Shanghai showcases its economic resilience with steady foreign investment

Shanghai's economy has grown steadily so far this year, and is on track to exceed annual targets.

The financial hub of China has showcased its economic resilience with positive growth in various sectors in the first eight months of 2023, especially in consumer spending, foreign trade and foreign investment.

For the first half of the year, the city's economic output reached an impressive 2.139 trillion yuan (US$295.752 billion), up 9.7 percent year on year.

According to latest data, for the period from January to August, industrial enterprises in the city reported a 4.1 percent increase annually in the total output value, topping 2.535 trillion yuan.

These promising figures position Shanghai on track to surpass its annual economic growth target of over 5.5 percent.

A significant contributing factor to the city's economic success has been the effective implementation of strategic policies.

The city has made concerted efforts to create a favorable business environment by streamlining regulations, reducing administrative burdens, and providing support to industries and enterprises.

This has not only encouraged domestic and foreign investment but also facilitated the expansion of emerging industries.

Furthermore, the service sectors have experienced a notable recovery, adding to economic resurgence in the city.

Transportation, logistics and tourism sectors also benefited from the lifting of travel restrictions and a revival in domestic and international movement.

Specifically, in the first eight months, fixed-asset investment in Shanghai demonstrated remarkable growth, registering a notable increase of 29.5 percent compared with the same period last year.

Within the three major investment areas, urban infrastructure investment rose by 16.9 percent, industrial investment by 19.2 percent, and the investment in real estate development up 29.8 percent.

Also spurring the investment activity was the acceleration of major construction projects, such as the development of Shanghai East Railway Station and the north side of Xiaoyangshan.

A revitalized consumer market

Amidst the economic recovery, the city has experienced promising signs of a revitalized consumer market.

The Double Five Shopping Festival played a crucial role in stimulating consumption, resulting in a structural shift with higher customer foot traffic compared with sales revenue and a faster growth rate in service consumption relative to commodity consumption.

Key commercial districts and tourist attractions have embraced significant improvements in visitor traffic, while cultural and tourism consumption has displayed a strong resurgence.

From January to August, the total retail sales of consumer goods in the city reached 1.229 trillion yuan, surging by 18.3 percent compared with the same period last year.

In terms of specific industries, wholesale and retail sales rose 16.4 percent to 1.128 trillion yuan, while accommodation and catering sales added up to 100.603 billion yuan, up 44.8 percent.

Shanghai's resilience in foreign trade and foreign investment has further contributed to its economic progress.

Despite global uncertainties and trade disruptions, the city has continued to attract foreign companies and maintain strong export performance.

The presence of a highly skilled workforce, excellent infrastructure, and a supportive business environment have solidified the city's reputation as an attractive destination for international businesses.

It witnessed the establishment of 3,877 new foreign-invested enterprises, indicating a remarkable increase of 44.2 percent compared with the same period last year.

The actual utilization of foreign investment reached US$15.899 billion, more than 94.6 percent of which was pumped into the tertiary industry.

Notably, information transmission software and information technology services, scientific research and technical services, and leasing and business services were the top three industries attracting foreign investment.

The city's foreign trade totalled 2.792 trillion yuan, marking a 3.6 percent increase from a year earlier.

Despite global economic fluctuations, exports grew 4.9 percent to reach 1.139 trillion yuan, while imports increased by 2.8 percent to 1.653 trillion yuan.

Major export markets for Shanghai include the European Union, with exports totaling 211.919 billion yuan, up 8.8 percent, and Japan, with exports reaching 93.289 billion yuan, up 9.8 percent.

However, exports to the United States experienced a slight decline of 11.4 percent, amounting to 182.862 billion yuan.

On the other hand, exports to Hong Kong saw a significant increase of 15.9 percent, reaching 94.292 billion yuan.

These figures reflect the city's ability to navigate international trade dynamics and maintain its position as a key player in the global market.

As Shanghai's economy continues to grow steadily, the government remains committed to creating a sustainable and inclusive development pattern.

Efforts are underway to address income inequality, support small and medium-sized enterprises, and promote environmental sustainability.