According to a written report released earlier this week, the city aims to further introduce 10 foreign-funded investment companies this year.

And overseas firms in China are expected to further enter the country's securities business under the timetable set by the government.

International sourcing giants like Wal-Mart and Motorola are planning to establish bases in Shanghai later this year, while the city expects around 70 international sourcing agencies by the end of this year, according to the commission's report.

"More breakthroughs (in the introduction of overseas investment) are expected this year," said Zhu Xiaomin, director of the commission, when briefing local media on the city's overseas investment prospects earlier this week.

According to Zhu, the city aims to introduce US$40 billion of overseas investment in five years, as of this year and with an emphasis on the service sector.

Besides the finance and sourcing industry, other service sectors such as real estate, tourism, consultancy and logistics are also expected to further attract overseas capital, said Zhu.

Shanghai's service sector introduced a total of US$3.6 billion of contractual overseas investment last year, increasing 93.6 percent over the previous year and accounting for around one-third of the city's total foreign investment, according to statistics released by the commission.

China's service sector will gradually open to overseas investors under the country's commitment to the World Trade Organization (WTO), said Zhu.

Shanghai, the country's economic powerhouse and financial hub, will "take the responsibility of leading such a process," added Zhu.

Chen Wei, an economist with the Shanghai Academy of Social Sciences, said overseas investment would continue to play "a fairly important role" in propelling the city's economic growth.

But the central and city governments needed to "open the city's service sector wider" to overseas investors so as to maintain such a trend, he said.

(China Daily January 23, 2003)