First-half growth decelerates in Beijing, Shanghai

The promising prospects of Shanghai were underscored by more foreign investment in the city. In the first half, foreign direct investment increased 10.9 percent, with Asia as the fastest-growing source of incoming capital.

In Beijing, the information service, financial service and technology service industries all grew faster in the first half than the 7.3 percent overall growth recorded for the tertiary industry.

The information, computer service and software industry grew 12.6 percent, while the financial service sector expanded 12.5 percent and technology service activity increased 9.3 percent.

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"Shanghai and Beijing are several steps ahead of other regions in China," Xu said. "China's vast central and western regions are in the middle stage of industrialization, so secondary industry and investment are still critical. It may take another decade for them to reach Beijing and Shanghai's current levels."

Industrial activity gains momentum

Thanks to a strong rebound in its industrial sector, Beijing's GDP growth in the second quarter accelerated.

The city's GDP in the first half expanded 7.2 percent, according to Beijing's statistics bureau. It indicated the city's economy expanded faster in the second quarter, given the first-quarter growth rate of 7.1 percent.

The bureau did not provide a separate growth number for the second quarter.

Given that the first-half growth rate of the city's tertiary industry actually slowed compared with the first quarter, the acceleration of GDP growth in the second quarter was attributed to the faster growth of industrial production.

Industrial output grew 6.3 percent in the first half, 0.3 percentage point faster than in the first quarter.

The added value of rolling stock, aerospace and other transportation equipment manufacturing more than doubled in the first half, while vehicle manufacturing grew 11.9 percent. These gains reflected the stimulus measures launched since April by the central government, analysts said.

Faster industrial expansion was recorded not only in traditional sectors but also in "strategically emerging industries", such as information technology, energy-efficient technology, alternative energy and advanced machinery manufacturing. These industries grew 14.9 percent year-on-year, accounting for more than half of the industrial output growth.