One of the country's most popular travel service providers, Ctrip, anticipated the city's star-level hotel rates would increase by an average of 20 percent during the Expo.

The government is not taking measures to curb the increases but expects a reasonable growth in room rates, said Cheng Meihong, the deputy director of the Shanghai Municipal Tourism Administration. "We encourage a rational and steady increase in hotel room rates during the Expo. However, we won't take any compulsory measure to restrict the increase."

The government has reserved eight four- and five-star hotels, including Broadway Mansions Hotel Shanghai, Hotel Equatorial Shanghai and Seagull on the Bund, for VIP guests. All of these hotel rooms are booked from April to October.

Wu Yizhong, a secretary at the Shanghai office of Swiss chocolate manufacturer Ferrero Rocher, said she is having problems trying to find rooms for visiting company executives.

Wu said she has had to use personal relationships to get rooms. "It's crazy," she said.