East China's Shanghai municipal government has unveiled its new plan to attract more foreign investment, especially to the service sector, boosting the city's overall export and import volume.
According to the Shanghai Municipal Economic Relations and Trade Commission (SMERTC) and Shanghai Municipal Foreign Investment Commission (SMFIC), the city will strive for an increase of 15 per cent in the volume of foreign trade next year.
The officials revealed that the city will continue to retain its growth rate of more than 10 per cent in terms of actual investment.
Pan Longqing, the director of SMERTC and SMFIC, said: "Shanghai is pledged to improve the quality of foreign investment to be injected into the city in 2005. Quality is more important than the amount."
Pan added that the local government's future work will focus on drawing more foreign investment into the six service sectors of modern logistics and transportation, financial services, exhibition and travel services, information services, professional services auxiliary to manufacturing, and entertainment.
Xie Kang, director of the research centre of transnational businesses under the Shanghai Academy of Social Sciences, said that the plans put forward by the municipality have been adapted to the global trend of FDI (foreign direct investment).
He pointed out that since 2003, 60 per cent of the total global FDI is in the service industry.
At the same time, such a plan will help Shanghai to avoid directly competing with its surrounding areas, and, in the meantime, will strengthening Shanghai's existing advantages.
The surrounding areas are also currently working hard to attract foreign investment into their manufacturing sectors.
In Xie's opinion, if Shanghai aims to attract more investment to its manufacturing sector, it will inevitably result in cut-throat competition and harm the overall development of the Yangtze River Delta.
When compared to its surrounding provinces, Shanghai now enjoys some advantages in its service sector.
However, Shanghai's service sector still lags behind when compared with leading developed countries.
Therefore, if Shanghai can learn the latest management sciences in these sectors during the process of attracting foreign investment in the sector, the city can rapidly improve the competence of the sector.
(China Daily February 7, 2005)
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