Business / Opinion

Shanghai has to build more than buildings to compete

By Ed Zhang (China Daily) Updated: 2014-02-10 07:21

Shanghai has claimed it has come up with a surprise - by showing better GDP growth in 2013 than most people had forecast.

Although it is about only one city's performance, which makes up about 4 percent of the mainland's total, how Shanghai - the country's commercial capital - manages its growth could point to the future for the rest of the nation.

Municipal officials announced on Jan 26 that the city's GDP had risen to 2.16 trillion yuan ($360 billion) in 2013, up 7.7 percent year-on-year, the same as the national growth rate.

In 2012, Shanghai's GDP growth was 7.5 percent, below the national rate by 0.3 of a percentage point.

The improvement was credible, municipal officials said, at a time of rising domestic costs and shrinking global demand for goods made in the city.

By comparison, China's overall economic data, released by the National Bureau of Statistics on Jan 20, showed 56.88 trillion yuan - close to $9.5 trillion - in national GDP.

In a sector-by-sector breakdown, the NBS reported, primary industry (agriculture) saw a growth of 4 percent; secondary industry (manufacturing and construction), growth of 7.8 percent; and tertiary industry (services) growth of 8.3 percent.

It was the first time in China's recent history (indeed since the NBS began to release sector-by-sector growth figures) that the service industry grew faster than manufacturing.

In absolute numbers, the service sector's contribution to GDP was 26.22 trillion yuan. The service sector's contribution, 46 percent of the total, is way below that in Shanghai, where its share was 62.6 percent.

But Shanghai's record isn't impressive if compared with other major cities in the world, where services account for about 90 percent of their economies. In some regional financial centers, the financial sector alone contributes up to 50 percent. Shanghai falls short by a long way.

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