COVID-hit Shanghai unveils US$257bn in projects

Shanghai, widely recognized as China’s commercial capital hub, has announced eight major infrastructure projects with total investment of 1.8 trillion yuan (US$257 billion). This comes after the city was forced to impose fresh lockdown in April and May.

Easily China’s biggest city, Shanghai’s economy slumped 13.7% during Q2, recording the worst performance of all of China’s 31 province-level regions.

According to data released by local statistics bureau, during the first eight months of 2022, Shanghai’s infrastructure investment slid 27.4% contrary to the 8.3% growth recorded on a national level.

The move towards more infrastructure investments align with the calls by national policymakers to restore the lagging pace of China’s economic growth, which has suffered a set back, owed mostly to COVID outbreaks, lockdowns, sliding real estate market, slow local consumption and an endangered trade outlook.

In a bid to drive growth, authorities have resorted to the old maneuver issuing debt to fund huge public works projects. The eight projects include a transport hub in eastern Shanghai’s Pudong area, urban railways and housing improvement, as well as offshore wind power demonstration projects and a nature park, according to the Shanghai municipal government’s Tuesday announcement.

The city has recorded a rise in infrastructure in the past few months with contracts signed for 597 major projects between mid-June and mid-September, 296 of those projects breaking ground already and an accrued investment of 941 billion yuan.