80% Foreigners Have Left Shanghai, FDI Falls for 12th Consecutive Month

Summary

The script discusses the decline in commercial activity at Shanghai Pudong Airport and the broader impact of decreasing foreign enterprises in Shanghai. It highlights the closure of businesses, the reduction in foreign investment, and the challenges faced by the Chinese economy, including the withdrawal of foreign capital and the effects on local consumption and job markets. The narrative also touches on China's efforts to attract foreign investment amidst these economic shifts.

Takeaways

• 📉 The commercial situation at Shanghai Pong Airport is bleak with many businesses closed and a significant decrease in foreign presence.
• 🏬 The closure of the bar and the jewelry store, along with the lack of commercial activity, indicates a downturn in the airport's economy.
• 😔 A woman laments the emptiness of airports post-pandemic, noting a particularly noticeable absence of foreigners in Shanghai.
• 📉 The number of foreign enterprises in Shanghai is decreasing, which is causing a ripple effect on the city's development and economy.
• 🛫 Many foreign companies are relocating, sometimes without notice, contributing to Shanghai's development bottleneck.
• 🌐 The current international environment is unfavorable, affecting not only the number of foreign enterprises but also personal lives and luxury consumption in Shanghai.
• 📊 Data shows a sharp decline in foreign direct investment (FDI) in China, reflecting a trend of foreign capital withdrawing and impacting the country's economy.
• 🏢 The closure of City Shop, a high-end supermarket popular among foreigners, highlights the struggles of businesses catering to this demographic.
• 🏙️ International communities in Shanghai that were once bustling with foreigners are now seeing their numbers dwindle.
• 📚 The decline in foreign population is also evident in the reduced number of students in international schools and decreased housing rentals.
• 🏦 Western financial institutions are reducing their presence in China, with some experiencing significant layoffs and others closing physical stores.

Q & A

What is the current situation at Shanghai Pudong Airport according to the script?

The script describes the situation at Shanghai Pudong Airport as bleak, with many businesses closed, including a bar and a jewelry store. The airport is also noted to have very few foreigners compared to the past, making it feel empty and desolate.

How has the pandemic affected the presence of foreigners in Shanghai, as mentioned in the script?

The script indicates that since the pandemic, there has been a significant decrease in the number of foreigners in Shanghai, especially at the airport, which used to be bustling with international travelers.

What impact has the decrease in foreign enterprises in Shanghai had on the city, according to the script?

The script suggests that the decrease in foreign enterprises has led to a development bottleneck for Shanghai, with more tourists but fewer foreign workers. This has affected personal lives, tax revenue, and luxury consumption in the city.

What are some of the consequences of the decline in foreign direct investment (FDI) in China mentioned in the script?

The script mentions that the decline in FDI reflects a decrease in foreign confidence in China's economy, affects the competitiveness of Chinese enterprises, and has a significant impact on Shanghai's consumer market.

How has the spending behavior of Chinese people been influenced by the decrease in foreign influence, as described in the script?

The script notes that the spending habits introduced by foreigners, which influenced many Chinese to spend more boldly, are disappearing. Now, Chinese people are more focused on saving rather than spending, which impacts Shanghai's consumption market.

What evidence is there of a decline in the foreign population in Shanghai, as per the script?

The script provides evidence such as a sharp decline in the number of registered students in international schools and a significant drop in housing rental data in areas where foreigners used to live.

What is the trend of foreign capital withdrawing from China, as indicated by the script?

The script indicates a trend of foreign capital withdrawing from China, with a year-on-year decrease in the actual use of foreign capital and a continuous decline in FDI for 12 consecutive months.

How did the closure of City Shop, a high-end supermarket in Shanghai, reflect the current economic situation, according to the script?

The closure of City Shop, which targeted high-end consumers and primarily sold imported goods, is seen as a reflection of the downturn in Shanghai's consumer market and the decrease in the number of affluent foreign consumers.

What is the significance of the withdrawal of foreign companies like Microsoft from having physical stores in China, as mentioned in the script?

The script suggests that the withdrawal of companies like Microsoft from physical stores in China is part of a broader trend of foreign companies reducing their presence in the country, which may be due to strategic adjustments, declining profitability, or other market factors.

What challenges are Western financial institutions facing in China, as described in the script?

The script describes challenges such as weak deal activity, pressure on costs and revenues, layoffs, and a slowdown in capital market activity due to a weak economy, particularly the real estate slump, and increasing geopolitical tensions between China and the US.

What measures has the Chinese government taken to counter the slowdown in foreign investment, according to the script?

The script mentions that the Chinese government has introduced measures such as expanding market access to allow greater foreign participation in sectors like banking, insurance, and healthcare, and has emphasized improving efforts to attract and utilize foreign investment.