Investment in Shanghai surges despite global uncertainty
Foreign investment in Shanghai rose nearly 32 per cent in the first two months of this year, despite the threat of a war in Iraq.
Foreign investors poured US$831 million (HK$6.4 billion) into the city during January and February, according to official figures released yesterday. Contracted foreign investment - an indicator of the future trend - surged 54 per cent to US$2.38 billion.
Local officials are counting on foreign investment to support development, but they predict that economic growth is likely to slow this year from 10.9 per cent last year due to uncertainties in the global economy.
Shanghai approved 642 foreign-invested projects in the first two months, up 54 per cent from the same period last year, as companies encouraged by China's entry into the World Trade Organisation flocked to the city.
Nearly half of the projects involved manufacturing, accounting for two-thirds of total contracted foreign investment for the period. There were 50 projects with investment of more than US$10 million each.
By the end of last month, Shanghai had a total of 28,382 foreign companies and cumulative foreign investment of US$41 billion.
Analysts say a US-led war against Iraq could cause the mainland's exports and inflows of foreign investment to slow.
Exports passing through Shanghai's port from other areas rose 25 per cent year on year to US$13.8 billion in the first two months, local media reported. Imports surged 55 per cent to US$11.4 billion.
Shanghai plans to spend 55 billion yuan (HK$51.7 billion) on infrastructure projects this year, a 14.4 per cent annual increase, to support economic growth.
Projects include expanding parkland, building expressways and finishing a high-speed train link to the international airport.
