Shanghai municipality lies on China's eastern coast bordering Jiangsu and Zhejiang provinces. It is situated on the delta plain at the confluence of the Huangpu river and the Yangtze estuary which provide the city with its remarkably sheltered harbour. The climate is subtropical.
It is now moving away from a heavy industrial base into light industrial production. It accounts for 7 per cent of China's gross industrial output, nearly 7 per cent of its heavy industry and some 30 per cent of light industrial output.
However, it remains one of the leading shipbuilding centres with nine shipyards (and the support services of marine equipment manufacturers, ship research and design institutes). The port is the largest in China, handling 30 per cent of the tonnage that passes through all Chinese ports.
China's largest continuous strip steel hot-rolling mill, producing 4m tonnes annually, has recently gone into production' at Shanghai Baoshan Iron and Steel Complex.
Shanghai is a centre for the manufacture of motor vehicles; Volkswagen has a plant at Anting which was set to manufacture 60,000 Santanas per year from 1990 and the city intended to add another 60-90,000 vehicles to this total during the Eighth Five Year Plan, but the current austerity programme has seriously affected motor manufacturers.
The establishment of the Pudong Special Economic Zone, was announced in April 1990. Work is well under way on the inner city area, which will lead to a massive re-development of eastern Shanghai at a cost of 40bn RMB over the period 1991-6. It involves commercial and financial development as well as industrial and port development. There are ambitious plans for infrastructural improvements to the area's transport network, port facilities and power supply.
Pudong is intended to be the driving force for the general development of the Yangtze River Delta as a whole, an area of over 500,000 square km. However, initial progress in attracting investment was slow and to improve the attraction of investors to Pudong the authorities
speeded up work on key infrastructural projects which will be completed by the end of 1993. There are now 700 joint ventures including investments by Dupont, Bayer, IBM and C Itoh.
The newly formed Min Hang district which covers 340 square km (only 10sq km smaller than Pudong) has a population of 500,000. The new district has a well established industrial base (chemicals, electrical goods, and telecommunications) and good communications with neighbouring Zhejiang province, Hong Qiao international airport and the newly opened Shanghai No. 1 Metro, which is expected to be fully operational later this year.
Shanghai's port, extending for 13km, offers more than 100 berths and the city's central position on China's east coast provides good transport facilities by sea. It handled 162m tonnes of cargo in 1992, an increase of 10.7 per cent over 1991. Work on a 176km underground railway system is underway with a US$275m loan from Germany. The 2.5bn RMB project is due to be completed in 1993. The Nanpu Bridge, China's largest suspension bridge and the second largest in the world, which carries a six-lane road across the Huangpu River, opened in November 1991.
The second phase of the Boshan Iron and Steel complex is nearing completion. The project is China's largest project to-date costing over 200bn RMB and as been undertaken, amidst much controversy, with the assistance of the Japanese and Germans (suppliers of most of the equipment) but when it is finished, the Chinese hope that production from the complex will largely end the need to import high-grade steel. The third phase, planned to include a blast furnace, two cold mills, a hot mill and a centring plant, will come into operation in 1997.
Shanghai Coking and Chemical Plant is planning to expand its capacity with a new 600m RMI3 complex to produce methanol and cellulose acetate, coal gas and heat energy. The first phase is expected to be completed this year. The World Bank has loaned US$20m under the Sparks Programme' which the municipality is planning to use for development of industrial projects on Chongming Island. The projects being considered for funding are: the production of household electrical appliances, textiles, food processing, the production of processing machinery, and training and information systems.
The World Bank is also funding the Shanghai harbour project; US$46m has been loaned for the procurement of general harbour and dock equipment and for the construction and equipping of a bulk grain berth/terminal. Work on a 34km sewage pipe, begun in 1988, which is scheduled to be completed in 1993, will have a daily discharge capacity of 1.4m tonnes. The Suzhou river sewerage treatment project, due to be completed at the end of the year, will provide a treatment capacity of 1.4 tonnes per day. There are also plans for a water pumping station on the Huangpu river.
A planned 275km expressway between Shanghai and Nanjing is one of the key projects of the Eighth Five Year Plan. Construction will begin in 1991 or 1992. Shanghai has large project to reclaim land at the mouth of the Yangtze, to the east of Chongming Island. The reclaimed land will increase the municipality's cultivated land by 4,000 ha and add 470 ha of forests. Another 600 has will be for other uses.
There are several chemical JVs in Shanghai including US investment in a plant to produce speciality chemicals and metal can-sealing compounds W.R.Grace's wholly owned factory on the Minhang Industrial Estate costing US$500,000 was opened in November 1987. UOP, a Union Carbide subsidiary, has set up a molecular sieve JV and 3M Corporation (US) set up in Shanghai in 1983 the first wholly owned foreign investment in China. The Shanghai Dupont Agricultural Chemicals Co Ltd is the first JV in the Pudong Development Zone to be approved and the first JV for the production of insecticides. *
Sources include the Department of Trade and Industry, UK.
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