The garden was opened to the public in July, but the Chinese Gardens Trust had been waiting for a 90-day period, from the completion of construction, to pass, for any problems to be ironed out.
In the Shanghai delegation was the head of the Shanghai Municipal People's Congress, Chairman Liu Yungeng, as well as the standing committee of the congress.
They had been welcomed to the city on Monday and were given a bus tour before arriving at the Chinese garden yesterday morning.
Chinese ambassador Zhang Limin, who has only been in the country for a few weeks, was also present, along with representatives from the Shanghai Museum and the company involved in the construction of the garden, the Shanghai Construction and Decoration Co.
The Otago-Southland Chinese Association welcomed Miss Clark and her entourage to a marquee beside the garden, with a lion dance and traditional drumming.
Dunedin Mayor Peter Chin told the crowd the Chinese garden was first planned more than 12 years ago by members of Dunedin's Chinese community.
The Chinese Gardens Trust, of which Mr Chin was chairman, was formed in 1997.
Mr Chin said the project, from a Dunedin perspective, went across all racial boundaries, having been blessed by the tangata whenua and because it was the only authentic garden of its type in the southern hemisphere.
"What we have now in Dunedin is a thoroughly beautiful garden which for generations to come will symbolise the sister city relationship between Shanghai and Dunedin."
In response, Mr Liu said, through a translator, the garden was authentic and was a "small museum of Chinese culture" which recognised the contribution of Chinese people in Dunedin and Otago.
Miss Clark said she saw the project as being of great significance for the relationship between New Zealand and China, especially as a free trade agreement was poised to take effect next month.
Miss Clark and Mr Liu unveiled a plaque at the entrance to the garden, after Chinese crackers were set off, before liberating fish in the pond.
Earlier Mr Liu and Mr Chin signed a memorandum of understanding continuing the 14-year sister city friendship between the cities.
The document was signed at the Clifford Skeggs Gallery, in front of Dunedin city councillors and the Shanghai delegation.
It included an agreement to carry out co-operation in areas such as trade and economic development, tourism, medical development and public health, culture, education and sports, women's activities and auditing.
The sister city relationship would continue to be monitored by a liaison team in Dunedin and the foreign affairs office of the Shanghai Municipal People's Government.
