When I asked this question a while ago, the FastString unit came to solve my problem.
Now I am starting to migrate my software from D7 to XE2. My question is, what alternatives do I have now since it appears that FastString will no longer solve the problem?
...or, more optimistically, does Delphi itself solves this performance issues?
A Lot of the FastCode routines have been included in recent Delphi, so you might not need 3rd party libraries anymore.
Try with the stock RTL/VCL, then see if you still have a problem and what would be the best solution to solve it in the new environment.