Shanghai's industrial production contracted 2.1 percent from a year earlier to 188.9 billion yuan (US$27.6 billion) last month, the Shanghai Statistics Bureau said Wednesday.

Although it was the seventh monthly retreat in a row, last month's decline narrowed from drops of 5.2 percent in April and 7.1 percent in March, a potential sign of recovery.

"The pace of retreat has slowed due to the government's efforts to boost investment and local spending," said Wang Zehua, an analyst with the bureau. "Despite the fact that Shanghai's exports are still being eroded by weak global demand, we expect manufacturing in the city to stage a comeback in the coming months."

Shanghai Party Secretary Yu Zhengsheng last month predicted the city's industrial output this month would grow again.

Mayor Han Zheng also said earlier that he was confident Shanghai could achieve economic growth of 9 percent this year despite the fallout from the global recession.

Shanghai's exports fell 26.2 percent year on year in April to US$25.1 billion, compared with a decline of 16.4 percent in March.

The city's six key industries - electronics, auto manufacture, steel, petrochemical processing, heavy machinery and biomedicine - posted a combined output of 121.9 billion yuan last month, up 0.9 percent from a year earlier.

The production of vehicles jumped 17.9 percent to 19.1 billion yuan. The production of heavy machinery and biomedicine rose 5.9 percent and 8.7 percent to 27 billion yuan and 3.7 billion yuan.

(Shanghai Daily June 11, 2009)