He did not give any further information.

Overseas-funded companies have to pay higher land-use prices than their domestic counterparts when developing office space, although overseas firms have been paying the same fees as local companies when building residential or commercial complexes since new rules went into effect last August.

An estimated 50 billion yuan (US$6 billion) will be invested in construction of new housing in Shanghai this year.

That investment is up 3 percent from last year when homebuyers purchased 190,678 apartments in Shanghai, according to statistics provided by the Shanghai Property Exchange Center.

This year's investment should allow local developers to start construction on 16 million square metres of housing and complete an equal amount of residential space, according to a government working conference held on March 19.

"Housing purchases made up the bulk of consumer spending last year," Shanghai vice-Mayor Han Zheng said at the conference. "That trend is not likely to change in the near term."

Last year, the property sector generated about 6.2 percent of the city's gross domestic product, pushing the city to list real estate as one of its six new pillar industries.

The city's push to develop the residential housing market this year will be aided by an ambitious plan to re-develop the area along the Huangpu River, according to Mao Jialin, director of the Municipal Housing Development Bureau.

Of the 2,260 hectares of land to be re-developed along the river, 36.5 percent has been earmarked for residential housing, he said.

Massive urban construction will also increase the market for new homes, as the city plans to pull down 10 million square meters of dilapidated houses, meaning thousands of families will be re-settled in new apartments this year.

(China Daily March 20, 2002)