Shanghai’s foreign capital inflows up 4.5 percent in Q1 despite COVID-19
By Tian Hong, Xie Weiqun, People’s Daily
Photo taken on March 31 shows night view of Lujiazui in Shanghai. Photo by Zhou Dongchao/People’s Daily Online
The year 2020 marks the 30th anniversary of the development and opening-up of Shanghai’s Pudong New Area, and the final year for the metropolis to basically build itself into an international financial center.
Shanghai has made steady progress in the opening-up of its financial market. On March 20, five well-known foreign financial institutions held an online opening ceremony for their projects in the municipality’s Lujiazui financial hub. Among them, J.P. Morgan Securities (China) Company Limited is one of the first newly established foreign-controlled joint venture securities firms in the country, and Korean Reinsurance Company Shanghai Branch is the South Korean company’s first business entity in China.
Another 18 multinational companies signed contracts expressing their intention to establish regional headquarters in the Pudong New Area on April 29.
“Shanghai is at the forefront of China’s reform and opening-up endeavor, and is one of the most attractive destinations for foreign investment in China,” said Yoon Sung-Muk, general manager of the Shanghai branch of the reinsurance company.
Scaling up investment in Shanghai and China at large has become the consensus and common choice of a host of top international financial institutions. In the first quarter of the year, the city saw foreign capital inflows totaling about $4.67 billion, up 4.5 percent year on year. In particular, foreign capital inflows hit $1.87 billion in March in the city, up 20.8 percent year on year.
In total, actual foreign investment in Shanghai had reached $264.2 billion, and the regional headquarters of 730 foreign-funded multinational companies (MNC), as well as 466 foreign-funded R&D centers, had landed in the city by the end of March.
Shanghai has become the city on the Chinese mainland accommodating the largest number of foreign-funded MNC regional headquarters and R&D centers.
Gong Zheng, acting mayor of Shanghai, awarded certificates to a new batch of 21 foreign-funded MNC regional headquarters and R&D centers in the city on April 8. Two of the 31 companies are Fortune 500 companies, and three have set their Shanghai headquarters as their headquarters covering Greater China, Asia Pacific or larger regions.
Shanghai is not only the gateway to the Chinese market, but also an important part of the regional and global economy, said Tsuji Takayoshi, general manager of Itochu Textile (China) Limited, adding that the company will actively develop e-commerce business, and bring more brands to the Chinese market.
Shanghai has continuously improved its business environment. The city released the English and Japanese versions of documents such as the 28 measures to cushion companies in the service sector against the COVID-19 epidemic, in order to help foreign enterprises to resume work and production as soon as possible during the epidemic prevention and control period.
The Shanghai Municipal Commission of Commerce has visited 720 foreign-funded MNC regional headquarters in the city, solving about 98.7 percent of 553 problems they encountered.
On April 10, the city rolled out 24 measures to stabilize foreign investment, creating open and convenient investment environment for foreign investors.
Hua Yuan, director of the municipal commission of commerce, said the COVID-19 pandemic has resulted in severe impacts on the global economy, but the momentum of the steady growth for China’s economy has never changed and will be an underlying trend going forward.
The China International Import Expo is showing increasing spillover effects, said the official, adding that a series of polices such as counter-cyclical regulation and further opening-up, as well as new consumption and demands will foster new areas of consumption and new growth points.