Despite a global slump in foreign direct investment, Shanghai's leasing and business services sector has bucked the trend, recording $4.87 billion in paid-in FDI from January to July, a year-on-year increase of 65.8 percent.

In the first seven months of this year, Shanghai welcomed 3,624 new foreign-funded enterprises, up 3.1 percent from a year earlier. Local paid-in FDI totaled $9.93 billion, with leasing and business services remaining the largest recipient of investment since 2024.

Huang Feng, president of the Shanghai Foreign Investment Association, explained that the robust growth of this sector can be largely attributed to the expansion of Shanghai's headquarters economy.

As more multinational corporations establish their regional headquarters in Shanghai, the capital invested by these corporations in the city and in other regions of China is recorded under this sector, he explained.

Shanghai has long been a leading hub on the Chinese mainland for multinationals, hosting the largest number of MNC regional headquarters and foreign-funded R&D centers. As of May, the city was home to 1,042 such headquarters and 605 such centers.

To support their development, Shanghai has introduced a series of preferential policies and established a dedicated fund for MNC regional headquarters.

The revised Measures of Shanghai Municipality to Manage the Fund for the Development of Regional Headquarters of Multinational Companies provide financial support for early-stage development, business expansion, functional upgrades, innovation platforms, and increased investment.

For instance, regional or business unit headquarters of multinationals with a paid-in registered capital of at least $30 million, no fewer than 10 employees, and parent company authorization to manage at least one domestic or foreign enterprise will receive an early support subsidy of 5 million yuan ($700,130). Global R&D centers with at least 50 dedicated R&D personnel are also entitled to the same subsidy.

Source: Yicai