Annual Mayor's Advisory Council of Foreign Businesses Set to Focus on Services Sector

Top executives of some of the world's biggest companies will gather in Shanghai this weekend to share with Shanghai Mayor Zhu Zhongming and other top municipal officials their visions and suggestions on future development of the city during the annual meeting of the mayor's International Business Leaders' Advisory Council, which begins on Sunday.

Founded in 1989, the council has grown into a think tank of sorts, focusing on the best ways to shape the city's future. It gives municipal officials the chance to consider global perspectives and also gives foreign businesses the opportunity to touch bases with Shanghai's priorities and policies.

Rob Speyer, chief executive officer of global property development and investment firm Tishman Speyer, will chair this year's meeting, which is themed "Fostering Innovation-driven Development of Shanghai's Service Sector."

"Throughout its history, Shanghai has proven its incredible resilience and ability to adapt to change," Speyer said. "Today, Shanghai is navigating another transition. The city is moving toward a more diverse, service-oriented economy in which technology, innovation and global connections will play an increasingly important role."

Fuxing Island is one illustration of that shift. During the weeklong National Day holiday that ended on October 7, the former shipyard, warehouse and port zone, located on a man-made island in Yangpu District, hosted a five-day festival that attracted large crowds and highlighted how old, decaying venues can be transformed into cultural destinations.

Foreign companies play a role in development of the services sector, which is part of China's blueprint for boosting consumer spending and rebalancing the economy away from dependence on exports.

Louis Vuitton's landmark boat-shaped outlet in Jing'an District is a case in point. Launched at HKRI Taikoo Hui last year, the venue's sleek silver-boat front facade has attracted sightseers as well as shoppers, with visits averaging 80,000 each day. For foreign shoppers, they are able to claim departure tax refunds on the spot. The success of the store has helped lift tourist numbers along the Nanjing Road W. retail area by 43 percent and spending by 61 percent since its launch.

Such pioneering innovation in the services sector has strengthened Shanghai's economic performance. In the first half of this year, Shanghai's gross domestic product increased 5.6 percent year on year to 2.78 trillion yuan (US$415 billion), ahead of the city's target for the year. The gain was led by the services sector, which rose 5.9 percent to 2.21 trillion yuan, or 79 percent of the total economic output.

In the first eight months of the year, Shanghai has hosted 4,172 new foreign-invested companies, with implementation of foreign investment rising 6.9 percent to US$11.6 billion. The top three sectors favored by foreign investors were business services, retail and technology research.

"What distinguishes Shanghai is its capacity to move quickly from policy to implementation," said Speyer.

Mayor Zhu will host the council meeting, with a welcoming address by Shanghai Party Secretary Chen Jining. Keynote addresses will be given by John Waldron, president and chief operating officer of Goldman Sachs, and Jason Furman, Aetna professor at Harvard University.

Among global companies represented on the council are Schneider Electric, Abbott Laboratories, ABB, adidas, AP Moller-Maersk, Bain, Bekaert, BNP Paribas, Boehringer Ingelheim, Chia Tai Group, Danone, HSBC, Intuitive Surgical, Investor AB, John Swire and Sons, Johnson Controls, Kuehne+Nagel Group, L'Oreal, Mizuho Financial Group, NIKE, Nomura, Novartis, OMRON, Prudential Plc, PwC, Roche, Royal Vopak, Siemens, SK Group, Sumitomo Mitsui Financial Group, thyssenkrupp, TOSHIBA Corporation and Vale SA. All have operations in the city, with experiences to share.