Shanghai's economy appears to be recovering after a nine-month slowdown, mayor Han Zheng said on Tuesday.

Industry output increased 24 percent in June from the same month last year. It was the first jump in output since November last year.

"I believe Shanghai will achieve its goal of a 9 percent increase in GDP by the end of the year," he said.

Disposable income grew 7.6 percent in the first six months of the year and employment was stable. Foreign investment continued to increase.

Han's comments come as a United Nations Environment Programme (UNEP) report said Shanghai's rapid development in the last decade has not had damaging effects to existing air pollution. The city has taken considerable care of creating an environmentally friendly Expo in 2010.

The city has achieved ratings of higher than 85 percent in air quality from 2003 to 2008; the city's overall energy efficiency was 0.79 tons of coal equivalent per RMB 10,000 GDP in 2008, 31 percent lower than 2000.

Shanghai's public transportation experiment with new energy vehicles and the tightening of vehicle emissions are all positive measures that have created productive effects in mitigating air pollution, the UNEP report said.

While the report applauds Shanghai's environmental initiatives, it also made recommendations for improvements.

UNEP said the city's reliance on coal is still prominent despite a decrease from 64.5 to 51.5 percent from 2001 to 2007.

While improvement on safe disposal of waste has been achieved, there is a need to develop a more comprehensive waste reduction strategy for the city as well as for the Expo, the report said.

Regional cooperation is key in controlling air and water pollution, the report said, as pollutants and a large volume of incoming motor vehicles from neighboring provinces affect Shanghai.

"The real test for both Beijing and Shanghai beyond the Olympics or Expo is whether long-term changes are accelerated and scaled up, because this is the only way you can ultimately improve the quality of life," said Achim Steiner, UN Under-Secretary-General and UNEP executive director.

Steiner also said that China is clearly moving toward a greener economy - not out of obligation, but out of choice.

"The financial stimulus package has a major green element in it. The fact that China is the world's largest wind power producers and it produces almost a quarter of worldwide PV technology shows China has a lot to gain from a global low carbon economy, and the best way to use it is to stimulate the domestic market," he said.

The Expo will also be a good way for China to demonstrate to the outside world its efforts in mitigating climate change and encouraging a green economy, Steiner continued.

"China clearly has a crucial role to play at the Copenhagen climate conference at the end of the year," he said.

"The world needs to better appreciate the efforts by China. Personally I hope that China will form part of the visionary leadership that we need in the next two or three months to achieve success at the summit."

(China Daily August 19, 2009)