ranked Chinese auto firm and the world’s seventh. 

Despite this year’s epidemic, SAIC posted sales gains for four consecutive months, and its year-on-year growth accelerated in July. 

The stronger competitiveness of Shanghai enterprises is partly attributed to city efforts to improve the business environment. That became a top priority on the municipal agenda, beginning in late 2017. 

In 2018, Shanghai launched the first version of its Business Environment Reform Program, which outlined more than 40 reform tasks and policies, and 20 online administrative processing systems. Updated versions of the plan were unveiled in 2019 and early this year, covering 188 reform tasks and 58 reform policies. 

Shanghai authorities have streamlined administrative procedures and cut red tape, making it easier for companies to do business in the city.

The city government organized 16 meetings with private enterprises over the past two years, conducted communications with 120 entrepreneurs and business owners, and sent out 1,077 questionnaires to get feedback from the private sector on the city's business environment.