Shanghai's GDP reached 4.33 trillion yuan (about $648.87 billion) in the first three quarters this year, up 5.5 percent year-on-year in real terms.

The better-than-expected performance was underpinned by a shift to new growth drivers such as integrated circuits, artificial intelligence, and information and professional services.

New growth drivers

In the first three quarters, the secondary industry saw its added value climb 4.6 percent, while the industrial added value rose 5.5 percent year-on-year.

While traditional advanced manufacturing—such as rail, ship, aerospace, and other transport equipment—continued to report strong year-on-year growth of 13.3 percent, the output value of integrated circuit, AI, and biomedicine manufacturing, the three pioneer industries, rose by 23.4 percent, 24.8 percent, and 7.9 percent, respectively.

As one of the three pioneer industries, Shanghai's integrated circuit industry can be traced back three decades, to the establishment of the Chinese mainland's first 8-inch chip production line in Pudong New Area.

Today, around 40 percent of China's integrated circuit professionals and nearly half of the country's integrated circuit innovation resources are concentrated in Shanghai.

New growth in services

The added value of the tertiary industry increased by 5.7 percent. By sector, value-added growth was 9.5 percent in finance, 8.9 percent in information transmission, software and information technology services, 6.5 percent in transportation, storage and postal services, and 5.7 percent in leasing and business services.

Information services are gaining momentum, buoyed by integrated circuit design and AI-related services.

Professional services including advertising, human resources, and legal services also recorded strong revenue growth as a growing number of manufacturers seek legal, financial, and consulting services as they expand global operations while technology companies need services related to patents and commercialization of research outcomes.

New opportunities on the demand side

Investment is increasingly directed toward industry and high-tech sectors. Shanghai's fixed-asset investment grew 4.3 percent year-on-year in the first three quarters, of which industrial investment jumped 21.9 percent and investment in high-tech industries surged 30.6 percent.

On the consumption side, culture, sports, and entertainment revenue rose 13.1 percent in the first three quarters, while international passenger arrivals increased 27.8 percent in the first eight months.

Foreign trade in goods reached a new high, up 17.9 percent in the first three quarters. High-tech exports grew rapidly, accounting for nearly 30 percent of the total goods exports.

Source: Shanghai Observer