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Expo Deficit Can Be Made up by GDP Growth: Official
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The 2010 World Expo to be held in Shanghai, China's largest metropolis, is predicted to lose approximately 1 billion yuan (US$120 million), a top city planner said on Thursday.

However, that loss will be covered by an increase to the city's gross domestic product, or GDP, in the next five years, Huang Yaocheng, deputy director of the Shanghai Bureau of World Expo Coordination, told a press conference on Thursday.

"The city's modern service industry development will greatly benefit from the World Expo,"Huang was quoted as saying by the local Shanghai Daily.

The event will boost the city's GDP by 2 percentage points from this year through 2009, and by 6.5 percentage points in 2010, according to Huang.

He said the service industry--including the financial sector--will enjoy the most benefits from the world fair followed by manufacturing and agriculture.

The operating budget for the expo is set at 10.7 billion yuan (US$1.3 billion), but the event is expected to bring in only 9.6 billion yuan (US$1.2 billion) in direct revenues, Huang said.

The 1 billion yuan deficit will be covered by increased revenues for related industries, such as hotels and tourism, he said.

He said Shanghai expects 70 countries and international organizations to officially take part in the 2010 World Expo.

(Xinhua News Agency May 12, 2006)

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