[中报]小商品城(600415):2023年半年度报告（英文版）
原标题:小商品城:2023年半年度报告（英文版） Stock code: 600415 Stock short name: 小商品城 Zhejiang China Commodities City Group Co., Ltd. Semi-annual Report for 2023 Important Note I. The Board of Directors, the supervisory committee and the directors, supervisors and senior management of the Company hereby warrant the truthfulness, accuracy and completeness of the contents of the Annual Report, guarantee that there are no false representations, misleading statements or material omissions contained in this Annual Report, and are jointly and severally responsible for the liabilities of the Company. II. All directors of the Company were present at the board meeting. III. This semi-annual report has not yet been audited. IV. ZHAO Wenge, Legal Representative, WANG Dong, Person in Charge of Finance, and ZHAO Difang, Head of Finance Department (Finance Manager) hereby state that, they guarantee the truthfulness, accuracy and completeness of the financial report in the semi-annual report. V. The profit distribution plan for the reporting period or the plan for public reserve funds into share capital that was approved by the board of directors Nil VI. Risk statement with forward-looking representations √Applicable □Not applicable The forward-looking representations involved in this Report such as future plans and development strategies do not constitute the Company’s substantial commitments to investors. Investors shall watch out for the investment risks. VII. Is the Company’s cash occupied by its controlling shareholder or any of other affiliates for non-operational purposes? No VIII. Has the Company provided external guarantee in violation of the prescribed decision-making procedures? No IX. Whether there is circumstance that more than half of the directors cannot guarantee the authenticity, accuracy and completeness of the semi-annual report disclosed by the Company No X. Reminder of major risks The Company has described the risks that may exist in this Report in details. Please refer to “Potential Risks” in “Section III Discussion and Analysis of Managers” of this Report. XI. Other □Applicable √Not applicable Table of Contents Section I. Definitions ................................................................................................................... 5 Section II. Company Profile and Financial Highlights ............................................................. 6 Section III. Discussion and Analysis of Managers .................................................................... 9 Section IV. Corporate Governance ........................................................................................... 35 Section V. Environmental and Social Responsibilities .......................................................... 40 Section VI. Significant Matters ................................................................................................... 41 Section VII. Changes in Shares and Shareholders .................................................................. 54 Section VIII. Preferred Shares ...................................................................................................... 59 Section IX. Bonds ......................................................................................................................... 60 Section X. Financial Report ....................................................................................................... 66
Section I. Definitions For the purpose of this Report, unless otherwise stated in the context, the following terms shall
Section II. Company Profile and Financial Highlights I. Company profile
II. Contact information
III. Introduction to changes in basic information
IV. Changes in information disclosure and filing place
V. Stock profile
VI. Other relevant information □Applicable √Not applicable VII. Main accounting data and financial indicators of the Company (i) Major accounting data
(ii) Major financial indicators
Illustration on major accounting data and financial indicators √Applicable □Not applicable 1. The operating revenue increased by RMB 954 million YoY, mainly due to the carryover revenue of the Second District East New Energy Product Market and the expansion of commodity sales scale. 2. The net profit attributable to shareholders of the listed company increased by RMB 776 million YoY, mainly due to the official operation of the Second District East New Energy Product Market, which resulted in an increase of RMB 531 million in operating gross profit, a YoY increase of RMB 449 million in investment income and asset disposal income, and a YoY increase of RMB 189 million in income tax expenses. 3. The net profit attributable to shareholders of the listed company after deducting non-recurring gains and losses increased by RMB 658 million YoY, due to an increase of RMB 776 million and RMB 118 million respectively in net profit and non-recurring profits and losses attributable to shareholders of the listed company compared with the same period of the previous year. VIII. Differences in accounting data between foreign and Chinese accounting standards □Applicable √Not applicable IX. Non-recurring profits and losses and amounts thereof √Applicable □Not applicable
Explanations shall be made for the non-recurring profits and losses identified by the Company according to the Explanatory Announcement No. 1 on Information Disclosure by Companies Publicly Offering Securities – Non-recurring profits and losses, and for the Company identifying the non-recurring profits and losses enumerated in the Explanatory Announcement No. 1 on Information Disclosure by Companies Publicly Offering Securities – Non-recurring profits and losses as recurring profits and losses. □Applicable √Not applicable X. Other □Applicable √Not applicable Section III. Discussion and Analysis of Managers I. Description of the industry and the Company’s main business during the reporting period (I) Main business of the Company The Company is committed to building a shared trade service platform for global small and medium-sized enterprises, with the strategic positioning of "world-class international trade comprehensive service provider", continuously enriching and improving the three major ecosystems: commodity display ecology, service supporting ecology, and trade performance ecology, in order to reduce trade costs, shorten trade chains, improve trade efficiency, and continue to create value for the circulation of small commodities, consolidate the advantageous position of China's daily consumer goods supply chain in global trade, and serve the new development pattern of domestic and international dual circulation. The product display ecology includes offline physical market operation and online platform services, supporting service ecology includes exhibition and hotel sectors, and trade performance ecology includes warehousing and logistics, self operated trade and payment, credit reporting, factoring, and other businesses. (II) The main business model of the Company 1. Product display ecology: (1) Market operation The market operation business is mainly operated and managed by the subordinate market operation companies of the Company. The main business income of the market operation segment is mainly the income from the use of shops. The Company adopts a shop rental model, that is, the ownership of the shops belongs to the Company, and market traders only have the right to use the shop within the contract period. The Company and market traders sign a contract to clearly stipulate the use period, usage fee and business purpose of the shops. The merchant shall not change the agreed business purpose, and shall not sublet without the Company’s consent. Generally, the payment methods of usage fee are one-time payment or installment payment according to the contract terms. At present, the markets operated by the Company include the first to fifth district markets, the import market, the first district eastern expansion and second district east market, the Huangyuan market, and the international production materials market of the International Trade City. (2) Online trading platform The Yiwu Small Commodities City Platform (referred to as "Chinagoods platform") is a B2B digital trade comprehensive service platform that relies on the Company's 75000 physical shops in the market, serves 2.1 million small and micro enterprises in the upstream and downstream of the industrial chain. With trade data integration as the core driver, it meets the needs of both supply and demand parties in manufacturing, display transactions, warehousing and logistics, financial credit, market management and other links. The current revenue model of the platform is to collect service fees by providing basic services and value-added services for members, digital advertising business services, digital services for financial institutions, and fourth-party services. 2. Supporting service ecology: (1) Exhibition The Company's exhibition sector has developed into a professional exhibition enterprise with one-stop service that integrates domestic exhibition organization, overseas exhibition, exhibition hall management, and exhibition supporting services. The exhibition section mainly undertakes exhibition projects such as China Yiwu International Small Commodity (Standard) Expo (UFI), China Yiwu Import Goods Expo (UFI), China Yiwu International Forest Products Expo (UFI), and self-operated projects such as overseas exhibitions (Korean Import Goods Exhibition, China Consumer Goods (Russia) Brand Exhibition, Benin (West Africa) China Commodity Exhibition, etc.), And engaged in exhibition hall operation, development, leasing and other exhibition industry chain services. The Company also undertakes the operation and management of Yiwu International Expo Center venues. (2) Hotel The hotel service business is mainly operated and managed by Zhejiang Yindu Hotel Management Co., Ltd., a subsidiary of the Company. The hotels operated by the Company mainly provide comprehensive services such as accommodation, catering, leisure and entertainment, and conferences, etc. The main revenue sources of the hotels include room sales, catering sales, commodity sales and venue leasing, etc. Sales of guest rooms and catering mainly rely on channels such as clients agreement, conferences, wedding banquets and recommendation by operators of online booking platforms. 3. Trade Performance Ecology: (1) Warehousing and logistics The Company's warehousing sector is led by warehousing, strengthening the service capacity of Yiwu freight warehouses, regional warehouses, and overseas warehouses, and deeply entering various links of the trade chain. At present, there are three parks: Chinagoods Shared Cloud Warehouse, Houzhai Warehouse Park, and Huanqiu Yida Supply Chain Industrial Park. Chinagoods Shared Cloud Warehouse is market-oriented and uses digital means to form a fully visible warehouse system. It combines public warehouses, express package distribution, and international consolidation to provide convenient warehousing services for market operators, domestic and foreign buyers, logistics and express delivery companies, as well as freight forwarders and foreign trade companies. Houzhai Warehouse Park and Huanqiu Yida Supply Chain Industrial Park are based on warehousing systems, providing efficient, convenient, and three-dimensional warehousing service systems for market operators. (2) Self-operated trade ICMALL is the initials of international commodity mall, which is a subsidiary of the well-known Chinese trademark "Yiwu China Small Commodities City". "爱喜猫" is the Chinese transliteration of ICMALL. With the brand vision of "discovering the best products in the world", ICMALL combines over 20000 high-quality products from imported goods and trendy domestic products, covering six categories: home life, beauty and skincare, mother and baby products, snacks and beverages, entertainment and cultural creativity, and toy digital. ICMALL strives to create a super supply chain channel brand in new fashion, new consumption, and new experience application scenarios. As a self-owned brand that focuses on the creative development of trendy domestic products, "Yiwu Good Products and Good Brands" provides empowering services for the improvement and upgrading of small commodities in Yiwu and even across China through the entire chain of product development and design, production and manufacturing, quality and price, marketing planning, after-sales service, and other aspects. In the future, the brand will strive to create a good products brand standardized output system with good prices, quality, and service. The Company enters the upstream and downstream of market trade through self-operated trade, fully leveraging its platform and brand advantages, linking trade with the market and nurturing the market, and forming a virtuous and orderly cycle. (3) Payment, credit reporting, factoring and other businesses The Company's "Yiwu Pay" is a licensed third-party payment institution supervised by the People's Bank of China, providing convenient and secure electronic payment solutions for merchants through internet payment technology. Yiwu Pay was established in 2012. With its professional global payment service capabilities, financial compliance capabilities, and security risk control capabilities, Yiwu Pay provides a one-stop cross-border payment solution for domestic and foreign customers, enabling them to receive payments in compliance, settle foreign exchange easily, improve fund utilization efficiency, and ensure safe receipt of funds. The business of Yiwu Pay covers various scenarios such as online and offline B2B payments, cross-border payments, among which cross-border payment revenue is the main revenue of the Company. Domestic payment business: As a licensed payment institution, "Yiwu Pay" links major domestic banking institutions through clearing organizations such as UnionPay and NetsUnion Clearing Corporation, providing merchants with collection services such as bank card fast payment, QR code scanning payment, wallet payment, and e-CNY payment, and obtains payment fee. Cross-border payment business: "Yiwu Pay" provides one-stop cross-border fund services such as global collection and payment, foreign exchange management, etc. for import and export enterprises, and obtains cross-border payment fee. Payment service business: "Yiwu Pay" collaborates with the credit consulting company, banks and other institutions to provide merchants with a financing credit model based on payment data as the underlying layer, and the credit reporting company uniformly encapsulates and outputs it to financial institutions such as banks, providing financing services and obtains corresponding service fees. The credit consulting company was established in July 2014, collaborating with government departments to promote the construction of the city's social credit system. It has established a data system centered on public data, commercial data, and e-commerce data. By constructing precise enterprise portraits, it provides technical support in credit verification, joint rewards and punishments, inclusive finance, and other fields of government and financial institutions, and empowers trade ecological value with data elements. Currently, it covers 995500 legal entities, with a total of over 158 million pieces of data. Through the enterprise credit information query platform, the credit consulting company provides enterprise credit information query services for financial institutions and carry out data management for inclusive finance of banks. Currently, there are more than 30000 credit granting subjects, with a total granted credit amount of RMB 8.45 billion. The credit consulting company charges service fees through technology development, system interface docking, and data support based on inclusive finance for banking and insurance institutions. Zhejiang China Commodities City Group Commercial Factoring Co., Ltd. (referred to as "China Commodities City Factoring") was established in January 2022 and is a local financial organization approved by the Zhejiang Provincial Local Financial Supervision and Administration Bureau. China Commodities City Factoring is mainly engaged in trade financing, accounts receivable settlement, management and collection, customer credit investigation and evaluation, and non commercial bad debt guarantee through the transfer of accounts receivable. China Commodities City Factoring mainly serves the merchants of Yiwu International Trade City, and the main income comes from interests and handling fees for factorage financing. After the expansion of business scale in the later stage, China Commodities City Factoring can cooperate with banks and other funding parties to obtain service fees. (III) Industry situation 1. Description of the industry of the Company According to the definitions in the Guidelines for Industry Classification of Listed Companies (revised in 2012) released by the CSRC, the Company is engaged in “Business Service” (L72) in “Lease and Business Service” (L). (1) Situation of Yiwu Market Yiwu International Trade City has ranked first in the national comprehensive market for 32 consecutive years in terms of market transaction volume, forming a relatively large industrial cluster in the field of small commodity circulation. In 2023, the Second District East New Energy Market gained a new construction area of 131000 square meters, and more than 490 new shops were added on the first and second floors, further expanding the offline market. The Yiwu International Trade City gathers 26 major categories and over 2.1 million types of commodities, radiating to 233 countries and regions, driving the development of 2.1 million small and medium-sized enterprises and the employment of 32 million industrial workers. Every year, more than 560000 foreign merchants come to Yiwu for procurement, and more than 15000 foreign merchants from more than 100 countries and regions reside in Yiwu. There are over 8000 foreign-funded entities in Yiwu. Yiwu market is an important platform connecting the domestic and international trade supply chains, and is at the key node of the global small commodity supply chain. It plays an important role in smoothing the internal circulation, improving the external circulation, and serving the new pattern of "dual circulation". Yiwu is the leader and demonstration center of market procurement trade in China, and has maintained high-speed growth for 8 years in a row, with a compound annual growth rate over 30%, which has effectively unlocked the validity of the market subject and further improved the convenience level of trade. In the first half of 2023, the total import and export amount of Yiwu City reached RMB 268.97 billion, a YoY increase of 21.0%. Among them, the export amounted to RMB 237.41 billion , a YoY increase of 17.0%; the import amounted to RMB 31.56 billion, a YoY increase of 63.5%. Yiwu vigorously explores emerging markets, creates high-level open platforms, cultivates and strengthens advantageous industries, and continuously gathers new momentum for foreign trade. From the perspective of trade regions, in the first half of 2023, Yiwu's import from and export to Africa reached RMB 49.38 billion, an increase of 31.0%; import from and export to Latin America amounted to RMB 40.73 billion, an increase of 37.3%. import from and export to India, Brazil, and Saudi Arabia amounted to RMB 13.03 billion, RMB 6.77 billion yuan, and RMB 6.74 billion, respectively, an increase of 13.6%, 43.5%, and 56.9%, respectively. Over the same period, import from and export to countries along the "Belt and Road" totaled RMB101.2 billion, an increase of 21%. Yiwu City exported RMB 181 billion through market procurement trade, an increase of 19.1%, accounting for 76.2% of the total export amount of Yiwu City, driving the city's export growth by 14.3 percentage points. The Company integrates market resources through digital means, driving the iterative upgrading of the market procurement trade method to "Version 2.0". The market procurement trade method has become the main force driving the growth of Yiwu's exports. Regionally, Southeast Asia, the Middle East and Latin America continue to occupy a high market share in the trade with Yiwu. Countries along the "Belt and Road" and in the "RCEP" region continue to bring opportunities to the Yiwu market, and RMB going global has become a new highlight of Yiwu's market. During the reporting period, the total passenger flow of buses, railways, and airlines in the urban area of Yiwu was 10.4063 million, a YoY increase of 69.01%. The postal industry in Yiwu City has completed a total of over 5 billion pieces of parcels, a year-on-year increase of over 12%. The total capital and cash flow of bank branches around the Yiwu market was RMB 1.78 trillion, a year-on-year increase of 26.82%. The turnover of market funds continued to be active, with deposits and loans exceeding RMB a trillion, a year-on-year increase of over 15%. Yiwu became the first county-level city in Zhejiang Province (excluding districts) to successfully enter the trillion-yuan level of deposit and loan, achieving a historic leap in the development of the regional financial industry. (2) Digital Economy ① Digital Economy a. Development of Digital Trade of the Company In 2022, the scale of China's digital economy reached RMB 50.2 trillion, a year-on-year increase of 10.3%. It has been significantly higher than the nominal GDP growth rate of the same period for 11 consecutive years. The proportion of the digital economy to GDP is equivalent to the proportion of the secondary industry to the national economy, reaching 41.5%. Centering on the strategic deployment of building "Digital Zhejiang" made by the General Secretary XI Jinping during his work in Zhejiang, the Company will continue to promote the digital transformation of market mass trade, and constantly shape the new competitive advantages of Yiwu market through the reconstruction of trade mode and business form and the reshaping of market scene ecology. From the perspective of domestic enterprise structure, small and medium-sized enterprises with large volume and rapid growth are the backbone of China's economic development, but subject to multiple factors such as assets, technology and experience, the digital level of small and medium-sized enterprises is generally low. The platform can use the advantages of its own traffic, data and industrial layout to build diversified solutions from design and production, matching transactions, customs declaration and performance, foreign exchange settlement and other services around the core pain points of SMEs, such as marketing, service and capital. At present, the transformation of Yiwu market has entered the digital stage from the informatization stage, leading the way and demonstrating the high-quality development of the commodity market led by digitization. In the "Top 10 Digital Leaders in China's Commodity Market" list released for the first time at the 12th China Commodity Market Summit in 2021, Yiwu China Commodities City ranked first. In 2022, the digital free trade application of small commodities was awarded the "Best Application" for digital reform in Zhejiang Province. The core value of digital trade is data resources. Data is not only a carrier for national security and personal privacy, but also an internal driving force for the new stage of economic development. Data, as a new economic production factor, can reduce production costs, innovate business models, and improve resource allocation efficiency. Relying on the carrier of digital trade, data will ultimately achieve cross-border flow and global sharing, thereby improving social production efficiency and promoting the development process of the global economy. With the deepening of globalization and the development of digital technology, digital trade will gradually move towards the goal of liberalization. Digital trade may reshape the global value chain system and payment system, becoming a new driving force for economic growth. With the development of digital technology and the deepening of globalization, traditional trade models are transforming and upgrading to digital trade models dominated by digitization. b. Development of Data Business of the Company Yiwu market is an important platform connecting the domestic and international trade supply chains, and is at the key node of the global small commodity supply chain. It plays an important role in smoothing the internal circulation, improving the external circulation, and serving the new pattern of "dual circulation". Over the years of business accumulation, Yiwu market has formed the support of industrial clusters in the field of small commodity circulation, collecting massive information and data on transactions, customs declaration, logistics, foreign exchange settlement, etc. Through the application products such as Caigoubao on the Chinagoods platform and Yiwu Pay, the Company has mined the trade data of the industrial belt of the "Belt and Road" China Commodities Cities, and gradually tracked out a new business model: based on the foreign exchange settlement data or trade data, the Company integrates credit information, provides credit basis for third-party commercial banks or self-operated factoring businesses, and charges service fees. Through data monetization, the massive data formed by the offline market operated by China Commodities Cities for many years, including the global small commodity index, is mined and reshaped through the services of online platforms in the value chain. During the reporting period, the Company's Yiwu Pay and credit consulting company collaborated with the People's Bank of China Yiwu Branch and Yiwu Rural Commercial Bank to launch China's first "credit product trade financing" based on cross-border RMB settlement data, bringing efficient, convenient, and low-cost financing methods to enterprises. This product combines the information of the two major resources of credit and payment licenses to build accurate portraits for cross-border e-commerce and other foreign trade entities, innovate evaluation standards, and provide exclusive credit services for enterprises. At present, an integrated service centered on the credit consulting company has been formed, in which the Yiwu Pay platform outputs risk control models based on customer authorization and cross-border settlement data, and authorizes banks to apply for the use of credit consulting products. Yiwu Pay integrates foreign exchange settlement data and credit data on the basis of the original income model, and derives a new income model. Huokuanbao is developed and operated by the Internet Financing Company, a subsidiary of the Big Data Company. It is based on the Chinagoods platform and integrates foreign trade export chain data such as design and production, order matching, trade performance, and foreign exchange settlement. It takes into account both subject credit and trade credit, to provide trade financing services for merchants, aggregate the foreign trade ecosystem of freight forwarders, warehousing, and logistics, and derive ecological values. Since 2023, the business volume of Huokuanbao has grown rapidly. In the future, it will collaborate with third-party commercial banks to develop and empower small and medium-sized enterprises' foreign trade exports. The Company integrates trade and foreign exchange data through the Chinagoods platform to solve the pain points and difficulties faced by small and medium-sized enterprises in trade, gradually enhancing the overall value of the Chinagoods platform, and continuously enhancing the competitiveness of China's daily consumer goods globally. ② Cross-border payment a. Situation of cross-border payment industry This year coincides with the 10th anniversary of the "Belt and Road" initiative. Over the past 10 years, RMB has played an increasingly important role in cross-border payment and other aspects. In countries along the "Belt and Road", the use of RMB has gradually increased, and RMB cross-border payment has made great progress. According to Bloomberg, in March of this year, the use of RMB surpassed the US dollar in China's cross-border transactions for the first time, and more and more countries and regions are increasing the scale of RMB settlement. Currently, over 70% of trade settlements between Russia and China are already using rubles and RMB; In addition, Argentine officials have also announced that they will use RMB instead of US dollars to pay for goods imported from China. According to data from the central bank, the cross-border payment and receipt of RMB increased from less than 10 billion yuan in 2009 to 42 trillion yuan in 2022. In 2022, RMB accounted for about 50% of the total cross-border payment and receipt of domestic and foreign currencies. There is a highly positive logical relationship between RMB internationalization and the construction of the "Belt and Road", which together constitute two key points for China to participate in and lead the new international pattern in the new era. The "Belt and Road" provides an important opportunity for RMB internationalization. The "Belt and Road" is a major initiative of China in the new era to create a pattern of land-sea and domestic-overseas linkage and east-west two-way opening. The "Belt and Road" involves a total population of about 4.4 billion and an economic aggregate of about 21 trillion US dollars, accounting for 63% and 29% of the world's total, respectively. Many countries along the "Belt and Road" are developing countries and emerging economies, which are generally in an upward phase of economic development. In the past 10 years, China's import and export trade to the regions along the "Belt and Road" has increased at an average annual rate of about 20%, and its direct investment to the regions along the "Belt and Road" has increased at an average annual rate of more than 30%. None of the countries along the "Belt and Road" are major currency issuers, and the currency inertia is relatively small. China's close economic and financial cooperation with them will provide a solid carrier and broad market for the regional use of RMB. RMB internationalization is an important guarantee and necessary condition for the smooth progress of the "Belt and Road" construction. Internationalization of RMB can effectively prevent financial risks within the region, reduce transaction costs, and enhance the overall competitiveness of the regional economy. With the gradual opening of China's capital account, the development of RMB internationalization can provide sufficient RMB liquidity for the construction along the "Belt and Road", and provide financial support and service convenience for major projects through RMB bonds, loans, direct investment and other forms. At the same time, the internationalization of RMB will also provide new international currencies and risk management mechanisms for countries along the "Belt and Road", promote international investment and cooperation processes, build economic and financial security anchors, and maintain regional economic and financial stability. b. Development of cross-border payment business of the Company Yiwu is the intersection of the "Land Silk Road" and the "Maritime Silk Road". As the constructor of the "World Capital of Small Commodities", Yiwu undertakes the important mission of promoting the high-quality development of the "Belt and Road" and RMB going global. The Company will spare no effort to promote the development of trade services and cross-border RMB business. Cross-border Business Map (Taking the First Saudi Cross-border RMB Business as an Example) II. Analysis of core competencies during the reporting period √Applicable □Not applicable (I) First-mover advantages At the start of China’s reform and opening-up, Yiwu took the lead in establishing the commodities market. During the recent forty years, the market has been upgraded five times and expanded ten times and has been among the top comprehensive national markets with the highest turnover, pointing to its remarkable first-mover advantages. As the largest commodities distribution center in the world, the Yiwu commodities market provides more than 2.1 million products, which fall in 26 categories and supports one-stop purchase. The market boasts enormous resources and huge business flow, goods flow, cash flow and information flow. (II) Brand advantages “Yiwu China Commodities City” is the first market identified by the SAIC as a well-known trademark among the national commodities trading markets. The Company has taken multiple measures to give play to the brand of “Yiwu China Commodities City” and is committed to improving its influence and leading role in the industry. Its brand advantages and influence have kept enhancing. (III) Supporting services advantages The People’s Government of Yiwu has been providing policy support for the development of the market for years, and the auxiliary industries are developing rapidly in Yiwu. 1. Convenient logistics system Yiwu has in place perfect commerce and trade auxiliary facilities and advantageous logistics service. The logistics network has full coverage in Yiwu. A large number of large-sized international and domestic express delivery and logistics companies have regional distribution centers in Yiwu, and a world-oriented goods transport and distribution network has been established. Yiwu has been listed among the “commerce and trade-oriented national logistics hubs” by the National Development and Reform Commission and the Ministry of Transport. According to the report on operation of the postal industry in 2022 released by the State Post Bureau, the express delivery business volume of Yiwu ranked second in China in 2022. 2. Industry support During the recent years, thanks to the Yiwu China Commodities City, the Yiwu-centered manufacturing industry cluster has been developing fast, an commodities industrial belt that is centered in Yiwu and covers Jinhua, Lishui, Quzhou, Hangzhou, Jiaxing, Taihu, Shaoxing, Ningbo, Wenzhou and Taizhou with an area of nearly 10,000 sq.m has been established, and a benign mechanism under which the Yiwu wholesales market and the peripheral industry cluster develop together has been formed. 3. Support for exhibition service The major international trade exhibitions held by the Company’s exhibition business division such as China Yiwu International Commodities Fair, China Yiwu International Forest Products Fair, China Yiwu International Imported Commodities Fair and China Yiwu Hardware and Electrical Expo support and cultivate vertical exhibition in multiple industries such as stationery and textiles, have developed multiple professional and international exhibition brands, and are important national platforms for the China Commodities City to lead industry development, develop the city economy and maintain the clusters of traders and commodities. (IV) Advantages of diversified businesses The Company has strengthened its presence in the related industries, made efforts on financial investment, kept developing the exhibition business, created a new e-commerce model, developed the hotel business and also run international trade, modern logistics, advertising information, shopping and tourism businesses. It has created a group structure and profit-making model of shared and interactive development of market resources. (V) Management advantages （未完）  |