In the first half of this year, 30,000 private enterprises have been registered in the city, a record-high, according to the statistics provided by the Shanghai Administration of Industry and Commerce.

The city now has nearly 210,000 private enterprises, employing 2.3 million people, or one in three Shanghai workers.

In the first half of this year, the output of private industrial enterprises and the business turnover of private retail enterprises totaled 157 billion yuan (US$18.92 billion) with 7.3 billion yuan (US$880 million) in tax paid.

Local analysts attribute the fast growth to the policy adopted by local authorities to open more sectors to private investors by the end of last year.

Urban construction, education, hospital operation, once "forbidden areas" for private investment, have now opened to private entrepreneurs.

To tackle the problem of fund-rising for private companies, usually small and medium-sized enterprises, Shanghai has set up a credit guarantee system and allocated special loans for private enterprises. Local banks have provided 5.2 billion yuan (US$627 million) in loans for 3,177 projects from 1995 to 2001, taking a leading position in China.

In the domain of foreign trade, more than 140 private enterprises have been granted foreign trade rights and exported commodities worth US$54 million in the first half of this year, a significant year-on-year increase of 200 percent.

Currently, the registered capital of private enterprises in Shanghai has reached 210 billion yuan(US$25.3 billion), of which 121 corporations contributed more than 100 million yuan (US$12 million) each in registered capital.

Private investment has entered almost all fields except finance, mining and other restricted areas.

In addition private enterprises are the main employers of laid-off workers.

Experts predict added value achieved by private enterprises in Shanghai will increase 15 percent annually in the years ahead.

Private enterprises could also be contributing 20 percent of the city's GDP and paying 16 billion yuan (US$1.928 billion) in tax in 2005, according to local experts' estimations.

(Xinhua News Agency October 6, 2002)