Economic growth in Shanghai, used to living life in the fast lane, is expected to slow this year as China's richest city grapples with power crunches, a property bubble and traffic snarls, the mayor has warned.
The city of 20 million - roughly the population of Australia - should nonetheless grow 11 percent and rack up its 14th year of double-digit growth, mayor Han Zheng said on Tuesday.
Despite electricity shortages brought on by a scorching summer and frigid winter and Beijing's efforts to rein in investment in sectors from steel to property nationwide, Shanghai's economy grew 13.5 percent last year - its fastest rate since 1998.
Han said the city would build more power plants and encourage energy conservation after a summer heat wave forced 1,000 firms, including a Volkswagen plant, to shut temporarily for the second year running.
A freezing winter also taxed the grid, at one point forcing more than 800 firms to switch production to graveyard shifts.
``We will enhance our energy security by developing a number of electrical power and liquefied natural gas projects,'' he said.
Shanghai raised power-generating capacity by more than 10 percent last year and plans to invest another 20 billion yuan (HK$18.85 billion) to improve grid transmission.
Han, mayor since 2003, also took aim at soaring property prices and increasingly gridlocked traffic, two other corollaries of breakneck growth, promising more affordable housing and greater investment in roads and public transport.
The city is luring multinationals seeking a manufacturing base in China after winning over the world's largest auto maker, General Motors, and US conglomerate Honeywell International, which now have their Asian headquarters in the hub.
Actual foreign investment rose 12percent to US$6.54 billion (HK$51.01 billion) last year, while exports leapt 52 percent to US$73.5 billion, Han said.
Booming trade propelled
Shanghai past Rotterdam to become the world's second-busiest port last year, with container traffic up 29 percent to 13.55 million 20-foot equivalent units.
Concerns had surfaced that
Shanghai may be losing its allure for multinationals because rising prices, traffic jams and red tape are making it uncompetitive compared with other mainland cities.
``If not addressed promptly and effectively, they will undermine Shanghai's long-term development,'' Han said. ``We must take these problems very seriously.''
