The output of major industrial companies in Shanghai, an economic powerhouse in eastern China, contracted 12.7 percent in the first two months of 2009 to 292.174 billion yuan ($42.81 billion), the municipal statistical bureau said Saturday.
Major companies are defined as those with annual revenue of at least 5 million yuan.
The bureau said falling exports amid the world downturn contributed to the rare decline.
Among 34 industries, 28 recorded declines in output. In 10 cases, the decline exceeded 20 percent.