Shanghai, the mainland’s commercial and financial capital, riding high on the success of Tesla’s Gigafactory 3, is on the lookout for more foreign direct investment (FDI) projects to achieve ambitious growth and employment targets the city has set this year.
Mayor Gong Zheng told a press conference on Wednesday that Shanghai remained the top choice for global investors looking to secure a foothold in the mainland, and FDI projects would continue to be a major growth driver for the country’s gateway city.
His remarks came as FDI into Shanghai rose 6.2 per cent year on year to a record US$20.2 billion last year despite the disruption caused by the pandemic.
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Shanghai has set a goal to achieve 6 per cent gross domestic product growth and create 500,000 new jobs this year.
“As a barometer for the Chinese economy, Shanghai will unswervingly widen the access for foreign investment,” Gong said after the close of the annual session of the local legislative body. “Efforts will be made to further open up the telecoms, internet, cloud, health care and cultural sectors. We warmly welcome multinational companies to bring their hi-tech, world-class projects to Shanghai so as to tap the opportunities in the market and pursue new growth here.”
Shanghai was among the slowest-growing provincial-level economies last year, with GDP expanding 1.7 per cent, compared to the national figure of 2.3 per cent. The mainland’s most developed metropolis had set a 6 per cent GDP target for the economy at the start of 2020.
Although China’s economy took a hit from the pandemic at the start of the year, it was the only major country to record growth last year as Beijing successfully contained the deadly coronavirus.
The mainland leadership has also been encouraging consumer spending in what they termed as inner circulation to propel the economy and keep employment rate.
Although Gong did not mention Tesla’s role in underpinning the growth last year, analysts said its success cemented city officials’ belief that leading technologies in new economy industries would drive growth of the local GDP.
“The mayor’s statement on attracting FDI is a result of Shanghai’s distinctive role in the national economy,” said Gao Shen, an independent analyst in Shanghai. “The big plants set up by foreign investors, such as the Gigafactory 3 by Tesla, proved to be instrumental in bolstering the local economy.”
The global leader in electric vehicles recorded sales of nearly 140,000 Shanghai-made cars last year, dominating the premium electric car segment.
Shanghai signed a pact with Tesla in mid-2018 when US-China trade tensions foiled many American investors’ expansion plans in the world’s second-largest economy.
Tesla also became the first foreign carmaker to set up its wholly-owned factory on the mainland as Beijing rolled out the red carpet to global corporate juggernauts as a way to promote globalisation.
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