Shanghai remains investment destination of choice as reforms attract US$21.5b in first half

The Shanghai city government is hoping the rebound in foreign inflow of capital in the first half will continue for the rest of year as it ploughs ahead with efforts to further open up the market.

In the first six months of the year, contracted foreign funds, an indicator of future commitments of capital, grew 18.1 per cent to US$21.5 billion in Shanghai, as the premier commercial hub signed more than 2,100 projects with overseas investors in the period, according to figures released by the city’s statistics bureau on Tuesday.

It reversed a decline of 47 per cent from a year earlier.

“This year [we have seen] an improving trend of attracting foreign investments,” said Tang Huihao, deputy statistics chief of Shanghai government. “Citywide, both contracted and actual foreign investments reversed from declines seen a year earlier.”

Actual foreign direct investments to the city increased to US$8.6 billion, up 6 per cent from a year ago. It fell 7 per cent in the same period a year ago.

Tang said the city can continue to attract foreign capital because the municipal government is actively following up on local implementation of Beijing’s pledge to lift restrictions on foreign investors, spanning from advanced manufacturing to financial sectors, against the backdrop of simmering trade rows between China and the United States.