Shanghai has seen the establishment of 11,500 enterprises funded by companies from elsewhere in the country with total registered capital of more than 40 billion yuan. These enterprises generated a combined 30 billion yuan in output value last year, contributing nearly one percent to Shanghai's 10.2 percent GDP growth rate for the year.

The increasing flow of domestic investment into Shanghai is due to the city's introduction of favorable policies for domestic investors in loans, housing, citizenship, and education for their children. Legend Group, a Beijing-based computer giant, realized 700 million yuan in output value in Shanghai in 1997, as much as 1.2 billion yuan in 1998, and up to 2 billion yuan last year.

Domestic enterprises have been focusing their investment in Shanghai in such sectors as services, agriculture, stocks, real estate, consultancy, software development, and education.

X102 (???)

Chinese Consumers Confident about Growing Economy

A recent survey shows that China's Index of Consumer Expectations (ICE) dipped a little in January but most consumers are optimistic about healthy economic growth.

According to the survey of consumer confidence released on March 4 by the National Bureau of Statistics (NBS), the ICE stood at 95.2 points, 0.1 point lower than the previous month. About 60 percent of those surveyed said they expect the national economy to grow faster this year than in 1999, and 61 percent foresee a sustained boom over the next five years.

However, the survey also reveals a weakening confidence in family economic status, as concerns about employment, education, medical care, insurance and housing weigh heavily on the budgets of many families. Some 70 percent of consumers said they believe this is the right time to buy household appliances, according to the Index of Consumer Sentiment (ICS), which rose a bit higher compared with the end of last year. Consumer indexes, including the ICE, ICS, and Index of Current Economic Conditions (ICC), are used internationally as indicators of the overall economic situations and consumer confidence.

Analysts from the bureau said that worry about insufficient income hinders future consumer spending, thus making the stimulation of domestic demand more difficult. They called for greater efforts aimed at developing a sound social security system while increasing salaries.