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小商品城:2021年年度报告(英文版)2022-04-16  

                                             2021 Annual Report



Stock Code: 600415                    Stock Short Name: 小商品城




 Zhejiang China Commodities City Group
                Co., Ltd.
           2021 Annual Report




                          1   / 228
                                            2021 Annual Report




                                            Important Note

I.   The Board of Directors, the Board of Supervisors 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. Ernst & Young Hua Ming Certified Public Accountants (special general partnership) has
     issued a standard unqualified audit opinion for the Company.

IV. ZHAO Wenge, Head of the Company, WANG Dong, Head in charge of accounting, and
     ZHAO Difang, Head of the accounting department (Accounting Supervisor), declare that
     they warrant the truthfulness, accuracy and completeness of the financial report in the
     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

        Based on the total share capital on the registration date of profit distribution equity in 2021,
cash dividends of RMB 0.73 (tax inclusive) will be distributed for every 10 shares. According to the
current total share capital of the Company, cash dividends of RMB 400,863,014.85 (tax inclusive)
will be distributed. In the event of changes in the total share capital of the Company before the
dividend distribution registration date, the scheme of allocation shall remain unchanged while the
total profits distribution will be adjusted accordingly.


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 its affiliates for
     non-operational purposes?

No


VIII.     Has the Company provided external guarantee in violation of the prescribed decision-
     making procedures?
No

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                                           2021 Annual Report



IX. Whether more than half of the directors can not warrant the truthfulness, accuracy and
     completeness of the 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. Others
□Applicable √Not Applicable




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                                                              2021 Annual Report


                                                          Table of Contents


Section I.          Definitions .......................................................................................................................... 5

Section II.         Company Profile and Financial Highlights .................................................................... 6

Section III.        Discussion and analysis of managers ......................................................................... 11

Section IV.         Corporate Governance .................................................................................................. 48

Section V.          Environmental and Social Responsibilities................................................................. 69

Section VI.         Significant Matters .......................................................................................................... 70

Section VII. Changes in Shares and Shareholders ........................................................................ 83

Section VIII. Preferred Shares ............................................................................................................ 92

Section IX.         Bonds ............................................................................................................................... 93

Section X.          Financial Report............................................................................................................ 102




                                      Accounting statements with the signatures and stamps of the person
                                      incharge of the Company, person in charge of accounting and person in
                                      charge of the accounting body.
       Documents for
                                      Resolution of the Board of Directors and resolution of the Board of
        Inspection
                                      Supervisors
                                      Written confirmation opinions of directors, supervisors and senior
                                      management on the Company's 2021 Annual Report and Summary




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                                       2021 Annual Report



                                Section I.           Definitions
I. Definitions
For the purpose of this Report, unless otherwise stated in the context, the following terms shall
have the following meanings:
Definitions
SCO                              means       Yiwu State-owned Capital Operation Co., Ltd.
MDG                              means       Yiwu Market Development Group Co., Ltd.
CCCH                             means       Yiwu China Commodities City Holdings Limited
CCCP                             means       Yiwu China Commodities City Property Development
                                             Co., Ltd.
CCCF                             means       Yiwu China Commodities City Financial Holdings Co.,
                                             Ltd.
Huishang Micro-finance           means       Yiwu Huishang Micro-finance Co., Ltd.
Haicheng Company                 means       Haicheng Yiwu China Commodities City Investment
                                             Development Co., Ltd.
Binjiang Shangbo                 means       Hangzhou Binjiang Shangbo Property Development
                                             Co., Ltd.
Yiwu Shanglv                     means       Yiwu Shanglv Investment Development Co., Ltd.
Chouzhou Financial Lease         means       Zhejiang Chouzhou Financial Lease Co., Ltd.
Yiwu Shangbo                     means       Yiwu Shangbo Property Co., Ltd.
Handing Shangbo                  means       Yiwu Handing Shangbo Real Estate Co., Ltd.
Gongchen Shangbo                 means       Yiwu Gongchen Shangbo Property Co., Ltd.
Huangyuan Shangbo                means       Yiwu Huangyuan Shangbo Property Co., Ltd.
The Company, the Listed          means       Zhejiang China Commodities City Group Co., Ltd.
Company or the Group




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                   Section II.       Company Profile and Financial Highlights
I.       Company profile
                   Chinese name                   Zhejiang China Commodities City Group Co., Ltd.
               Chinese short name                                   小商品城
                   English name                   Zhejiang China Commodities City Group Co.,Ltd
               English short name                                     YIWU CCC
              Legal representative                                  ZHAO Wenge



II.      Contact information
                                   Board Secretary                  Securities Affairs Representative
          Name                         XU Hang                                RAO Yangjin
         Address           Haiyang Business Building, No.105       Haiyang Business Building, No.105
                                  Futian Road, Yiwu                        Futian Road, Yiwu
        Telephone                   0579-85182812                            0579-85182812
           Fax                      0579-85197755                            0579-85197755
          Email                 Hxu@cccGroup.com.cn                     Hxu@cccGroup.com.cn


III.     Basic Information
               Registered address              Haiyang Business Building, No.105 Futian Road, Yiwu,
                                                                Zhejiang Province
                   Office address              Haiyang Business Building, No.105 Futian Road, Yiwu,
                                                                Zhejiang Province
        Postal code at the office address                            322000
                Corporate website                                www.cccGroup.com.cn
                       Email                                   600415@cccGroup.com.cn



IV.      Places for information diclosure and access to the annual report
 Media's names and websites selected by the China Securities Journal, Shanghai Securities News
    Company for annual report disclosure                   and Securities Times
   Stock exchange website selected by the                    www.sse.com.cn
    Company for annual report disclosure
  Place for access to the Company’s annual       Securities Department of the Company
                    report


V.       Stock profile
                                              Stock profile
       Type of stock           Exchange     Stock short name        Stock code      Stock short name
                                                                                     before change
         A-share          Shanghai Stock        小商品城              600415              None
                            Exchange


VI.      Other relevant information
                             Name            Ernst & Young Hua Ming Certified Public Accountants
CPAs engaged
                                                          (special general partnership)
   by the
                         Office address      16 th Floor, Ernst & Young Building, Oriental Plaza, 1
  Company
                                              Chang'an Street, Dongcheng District, Beijing, China
 (domestic)
                          Name of the                    YIN Guowei, HUANG Zhigang
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                                           2021 Annual Report


                      Signing Certified
                           Public
                        Accountants

VII. Major accounting data and financial indicators in the past three years
(i) Major accounting data
                                                                                              Unit: RMB
    Major                                                                YoY
                              2021                   2020                                    2019
accounting data                                                       Change (%)
Operating
                        6,033,842,972.95      3,725,686,100.39             61.95       4,042,767,521.18
revenue
Net         profits
attributable     to
shareholders of         1,334,095,906.95        926,626,706.42             43.97       1,255,276,023.70
the         Listed
Company
Net         profits
attributable     to
shareholders of
the         Listed      1,221,808,001.15        517,246,267.88            136.21         930,676,526.71
Company with
non-recurring
items excluded
Net cash flow
from operating          2,033,082,507.76        828,788,261.95            145.31     -1,538,907,257.55
activities
                                                                         YoY
                      December 31, 2021     December 31, 2020                        December 31, 2019
                                                                      Change (%)
Net        assets
attributable    to
shareholders of        14,610,845,868.33     13,558,228,377.08               7.76     13,020,619,449.36
the         Listed
Company
Total assets           31,014,635,513.35     28,750,127,146.86               7.88     31,323,233,994.44

(ii) Major financial indictors
       Major financial indictors            2021            2020       YoY Change (%)           2019
Basic EPS (RMB)                                0.25            0.17              47.06             0.23
Diluted EPS (RMB)                              0.25            0.17              47.06             0.23
Basic EPS after deducting non-
recurring    gains      and      losses        0.22            0.10                 120.00           0.17
(RMB/share)
Weighted average ROE (%)                                              Up 2.50 percentage
                                               9.38            6.88                                 10.04
                                                                                   points
Weighted average ROE after
                                                                      Up 4.75 percentage
deducting non-recurring gains and              8.59            3.84                                  7.44
                                                                                   points
losses (%)

Explanation of main accounting data and financial indicators of the Company in the previous three
years at the end of the report period
√Applicable □Not Applicable
     1. The Company’s operating revenue increased by RMB 23.08 million YoY, mainly due to the
increase in the sales of goods during the current period.



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      2. The net profit attributable to shareholders of the listed company increased by RMB 407
million over the same period of the previous year. This was mainly due to an increase of RMB 92
million in net operating revenue and operating cost, an increase of RMB110 million in investment
income, a decrease of RMB 24 million in non-operating expenses and a decrease of RMB172
million in income tax expense compared with the same period of the previous year
      3. The net profit attributable to shareholders of the Listed Company after deduction of the non-
recurring gains and losses increased by RMB 704 million over the same period of the previous year.
This was mainly due to an increase of RMB 407 million in net profit attributable to shareholders of
the Listed Company in the same period of the previous year, and a decrease of RMB 297 million in
non-recurring gains and losses.
      4. The net flow generated by operating activities increased by RMB 1.204 billion over the same
period of the previous year, mainly due to an increase of RMB 1.375 billion in net cash deducted
from payment for selling goods and providing services.
VIII. Differences in accounting data between foreign and Chinese accounting standards
(i) Differences between the net profit and net assets attributable to shareholders of the
      Company disclosed in accordance with international accounting standards and China
      accounting standards in the financial report
□Applicable √Not Applicable

(ii) Differences between the net profit and net assets attributable to shareholders of the
     Company disclosed in accordance with overseas accounting standards and China
     accounting standards in the financial report
□Applicable √Not Applicable
(iii) Explanation of differences between domestic and overseas accounting standards
□Applicable √Not Applicable

IX.   Key financial indicators by quarter in 2021
                                                                                           Unit: RMB
                          1st Quarter                                                  4th Quarter
                                            2nd Quarter           3rd Quarter
                          January to                                                   October to
                                            April to June      July to September
                            March                                                      December
Operating
                        773,146,503.41    1,299,481,223.59     2,053,219,737.59     1,907,995,508.36
revenue
Net           profits
attributable       to
shareholders of         377,396,281.59      473,118,179.34       358,731,419.31       124,850,026.71
the           Listed
Company
Net            profit
attributable       to
shareholders of
the           Listed
                        346,787,473.15      458,193,426.29       344,238,070.51        72,589,031.20
Company         after
deducting       non-
recurring      gains
and losses
Net cash flow
from       operating    -267,130,288.24     433,866,112.99     1,053,274,803.88       813,071,879.13
activities
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Explanation of difference between quarterly data and disclosed data in regular reports
□Applicable √Not Applicable

X. Non-recurring items and amounts thereof
√Applicable □Not Applicable
                                                                                             Unit: RMB
                                      Amount for        Remark (if         Amount for       Amount for
     Non-recurring items
                                        2021            applicable)          2020             2019
Gain or loss from the disposal
                                       -561,416.89                       383,206,932.21   108,675,734.58
of non-current assets
Government grants that are                             Please refer
recognized in the current profit                       to details of
or loss, excluding the                                 other income
government grants that are                             and
closely related to the normal                          government
operation of the Company and         23,559,898.01     grants             18,655,980.14     9,031,831.74
are provided in a fixed amount                         accounted
or quantity continuously                               for profit or
according to the national                              loss for the
polices and certain standards                          current
                                                       period
Cash occupation fees charged                           Fees paid for
from non-financial enterprises                         using     fund
that are recognized in the                             collected
current profit or loss                                 from      joint
                                                       ventures
                                    107,299,598.45                       124,744,826.38   241,150,826.18
                                                       including
                                                       Tonghui
                                                       Shangbo
                                                       and Handing
                                                       Shangbo
Gain arising from investment
costs for acquisition of
subsidiaries, associates and
joint ventures by the
                                                   -                      31,308,053.80                  -
corporation being less than its
share of fair value of
identifiable net assets of the
investees on acquisition
Gain or loss from changes in
                                                       Mainly due
fair value of held-for-trading
                                                       to gains or
financial assets, derivative
                                                       losses from
financial assets, financial
                                                       the changes
liabilities held for trading and
                                                       in fair value
derivative financial liabilities,
                                                       arising from
and investment income from
                                                       the holding
the disposal of held-for-trading
                                      7,298,587.58     of held-for-      -32,578,800.48    68,526,573.42
financial assets, derivative
                                                       trading
financial assets, financial
                                                       financial
liabilities held for trading,
                                                       assets and
derivative financial liabilities
                                                       other
and other debt instruments,
                                                       noncurrent
except for effective hedging
                                                       financial
during the ordinary course of
                                                       assets
business
Profits and losses arising from
                                                   -                      11,786,857.07                  -
external entrusted loans
Net income from other non-            3,504,923.76                        -4,107,200.75     1,049,413.04

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operating activities
Other profit and loss items that
meet the definition of non-           1,604,200.49                          688,953.43                   -
recurring profit and loss
Less: effect of income tax           28,698,936.71                      122,917,029.51   103,828,184.21
     Effect of minority interest
                                      1,718,948.89                        1,408,133.75         6,697.76
(after-tax)
              Total                 112,287,905.80                      409,380,438.54   324,599,496.99

Expanation about defining the non-recurring profit and loss items listed in the Explanatory Notice
No. 1 of Information Disclosure of Companies Publicly Issuing Securities - Non-recurring Profit and
Loss items as the current profit and loss items
□Applicable √Not Applicable

XI. Items measured at fair value
√Applicable □Not Applicable
                                                                                     Unit: RMB10,000
                                                                     Changes for
                             Opening                                                Amount of impact
         Item                                   Closing balance      the current
                             balance                                                on current profits
                                                                       period
Held-for-trading
                                   5,171.27               7,537.51       2,366.24                91.80
financial assets
Other            equity
instruments                      66,225.63               64,218.80      -2,006.83             1,254.27
investment
Other       non-current
                                152,392.52              152,481.93          89.41             2,881.82
financial assets
          Total                 223,789.42              224,238.24         448.82             4,227.89

XII. Others
□Applicable √Not Applicable




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                  Section III. Discussion and analysis of managers
I.   Discussion and analysis of operation
     (I) Market operation
     In 2021, facing the complex international trade development environment, and based on the
new forms and models of trade, the Company performed digital innovation in trade services,
attracted emerging advantageous industries, and implemented a differentiated rent price system;
the Company focused on talents, brand, quality and standards, and continued to bring university
graduates, design, live broadcast, and standards into the market; the Company integrated the
market property, and promoted itself to transform from a management company to a service
company.
     During the report period, the Company took multiple measures to promote the upgrading of the
market, enhance its advantages, and guide market traders to upgrade from information trade era to
digital trade era. The occupancy rate of the shops in the market maintained above 98% in 2021,
and the volume of business reached RMB 186.679 billion, up 14.77% YoY, showing strong
resilience and vitality.




     1. Precise and intelligent monitoring and control for prevention of the Covid-19 pandemic
     The Company promoted the intelligent upgrading for prevention of the pandemic, installed self-
service personal health report equipment, and intelligent channel turnstiles, to provide technical
support and data guarantee; fully activated the combat model of "communist party members +
units", and orderly conducted nucleic acid testing and pandemic prevention drills in various markets
to prevent the market from the pandemic and ensure stable operation of the markets.
     2. Construction of digital market
     Focusing on digitalization empowering the market, and based on management and service, the
two application systems of digital management and digital service were built, by setting up the data
sharing and application mechanism and sorting and restructuring existing business, thus promote
the market's development toward being informational, intelligent and user-friendly.

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                                           2021 Annual Report



    (1) Building digital customer service center
    During the report period, the Company completed the development of the modules of pledging,
lease renewal, transfer, online basic management and upgrading of module of market trader
integrity credit, and conducted trial operation of digital customer service center.
    (2) Launch of online platform for purchasers
    On August 21, 2021, the Company launched the online platform for purchasers, which includes
the service modules such as market navigation, online goods searching and intelligent parking, and
has a average daily traffic of 64k.
    (3) Development of intelligent design system
    Starting from product package design and pattern, the Company joined hands with universities
and colleges including Zhejiang University and Yiwu Industrial & Commercial College to develop an
intelligent design system, to provide intelligent product design for merchants in the markets.
    3. Empowering the market
    (1) Bringing university graduates into the market
    Through design competition that includes 100 universities and colleges, more than 9300
undergraduates in design provided design service for market traders; undergraduates "selling
goods in booth" activities were conducted, and a communication platform for merchants and
undergraduates was established, matching over 2000 people; college graduates and people with
higher education level accounted for 26.9% of all the merchants in the market, indicating a rising
year-by-year trend.
    (2) Bringing design into the market
    During the report period, the Company successfully held the Forth "Yiwu China Commodities
City Cup" International Commodities Creative Design Competition, set up 20 design markets and 8
planning and design booths, attracted 1000 designers and identified 1000 designer shops and
launched 12.6k new products.
    (3) Bringing live broadcast into the market
    In 2021, the Company set up chinagoods live broadcast center and digital live broadcast
industrial incubator, organized market traders to perform live broadcast for over 1000 times, and
conducted 147 trainings for live broadcast e-commerce for nearly 5000 people. The Company
joined hands with Kuaishou platform to hold the first "Yiwu China Commodities City 415 Live
Broadcast Purchase Festival", which was promoted in all channels and provided with 100 million
traffic and allowed brands to be exposed to consumers across China, with a GMV of RMB 1.69
achieved. The Company cooperated with top live e-commerce agencies in China such as "Make
Friends", to help merchants in the market seize the opportunity of "e-commerce + live stream".
    (4) Bringing standards into the market



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    During the report period, the Company sorted standards at home and abroad for 12 major
industries, released 25 relevant reports, guided industrial association to develop multiple Group
standards, and conducted 43 trainings on standardization for over 5500 people.
    4. Direction of market service
    Based on the operation concept of "Find products for buyers, and expand channels for sellers",
the Company sorted its core business, built the frame of manager salary system, set up the path for
transformation from manager to operation specialist, and eventually promoted the Company's
transformation from a management company to a service company.
    5. Constructing oversea market
    Dubai Yiwu China Commodity City, the first oversea market of the Company, will start trail
operation in March 2022, and its shop occupancy rate has reached 99%. It's a comprehensive
wholesale market with multiple functions including product display, warehousing as well as bonding,
and has 1600 shops and 324 warehouses, covering eight industries. The market can give full play
to the Dubai's advantages in policies and make full use of Dubai's radiation effect on Mideast, North
Africa and other regions, thus complementing each other with Yiwu China Commodity City. Through
commodity sales exhibition, bonded warehousing, transshipment, and others, the market can
promote bilateral trade and industrial investment between China and UAE and its neighboring
countries, and strive to be a win-win cooperation model of the "Belt and Road" Initiative.




    (II) Promote trade digitalization
    In 2021, the Company optimized the digital functions and applications of the chinagoods
platform for display transactions, logistics performance, trade finance, and some other fields in
depth. The big data company (the operator of the chinagoods platform) has realized a revenue of
RMB 140 million and a net profit of RMB 27.47 million. The platform has achieved a total GMV of
RMB 16.8 billion in 2021.
    1. Implementing digital top-layer design
    During the report period, the Company enhanced digital new architecture, completed 5G
covering in main markets and modification of Gigabit broadband; built Data Center Manager and


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completed collecting, cleaning and filing of data for hundreds of systems; set up the implementation
path for digitalization, improved the data security system and guaranteed network operation
maintenance security.
     2. Iteration and optimization of chinagoods platform
     In 2021, Chinese Website, English Website, Arabic Website and Spanish National Website
were launched on the platform and digitalization of traders and goods; The Company promoted
R&D of core products of the platform and explored linked trade between the platform and oversea
business. 60000 shops have been launched on the platform, with 460 kinds of commodities and
over 1.2 million registered purchasers.
     3. Results of application
     The integration of chinagoods and the online purchase platform was accelerating, which would
create commodity digital trade application scenario. Daikuanbao realized transaction amount over
RMB 100 million; Caigoubao was launched, laying the foundation for subject manifestation and data
provenance; Digital trade cockpit was launched, enabling display of all trade data on one screen.
     chinagoods platform is an important measure of the Company for digital transformation, is an
important means for the Company's transformation, upgrading, expansion and development in the
era of trade digitalization and information technology revolution, is a sign of integration of the
Company's online and offline markets.
     (III) Build a global supply chain service system
     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".
     1. Warehousing and logistics system
     The warehousing and logistics system was developing steadily. The united warehousing
information platform, cargo space booking system and express and drayage operation platform
were launched. Chinagoods digital cloud warehouse and Huanqiuyida Logistics Supply Chain
Industry Park were put into operation. 206 international logistics lines were launched and
accumulated goods delivered reached 1 million cubic meters.
     2. Oversea warehouses
     The expansion of oversea warehouses was accelerating. As of the end of the report period, the
Company laid out 120 oversea warehouses, with a total area over 600k ㎡, covering 46 countries
and regions and serving export over RMB 6 billion. The Company laid out 15 "Bring you to China"
exhibition halls, with a total area over 4200 ㎡, displaying 21k SUK of commodities The five
exhibition halls in Czech, Rwanda, Benin, Philippines, and Thailand achieved "oversea warehouse
+ exhibition hall" operation mode. The Company brought Yimi Supply Chain and other enterprises
to conduct trial operation of "chinagoods national website+ oversea warehouse + exhibition hall"
mode.
     3. Comprehensive Bonded Zone


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    Yiwu Comprehensive Bonded Zone, as an exemplary project of Yiwu that was taken into free
trade trial zone, was one important mission that the state and Zhejiang Provincial Government
granted Yiwu. During the report period, the growth of Yiwu Comprehensive Bonded Zone was sped
up and the phase I project was put into operation on October 22, 2021; the planning and
construction of phase II project has started. As of the end of the report, nearly 20 key projects such
as "Zhejiang Non-ferrous Metal Trading Allocation Center Project", "Comprehensive Bonded Zone
Store-Warehouse-Field Whole Industry Chain Project", "B2B Intelligent Manufacturing Allocation
Warehouse Project" were signed. The Company attracted big enterprises with existing enterprises,
getting multiple top trade enterprises to enter the Bonded Zone.
    Since it was put into operation, bonded logistics business such as cross-border e-commerce
1210 and general trade import and export was conducted steadily, with great achievements: Whole-
area Supply Chain Financial Service Platform (Phase I) was launched, tariff guarantee product
"Guanshuibao" and "Customs Separate Payment Guarantee" and other business were
implemented; first "Bonded Zone-port linkage + staple commodity" business was completed; on
November 24, first cross-border bonded live broadcast was conducted in warehouse D2; on
December 9, first check business for returned goods entering the Bonded Zone was completed in
Yiwu Comprehensive Bonded Zone. After two months of operation, Yiwu Comprehensive Bonded
Zone achieved total amount of import and export of RMB 2.8 billion.




    (IV) Self-operated business stepped into a new phase

    During the report period, the Company integrated the source supply chain resources of Yiwu
market, combined "Trendy domestic commodities" and "Imported good commodities", built a trade

system of "All good commodities" for sales at home and abroad, to serve the dual circulation of

domestic circulation and international circulation, and promote the brands of "Yiwu Selection" and
"ICMall". As of the end of the report period, the income from commodity sales reached RMB 2.593

billion, which was a big leap.

    1. On supply side

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    In 2021, the Company's two self-run brands "Yiwu Selection" and "ICMall" through direct

sourcing, domestic agency, OEM production and other ways, gained a total of 108 domestic and
foreign brand agencies, 20,000 + SKU of high-quality single products, 2000 core suppliers in the

warehouse, 3000 advantageous commodities. The business scope covered seven categories of

home life, beauty makeup and skin care, maternal and child products, snacks and drinks,
entertainment and cultural innovation, toys and digital products, and cross-border goods. It aimed to

create a supply chain service platform with full-scene digitization, full-link new experience and O2O

online-offline integrated development.
    2. On sales and distribution side

    The Company's expansion of online and offline sales and distribution channels for "Yiwu

Selection" and "ICMall" was accelerating. On the offline side, the Company actively expanded

domestic second-level wholesale market and industry dealer channels, and accumulated over 2000

cooperation channels by parent brand authorization, subsidiary brand joining, supply chain

cooperation and other means, and was selected as a trial project of first special campaign for
optimization and upgrading of national commodity market. On the online side, the Company

explored cross-border incubation mechanism, set up short video and live broadcast business, and

opened and operated chinagoods oversea flagship shop, TikTok self-operated shop, Kuaishou self-
operated shop and others, completing 149k online orders.

    3. On service side

    The Company enhanced its supply chain service ability, signed over 30 warehousing service

providers and over 50 logistics service providers and completed customs clearance for over 4000

TEU imported commodities. As of the end of the report period, the accumulated signed import trade

amount reached RMB 1.86 billion.

    (V) Speeding up digitalization of exhibition

    During the report period, the Company's subsidiary Shangcheng Exhibition took the opportunity

that Yiwu market is a pilot of digitalization transformation, took Yiwu's construction of intelligent city

into account, and made full use of IoT, internet, cloud computing, intelligent analysis and other

technologies, to build a intelligent service exhibition system; based chinagoods platform, built a safe,

reliable, efficient and useful cloud digital exhibition platform, and promoted the online-offline dual
drive exhibition mode to be mature and standardize; cooperated with Yiwu Market Development

Committee and other government authorities the "Visit Exhibition Hall Here" platform, which would

provide more convenient and comfortable exhibition experience for exhibitors, participants and
audience; fined data management, and analyzed Group features, information channels and

preferred types and other dimensions of data, to form digital economy that takes data as the key

                                                 16   / 228
                                            2021 Annual Report



element; explored in depth the value of digital venues and maximized digital technologies' new

advantages.
    To get rid of the restrictions that the pandemic imposed on offline exhibition as soon as

possible, and find the new opportunity of exhibition industry, Shangchen Exhibition actively explored

the construction of online exhibition platform in depth and successfully made a breakthrough. In
2021, Shangcheng Exhibition expanded the scale of online exhibition, and successfully held

multiple online-offline combined exhibitions including online China Yiwu International Commodities

Fair, online China Yiwu International Forest Product Fair and online China Yiwu Cultural and
Tourism Products Trade Fair, with 250 million visits for online exhibition, which formed a new

development trend of online-offline combination of exhibition.

II. Description of the industry of the Company during the reporting period

    In 2021, thanks to China's stable economic and social development and its leading position in

the world in epidemic prevention and control, China's potential of the foreign trade industry was fully

tapped and its comprehensive competitiveness continued to improve. The changing flow of
commerce promoted the emergence and evolution of the structural trend of foreign trade. China is

at the key point of "top-down" comprehensive transformation and upgrading of foreign trade in the

national strategy, and Yiwu plays a pivotal role in this key point.
    1. National policies for the industry

    In July 2021, "Opinions about speeding up the development of new forms and modes of foreign

trade" (hereinafter referred to as the "Opinions") issued by the General Office of the State Council,

clearly supports the development of cross-border e-commerce, overseas warehouse, market

procurement trade mode, comprehensive service enterprises in foreign trade, offshore trade,

convenient trade payment and settlement, and ither new forms and modes of foreign trade, to inject

new vitality to the development of foreign trade.

    The "Opinions" stressed that "the policy frame for market procurement trade mode will be

optimized, and that by 2025, 10 integrated markets for domestic and foreign trade with export

amount over RMB 100 billion will be produced, and a host of famous brands will be created", which

points out the direction and specifies the goals for market procurement trade mode in the new

phase.
    2. Yiwu market

    Yiwu relies on its over 2.1 million micro, small and medium-sized enterprises to maintain trade

with over 230 countries and regions across the world, with an export-oriented degree of 65%.
Focusing on the goods aggregation of nearly RMB 400 billion import and export amount in the

market, cross-border rail and air transportation capacity develops rapidly, which, together with the

                                                 17   / 228
                                           2021 Annual Report



low cost of domestic logistics, bring super high logistics efficiency for LCL export, thus drives

emergence and development of a considerable numer new B2C cross-border e-commerce
enterprises.

    (1) The overall situation of Yiwu market

    In 2021, Yiwu's total import-export amount reached RMB 390.31 billion, up 24.7% YoY; of
which, the total export amount was RMB 365.92 billion, up 21.7% YoY, and the total export amount

exceeded that of 18 provinces; the total import amount was RMB 24.39 billion, up 95.3% YoY.


                 Cross-border e-commerce export volume and market
                 procurement trade export volume of China (2016-2021)




                            Cross-border e-commerce export volume of China (RMB 100mn)
                            Market procurement trade export volume of China (RMB 100mn)
                            Proportion of cross-border e-commerce and market procurement trade
                            export volume in total export volume of China

    In 2021, Yiwu's foreign trade export achieved excellent performance, and market procurement
trade was an important booster.
    (2) Market procurement trade in Yiwu
    Since 2013, China's Ministry of Commerce and other relevant departments have first carried
out pilot projects under market procurement trade mode in Yiwu. In the business process,
supervision, information construction and other aspects, Yiwu took the lead, with tailored support
policies, VAT exemption without refund, simplified declaration and other breakthroughs in policy. A
relatively complete territorial comprehensive management system and commodity identification
system were gradually formed. Since then, China has recognized 31 market procurement trade pilot
units in 15 provinces for 5 batches.
                                                                                     Date of
                                Pilot Projects of Market Procurement                 establishment
   First batch  Pilot Project of Market Procurement of Zhejiang Yiwu Market           April 2013
   Second batch Jiangsu Haimen Diishiqiao International Home Textile City, Zhejiang Decmeber 2015
                Haining Leather City
   Third batch  Changshu Clothing City, Jiangsu Province; Huadu Leather and September 2016
                Leather Goods Market, Guangzhou, Guangdong Province; Linyi City,
                Shandong Province; Hankou North International Commodity
                Exchange Center, Wuhan, Hubei Province; Baigou Bag Market,
                Hebei Province



                                                  18   / 228
                                                2021 Annual Report


  Fourth batch   Zhejiang Wenzhou (Lucheng) Light Industrial Products Trading                                   November 2018
                 Center, Quanzhou Shishi Clothing Mall, Fujian Province, Gaoqiao
                 Market, Hunan Province, Foshan (Shunde) Asia International
                 Furniture Material Trade Center, Zhongshan City and Lighting
                 Exhibition Center, Zhongshan City, Sichuan Province, Chengdu
                 International Trade Center

  Fifth batch    Liaoning Xiliu Clothing City, Zhejiang Shaoxing Keqiao China Light September 2020
                 Textile City, Zhejiang Taizhou Luqiao Daily Necessities and Plastic
                 Products Trading Center, Zhejiang Huzhou (Zhili) Children's Wear
                 and Daily Consumer Goods Trading and Management Center, Anhui
                 Bengbu Zhongheng Trade City, Fujian Jinjiang International Shoes
                 Textile City , Shandong Qingdao Jimo International Trade City,
                 Shandong Yantai three station wholesale trading market, Henan
                 China (Xuchang) International Hair products trading market,
                 Hubei Yichang Three Gorges Logistics Park, Guangdong
                 Shenzhen South China International Industrial Raw Materials
                 City, Guangdong Shantou Bao 'ao International Toy City,
                 Guangdong Dongguan Dalang Wool Trade Center, Yunnan Kunming
                 Junfa - New Luosiwan International Trade City, Yunnan Ruili
                 International Commodity Exchange Market (border Trade Commodity
                 Market), Inner Mongolia Manzhouli Mangou Center (Border Trade
                 Commodity Market), Guangxi Sample Export Commodity Purchase
                 Center (Border Trade Commodity Market)



    Yiwu is the leader and demonstration center of market procurement trade in China, and has
maintained high-speed growth for 7 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 2021, China's total import under market procurement trade mode was RMB 930.39 billion, of
which Yiwu's total import under market procurement trade mode was RMB 290.16 billion,
accounting for 31.2% of that of China, up 30.1% YoY.
    (3) Siphonic effect of logistcs of Yiwu
    There is a continueous "siphonic effect" of Yiwu, due to its strong goods sources guarantee,
good business environment, and multi-dimensional domestic-international logistics network
consisting of sea, road, air and railway, express, China-Euro Railway Express, and others. In 2021,
Yiwu's express delivery service enterprises completed 9289.574 million express orders, up 29.50%
YoY.



                               Top 10 cities in express delivery service and
                                   their accumulated volumes in 2021       Unit: 100mn pcs




                                                           19   / 228
                  Guangzhou   Yiwu   Shenzhen   Shanghai    Hangzhou    Jieyang   Dongguan   Suzhou   Beijing   Quanzhoou
                                         2021 Annual Report




III. Description of the business of the Company during the reporting period
     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).
    (I) Main businesses
    The Company is engaged in market development and operation and supporting services,
providing online trading platform and services, online trading market development and operation,
etc., belonging to the comprehensive industry category.
    (II) Operating model
    1. Market operation
    Market operation business is mainly operated and managed by the Company's subordinate
market branches. 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. Currently
the markets that the Company is responsible for operating include Zone 1 to Zone 5 of the
International Trade City, Importing Market, Zone 1 East Expansion Market, Huangyuan Market and
International Production Goods Market.
    2. Online trade platform
    Relying on the Company's market resources of 75,000 off-line shops, Yiwu market official
website “chinagoods” platform (www.chinagoods.com, referred to as "chinagoods platform")
provides service for 2.1 million micro, small, and medium enterprises in the upper reaches of the
industry 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 to achieve effective and accurate allocation of market
resources, and build a true, open, and integrated digital trade comprehensive service platform.


IV. 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
                                              20   / 228
                                          2021 Annual Report


center in the world, the Yiwu commodities market provides more than 2million 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) Auxiliary 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 operation of
the postal industry in 2021 that was announced by the State Post Bureau, the express delivery
business volume of Yiwu ranked second in China in 2021.
    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 from 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) Diversified businesses advantage
    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,

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                                          2021 Annual Report


shopping and tourism businesses. It has created a Group structure and profit-making model of
shared and interactive development of market resources.
    (V) Management advantage
    In terms of personnel, management and technology, excellent operation and management
ability is one of the core competences of the Company as a professional market operating company.
The Company has developed a series of perfect management systems for market operation and
management, accumulated rich experience in operation and management, and has cultivated a
professional management team with reasonable knowledge and expertise structures and strategic
development insights.
    (VI) Adavantage of online and offline platform integration
    The Company’s international trade city is the global leading commodity market. The
Company’s official Yiwu CCC website, chinagoods platform, relying on the Company’s 75,000 off-
line shops, through integration of online and offline services, serves 2 million small, medium and
micro enterprises in the upper reaches of the industry 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.
    (VII) Advantage of international logistics
    The Company's Huanqiuyida international logistics business, establishes a logistics platform to
replace the multi-layer freight forwarder system, thus shortening the level of freight forwarder
distribution, and improving logistics efficiency. In contrast, the traditional foreign trade freight
forwarders are divided into multiple levels, the logistics and transportation services are not
standardized, and the service prices vary widely and are usually not the lowest price.


V. Operating status during the reporting period
   In 2021, the Company's operating revenue was RMB 6.034 billion, up RMB 2.308 billion, or
61.95% YoY; Net profit attributable to shareholders of the parent company was RMB 1.334 billion,
up RMB 407 million, or 43.97% YoY.

(i) Analysis of main business
 1. Analysis of changes in related accounting subjects of income statement and cash flow
     statement
                                                                                Unit: RMB
Item                                                 Amount in the same
                                  Amount in the
                                                     report period of the YoY change (%)
                               current report period
                                                        previous year
Operating revenue                 6,033,842,972.95     3,725,686,100.39              61.95
Operating cost                         4,027,543,138.56          1,811,136,443.99            122.38
Sales expenses                           204,745,974.57           241,889,186.44              -15.36
Administrative expenses                  453,543,427.80           377,516,845.45               20.14
Financial expenses                       179,911,613.70           182,089,699.33               -1.20
R&D expenses                              10,308,801.84            18,507,626.99              -44.30
Net cash flow from operating
                                       2,033,082,507.76           828,788,261.95             145.31
activities


                                                 22   / 228
                                         2021 Annual Report


Net cash flow from investing
                                      1,650,766,978.93            636,113,348.17               159.51
activities
Net cash flow from financing
                                      -1,701,935,200.78       -2,855,836,638.69         Not applicable
activities
Reasons for the change in operating revenue: the Company’s operating revenue increased by
61.95% YoY, mainly due to the increase in the sales of goods during the current period.
Reasons for the change in operating cost: The Company’s operating cost increased by 122.38%
YoY, mainly due to the increase in the sales of goods during the current period.
Reasons for change in R&D expenses: the Company's R&D expenses decreased 44.30% YoY,
mainly due to the increase in expensed R&D investment during the current period.
Reasons for the change in the net flow generated by operating activities: mainly due to an increase
of RMB 1.375 billion in net cash deducted from payment for selling goods and providing services.
Reasons for changes in net cash flow from investment activities: mainly because the net outflow of
investment during the current period decreased by RMB 1.958 billion YoY, and cash paid for
purchasing and construction of fixed assets, intangible assets and other long-term assets increased
by RMB 830 million YoY.
Reasons for changes in net cash flow from financing activities: Mainly because the net inflow of
financing during the current period decreased by RMB 1.385 billion YoY, cash received for absorbed
investment decreased by RMB 142 million YoY, and cash paid for dividends and interest payments
increased by RMB 113 million YoY.


Details of material changes to the business types, the components, or sources of profits of
the Company in this reporting period
□Applicable √Not Applicable

  2. Revenue and cost analysis
√Applicable □Not Applicable
       In 2021, the Company's operating revenue was RMB 6.034 billion, up 61.95% YoY, and the
Company's operating cost was RMB 4.028 billion, up 122.38% YoY.


(1).    Main business by industry, product and region
                                                                                     Unit: RMB10,000
                                    Main business by industry
                                                      Change           Change
                                          Gross          in              in         Change in gross
    By         Operating    Operating
                                           profit    operating        operating     profit margin YoY
 industry      revenue        cost
                                        margin (%) revenue            cost YoY              (%)
                                                      YoY (%)           (%)
Market                                                                             Up 6.05 percentage
              239,646.10     86,713.96         63.82          12.66       -3.47
operation                                                                                       points
Sales of                                                                                    Down 0.21
              259,327.86    258,667.18              0.25    575.71      577.11
goods                                                                                percentage points
Hotel                                                                                       Down 8.70
               12,745.36     13,376.12          -4.95       -14.75        -7.04
service                                                                              percentage points
Exhibition     11,953.88     12,296.06          -2.86         24.08      15.66      Up 7.49 percentage

                                               23   / 228
                                            2021 Annual Report


and                                                                                                             points
advertising
Other                                                                                          Up 11.60 percentage
                34,932.61      16,028.14              54.12             43.42        14.48
services                                                                                                     points
                                                                                                       Down 13.86
Sub-total      558,605.81     387,081.46              30.71             82.59       128.24
                                                                                                 percentage points

Explanation of main business by industry, product, region and sales mode
       1. The revenue and cost of product sales increased by 575.71% and 577.11% respectively
year-on-year, mainly due to the large year-on-year increase in the commodity sales business of
import and export companies and supply chain companies in the current period
       2. The revenue of other services increased by 43.42% year-on-year, mainly due to the
information technology services conducted by the big data company.


(2). Table of production and sales analysis
□Applicable √Not Applicable

(3). The performance of major purchage contracts and major sales contracts
□Applicable √Not Applicable


(4).    Cost Analysis Table
                                                                                                   Unit: RMB10,000
                                            Status by industry
                                                                                           Percentage
                                         Proportio                                          change of
                                          n in the                       Proportion in      amount in
                             Amount in                     Amount in
                                         total cost                      the total cost    the current
    By           Cost           the                        the same                                         Situation
                                           in the                         in the prior        period
 industry     components      current                      period of                                        Remarks
                                          current                        correspondin       compared
                              period                       prior year
                                           period                        g period (%)     with the prior
                                            (%)                                           correspondin
                                                                                          g period (%)
              Depreciation
Market
              and            46,031.98       11.89         46,198.46            27.24             -0.36
operation
              amortization
Market        Wages and
                             22,111.44        5.71         20,669.29            12.19              6.98
operation     benefits
Market
              Other costs    18,570.54        4.80         22,967.84            13.54            -19.15
operation
                                                                                                           Mainly due
              Cost      of                                                                                 to      the
Sales of                     258,667.1
              product                        66.82         38,201.55            22.53           577.11     increase in
goods                                8
              sales                                                                                        product
                                                                                                           sales
              Depreciation
Hotel
              and             2,432.99        0.63          2,557.02              1.51            -4.85
service
              amortization
              Cost of food
              and
Hotel
              beverage        4,356.83        1.13          5,969.28              3.52           -27.01
service
              raw
              materials
Hotel         Wages and
                              4,216.87        1.09          4,077.68              2.40             3.41
service       benefits
Hotel         Material and
                                759.03        0.20            716.93              0.42             5.87
service       fuel

                                                      24   / 228
                                         2021 Annual Report


             consumption
Hotel
             Other costs      1,610.40     0.41       1,067.58      0.63         50.85
service
Exhibition   Depreciation
advertisin   and              4,167.15     1.08       3,771.71      2.22         10.48
g service    amortization
             Exhibition
Exhibition
             and
advertisin                    6,311.12     1.63       5,172.71      3.05         22.01
             advertising
g service
             cost
Exhibition
advertisin   Other costs      1,817.79     0.47       1,687.16      0.99          7.74
g service
             Property
Other
             management       2,318.52     0.60       2,237.42      1.32          3.62
services
             cost
             Network
Other        transformatio
                              7,542.35     1.95       7,975.07      4.70         -5.43
services     n        and
             service
                                                                                         Mainly due
                                                                                         to        the
                                                                                         increase in
                                                                                         costs      of
Other                                                                                    warehousin
             Other costs      6,167.27     1.59       3,788.81      2.24         62.78
services                                                                                 g        and
                                                                                         logistics
                                                                                         during
                                                                                         current
                                                                                         period
                                                                                         No income
Real                                                                                     this year,
             Cost of real
estate                               -        -       2,537.33      1.50             -   so it could
             estate sales
sales                                                                                    not        be
                                                                                         compared
                             387,081.4              169,595.8
Total                                    100.00                  100.00         128.24
                                     6                      4
Explanation on cost analysis and other information
None

(5). Changes in consolidation scope due to the changes in main subsidiaries' share
ownership during the report period
□Applicable √Not Applicable

(6). Major changes or adjustment in the Company's business, products or services
□Applicable √Not Applicable

(7). Main sales customers and suppliers
A. Main sales customers of the Company

Case in which the sales to a single customer accounted for over 50% of the total sales, new
customers were added to the list of top 5 customers or the Company relied heavily on a few
customers during the report period
□Applicable √Not Applicable
B. Main suppliers of the Company

Case in which the purchase amount for a single supplier accounted for over 50% of the total
purchase amount, new suppliers were added to the list of top 5 suppliers or the Company relied
heavily on a few suppliers during the report period
                                               25   / 228
                                          2021 Annual Report


□Applicable √Not Applicable

Other statements
None

  3. Costs
√Applicable □Not Applicable
                                                                                        Unit: RMB10,000
    Item            2021         2020         YoY change          Change       Explanation on changes
                                                amount              /%
Sales              20,474.60    24,188.92        -3,714.32         -15.36
expenses
Administrative     45,354.34    37,751.68            7,602.66       20.14
expenses
R&D                 1,030.88     1,850.76             -819.88       -44.30   Due to decrease in expended
expenses                                                                     R&D investment in this period
Financial          17,991.16    18,208.97             -217.81        -1.20
expenses
Income     tax     32,752.52    49,975.50       -17,222.98          -34.46   Due to the YoY decrease in
expenses                                                                     taxable income

                                                                                     Unit: RMB10,000
            Item                     2021                    2020            YoY change     Change / %
                                                                               amount
Staff expenses and work
                                        32,636.89               24,502.91         8,133.98          33.20
clothes
Advertising expenses                     4,564.90                9,441.10        -4,876.20         -51.65
Security and insurance costs             3,830.60                2,711.54         1,119.06          41.27
R&D expenses                             1,030.88                1,850.76          -819.88         -44.30
Depreciation             and
                                         3,869.35                3,868.23              1.12          0.03
amortization
Promotion and investment
                                        12,124.46               10,567.68         1,556.78          14.73
promotion
Intermediary expenses                    2,348.08                3,852.94        -1,504.86         -39.06
Office expenses                          1,761.61                2,003.44          -241.83         -12.07
Water, electricity and fuel
                                            135.19                365.14           -229.95         -62.98
consumption
Rent       and      property
                                            307.15                307.15                  -              -
management
Other expenses                           4,250.71                4,320.47            -69.76         -1.61
Subtotal of management,
                                        66,859.82               63,791.36         3,068.46           4.81
R&D and sales expenses
1. Reasons for YoY increase in staff expenses and work clothes: mainly due to the increase in
performance and the increase in wages with gross wages management methods.
2. Reasones for YoY decrease in advertising expenses: mainly due to the cancellation of oversea
advertising under the influence of the Covid-19 pandemic.

  4. R&D Investment
     (1). Table of R&D investment status
√Applicable □Not Applicable
                                                                                        Unit: RMB10,000
Expended R&D investment in this                                                                 1,030.88
period
Capitalized R&D investment in this                                                               2,860.04
period
                                                26   / 228
                                        2021 Annual Report


Total R&D investment                                                                      3,890.92
Total R&D investment as a percentage                                                          0.64
of operating income (%)
Proportion of capitalization of R&D                                                          73.51
investment (%)

      (2). Table of R&D personnel status
 √Applicable □Not Applicable
Number of R&D personnel                                                                        139
Number of R&D personnel as a percentage of the Company’s
                                                                                              3.29
total personnel number (%)
                               The education level of R&D personnel
Education level                                                   People at this education level
Master's degree                                                                                   7
Bachelor's degree                                                                                99
College graduates                                                                                33
                                       Age of R&D personnel
Age range                                                           People in this age range
Below 30 (30 excluded)                                                                           62
30-40 (30 included, 40 excluded)                                                                 64
40-50 (40 included, 50 excluded)                                                                 11
50-60 (50 included, 60 excluded)                                                                  2
     (3). Reasons for change
□Applicable √Not Applicable
     (4). Reasons for major changes in the composition of the R&D personnel and their infuence
on the Company's future development
□Applicable √Not Applicable

  5. Cash flow
√Applicable □Not Applicable
                                                                                  Unit: RMB10,000
                   Item                            2021              2020             YoY change
Net cash flow      (used)/generated      from     203,308.25          82,878.83          120,429.42
operating activities
Net cash flow (used)/generated from                 165,076.70         63,611.33         101,465.37
investing activities
Net cash flow (used)/generated from                                                      115,390.14
                                                   -170,193.52       -285,583.66
financing activities
(Decrease)/increase in cash and cash                                                     336,789.52
                                                    197,382.55       -139,406.97
equivalents
Analysis of main reasons for changes:
1. The net cash flow from operating activities in 2021 increased by RMB 1.204 billion compared
with that in 2020. Mainly due to an increase of RMB 1.375 billion in net cash deducted from
payment for selling goods and providing services.
2. The net cash flow from investment activities in 2021 increased by RMB 1.015 billion compared
with that in 2020. Mainly because the net outflow of investment during the current period decreased
by RMB 1.958 billion YoY, and cash paid for purchasing and construction of fixed assets, intangible
assets and other long-term assets increased by RMB 830 million YoY.
3. The net cash flow from finacing activities in 2021 increased by RMB 1.154 billion compared with
that in 2020. Mainly because the net inflow of financing during the current period decreased by
RMB 1.385 billion YoY, cash received for absorbed investment decreased by RMB 142 million YoY,
and cash paid for dividends, profits or interest payments increased by RMB 113 million YoY.



                                             27   / 228
                                           2021 Annual Report


(ii) Material changes to profits caused by non-main businesses
□Applicable √Not Applicable

(iii) Analysis of assets and liabilities
√Applicable □Not Applicable
  1. Assets and liabilities
                                                                                         Unit: RMB10,000
                           Propor
                           tion in                       Closing         Percentage
                             total                     balance’s       change of the
               Closing                 Closing
                           assets                      proportion      closing balance
              balance in             balance in                                             Reasons for
   Item                     at the                       in total       of the current
               current                the prior                                               change
                           end of                       assets in     period compared
                period                 period
                              the                       the prior       with the prior
                           current                     period (%)         period (%)
                           period
Total         3,101,463.             2,875,012.
assets
                           100.00                            100.00              7.88
                      55                     71
Monetary                             561,264.2
capital
              483,146.84    15.58                             19.52             -13.92
                                              9
                                                                                          Mainly due to
Held-for-
                                                                                          buying    bank
trading
financial
                7,537.51      0.24     5,171.27                0.18             45.76     wealth
                                                                                          management
assets
                                                                                          products
Accounts
receivable
               18,523.75      0.60    15,357.35                0.53             20.62
                                                                                          Mainly due to
                                                                                          the growth of the
Prepaymen                                                                                 product      sales
ts
               87,516.77      2.82    10,518.75                0.37            732.01     and the increase
                                                                                          in        advance
                                                                                          payment
                                                                                          Mainly due to
                                                                                          recovering      of
Other                                 270,847.8                                           financial
receivables
              135,592.43      4.37                             9.42             -49.94    assistance
                                              1
                                                                                          during the reprot
                                                                                          period
                                      132,946.7
Inventory     132,740.26      4.28                             4.62              -0.16
                                              7
                                                                                          Mainly due to
Other
                                                                                          the increase in
current        24,866.22      0.80    17,972.47                0.63             38.36     overpaid     input
assets
                                                                                          VAT tax
                                                                                          Mainly due to
                                                                                          the increase in
Long-term
receivables
               22,230.74      0.72    12,675.66                0.44             75.38     the financial aids
                                                                                          from        Dubai
                                                                                          project company
                                                                                          Mainly due to
                                                                                          the        capital
                                                                                          increase of joint
Long-term
                                      383,289.7                                           ventures      and
equity        577,245.52    18.61                             13.33             50.60     incease          in
investment                                    5
                                                                                          investment
                                                                                          income by equity
                                                                                          method
Other
equity
instrument
               64,218.80      2.07    66,225.63                2.30              -3.03
s

                                                28   / 228
                                      2021 Annual Report


investment
Other non-
current                            152,392.5
financial
              152,481.93    4.92                         5.30            0.06
                                           3
assets
                                                                                 Mainly bacause
                                                                                 BD zone of the
                                                                                 comprehensive
Property                           196,042.6
investment
              297,393.64    9.59                         6.82           51.70    Bonded    Zone
                                           3                                     was completed
                                                                                 and transferred
                                                                                 in
Fixed                              523,429.3
assets
              507,859.09   16.37                        18.21           -2.97
                                           8
Constructio
n        in   109,057.80    3.52   98,289.19             3.42           10.96
progress
                                                                                 Presented  for
                                                                                 the adjustment
Right-of-
use assets
               22,534.71    0.73            -               -   Not applicable   under the new
                                                                                 standard   for
                                                                                 lease
Intangible                         390,078.1
assets
              404,356.46   13.04                        13.57            3.66
                                           0
Developme                                                                        Mainly due to
nt               635.98     0.02    2,222.31             0.08          -71.38    the transfer-in of
expenses                                                                         intangible assets
                                                                                 Mainly because
                                                                                 the
Long-term                                                                        transformation of
prepaid        18,818.44    0.61   11,072.87             0.39           69.95    Yindu Hotel was
expenses                                                                         completed and it
                                                                                 was transferred
                                                                                 in
Deferred                                                                         Mainly because
income tax     13,573.70    0.44    9,966.43             0.35           36.19    it    was      re-
assets                                                                           determined
                                                                                 Mainly due to
Other non-
                                                                                 prepayment for
current        21,132.96    0.68   15,249.52             0.53           38.58    the pay license
assets
                                                                                 of Kuaijietong
Total         1,638,379.           1,517,541.
liabilities
                           52.83                        52.78            7.96
                      34                   78
Short-term                         125,717.9
borrowings
               94,273.61    3.04                         4.37          -25.01
                                            4
Accounts
payable
               49,336.04    1.59   63,646.38             2.21          -22.48
                                                                                 Mainly due to
Advances                                                                         the increase in
from           15,356.63    0.50   11,275.29             0.39           36.20    advance rent of
customers                                                                        Business Center
                                                                                 and others
                                                                                 Mainly due to
                                                                                 the growth of the
Contract                           244,221.1                                     product     sales
liabilities
              405,841.92   13.09                         8.49           66.18    and the increase
                                           8
                                                                                 in     advances
                                                                                 from customers
                                                                                 Mainly due to
Payroll                                                                          calculation    by
payable
               24,396.48    0.79   16,149.90             0.56           51.06    gross     wanges
                                                                                 method
Tax
payable
               55,949.65    1.80   49,540.05             1.72           12.94
Other         190,874.28    6.15   164,634.5             5.73           15.94
                                           29   / 228
                                        2021 Annual Report


payables                                      6
                                                                                      Mainly due to
Non-
                                                                                      the transfer-in of
current
                                     131,502.6                                        medium        and
liabilities   366,424.19    11.81                           4.57            178.64    long-term notes
due within                                   6
                                                                                      due within one
one year
                                                                                      year
Other
                                     302,360.8
current       308,138.48     9.94                          10.52              1.91
liabilities                                  0
                                                                                      Mainly due to
Long-term
borrowings
               77,125.00     2.49    28,200.00              0.98            173.49    new long-term
                                                                                      borrowings
                                                                                      Mainly due to
                                                                                      the transfer-out
Bonds                                355,216.1                                        of medium and
payable
                       -         -                         12.36           -100.00    long-term notes
                                             7
                                                                                      due within one
                                                                                      year
                                                                                      Mainly due to
                                                                                      the    transfer-in
                                                                                      because of the
Lease
liabilities
               20,594.27     0.66              -               -     Not applicable   adjustment
                                                                                      under the new
                                                                                      standard       for
                                                                                      lease
Estimated
liabilities
               11,062.03     0.36    11,062.03              0.38                  -
                                                                                      Mainly due to
                                                                                      receiving   the
Deferred                                                                              start-work
income
                7,817.01     0.25      2,654.53             0.09            194.48    reward       of
                                                                                      comprehensive
                                                                                      Bonded Zone
Deferred
income tax     11,189.75     0.36    11,360.29              0.40             -1.50
liabilities

Other statements
None
  2. Overseas assets
√Applicable □Not Applicable
(1). Scale of assets
Among them: offshore assets was RMB 636 million, accounting for 2.05% of the total assets.

(2). Explanation one the high proportion of offshore assets
□Applicable √Not Applicable

  3. Encumbrances on major assets as of the end of the reporting period
√Applicable □Not Applicable
                                                                                      Unit: RMB
              Item                                 2021                           2020
Monetary capital                                             60.78                            60.58
Long-term equity investment                         102,918,559.00                  102,918,559.00
Other non-current financial assets                  636,870,392.09                  617,511,352.00
Total                                               739,789,011.87                  720,429,971.58

      1. As of December 31, 2021, bank deposits with a book value of RMB 60.78 (December 31,
2020: RMB 60.58) were restricted for ownership or use rights due to being as security deposits for
obtaining commercial housing mortgage loan.
                                              30   / 228
                                           2021 Annual Report


    2. As of June 30, 2021, long-term equity investments with a book value of RMB
102,918,559.00 (December 31, 2020: RMB 102,918,559.00) and other non-current assets of RMB
636,870,392.09 (December 31, 2020: RMB 617,511,352.00) were frozen by Shanghai Municipal
Public Security Bureau.


4. Other statements
□Applicable √Not Applicable

(iv) Analysis of business information of industry
√Applicable □Not Applicable
For details, please refer to "II. The situation of the industry of the Company" in this section




                                                31   / 228
                                         2021 Annual Report




(v) Analysis of investments
Overview of external equity investment
√Applicable □Not Applicable
    At the end of December 2021, the external investment amount was RMB 8,014,837,600
(including trading financial assets of RMB 75,375,100, investment in other equity instruments of
RMB 642,188,000, other non-current financial assets of RMB 1,524,819,300, and long-term equity
investment of RMB 5,772,455,200) , an increase of 32.02%, or RMB 1,944,045,800, compared with
RMB 6,070,791,800 at the end of the previous year (including trading financial assets of RMB
51,712,700, investment in other equity instruments of RMB 662,256,300, other non-current financial
assets of RMB 1,523,925,300, and long-term equity investment of RMB 3,832,897,500). The main
changes are as follows:
    I. Long-term equity investment during the reporting period increased by RMB 1,939,557,700
YoY, mainly due to:
    1. During the reporting period, the new long-term equity investment was RMB 1,496,216,800,
including RMB 1.225 billion for Yiwu China Commodities City Property Development Co., Ltd. ,
RMB 50 million for Yiwu Huishang Redbud Phase II Investment Partnership (LLP), RMB 44.7918
million for JEBEL ALI FREE ZONE TRADER MARKET DEVELOPMENT AND OPERATION FZCO,
RMB 17.85 million for Yiwu Digital Port Technology Co., Ltd., RMB 1.075 million for Zhejiang
Yixinou Supply Chain Management Co., Ltd., and RMB 150 million for Yiwu Hongyi Equity
Investment Foundation Partnership and RMB 7.5 million for Yiwu Meipingshu Supply Chain
Management Co., Ltd.
    2. Net income from long-term equity investment by equity method of           RMB 599,180,300,
including recovered equity investment from Huishang Redbud of RMB 17,223,600, distributed
dividend form Binjiang Shangbo of RMB 1,372,000, equity dividend from Huishang Redbud of RMB
5,909,200 and other change in equity of Meipingshu of RMB 4,493,400.
    II. During the reporting period, the investment in other equity instruments decreased by RMB
20.0683 million year-on-year, due to the change in fair value of Shenwan Hongyuan Group Co., Ltd.
during the reporting period for RMB -20.0683 million.
    III. During the reporting period, the trading financial assets increased by RMB 23.6624 million
year-on-year, including, an increase of RMB 25 million for purchase of bank wealth management
products, the gains and losses for changes in fair value of Orient International Ventures Co., Ltd.
during the reporting period of RMB -1.3325 million, and an decrease of RMB 5,100 due to selling of
subscribed new stocks.
    IV. During the reporting period, other non-current financial assets increased by RMB 894,000
year-on-year, including: RMB 40 million for Suzhou Xiangzhong Venture Capital Partnership (LLP),
RMB 1 million for Quanzhou Huayun Tiancheng E-commerce Co., Ltd. recovered investment of
RMB 3.1865 million from Suzhou Yiyun Venture Capital Center (LLP), recovered investment of
RMB 7.2012 million from Jiaxing Zhehua Zijin Investment Partnership (LLP), and recovered
investment of RMB 38.2822 million from Beijing Redbud Huaron Equity Investment Co.Ltd., and
increase of RMB 8.5639 million for the gains and losses for changes in fair value.
                                              32   / 228
                                           2021 Annual Report


      The main investment is as follows:
                                                                                           Unit: RMB10,000
                                                                                    Book value
                                                                                    at the end
                                                                                                 Shareholding
     Target                   Main business                    Cost of investment        of
                                                                                                   ratio (%)
                                                                                    December
                                                                                       2021
                  Industry investment, investment
                  management (excluding financial
                  businesses such as securities and
                  futures), property service, design,
Yiwu Shanglv
                  production and agency of domestic
Investment
                  advertising, operation and                           39,200.00     38,366.84         49.00
Development
                  management of parking garages,
Co., Ltd.
                  marketing planning, operation and
                  management consulting, operation and
                  management of shopping malls and
                  business management consulting
Yiwu Rongshang    Real estate development and
Property Co.,     operation, landscape engineering and                  5,000.00     21,738.75         49.00
Ltd.              decoration engineering
Yiwu              Real estate development and sale;
Chuangcheng       lease of proprietary houses; real estate
                                                                        2,000.00      8,806.33         24.00
Property Co.,     brokerage service; interior decoration
Ltd.              service; and landscaping service
Hangzhou
Binjiang
Shangbo           Real estate development and
                                                                        2,450.00      3,447.62         49.00
Property          operation
Development
Co., Ltd.
                  Micro-loans in Yiwu, and consulting
Yiwu Huishang
                  services in connection with the
Micro-finance                                                          12,420.00      8,282.47         23.00
                  development, management and
Co., Ltd.
                  finance for small-sized enterprises
                  Financial lease service; transfer of
                  financial lease assets; fixed-income
                  securities investment; acceptance of
                  lessees’ lease margin; absorption of
Zhejiang
                  time deposit with a term no shorter
Chouzhou
                  than three months from non-bank                      26,000.00     42,602.08         26.00
Financial Lease
                  shareholders; inter-financial
Co., Ltd.
                  institutional lending; borrowing from
                  financial institutions; overseas
                  borrowing; sale and disposal of leased
                  items; and economic consulting
Yiwu China
Commodities
                  Equity investment, investment
City Fuxing
                  management and investment                            10,291.86     10,291.86         49.90
Investment
                  consulting
Center (limited
partnership)
                  Equity investment and related
                  consulting services (without approval
                  of the industry regulatory authorities
Yiwu Huishang     such as the finance regulatory
Redbud Equity     authority, the Company warrants that it
                                                                        3,277.64      7,099.70         10.42
Investment Co.,   will not be engaged in the absorption of
Ltd.              deposits, financial guarantee, agency
                  wealth management, fundraising
                  (financing) from the public and other
                  financial businesses)




                                                  33   / 228
                                               2021 Annual Report


                    Investment management, asset
                    management (excluding the assets
                    subject to special state regulation such
                    as state-owned assets) (the above
                    business scope excludes financial
Yiwu Huishang
                    businesses such as securities and
Redbud Phase II
                    futures; and without approval of the
Investment
                    industry regulatory authorities such as         10,000.00   10,663.80    9.43
Partnership
                    the finance regulatory authority, the
(limited
                    Company shall not be engaged in the
partnership)
                    absorption of deposits, financial
                    guarantee, agency wealth
                    management, fundraising (financing)
                    from the public and other financial
                    businesses)
Yiwu Meipinshu
                    Supply chain management service,
Supply Chain
                    software development, and business               2,570.14    2,737.09   22.11
Management
                    management consulting
Co., Ltd.
                    Services: technology development,
                    technical consulting, technical services
Hangzhou            and achievements transfer of computer
MicroAnts Co.,      hardware and software and network                1,275.00     520.05    49.04
Ltd.                information technologies and webpage
                    design; wholesale and retail: computer
                    software
                    Investment management, equity
                    investment, asset management and
                    investment consulting (without
Yiwu Hongyi
                    approval of the industry regulatory
Equity
                    authorities such as the finance
Investment Fund
                    regulatory authority, the Company shall         84,000.00   88,787.23   49.98
Partnership
                    not be engaged in the absorption of
(limited
                    deposits, financial guarantee, agency
partnership)
                    wealth management, fundraising
                    (financing) from the public and other
                    financial businesses)
Shenwan             Securities brokerage, securities
Hongyuan Group      investment consulting and securities            55,362.54   64,218.80   0.501
Co., Ltd.           underwriting & sponsorship
Beijing Yiyun
Clean
                    Venture capital, agency of other VC
Technology                                                           1,891.82     288.00    15.00
                    institutions or individuals’ VC business
Venture Capital
Co., Ltd.
Shenzhen Tiantu
Investment          PE investment management in the
                                                                    11,438.62    4,788.21   1.536
Management          consumer goods industry
Co., Ltd.
Beijing Redbud
                    Asset management, investment
Huarong Equity
                    management and investment                        6,171.78   13,846.69   12.36
Investment
                    consulting
Partnership
                    Granting of personal consumption
                    loans; acceptance of deposits from
                    shareholders’ domestic subsidiaries
                    and domestic shareholders; lending to
                    domestic financial institutions;
Mashang
                    issuance of financial bonds upon
Consumer                                                             3,000.00    4,854.75    0.75
                    approval; inter-financial institution
Finance Co., Ltd.
                    lending in China; consumption finance-
                    related consulting; agency sale of
                    insurance products related to
                    consumption loans; and fixed-income
                    securities investment


                                                     34   / 228
                                             2021 Annual Report


                   Industry investment, venture capital,
                   investment management, business
                   management, social and economic
Jiaxing Zhehua     consulting. (Operating activities subject
Redbud             to approval in accordance with laws
Investment         shall only be conducted after approval
                                                                   8,152.97   11,562.84     17.51
Partnership        from related authority) [it shall not be
(limited           engaged in the absorption of deposits,
partnership)       financial guarantee, agency wealth
                   management, fundraising (financing)
                   from the public and other financial
                   businesses]
Nantong Redbud
Huatong Equity
                   Equity investment; investment
Investment
                   consulting; and investment                     20,000.00   25,871.01     21.05
Partnership
                   management
(limited
partnership)
Yiwu Shangfu
Chuangzhi          Asset management, investment
Investment         management, and investment                     61,751.14   63,687.04   74.9982
Center (limited    consulting service
partnership)
Yiwu Shanfeng
Investment         Investment management, asset
Partnership        management and investment                       2,600.00    2,388.19     56.40
(limited           consulting
partnership)
                   Network information technology
                   service; computer system integration
                   service; development and technical
                   service of computer hardware and
                   software; wholesale, agency purchase
                   and agency sale of maternal and infant
                   products; online operation of electronic
                   products and components and
Fujian Zongteng
                   accessories thereof, household
Network Co.,                                                       3,000.00   11,151.71    0.6863
                   supplies and components and
Ltd.
                   accessories thereof, and outdoor
                   goods and components and
                   accessories thereof; market research;
                   business management consulting;
                   enterprise marketing planning;
                   international freight forwarding; and
                   domestic trade agency service; and
                   foreign trade
                   Food business; self-operated and
                   agent for the import and export of
                   products and technologies other than
                   those that are uniformly organized or
                   approved by the state, "three forms of
                   OEM and compensation trades" and
                   processing of imported materials,
Oriental           development, production, and sales of
International      biological, pharmaceutical and
                                                                   5,000.00    5,037.36      0.72
Entrepreneurship   chemical products, international freight
Co., Ltd.          forwarding agent, industrial and high-
                   tech industry investment, counter
                   trade, transit trade and service trade,
                   sales: clothing and apparel, shoes and
                   hats, knitwear, leather products,
                   luggage and bags, daily necessities;
                   the second-category medical devices
                   sales.



                                                   35   / 228
                                             2021 Annual Report


Yiwu Guoshen        Real estate development, sale and
Shangbo             lease; real estate brokerage service,
                                                                    2,000.00     2,416.65    49.00
Property Co.,       interior decoration service; and
Ltd.                landscaping service
                    Communication equipment repair;
                    communication equipment sales;
                    communication equipment
                    manufacturing; computer and
                    communication equipment leasing;
                    information technology equipment
                    sales; computer software and
                    hardware and auxiliary equipment
                    wholesale; computer software and
                    hardware and auxiliary equipment
                    retail; information consulting services
                    (excluding licensing information
                    consulting services) ; socio-economic
Yiwu Digital Port   consulting services; advertising design,
Technology Co.,     agency; advertising production;                 2,550.00     2,463.91    51.00
Ltd.                advertising publishing (excluding
                    channels such as radio, television,
                    newspaper publishing units); technical
                    services, technology development,
                    technology consulting, technology
                    exchange, technology transfer,
                    technology promotion; software
                    development; sales of chemical
                    product (excluding licensed chemical
                    products); business agent services;
                    general goods warehousing services
                    (excluding hazardous chemicals and
                    other items that require license
                    approval)
Yiwu China          Real estate development, sales,
Commodities         leasing (used together with valid
City Property       qualification certificates), real estate      271,854.77   275,693.84    49.00
Development         brokerage services, interior decoration;
Co., Ltd.           landscaping
Pujiang Lvgu
                    Real estate development, sales,
Property Co.,                                                      37,365.79    45,928.14    49.00
                    leasing and property management
Ltd.
Yiwu Shanyue
Equity              Equity investment; equity investment
Investment          fund management, investment
                                                                    2,000.00     1,689.66    39.60
Partnership         consulting, and operation and
(limited            management of state-owned assets
partnership)
Jebel Ali Free
Zone Trader
                    Lease and management of proprietary
Market
                    properties; and lease and management            7,350.28     6,415.00    30.00
Development
                    of the properties owned by others
and Operation
FZCO
Suzhou
Xiangzhong
                    Venture capital (limited to investment
Venture Capital
                    in unlisted enterprises); Equity                4,000.00     4,042.17   10.259
Partnership
                    investment
(Limited
Partnership)




1. Major equity investments
√Applicable □Not Applicable
                                                    36   / 228
                                                           2021 Annual Report



                                                                                                     Percentage
                                                                                        Actual
                                                                                                        in total
                                                                                      investment
                                                                                                    equity in the
                                                                                        amount
                                                                                                       invested
          Target                              Main business                            during the                   Remarks
                                                                                                      project By
                                                                                       reporting
                                                                                                      the end of
                                                                                         period
                                                                                                    the reporting
                                                                                     (RMB10,000)
                                                                                                     period (%)
                                                                                                                    The subscribed
                                                                                                                    capital was RMB
                                                                                                                    2.45 billion, and as
Yiwu China Commodities   Real estate development, sales, leasing (used together
                                                                                                                    of the end of the
City Property            with valid qualification certificates), real estate          122,500.00           49.00
                                                                                                                    reporting period, the
Development Co., Ltd.    brokerage services, interior decoration; landscaping
                                                                                                                    actual capital
                                                                                                                    contributed was
                                                                                                                    RMB 2.45 billion
                         Investment management, equity investment, asset
                                                                                                                    The subscribed
                         management and investment consulting (without
                                                                                                                    capital was RMB 10
Yiwu Hongyi Equity       approval of the industry regulatory authorities such as
                                                                                                                    billion, and as of the
Investment Fund          the finance regulatory authority, the Company shall not
                                                                                        15,000.00          49.98    end of the reporting
Partnership (limited     be engaged in the absorption of deposits, financial
                                                                                                                    period, the actual
partnership)             guarantee, agency wealth management, fundraising
                                                                                                                    capital contributed
                         (financing) from the public and other financial
                                                                                                                    was RMB 840 million
                         businesses)
                         Investment management, asset management (excluding
                         the assets subject to special state regulation such as
                                                                                                                    The subscribed
                         state-owned assets) (the above business scope
                                                                                                                    capital was RMB 100
Yiwu Huishang Redbud     excludes financial businesses such as securities and
                                                                                                                    million, and as of the
Phase II Investment      futures; and without approval of the industry regulatory
                                                                                         5,000.00           9.43    end of the reporting
Partnership (limited     authorities such as the finance regulatory authority, the
                                                                                                                    period, the actual
partnership)             Company shall not be engaged in the absorption of
                                                                                                                    capital contributed
                         deposits, financial guarantee, agency wealth
                                                                                                                    was RMB 100 million
                         management, fundraising (financing) from the public
                         and other financial businesses)
                                                                                                                    The subscribed
                                                                                                                    capital was AED
Jebel Ali Free Zone                                                                                                 50.40 million, and as
                         Lease and management of proprietary properties; and
Trader Market                                                                                                       of the end of the
                         lease and management of the properties owned by                 4,479.18             30
Development and                                                                                                     reporting period, the
                         others
Operation FZCO                                                                                                      actual capital
                                                                                                                    contributed was AED
                                                                                                                    40.50 million
                                                                                                                    The subscribed
                                                                                                                    capital was RMB 200
Suzhou Xiangzhong
                                                                                                                    million, and as of the
Venture Capital          Venture capital (limited to investment in unlisted
                                                                                         4,000.00           8.00    end of the reporting
Partnership (Limited     enterprises); Equity investment
                                                                                                                    period, the actual
Partnership)
                                                                                                                    capital contributed
                                                                                                                    was RMB 40 million
                         Communication equipment repair; communication
                         equipment sales; communication equipment
                         manufacturing; computer and communication
                         equipment leasing; information technology equipment
                         sales; computer software and hardware and auxiliary
                         equipment wholesale; computer software and hardware
                                                                                                                    The subscribed
                         and auxiliary equipment retail; information consulting
                                                                                                                    capital was RMB
                         services (excluding licensing information consulting
                                                                                                                    25.50 million, and as
                         services) ; socio-economic consulting services;
Yiwu Digital Port                                                                                                   of the end of the
                         advertising design, agency; advertising production;             1,785.00          51.00
Technology Co., Ltd.                                                                                                reporting period, the
                         advertising publishing (excluding channels such as
                                                                                                                    actual capital
                         radio, television, newspaper publishing units); technical
                                                                                                                    contributed was
                         services, technology development, technology
                                                                                                                    RMB 25.50 million
                         consulting, technology exchange, technology transfer,
                         technology promotion; software development; sales of
                         chemical product (excluding licensed chemical
                         products); business agent services; general goods
                         warehousing services (excluding hazardous chemicals
                         and other items that require license approval)


            2. Major non-equity investments
            √Applicable □Not Applicable

                                                                   37   / 228
                                                             2021 Annual Report


                                                                                                  Unit: RMB10,000
                                                                                                                     Investmet
                                                                                                                                      Accumulative
                                          Project                                                                    amount in
                 Item                                                           Progress                                                invested
                                          amount                                                                       current
                                                                                                                                         amount
                                                                                                                       period
                                                        The underground space and office building have
West Yiwu International Means of                        been delivered, the hotel decoration has been
                                          133,916.00                                                                   4,625.49         100,733.97
Production Market Auxiliary Project                     completed, and the acception of fire fighting
                                                        equipment has not been completed
Haicheng Yiwu China Commodities
City Commerce Phase I Project—           180,000.00    The main work is under construction                                       -       3,229.05
Hotel Project
                                                        Construction of BD warehouse and customs
                                                        seperation net has been completed, installment of
                                                        refrigeration houses of D3 and D6 was under
Phase I Project of Yiwu Integrated
                                          624,250.00    construction, 83% of the underground space of                 90,342.12         140,921.35
Free Trade Zone
                                                        south zone project of the import market has been
                                                        completed, and the contractor for the north zone
                                                        has started construction
                                                        The main work has been basically completed, 60%
                                                        of the outdoor ancillary pipelines on the south side
East Parking Building Project of Zone
                                           60,706.00    and one the north side have been completed, and               26,875.31          35,548.60
2 of Yiwu International Trade City
                                                        90% of the decoration of the first and second floors
                                                        has been completed.
                                                        The main work for basement has been completed,
Yiwu Digital Trade Industrial Park         39,579.00    and 50% of the main work for first and second floors           6,007.08           6,007.08
                                                        has been completed


            3. Financial assets measured with fair value
            √Applicable □Not Applicable
                                                                                                  Unit: RMB10,000
                                                                                               Gains or
                                              Initial                                           losses
                                                             Opening          Closing                            Accounting           Source of
                        Name               investment                                         during the
                                                            book value       book value                             item               funds
                                               cost                                           reporting
                                                                                                period
        Jiangsu Times Knitting                                                                                 Held-for-trading       Self-owned
                                                    0.15                 -           0.15                  -
        Technology Co., Ltd.                                                                                   financial assets         funds
                                                                                                               Held-for-trading       Self-owned
        Wealth management products                      -                -       2,500.00                  -
                                                                                                               financial assets         funds
        Oriental International                                                                                 Held-for-trading       Self-owned
                                               5,000.00        5,170.61          5,037.36         -75.34
        Entrepreneurship Co., Ltd.                                                                             financial assets         funds
                                                                                                                 Other equity
        Shenyin & Wanguo Securities                                                                                                   Self-owned
                                              55,362.54       66,225.63         64,218.80       1254.27           instruments
        Co., Ltd.                                                                                                                       funds
                                                                                                                   investment
        Jiaxing Zhehua Redbud                                                                                      Other non-
                                                                                                                                      Self-owned
        Investment Partnership (limited       10,000.00       12,016.76         11,562.84         561.66             current
                                                                                                                                        funds
        partnership)                                                                                           financial assets
                                                                                                                   Other non-
        Beijing Redbud Huarong Equity                                                                                                 Self-owned
                                              10,000.00       17,557.86         13,846.69       1,774.12             current
        Investment Co., Ltd.                                                                                                            funds
                                                                                                               financial assets
        Nantong Redbud Huatong                                                                                     Other non-
                                                                                                                                      Self-owned
        Equity Investment Partnership         20,000.00       25,484.32         25,871.01         386.70             current
                                                                                                                                        funds
        (limited partnership)                                                                                  financial assets
                                                                                                                   Other non-
        Beijing Wudaokou Education                                                                                                    Self-owned
                                                 500.00           61.64             59.38          -2.25             current
        Technology Co., Ltd.                                                                                                            funds
                                                                                                               financial assets
                                                                                                                   Other non-
        Zhejiang Yiwu Tap Water Co.,                                                                                                  Self-owned
                                                 100.00        2,320.60          3,064.89         817.19             current
        Ltd.                                                                                                                            funds
                                                                                                               financial assets
                                                                                                                   Other non-
        Yiwu Water Resources                                                                                                          Self-owned
                                                 200.00        1,510.00          1,860.00         350.00             current
        Development Co., Ltd.                                                                                                           funds
                                                                                                               financial assets
                                                                                                                   Other non-
        Suzhou Yiyun Venture Capital                                                                                                  Self-owned
                                               4,000.00       12,351.95          2,957.37      -9,075.93             current
        Center (limited partnership)                                                                                                    funds
                                                                                                               financial assets
                                                                                                                   Other non-
        Beijing Yiyun Clean Technology                                                                                                Self-owned
                                               6,091.82          360.00            288.00         -72.00             current
        Venture Capital Co., Ltd.                                                                                                       funds
                                                                                                               financial assets
                                                                                                                   Other non-
        Mashang Consumer Finance                                                                                                      Self-owned
                                               3,000.00        5,167.50          4,854.75        -312.75             current
        Co., Ltd.                                                                                                                       funds
                                                                                                               financial assets
                                                                   38   / 228
                                                      2021 Annual Report


                                                                                                           Other non-
Shenzhen Tiantu Investment                                                                                                  Self-owned
                                        11,802.00        4,812.23            4,788.21        -24.02         current
Management Co., Ltd.                                                                                                          funds
                                                                                                        financial assets
                                                                                                           Other non-
Yiwu Shanfeng Investment                                                                                                    Self-owned
                                         2,600.00        2,600.00            2,388.19       -211.81         current
Partnership (limited partnership)                                                                                             funds
                                                                                                        financial assets
                                                                                                           Other non-
Cheng Jian Bao (Beijing)                                                                                                    Self-owned
                                           150.00          150.00              150.00             -         current
Consulting Services Co., Ltd.                                                                                                 funds
                                                                                                        financial assets
Yiwu Shanyue Equity                                                                                        Other non-
                                                                                                                            Self-owned
Investment Partnership (limited          2,000.00        2,000.00            1,689.66       -310.34         current
                                                                                                                              funds
partnership)                                                                                            financial assets
                                                                                                           Other non-
                                                                                                                            Self-owned
Yiwu Smart Transport Co., Ltd.             120.00          120.00              120.00             -         current
                                                                                                                              funds
                                                                                                        financial assets
                                                                                                           Other non-
Fujian Zongteng Network Co.,                                                                                                Self-owned
                                         3,000.00        4,128.53           11,151.71      7,023.18         current
Ltd.                                                                                                                          funds
                                                                                                        financial assets
Yiwu Shangfu Chuangzhi                                                                                     Other non-
                                                                                                                            Self-owned
Investment Center (limited              61,751.14       61,751.14           63,687.04      1,935.90         current
                                                                                                                              funds
partnership)                                                                                            financial assets
Suzhou Xiangzhong Venture                                                                                  Other non-
                                                                                                                            Self-owned
Capital Partnership (Limited             4,000.00                   -        4,042.17        42.17          current
                                                                                                                              funds
Partnership)                                                                                            financial assets
                                                                                                           Other non-
Quanzhou Huayun Tiancheng                                                                                                   Self-owned
                                           100.00                   -          100.00             -         current
E-commerce Co., Ltd.                                                                                                          funds
                                                                                                        financial assets


    4. Specific progress of major asset restructurings during the report period
    □Applicable √Not Applicable

    (vi) Major sales of assets and equity
    □Applicable √Not Applicable
    (vii)     Analysis of major subsidiaries and associates
    √Applicable □Not Applicable
                                                                                             Unit: RMB10,000
                                                                        Registere
  company name                          Business                                        Total assets       Net assets         Net profits
                                                                        d capital

Yiwu Shangbo Property
                            Real estate development and sale             30,000.00          37,435.89          34,399.30           -463.59
Co., Ltd.

Yiwu Commodities City
Gonglian Property Co.,      Real estate development and sale             20,000.00          16,438.80          15,869.41             31.56
Ltd.
Yiwu China
Commodities City            R&D of computer and multimedia
                                                                            5,000.00         9,091.41            5,280.63          297.86
Information Technology      software
Co., Ltd.
                            Computer software, multimedia
Zhejiang Yiwugou E-
                            technologies, computer network and           10,000.00          12,799.94            9,146.40           659.45
commerce Co., Ltd.
                            application, and wholesale & retail
Yiwu China
Commodities City            R&D of computer and multimedia
                                                                         15,000.00          12,150.37          12,079.28           -207.35
Payment Network             software
Technology Co., Ltd.
Yiwu China
Commodities City            Ordinary cargo transport and goods
                                                                         10,000.00           5,757.70            4,402.28          -450.52
Logistics and               warehousing
Warehousing Co., Ltd.
Yiwu China
Commodities City
                            Supply chain management service              10,000.00          20,518.22            5,920.57        -1,600.48
Supply Chain
Management Co., Ltd.
Yiwu China
                            Domestic trade and international
Commodities City Import                                                  10,000.00         101,833.20            2,394.38        -2,708.45
                            trade
and Export Co., Ltd.

                                                               39   / 228
                                                      2021 Annual Report



Yiwu China                Enterprise free capital investment,
Commodities City          asset management, investment
                                                                     400,000.00    261,215.67    248,251.50   14,068.48
Financial Holdings Co.,   consulting services, investment
Ltd.                      management services

                          Development of tourism resources
                          and tourism projects; domestic
Yiwu China
                          tourism business, inbound tourism
Commodities City
                          business; tourism information               10,000.00     13,975.64      8,673.59     -338.25
Tourism Development
                          consulting; and wholesale of fruits,
Co., Ltd.
                          vegetables, aquatic products and
                          primary edible agricultural products
Yiwu China
Commodities City          Overseas industry investment, and
Overseas Investment       construction and operation of               10,000.00     25,073.63      8,461.32     -659.79
and Development Co.,      overseas shopping malls
Ltd.
                          Industry investment, investment
                          management, property service,
                          operation and management of
Yiwu Shanglv
                          parking garages, business
Investment Development                                                80,000.00    142,761.41     81,538.15    3,543.88
                          marketing planning, operation and
Co., Ltd.
                          management consulting, and
                          operation and management of
                          shopping malls

Yiwu China
Commodities City
                          Real estate development and sale           500,000.00   1,535,632.15   570,679.62   14,621.40
Property Development
Co., Ltd.


Pujiang Lvgu Property
                          Real estate development and sale            70,000.00    123,263.12     91,806.52   16,246.73
Co., Ltd.


                          Industry investment, investment
Zhejiang Huajie
                          management, investment consulting,
Investment and                                                        50,000.00      8,315.07      8,217.15     -337.66
                          business information consulting, and
Development Co., Ltd.
                          asset management services
                          Internet data services; professional
                          design services; intelligent control
Yiwu China                system integration; computer
Commodities City Big      information technology                      10,000.00     27,354.40      8,610.84    2,747.00
Data Co., Ltd.            development, technical consulting,
                          technical services, technology
                          transfer, etc.
                          Industry investment, investment
                          management, property service,
                          market development and operation,
Haicheng Yiwu China
                          market auxiliary service, real estate
Commodities City
                          development, sale and lease,                60,000.00    224,577.91    -85,986.09   -14,685.04
Investment Development
                          design, production and agency of
Co., Ltd.
                          domestic advertising, and operation
                          and management of parking
                          garages
                          Property management; low-
                          temperature storage; general goods
Yiwu Comprehensive        warehousing services (excluding
Bonded Zone Operation     hazardous chemicals and other
                                                                      10,000.00      4,250.84       545.15     -1,097.12
and Management Co.,       items that require license approval);
Ltd.                      information consulting services;
                          warehousing equipment rental
                          services, etc.

                          Container handling; land transport-
BETTER SILK ROAD          related services; and land transport
                                                                      RF27,000          85.35       -118.98       -88.06
RWANDA Ltd                supporting activities-related
                          business




                                                             40   / 228
                                                       2021 Annual Report



Hangzhou Binjiang
Shangbo Property            Real estate development and sale                5,000.00     11,071.23      7,807.93    3,566.03
Development Co., Ltd.

Yiwu Rongshang
                            Real estate development and sale            10,204.08       572,489.20     44,364.80   39,544.26
Property Co., Ltd.


Yiwu Huishang Micro-
                            Micro loans                                 54,000.00        36,356.87     36,010.74    1,002.29
finance Co., Ltd.


Zhejiang Chouzhou           Financial lease service, and transfer
                                                                       100,000.00      1,434,774.71   163,854.17   20,984.32
Financial Lease Co., Ltd.   of financial lease assets


Yiwu Huishang Redbud
                            Equity investment and related
Equity Investment Co.,                                                  49,000.00        77,785.77     68,135.31   10,113.63
                            consulting services
Ltd.
Yiwu Huishang Redbud
Phase II Investment         Investment management and asset
                                                                       106,100.00       100,342.94    100,342.94      536.46
Partnership (limited        management
partnership)
Yiwu Hongyi Equity
                            Investment management, equity
Investment Fund
                            investment, asset management and           200,100.00       177,701.00    177,663.28    9,749.03
Partnership (limited
                            investment consulting
partnership)

Jebel Ali Free Zone         Lease and management of
Trader Market               proprietary properties; and lease                AED
                                                                                        104,546.72     20,901.34   -1,384.10
Development and             and management of the properties            16,800.00
Operation FZCO              owned by others
                            Real estate development, sale and
Yiwu Guoshen Shangbo        lease; real estate brokerage service,
                                                                            4,081.63   1,336,782.47     4,931.94    7,409.91
Property Co., Ltd.          interior decoration service; and
                            landscaping service
                            Real estate development and sale;
                            lease of proprietary houses; real
Yiwu Chuangcheng
                            estate brokerage service; interior              8,333.33    391,010.26     36,693.05   31,495.95
Property Co., Ltd.
                            decoration service; and landscaping
                            service


    (viii)    Structured entities controlled by the Company
    □Applicable √Not Applicable
    VI. Discussion and Analysis of the Company's Future Development
    (i) Industry Pattern and Trends
    √Applicable □Not Applicable
        1. National policies for the industry
          (1) National policies
          In December 2021, the General Office of the State Council issued the "Opinions on Doing a
    Good Job in Cross-Cycle Adjustment and Further Stabilizing Foreign Trade". From strengthening
    fiscal, taxation and financial policy support, further encouraging the development of new foreign
    trade formats, alleviating the pressure on foreign trade supply chains such as international logistics,
    and supporting key industries and key enterprises, 15 policy measures have been proposed in
    other aspects to ensure orders, stabilize expectations, and promote the steady development of
    foreign trade. In the same month, the General Office of the State Council issued the "Opinions on
    Promoting the Integrated Development of Domestic and Foreign Trade", making arrangements for
    promoting the integration of domestic and foreign trade, forming a strong domestic market,


                                                              41    / 228
                                            2021 Annual Report


smoothing the domestic and international dual circulation, and promoting the realization of higher-
level opening up and higher-quality development.
    (2) Local policies
    The 2022 Yiwu Municipal Government Work Report puts "market upgrading action" at the top
of the ten major actions implemented by the city, emphasizing that "the market is the root and soul
of Yiwu, and the prosperity of the market would make Yiwu prosperous. It should always be insisted
that the market should be put at the center, the city should be built around the market, and
industries should be nurtured around the market, so as to promote the continued prosperity of the
market. "
    In January 2022, Yiwu held the 15th session of Party Congress. The report of the session
pointed out, "The overall requirement for the next five years is to focus on the overall goal of
building a high-quality and high-level world capital of small commodities, and to compete on the
three new tracks of 'digitalization, dual circulation, and common wealth'".
    2. New trends of international trade
    (1) New trends of international trade
    The trend of "multiple varieties, multiple batches, and small batch size" in international trade
has gradually formed. This is due to the fluctuation of upstream raw material prices and the disorder
of the global supply chain. On the other hand, changes in form of downstream retail and disrtibution,
development and penetration of e-commerce and changes in consumer habits have also
contributed to the further fragmentation of international trade.
    Fragmented international trade order flow requires matching fragmented contract performance
capabilities, which brings opportunities and challenges to global supply chains and corporate
fulfillment capabilities. At the same time, the rise of emerging traffic-driven business flow models
represented by independent websites, KOLs and live e-commerce has further increased the
demand for fragmented contract performance capabilities. The core of the long-term growth of
emerging traffic forms still depends on the contract performance side to reconstruct new
consumption by systematic operation, supply chain optimization, and reverse empowerment.
    (2) Yiwu in the context of new trends
    Yiwu is a key node of China's new foreign trade form, an international trade highland, a
demonstration area for digital dual circulation and common prosperity, and has core resources for
cross-border trade development. In the context of the new trends of international trade
fragmentation and the entry into force of RCEP, the Company promoted the upgrading of the Yiwu
market from the "collection of merchants" model to the mode of "collection of merchants and goods",
and led Yiwu market traders to seize the historic opportunity of the RCEP agreement taking effect,
and enhance the influence of Yiwu as a "world commodity land". The entry into force of the RCEP
agreement is beneficial to Yiwu, which takes the advantages of a large number of foreign buyers, a
complete range of market commodities, and a smooth internal and external logistics hub, to better
meet the small batch and multi-frequency trade needs of foreign buyers, and uses export to drive
transhipment by "consolidation and re-export of maket purchased goods + bonded imported goods ",
to further reduces the cost of enterprise logistics and customs declaration, promotes the integrated

                                                 42   / 228
                                           2021 Annual Report


development of "import, export and transhipment" of foreign trade, and help Yiwu to build a
domestic and international dual-circulation strategic node and a world commodity distribution center.

(ii) Development strategies of the Company
√Applicable □Not Applicable
     At the Fifth China-Africa Entrepreneurs Conference, General Secretary Xi Jinping called Yiwu
the world "Capital of Small Commodities", pointing out the direction for the development of the
market and the Company. With the historical mission of building the world "Capital of Small
Commodities" with high quality and high level, the Company has put forward the development
strategy of "taking the market as the main business, taking the digit as the link, and taking platform
as the support to build a comprehensive service provider for international trade", to build a real
economy ecology with the market as the core and a digital economy ecology with the chinagoods
platform as the core. The Company connects the Company's market, logistics, trade, finance and
other sectors with digital links to form a full-scene, full-link, and diversified service system, to reduce
the cost of small commodity trade characterized by "multiple varieties, multiple batches, and small
batch size". and improve convenience level of trade. The Company drives the market trade system
of "online-offline integration, import-export linkage, cross-border communication, and co-prosperity
of domestic trade and foreign trade" to develop into depth, to serve dual circulation of domestic
circulation and international circulation in the historical context of common prosperity.

(iii) Business plan
√Applicable □Not Applicable
      2022 is the 40th anniversary of the construction of Yiwu market and also the 44th anniversary
of China's reform and opening-up. From "exchanging chicken feather for sugar" by wandering
around streets to world "Capital of Small Commodities", in lack of own resources, Yiwu has
connected itself to a big world with small commodities, driving surrounding industries' prosperous
development, leading entrepreneurs to commom prosperity, and leaving a distinct mark on the
milestone of China's reform and opening-up. Yiwu has grown up with the support of China's reform
and opening-up and in the mode of "globalization". In continuous reform and iteration, "taste of
truth" and Yiwu's development experience, together with Yiwu' unique business gene, have
sedimented, fermented and developed.
    In 2022, the Company will continue to focus on the strategic goal of building the world "Capital
of Small Commodities" with high quality to speed up the market's innovative development and the
Company's transformation and upgrading. Facing the opportunities and challenges brought by the
fragmentation trend of international trade to the contract performance side, as well as the
opportunity of the entry into force of RCEP, the Company will combine its own resources and the
characteristics of the market procurement trade mode to focus on opening up the whole link of the
supply chain for export, invest in the construction of RCEP-related links, grab the increment,
promote the market's development for domestic and foreign trades in parallel, and enhance the
Company's core competitiveness and profitability.
    Business plan goals of 2022: based on 2019 performance, operating revenue growth rate is not
less than 120%; earnings per share is not less than RMB 0.22; the above two indicators are not
less than 75% of those of the Company's benchmarking enterprise or average of the industry; main
                                                 43   / 228
                                          2021 Annual Report


business income accounts for not less than 90% of operating income; GMV of chinagoods platform,
which is the innovative business of the Company, is not less than RMB 24 billion.
    1. Market operation
    The Company will start the construction of the market in Zone VI of the International Trade City
to create a new generation of market leading the global trade fashion. The Company will iteratively
upgrade the International Trade City in terms of market form, business space, hardware facilities,
and service value adding, and build the International Trade City into a new trading model leading
area, a new industry cultivation window, a new trade service gathering area, and a new business
social habitat. , making it a new driver for Yiwu market development and a new benchmark for
market form.
    The Company will speed up the construction of the Zone II east market, focus on new digital
infrastructure such as AI assistants, smart transportation, green and low-carbon, create a new
digital market scenario integrating digital trade, service and management, and provides full life cycle
services for trade entities. The Zone II east market is scheduled to start trial operation in October
2022.
    2. Chinagoods platform
    In 2022, the Company will focus on "market procurement 2.0" and take digital reform as an
incision to realize data sharing and system connection between the chinagoods platform and the
networked information platform. The Company will design various digital service products, and
realize the integration of the four orders of "purchase order, delivery order, customs declaration and
foreign exchange settlement order" with "one order to the end", enhance the comprehensive
operation ability and service level of the platform, and strive to build a comprehensive application
for trade with business flow as the core, logistics as the basis, information flow as the guider, and
capital flow as the support, to empower free trade scenarios for small commodities. By the end of
2022, the Company will strive to build a full-link, full-scenario and digitalized market trade
ecosystem on the chinagoods platform.
    The construction of basic functions of chinagoods platform will be enhanced. The rating of
market taders will be improved, 2000 benchmarking traders will be cultured and 10000 core traders
will be incubated. A customer service system will be built, along with an integrity guarantee system,
and online and offline resources will both be used to promote the matching of procurement
demands. The Company will create an all-media matrix, establish a value-added service system
such as advertising, publicity and promotion on the platform for for shops, and improve the market-
oriented operation capability of the platform.
    The construction of digital tade platform will be sped up. The Company will open up data
channels and improve online service functions in various links such as R&D and production, display
and transaction, warehousing and logistics, customs inspection and foreign exchange tax, payment
and settlement, and supply chain finance. As of the end of the reporting period, the Company held
the licenses for factoring, credit investigation, small loans, and foreign currency exchange, and the
delivery procedures for the payment license was also in progress, which would form a closed loop
of payment flow and information flow. Relying on the real trade background and the Internet

                                                 44   / 228
                                           2021 Annual Report


technology of the chinagoods platform, the Company will build a circular and ecological multi-win
growth pole centered on factoring business, provide comprehensive Internet supply chain financial
solutions for micro, small and medium-sized enterprises in sub-sectors, and promote the intelligent
digitization of production relations and production factors in all aspects of international trade.
    3. Supply chain system
    The goods collection mode of "goods collection warehouse in industrial base - main logistic line
- Yiwu warehouse" will be built. The Company plans to build an international digital logistics market
and the construction of phase I project has started.
    The Company will promote the construction of hub facilities for foreign trade of small
commodities. The Company will continue to invest in offshore exhibition and trade platforms such
as oversea warehouse and oversea branch market, innovate operation mode and drive the growth
of foreign trade. The Company will speed up the construction of oversea warehouses owned by
Yiwu and warehouses in regions such as Guangxi and Yunnan ajoining RCER member states,
strive to build 40 new oversea warehouses, and accumulate over 160 in 2022. In 2022, the
Company will strive to cover 15 RCEP member states with oversea warehouse digital trade hub,
improve the RECP regional trade hub network, and promote high-quality development of two-way
trade.
    4. Import-export trade
    The Company will build a trade ecology of "All good commodities". The Company will upgrade
the business models of ICMall and Yiwu Selection, integrate the product advantages of "Imported
good commodities+ Trendy domestic commodities", invest in offline retail stores, and launch the
"All good commodities" chain management platform to create an online-offline O2O trade ecology.
    The Company will integrate into the RCEP trade ecology, integrate the full-link resources of
import trade, gather imported brands, commodities, and import trade ecological service enterprises,
and provide a free exhibition and trade platform for global commodities. In the future, Yiwu China
Imported Commodities City will set up more than 100 national pavilions and special product
exhibition halls for imported commodities including RCEP member states, and deploy more than
10,000 domestic distribution outlets for imported commodities to share and expand development
opportunities for import.
    The Company will actively explore offshore trade relying on market. Through the layout of
overseas warehouses, overseas parks and other overseas station nodes, the Company will actively
explore the development of offshore trade, to organize trade service providers in Yiwu, supply or
process commodities in RCEP member states, and directly sell them to other foreign customers in
regions such as Europe and the United States, creating a "world commodity land".
    5. Organization and mechanism support system
    The Company will promote the improvement of enterprise management effectiveness and
efficiency, and effectively promote the modernization of the governance system and governance
capacity. The Company will promote the reform of mixed ownership, focus on key areas and key
links of market transformation, and speed up the introduction of leading enterprises in the industry
chain in logistics, warehousing, supply chain finance, cross-border settlement and other aspects as

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strategic investors to stimulate business innovation vitality and improve the ability and level of
empowering the market. The Company will improve the authorization, assessment, and incentive
mechanism, adhere to the transformation from operational control to strategic control, revise and
improve the authorization list, implement classified and hierarchical authorizations for branches and
subsidiaries, and give subordinate companies more operational autonomy. The Company will
strengthen the assessment of operating efficiency, deeply implement the classification assessment
for operating company and management company, increase the weight of profit and revenue
indicators of operating company, and explore customized assessment of innovative businesses.
The Company will strengthen the application of assessment results, prudently implement the
excess profit sharing plan, and continue to implement medium- and long-term incentives such as
share option (or share)     incentives and co-investment to further enhance the driving force for
business innovation and development. The Company will strengthen the construction of human
resources, form a benign cadre echelon, increase the market-oriented recruitment of mid-to-high-
end professional talents for innovative businesses, innovate employee training and career
development mechanisms, strengthen the construction of corporate culture, and provide strong
support in talents for market innovation and development and enterprise transformation and
improvement.

(iv) Potential risks
√Applicable □Not Applicable
     1. Market operation risk
    Large-sized shopping malls, hypermarkets, warehouse stores and e-commerce platforms are
strong competitors in the commodities trading market. Large-sized shopping malls offer products of
reliable quality and well-known brands; hypermarkets or warehouse stores supply diversified
products at low prices; e-commerce platforms provide new trading means and facilitate consumers.
Purchasers or consumers may also choose to make procurement or consumption via e-commerce
platforms for convenience. Therefore, the Company may compete with other forms of business. In
addition, affected by the rising specialized market, robust development of the industry market and
rapid development of the central and western regions, the Company may also face competition
from other similar specialized markets.
    2. Risk of insufficient reserve of talents
    With the acceleration of market transformation and the expansion of the Company’s business,
and with the expansion of experienced international trade, warehousing and logistics, supply chain,
overseas development, information data, industrial investment, and business operations, the
Company may face the risk of insufficient reserves of professional talents and compound talents.
    3. The risk of increasing external uncertainty
    In the context of the normalization of epidemic prevention and control, the development of
global market trade is more complicated and severer than before. The global spread of the
epidemic and reverse globalization are parallel, and the downward pressure on the world economy
has increased. New technologies have accelerated the birth of new opportunities, and new trade
models and new business formats have emerged. In the post-epidemic era, uncertainty will become

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the greatest certainty for the development of market trade, and the global epidemic will continue for
a long time, showing a repeated see-saw state. Epidemic prevention and control, international
politics, and global economy are intertwined. Uncertainty, instability, and restructuring of
international trade will become the new normal. The Company may face the risk of increased
external uncertainty.


(v) Others
□Applicable √Not Applicable

VII. The Company failed to disclose and explain the reasons in accordance with the
     standards due to special reasons such as non-applicable standards or state secrets and
     trade secrets.
□Applicable √Not Applicable




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                          Section IV. Corporate Governance
I.   Description of corporate governance
√Applicable □Not Applicable
    During the report period, in strict accordance with the Company Law, Securities Law,
Guidelines for Corporate Governance of Listed Companies and the relevant provisions of the China
Securities Regulatory Commission and other laws and regulations, the Company continuously
establishes and improves relevant systems, strives to improve the corporate governance structure,
standardize operations, and operate in compliance with laws. There is no difference between the
corporate governance structure of the Company and the regulatory documents on the governance
of listed companies issued by the China Securities Regulatory Commission.
    (I) Shareholders and general meetings of shareholders
    The Company convenes and holds a general meeting of shareholders in strict accordance with
the Rules of Procedure for the General Meeting of Shareholders to ensure that all shareholders of
the Company fully exercise their rights, especially those of small and medium shareholders. In
peacetime, we earnestly receive visits and calls from shareholders to ensure the shareholders’
rights to know, participate and vote on major company issues, so that shareholders can truly enjoy
equal rights.
    (II) Controlling shareholder and the listed company
    The controlling shareholder of the Company exercised the rights of investors through the
general meeting of shareholders in accordance with the law, and did not directly or indirectly
intervene in the Company's decision-making and business activities beyond the general meeting of
shareholders. The Company has achieved the five independences of personnel, assets, finances,
institutions and businesses. The Company's board of directors, board of supervisors and internal
institutions can operate independently. The controlling shareholder of the Company can strictly
abide by the promise made to the Company to avoid horizontal competition. When the Company
has connected transactions with its controlling shareholder, it strictly follows the Related
Transaction Decision and Implementation System to ensure that the connected transactions are fair
and just.
    (III) Directors and Board of Directors
    The Company selects directors in strict accordance with the procedures stipulated in the
Articles of Association; convenes and holds board meetings in strict accordance with the Rules of
Procedures for the Board of Directors. All directors of the Company can seriously attend the board
of directors and shareholders meetings, actively participate in training, and earnestly perform their
duties as directors. Directors can earnestly perform the duties and obligations entrusted by laws,
regulations and the Company's Articles of Association, and express independent opinions and
suggestions on important company matters, so as to effectively protect the legitimate rights and
interests of shareholders. Clarified the annual report review procedures of the Audit Committee of
the Board of Directors, and effectively played the role of each special committees.
    (IV) Supervisors and Board of Supervisors


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        During the reporting period, the Company held three meetings of Board of Supervisors, and the
convening and holding procedures of each meeting complied with the provisions of the Company
Law, the Articles of Association and the Rules of Procedure of the Board of Supervisors. Company
supervisors can earnestly perform their duties, supervise major company matters, supervise the
legality and compliance of the Company's directors and senior managers in performing their duties,
safeguarding the legitimate rights and interests of the Company and shareholders.
        (V) Information disclosure and investor relationship management
        According to the Information Disclosure Management System, the Company discloses relevant
information truthfully, accurately, completely and in a timely manner. Investors can learn about the
Company through media promotion, telephone consultation, and company website. In addition to
completing the mandatory periodic reports and temporary announcements disclosed by laws and
regulations, the Company also actively carry out compliance and voluntary information disclosure,
so that investors can have a continuous understanding of the operations that they care about, and
truly protect the shareholders' right to know.

Whether there are major differences between the corporate governance and the requirements of
the law, administrative laws and regulations, and relevant regulations of the China Securities
Regulatory Commission; if there are major differences, the reasons should be explained.
□Applicable √Not Applicable

II.  Specific measures for ensuring the independency of the Company's controlling
     shareholder and actual controller in company assets, personnel, finance, organization,
     business and others, and solutions taken after they influenced the inpendency of the
     Company, the progress thereof and follow-up work plan
□Applicable √Not Applicable

Cases in which the Company's controlling shareholder, actual controller and other units controlled
by them conduct business as same as or similar to that of the Company, the influence on the
Company due to major changes in horizontal competitors or horizontal competition, measures taken,
progress thereof and follow-up solution plan
□Applicable √Not Applicable

III.    General meeting of shareholders
                                              Designated
       Session of                           website on which     Date of disclosure    Resolution of
                             Date
        meeting                             the resolution is     of the resolution    the meeting
                                               published
   The first                                                                             See the
  provisional                                                                           resolution
                         April 9, 2021      www.sse.com.cn         April 10, 2021
 shareholders                                                                           notice for
meeting in 2021                                                                           details
  The second                                                                             See the
  provisional                                                                           resolution
                        April 19, 2021      www.sse.com.cn         April 20, 2021
 shareholders                                                                           notice for
meeting in 2021                                                                           details
 2020 Annual                                                                             See the
   General                                                                              resolution
                        May 25, 2021        www.sse.com.cn         May 26, 2021
  Meeting of                                                                            notice for
 Shareholders                                                                             details
   The third                                                                             See the
                      November 4, 2021      www.sse.com.cn       November 5, 2021
  provisional                                                                           resolution

                                                 49   / 228
                                          2021 Annual Report


 shareholders                                                                           notice for
meeting in 2021                                                                          details


The preferred shareholders whose voting rights had been restituted requested to an extraordinary
general meeting of shareholders
□Applicable √Not Applicable

Statement on shareholders’ meetings
√Applicable □Not Applicable
    1. The 2021 First Provisional General Meeting of Shareholders deliberated and adopted the
“Proposal on By-election of Independent Directors”.
    2. The 2021 Second Provisional General Meeting of Shareholders deliberated and adopted the
“Proposal on Capital Increase of Participating Companies and Related Transactions”.
    3. The 2020 Annual General Meeting of Shareholders deliberated and adopted “2020 Board of
Directors Work Report”, “2020 Board of Supervisors Work Report”, “2020 Annual Report and
Summary”, “2020 Final Accounts Report”, “2021 Financial Budget Report”, and “2020 Profit
Distribution Plan”, “Proposal on Renewing the Appointment of Accounting Firm”, “Proposal on the
Proposed Issuance of Various Debt Financing Instruments in the Coming 12 Months”.
    4. The 2021 Third Provisional General Meeting of Shareholders reviewed and approved the
Proposal on the Redemption of Some Directors' Remuneration in 2020 and the Proposal on the By-
election of Supervisors.




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                                                                2021 Annual Report




IV. Directors, supervisors and senior management
(i) Changes in shareholding and remuneration of current and resigned directors, supervisors and senior executives during the reporting period
√Applicable □Not Applicable
                                                                                                                             Unit: 10,000 Shares
                                                                                                                  Total pre-tax
                                                                                          Change
                                                                  Number of     Number                           remuneration        Remuneration
                                                                                             in
                                                                 shares held of shares              Reasons received from the received from
                   Position                Start date End date                             shares
    Name                      Sex    Age                             at the      held at                for     Company during       related parties
                    (Note)                 of tenure  of tenure                             held
                                                                  beginning    the end of            change       the reporting           of the
                                                                                           during
                                                                  of the year   the year                          period (RMB           Company
                                                                                          the year
                                                                                                                    10,000)
    ZHAO            Board                 September                                                   Equity
                              Male    55                                4          34        30                       49.20                No
    Wenge         chairman                  27, 2018                                                incentive
               Vice Chairman
    WANG                                    March 8,                                                  Equity
                and General   Male    50                                0          30        30                       49.20                No
     Dong                                     2019                                                  incentive
                   Manager
    WANG                                  August 27,
                   Director   Male    58                                0           0                                   0                  Yes
  Chunming                                    2019
       LI                                   May 12,
                   Director   Male    50                                0           0                                   0                  Yes
  Chengqun                                    2014
                   Director,
                                           December                                                   Equity
  XU Hang       Secretary of  Male    48                                0          30        30                       41.82                No
                                            12, 2017                                                incentive
                  the Board
                                           December
  GU Zhixu         Director   Male    34                                0           0                                   0                  No
                                            10, 2020
      MA        Independent               August 27,
                              Male    54                                0           0                                  7.2                 No
  Shuzhong         director                   2019
    HONG        Independent                 May 22,
                              Male    56                                0           0                                  7.2                 No
   Jianqiao        director                   2020
      JIN       Independent                 May 22,    April 9,
                              Male    46                                0           0                                   0                  No
  Yanghua          director                   2020      2021
     LUO        Independent                  April 9,
                              Male    54                                0           0                                  4.8                 No
   Jinming         director                   2021

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                                                              2021 Annual Report




                                           December
JIN Xiaojia   Supervisor      Male    34                                 0          0                         0      Yes
                                            16, 2016
  WU                                       March 10,
              Supervisor     Female   31                                 0          0                         0      Yes
Menghua                                       2022
 WANG                                      August 27,   February
              Supervisor     Female   42                                 0          0                         0      Yes
Gaiying                                       2019      22, 2022
 WANG                                       October
              Supervisor      Male    50                                 0          0                         0      Yes
 Jinjian                                    26, 2020
               Employee                    December
FANG Min                      Male    37                                 0          0                       20.97    No
               supervisor                   8, 2020
   JIN         Employee                    December
                              Male    44                                 0          0                       17.01    No
Yongsheng      supervisor                   8, 2020
   JIN        Vice general                 September                                              Equity
                              Male    52                                 0          30     30               79.86    No
Gengzhong       manager                     18, 2020                                            incentive
              Vice general                  July 17,                                              Equity
WU Xiubin                     Male    51                                 0          30     30               41.82    No
                manager                       2020                                              incentive
 ZHANG        Vice general                   July 7,                                              Equity
                              Male    54                                 0          30     30               41.82    No
 Qizhen         manager                       2017                                              incentive
 GONG         Vice general                 September                                              Equity
                              Male    42                                 0          20     20               37.27    No
Chenghao        manager                     29, 2021                                            incentive
  SHOU        Vice general                 November
                              Male    48                                 0          0                         0      No
 Shengdi        manager                     4, 2021
              Vice general                 November
 ZHU Yi                       Male    42                                 0          0                         0      No
                manager                     4, 2021
  YANG        Vice general                 September                                              Equity
                              Male    39                                 0          20     20               34.74    No
  Yang          manager                     29, 2021                                            incentive
  ZHAO          Financial                   May 12,                                               Equity
                             Female   49                                5.01       35.01   30               41.82    No
  Difang        Manager                       2014                                              incentive
                                                        Septemb
              Vice general                 September                                              Equity
WEI Gang                      Male    35                 er 29,          0          30     30               31.37    No
                manager                     19, 2016                                            incentive
                                                         2021
  ZHOU        Vice general                   July 3,    Septemb
                              Male    46                                 0          0                       151.88   No
   Long         manager                       2020       er 29,

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                                                                      2021 Annual Report




                                                               2021
  Total              /            /       /         /            /              9.01      289.01      280           /            657.98               /
  Name                                                                     Main working experience
ZHAO          He used to be Vice Chairman and General Manager of the Company, and is currently Secretary of the Party Committee and Chairman of the
Wenge         Company.
WANG          He used to be a member and vice director of the Party Committee of Yiwu SASAO, and vice director (concurrently) of the management
Dong          committee of the State-owned Assets Operation Center, and is currently the vice secretary of the Company’s party committee, vice chairman
              and general manager.
WANG          He used to be Chairman of Yiwu Water Affairs Construction Group Co., Ltd., and is currently Secretary of the Party Committee and Chairman
Chunming      of Yiwu Market Development Group Co., Ltd. and Director of the Company.
LI            He is currently Vice Secretary of the Party Committee, Vice Chairman, General Manager and Director of Yiwu Market Development Group Co.,
Chengqun      Ltd.
XU Hang       He used to be general manager of the Company's securities legal affairs department, and representative of securities affairs of the Company's,
              and is currently a director and the secretary of the board of the Company.
GU Zhixu      He used to be the project manager of Business Division 4 of Tianjian Accounting Firm, the business manager of Investment Division I of
              Zhejiang Financial Holding Investment Management Co., Ltd., the senior financial manager of the Planning and Finance Department of
              Zhejiang Financial Holding Co., Ltd., and the senior financial manager of the Planning and Finance Department of Zhejiang Financial
              Development Co., Ltd., and is currently assistant to the director of the Comprehensive Office of Zhejiang Finance Development Co., Ltd. and
              director of the Company.
MA            He's now a professor of Zhejiang University, and an independent director of the Company and Silan Microelectronics Co., Ltd.
Shuzhong
HONG          He is currently the dean of the Accounting Department of the School of Management of Fudan University, and concurrently serves as an
Jianqiao      independent director of the Company, Laiyifen, Jinjiang Corporation, China Tianying and Boqian New Materials.
LUO           He is currently the Secretary of the Party Committee of the Accounting School of Zhejiang Gongshang University, and concurrently serves as
Jinming       an independent director of the Company, Hangxiao Steel Structure, and Riyue Co., Ltd.
JIN Xiaojia   He used to be the accounting director of the Finance Department of Yiwu Communications Investment and Construction Group, and is
              currently a supervisor and chairman of the Board of Supervisors of the Company.
WU            She used to be a supervisor of Yiwu Market Development Group Co., Ltd., concurrently a supervisor of Yiwu State-owned Capital Operation
Menghua       Co., Ltd. and a supervisor of Yiwu Industrial Investment Development Group Co., Ltd., and currently serves as a supervisor of the Company.
WANG          She used to be the project manager of the audit department of Zhejiang New Century Certified Public Accountants, and is currently a full-time
Gaiying       supervisor of the Supervisor Service Center of the State-owned Assets Supervision and Administration Office of Yiwu City.
WANG          He used to be the vice general manager of Yiwu China Commodity City Property Development Co., Ltd., and is currently the general manager

                                                                           53   / 228
                                                                   2021 Annual Report




Jinjian      and company supervisor of Yiwu China Commodity City Property Development Co., Ltd.
FANG Min     He used to be a business commissioner of the Company’s human resources department (party construction office), and currently serves as
             vice general manager of the Company’s human resources department (party construction office) and employee supervisor of the Company.
JIN          He used to be the head of internal control of the Company's supervision and audit department, the manager of the financial department of the
Yongsheng    Company's Yawu Expo Hotel, and the manager of the financial department of the Company's Ocean Hotel. He is currently the head of internal
             audit of the Company's legal audit department and an employee supervisor of the Company.
JIN          He used to be the Vice General Manager of the Party Leadership Group of Zhejiang Huajie Investment Development Co., Ltd., and the Vice
Gengzhong    General Manager of Europe Huajie Development Co., Ltd. He is currently a member of the Company partty committee and the vice general
             manager of the Company.
WU Xiubin    He used to be a member of the party committee and vice general manager of Yiwu Construction Investment Group Co., Ltd., and is currently a
             member of the party committee and vice general manager of the Company.
ZHANG        He used to be the general manager and marketing director of the Company's marketing department, and is currently a member of the party
Qizhen       committee and vice general manager of the Company.
GONG         He used to be the general manager of Yiwu China Commodity City Information Technology Co., Ltd., and the general manager of Yiwu China
Chenghao     Commodity City Supply Chain Management Co., Ltd., and is currently a member of the party committee and vice general manager of the
             Company.
SHOU         He used to be a member of the Party Committee of Zhejiang Yiwu Municipal Bureau of Foreign Trade and Economic Cooperation, a member
Shengdi      of the Party Committee and Vice Director of Zhejiang Yiwu City Commerce Bureau, and is currently a member of the party committee and vice
             general manager of the Company.
ZHU Yi       He used to be the Vice Director of the Office of the Comprehensive Deepening Reform Committee of the Yiwu Municipal Committee of the
             Communist Party of China, and is currently a member of the party committee and vice general manager of the Company.
YANG         He used to be the general manager of Zhejiang Yiwu China Commodity City Imported Commodity Market Branch, the general manager of
Yang         Zhejiang Yiwu China Commodity City Import and Export Co., Ltd., and is currently a vice general manager of the Company.
ZHAO         He used to be the general manager of the Company's financial department and is currently the head in finance of the Company.
Difang
WEI Gang       He used to be a vice general manager of the Company, and resigned from vice general manager of the Company on September 29, 2021, and
               have not held other positions in the Company since then.
ZHOU           He used to be a vice general manager of the Company, and resigned from vice general manager of the Company on September 29, 2021, and
Long           have not held other positions in the Company since then.
Statement on other matters
√Applicable □Not Applicable


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                                                                   2021 Annual Report




1. The remuneration received by some of the Company's directors and executives is the pre-paid remuneration for 2021, and the actual remuneration will be
determined after the completion of relevant assessments and the implementation of relevant procedures.
2. Fang Min, and Jin Yongsheng are the employee representative supervisors, and the remuneration listed in the table is the total remuneration received
after the annual appraisal based on the position in the Company.




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(ii) Appointments of current and resigned directors, supervisors and senior executives
during the reporting period
       1. Position in shareholder units
√Applicable □Not Applicable
  Name of                                          Positions held in Start date of    Term end
                 Name of shareholder unit
incumbent                                         shareholder units     tenure          date
   ZHAO                                            Board Chairman,
                            CCCH                                         2019
  Wenge                                            general manager
  WANG
                            CCCH                       Director          2021
    Dong
  WANG
                            MDG                    Board Chairman        2019
Chunming
                                                    Vice Chairman
      LI
                            MDG                      and General         2014
Chengqun
                                                       Manager
                Zhejiang Provincial Finance        Comprehensive
 GU Zhixu                                                                2021
                      Development Ltd.                   Office
              Yiwu State-owned Assets and
     JIN                                          Assigned full-time
                   State-owned Enterprise
   Xiaojia                                            supervisor
               Development Service Center
              Yiwu State-owned Assets and
  WANG                                            Assigned full-time
                   State-owned Enterprise
  Gaiying                                             supervisor
               Development Service Center
              Yiwu State-owned Assets and
    WU                                            Assigned full-time
                   State-owned Enterprise
 Menghua                                              supervisor
               Development Service Center
          Description of the position of the shareholder unit                    None

     2. Position in other units
√Applicable □Not Applicable
                                                                                              Term
 Name of                                                    Positions held in    Start date
                        Names of other units                                                   end
incumbent                                                     other units        of tenure
                                                                                              date
             Yiwu China Commodities City Investment                               March
XU Hang                                                         Director
                     Management Co., Ltd.                                         2017
    MA                                                        Independent
             Hangzhou Silan Microelectronics Co., Ltd.                           July 2016
Shuzhong                                                        director
  HONG                                                        Independent
                    Shanghai Laiyifen Co., Ltd.
 Jianqiao                                                       director
  HONG        Shanghai Jinjiang International Industrial      Independent
 Jianqiao              Investment Co., Ltd.                     director
  HONG                                                        Independent
                      China Tianying Co., Ltd.
 Jianqiao                                                       director
  HONG                                                        Independent
               Jiangsu Boqian New Material Co., Ltd.
 Jianqiao                                                       director
                                                               Chairman,
 WANG          Yiwu China Commodities City Property                              January
                                                                 general
 Jinjian              Development Co., Ltd.                                       2019
                                                                manager
        Description of employment in other units                                None

(iii) Remuneration of directors, supervisors and senior management personnel
√Applicable □Not Applicable
Decision-making     procedures The remuneration of the Company’s remunerated directors,
for   the    remuneration     of   supervisors and senior executives shall be reviewed by the
directors,   supervisors    and    remuneration and appraisal committee of the Company’s board

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senior executives                     of directors and submitted to the board of directors for review and
                                      approval. The remuneration of directors and supervisors shall
                                      also be submitted to the general meeting of shareholders for
                                      review and approval.
                                      The remuneration of independent directors is determined in
                                      accordance with the Independent Director Allowance System.
                                      The Independent Director Allowance System is deliberated and
The basis for determining the         formulated by the board of directors and approved by the general
remuneration       of    directors,   meeting shareholders. The remuneration of the Company’s
supervisors        and      senior    directors, supervisors and senior management shall be reviewed
managers                              and determined by the Board of Directors’ Compensation and
                                      Appraisal Committee in conjunction with the assessment opinions
                                      and results of the state-owned regulatory authority, and
                                      submitted to the board of directors for deliberation.
Actual         payment           of
                                      The relevant assessment for 2021 has not yet been completed,
remuneration       for   directors,
                                      and the actual payment will be determined after the assessment
supervisors        and      senior
                                      is completed and the relevant procedures are performed.
management
The total remuneration actually
                                      The actual payment of remuneration will be determined after
received      by   all   directors,
                                      completing     the     assessment   and   performing    the   relevant
supervisors        and      senior
                                      procedures. The salary currently paid is the pre-paid salary for
management at the end of the
                                      2021, totaling RMB 6,579,800 before tax.
reporting period
(iv) Changes in directors, supervisors and senior officers of the Company
√Applicable □Not Applicable
     Name                  Title            Change                 Reasons for change
LUO Jinming          Independent director            Election                       Election
                                                                           Due to job adjustments, he
JIN Yanghua          Independent director          Leaving office
                                                                      resigned from independent director.
   GONG
                    Vice general manager                 Hiring           Hired by the Board of Directors
  Chenghao
    SHOU
                    Vice general manager                 Hiring           Hired by the Board of Directors
   Shengdi
   ZHU Yi           Vice general manager                 Hiring           Hired by the Board of Directors
 YANG Yang          Vice general manager                 Hiring           Hired by the Board of Directors
                                                                            Due to job adjustments, he
  WEI Gang          Vice general manager            Dismissed               resigned from vice general
                                                                                     manager.
                                                                            Due to job adjustments, he
 ZHOU Long          Vice general manager            Dismissed               resigned from vice general
                                                                                     manager.

(v) Explanation of punishments by securities regulatory agencies in the past three years
√Applicable □Not Applicable
    On January 29, 2019, the Company received the China Securities Regulatory Commission
Zhejiang Regulatory Bureau's Decision on Measures to Issue Warning Letters to Zhejiang China
Commodity City Group Co., Ltd. and related personnel (Administrative Regulatory Measures

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                                          2021 Annual Report


Decision [2019 ] No. 8). For the specific content of the relevant decision, please refer to the
Announcement of the YIWU CCC on Receiving the Warning Letter from Zhejiang Securities
Regulatory Bureau issued by the Company on January 30, 2019 (Announcement No.: L2019-007).


(vi) Others
□Applicable √Not Applicable
V. Description of the meetings of the Board of Directors held during the reporting period
Session of meeting          Date                          Resolution of the meeting
28th meeting of 8th    January 20,     9 directors should be present, 9 directors actually presented,
Board of Directors     2021            and all the resolutions of the meeting were passed
29th meeting of 8th    March 24,       See the Company's announcement on March 25, 2021 for
Board of Directors     2021            details
30th meeting of 8th    March 30,       9 directors should be present, 9 directors actually presented,
Board of Directors     2021            and all the resolutions of the meeting were passed
31st meeting of 8th    April 1, 2021   See the Company's announcement on April 2, 2021 for
Board of Directors                     details
32nd meeting of        April 28,       See the Company's announcement on April 30, 2021 for
8th Board of           2021            details
Directors
33rd meeting of 8th    May 20,         9 directors should be present, 9 directors actually presented,
Board of Directors     2021            and all the resolutions of the meeting were passed
34th meeting of 8th    June 15,        9 directors should be present, 9 directors actually presented,
Board of Directors     2021            and all the resolutions of the meeting were passed
35th meeting of 8th    August 9,       See the Company's announcement on August 11, 2021 for
Board of Directors     2021            details
36th meeting of 8th    September       See the Company's notice on September 30, 2021 for details
Board of Directors     29, 2021
37th meeting of 8th    October 18,     See the Company's announcement on October 19, 2021 for
Board of Directors     2021            details
38th meeting of 8th    October 27,     9 directors should be present, 9 directors actually presented,
Board of Directors     2021            and all the resolutions of the meeting were passed
39th meeting of 8th    Oct 29, 2021    9 directors should be present, 9 directors actually presented,
Board of Directors                     and all the resolutions of the meeting were passed
40th meeting of 8th    November 4,     9 directors should be present, 9 directors actually presented,
Board of Directors     2021            and all the resolutions of the meeting were passed
41st meeting of 8th    November        See the Company's announcement on November 20, 2021
Board of Directors     19, 2021        for details
42nd meeting of        November        9 directors should be present, 9 directors actually presented,
8th Board of           29, 2021        and all the resolutions of the meeting were passed
Directors
43rd meeting of 8th    November        9 directors should be present, 9 directors actually presented,
Board of Directors     30, 2021        and all the resolutions of the meeting were passed
VI. Duties performed by directors
(i) Board of Directors and Shareholders Meetings attended by Directors
                                                                                            Participati
                                                                                              on in
                                                                                             General
                                       Participation in Board of Directors                   meeting
           Indepen
                                                                                                of
Director      dent
                                                                                            sharehold
 Name       director
                                                                                               ers
             or not
                       Number      Number     Number of        Numbe     Abs   Failure to      The
                       of board        of     participatio       r of    enc   attend the   number of
                       meeting     attendan     ns by          delegat    e    meeting in   sharehold
                        s this      ces in    communica           es     Fre     person        ers
                                               58   / 228
                                         2021 Annual Report


                        year     person            tion       attende   que        twice in a   attending
                                                                  d     ncy        row or not      the
                                                                                                 general
                                                                                                meeting
 ZHAO
             No          16         16             14           0        0            No           0
Wenge
WANG
             No          16         16             14           0        0            No           4
 Dong
WANG
Chunmi       No          16         16             14           0        0            No           0
   ng
   LI
Chengq       No          16         16             14           0        0            No           1
   un
   XU
             No          16         16             14           0        0            No           4
 Hang
  GU
             No          16         15             14           1        0            No           0
 Zhixu
  MA
Shuzho       Yes         16         16             14           0        0            No           3
   ng
HONG
Jianqia      Yes         16         15             14           1        0            No           4
    o
  JIN
Yanghu       Yes         4          4               4           0        0            No           0
    a
  LUO
             Yes         12         12             10           0        0            No           3
Jinming

Explanation of not attending the board meeting in person for two consecutive times
□Applicable √Not Applicable

 Number of meetings of the Board of Directors
                                                                              16
              held during the year
  Including: the number of on-site meetings                                   2
 Number of meetings held by communication                                     14
Number of meetings held on site combined with
                                                                              0
          communication methods

(ii) Objections raised by directors on company-related matters
□Applicable √Not Applicable

(iii) Others
□Applicable √Not Applicable

VII. Committees under the Board of Directors
√Applicable □Not Applicable
    (1). Members of Committees under the Board of Directors
Category of committees                                     Member name
    Audit committee                        HONG Jianqiao, MA Shuzhong, XU Hang
 Nomination Committee                    MA Shuzhong, LUO Jinming, WANG Chunming
   Compensation and
                                          LUO Jinming, HONG Jianqiao, LI Chengqun
  Appraisal Committee
                                              59   / 228
                                          2021 Annual Report



   Strategy Committee                     ZAHO Wenge, WANG Dong, MA Shuzhong



     (2). 11 meetings held by these committees during the report period
                                                                                               Other
                                                            Important comments and           things on
   Date           Contents of the meeting
                                                                  suggestions                   duty
                                                                                             fulfillment
February                                              Agreed with 2020 Integrated Audit
             2020 Integrated Audit Plan
8, 2021                                               Plan
             Proposal for nominating
March 22,                                             Agreed to nominate LUO Jinming as
             candidates for independent
2021                                                  candidate for independent director
             directors
             Proposal on capital increase and
April 1,                                              Agree to increase capital of RMB
             related party transactions of
2021                                                  1.225 billion for CCCP
             shareholding companies
                                                      Agreed with the preliminary
April 12,    Preliminary communication on the
                                                      communication on the results of
2021         results of 2020 integrated audit
                                                      2020 integrated audit
             1. 2020 Financial Reort
             2. 2020 Internal Control Evaluation      Agreed with the 2020 Financial
             Report                                   Report, the 2020 Internal Control
             3. 2020 Internal Control Audit           Evaluation Report, the 2020 Internal
April 28,
             Report                                   Control Audit Report, the 2020 Audit
2021
             4. The Audit Committee's 2020            Committee Performance Report and
             Performance Report                       the Proposal on Re-appointing the
             5. Proposal on re-appointing             Accounting Firm
             accounting firm
August 9,    2021 Semi-annual Internal Control        Agree with the 2021 Semi-annual
2021         Audit Work Report                        Internal Control Audit Work Report
                                                      Agreed to nominate GONG
September    Proposal on Nomination of Vice
                                                      Chenghao and YANG Yang as vice
27, 2021     General Manager
                                                      general managers of the Company
             1. The proposal on the
             remuneration of some directors of
                                                      Agreed to honor the 2020 annual
September    the Company in 2020
                                                      remuneration of some directors and
27, 2021     2. The proposal on the
                                                      executives
             remuneration of some directors of
             the Company in 2020
             Proposal on capital increase and
October                                               Agreed to increase capital of RMB
             related party transactions of
14, 2021                                              2.45 billion for CCCP
             shareholding companies
                                                      Agreed to nominate SHOU Shengdi
November     Proposal on Nomination of Vice
                                                      and ZHU Yi as vice general
2, 2021      General Manager
                                                      managers of the Company
December                                              Agreed with the 2021 Integrated
             2021 Annual Integrated Audit Plan
23, 2021                                              Audit Plan

     (3). The specifics of objection
□Applicable √Not Applicable

VIII. Explanation of the Company risk that the board of supervisors founds
□Applicable √Not Applicable
The Board of Supervisors has no objection to the supervision matters during the reporting period.



                                               60   / 228
                                            2021 Annual Report


IX. Employees of the parent company and major subsidiaries
(i) Employees
 Number of employees in the parent company                           2,282
  Number of employees in major subsidiaries                          1,941
        Total number of employees                                    4,223
                                   Professional composition
     Professional composition category                      Professional composition
              Production staff                                        108
                Salesperson                                            86
               Technical staff                                       2,706
              Financial officer                                       138
             Administration staff                                     301
             Security personnel                                       551
         Vehicle management staff                                     333
                    Total                                            4,223
                                        Education level
          Education level category                              Quantity (person)
               Postgraduate                                           106
             Bachelor's degree                                       1,564
       College graduates and below                                   2,553
                    Total                                            4,223
(ii) Salary policy
√Applicable □Not Applicable
     I. Principles of remuneration system
    (1) Combination of duties, powers, responsibilities, and benefits;
    (2) It shall be fair internally and competitive externally;
    (3) Distribution according to work, priority to efficiency, fairness and sustainable development;
    (4) Adoption of the distribution form of "salary determined by post, grade determined by ability,
and award determined by performance" to reasonably widen the income gap.
    2. Basis of salary system
    Position importance, performance contribution, ability, work attitude and spirit of cooperation.
    (1) As far as the overall level is concerned, the Company determines the remuneration based
on the current economic benefits and sustainable development.
    (2) The Company's salary system includes two different types.
    a. The annual salary system is applicable to managers and vice managers of the Company's
headquarters, as well as members of the management team of branches and subsidiaries;
    b. The structured wage system is applicable to employees who have signed labor contracts for
two years and above. Including grassroots management personnel, functional department
personnel, engineering management personnel, logistics management personnel and equipment
maintenance personnel.
    (3) The remuneration of specially hired staff, staff waiting for duty, retired staff and timing
piecework staff shall be stipulated separately.
    (4) The Company's employee income generally includes four parts: job skill wages, bonuses,
benefits, and allowances.

(iii) Training program
√Applicable □Not Applicable

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                                           2021 Annual Report


      According to the different training organizations, the Company's employee training can be
divided into: OJT training, company internal training, expatriate training and online training.
      1. OJT (On the Job Training) The training of ordinary employees and new employees by
leaders of various departments, experienced or skilled employees belongs to OJT training,
including the Company's administrative management series training, business management series
training, engineering technology series training, and security logistics series training.
      2. Enterprise internal training. According to the Company's training needs, the Company
organizes internal trainers or invites external training institutions to tailor training courses for the
Company, allowing employees to receive systematic training, including corporate culture, company
organizational structure and rules and regulations, industry status and prospects, and professional
ethics, etiquette, code of conduct, language, computer skills, etc.
      3. Expatriate training In accordance with the needs of the Company's business development
and job skills, the Company organizes personnel in specific positions to go out to participate in the
training of training institutions, including financial securities series training, human resource
management training, and enterprise management series training.
      4. Network training It is an online training for employees through the application of information
technology and Internet technology, and different training content is set for different positions, so
that training and learning are independent and personalized, and the use of resources is maximized.

(iv) Labor outsourcing
√Applicable □Not Applicable
Total number of working hours of labor                                                31,678.57 months
outsourcing
Total remuneration paid for labor outsourcing                                      RMB 69.8461 million
X.    Plan for profit distribution or capital reserve into stock capital

(i)   Formulation, implementation or adjustment of cash dividend policy

√Applicable □Not Applicable
      According to the China Securities Regulatory Commission's Notice on Further Implementation
of Cash Dividends by Listed Companies (ZJF [2012] 37) and Zhejiang Securities Regulatory
Bureau’s Notice on Forwarding the Notice on Further Implementation of Listed Companies' Cash
Dividends (ZZJSSZ [2012] 138), the Company held the 24th meeting of the sixth board of directors
on August 15, 2012, and reviewed and approved the Proposal on Amending the Articles of
Association, which revised the Company’s profit distribution policy and adjustment decision-making
mechanism. The second extraordinary general meeting of shareholders held on September 3, 2012
was deliberated and approved. In order to further implement the new requirements of the China
Securities Regulatory Commission's Guidelines for the Supervision of Listed Companies No. 3-
Cash Dividend Distribution of Listed Companies (November 30, 2013) and the Guidelines for Cash
Dividend Distribution of Listed Companies of the Shanghai Stock Exchange, the forty-fourth
meeting of the sixth board of directors of the Company held on April 17, 2014 reviewed and
approved the Proposal on Amending the Profit Distribution Clauses in the Articles of Association of
the Company. The Company further clarified the basic principles, distribution forms, specific policies,
decision-making mechanisms and procedures of the Company's profit distribution, which were
                                                62   / 228
                                        2021 Annual Report


reviewed and approved by the 2013 Annual General Meeting of Shareholders held on May 12,
2014. The nineteenth meeting of the seventh board of directors of the Company held on December
25, 2015 reviewed and approved the Plan of Zhejiang China Commodity City Group Co., Ltd. on
Shareholder Dividend Return Plan.
    The Company's 2020 annual general meeting of shareholders held on May 25, 2021 reviewed
and approved the Company's profit distribution plan for 2020. In 2020, based on the total share
capital of 5,443,214,176 shares, a cash dividend of RMB 0.55 (including tax) will be distributed for
every 10 shares. A total of RMB 301,945,279.68 was allocated. The Company's Board of Directors
published the Announcement on the Implementation of the Distribution of Rights and Interests in
2021 on the website of the Shanghai Stock Exchange and the China Securities Journal, Shanghai
Securities News and Securities Times on June 10, 2021. The profits have been distributed before
June 18, 2021. The decision-making procedures related to the Company's profit distribution comply
with the provisions of the Articles of Association. The Company listens to the opinions and demands
of small and medium shareholders, and the profit distribution is based on factors such as the
Company's industry characteristics, development stage and profitability level, and capital needs. It
takes into account the requirements for investors to share the results of the Company's
development and growth and obtain reasonable investment returns.


(ii) Special explanation of cash dividend policy
√Applicable □Not Applicable
Whether it complies with the provisions of the Company's Articles of Association
                                                                                         √Y □N
or the requirements of the resolution of the general meeting of shareholders
Whether the dividend standard and ratio are clear and clear                              √Y □N

Whether the relevant decision-making procedures and mechanisms are complete              √Y □N
Whether the independent directors performed their duties and played their due
                                                                                         √Y □N
role
Whether minority shareholders have the opportunity to fully express their opinions
and demands, and whether their legitimate rights and interests have been fully           √Y □N
protected
(iii) During the reporting period, if the parent company is profitable and the profit available
       for distribution to shareholders is positive, but does not propose a plan for the
       distribution of cash profits, the Company shall disclose in details the reason, the
       application and using plan of the undistributed profits.
□Applicable √Not Applicable
XI. Incentive stock option plans, employee stock ownership plans and other employee
       incentives granted by the Company and the impact thereof
(i) Relevant incentive matters have been disclosed in the temporary announcement and
      there is no progress or change in subsequent implementation.
√Applicable □Not Applicable
                          Overview of the matter                           Query website
       On October 23, 2020, the twenty-third meeting of the eighth Board   For details, please
of Directors of the Company passed the Proposal on the Company's           refer to the Company's
2020 Restricted Equity incentive Plan (Draft) and Its Summary, Proposal    announcement on the
on the Measures for the Evaluation and Management of the                   website      of         the
Implementation of the Company's 2020 Restricted Equity incentive Plan,     Shanghai          Stock

                                              63   / 228
                                          2021 Annual Report


Proposal on Requesting the General Meeting of Shareholders to                  Exchange
Authorize the Board of Directors to Handle Issues Related to Equity            (www.sse.com.cn)      on
Incentives. The independent directors of the Company issued relevant           October 24, 2020.
independent opinions.
    On October 23, 2020, the sixth meeting of the eighth Board of
Supervisors of the Company deliberated and approved the Proposal on
the Company's 2020 Restricted Equity incentive Plan (Draft) and its
Summary, The Proposal on the Implementation Evaluation and
Management Measures for the Company's 2020 Restricted Equity
incentive Plan, Proposal on Verification of the List of Incentive Objects
of the Company's 2020 Restricted Equity incentive Plan. The board of
supervisors issued relevant verification opinions.
    Independent financial consultants, lawyers and other intermediary
agencies issued corresponding opinions.
                                                                                   For details, please
    On November 18, 2020, it received the Approval for Approving               refer to the Company's
Zhejiang China Commodity City Group Co., Ltd. to implement the 2020            announcement on the
restricted equity incentive plan issued by the State-owned Assets              website     of        the
Supervision and Administration Office of the People's Government of            Shanghai            Stock
Yiwu City, forwarded by Yiwu China Commodity City Holdings Ltd. (Yiwu          Exchange
SASAOF〔2020〕51).                                                             (www.sse.com.cn)      on
                                                                               November 20, 2020.
    From November 20, 2020 to November 29, 2020, the list of
                                                                                   For details, please
incentive objects and positions of the 2020 restricted equity incentive
                                                                               refer to the Company's
plan were internally publicized. Within the time limit of the publicity, the
                                                                               announcement on the
board of supervisors of the Company did not receive any objection from
                                                                               website     of        the
any organization or individual or bad feedback, without feedback record.
                                                                               Shanghai            Stock
On November 30, 2020, the Board of Supervisors of the Company
                                                                               Exchange
issued the Examination Opinions and Public Statement of the Board of
                                                                               (www.sse.com.cn)      on
Supervisors on the List of Incentive Objects of the Company's 2020
                                                                               December 1, 2020.
Restricted Equity incentive Plan.
    On December 10, 2020, the Company's 2020 Fifth Provisional                     For details, please
General Meeting of Shareholders deliberated and approved the                   refer to the Company's
“Proposal on the ‘Company's 2020 Restricted Equity incentive Plan            announcement on the
(Draft)’ and Summary”, the “Proposal on the “Measures of Assessment        website     of        the
and Management of Implementation of ‘Company’s 2020 Restricted               Shanghai            Stock
Equity incentive Plan’”, and the “Proposal on Requesting the General        Exchange
Meeting of Shareholders to Authorize the Board of Directors to Deal with       (www.sse.com.cn)      on
Equity Incentive Related Matters”, and disclosed the “Self-examination       December 11, 2020.


                                                64   / 228
                                           2021 Annual Report


Report on the Trades of Company’s Stocks by Insiders of Company’s
2020 Restricted Equity incentive Plan”.
    On December 11, 2020, the twenty-sixth meeting of the eighth
session of the Company's board of directors passed the Proposal on
Granting Restricted Shares to Incentive Objects for the First Time. The
                                                                               For details, please
independent directors of the Company issued relevant independent
                                                                           refer to the Company's
opinions.
                                                                           announcement on the
    On December 11, 2020, the seventh meeting of the Company's
                                                                           website      of       the
eighth board of supervisors passed the Proposal on Granting Restricted
                                                                           Shanghai            Stock
Stocks to Incentive Objects for the First Time. The Board of Supervisors
                                                                           Exchange
issued the Verification Opinions of the Board of Supervisors on Matters
                                                                           (www.sse.com.cn)      on
Related to the First Grant of the Company's 2020 Restricted Equity
                                                                           December 12, 2020.
incentive Plan.
    Independent financial consultants, lawyers and other intermediary
agencies issued corresponding opinions.
                                                                               For details, please
                                                                           refer to the Company's
    On January 15, 2021, the Company received the Securities Change
                                                                           announcement on the
Registration Certificate issued by the Shanghai Branch of China
                                                                           website      of       the
Securities Depository and Clearing Co., Ltd., and the Company
                                                                           Shanghai            Stock
completed the registration of the first grant of restricted stocks to
                                                                           Exchange
incentive objects.
                                                                           (www.sse.com.cn)      on
                                                                           January 19, 2021.
    On August 9, 2021, the 35th meeting of the eighth Board of
Directors of the Company passed the "Proposal on Reserved Granting
Restricted Stocks to Incentive Objects", "On Adjusting the Repurchase
Price of Restricted Stocks and Repurchasing and Cancelling Some                For details, please
Restricted Stocks" 's proposal". The independent directors of the          refer to the Company's
Company issued relevant independent opinions.                              announcement on the
    On August 9, 2021, the ninth meeting of the eighth Boarder of          website      of       the
Supervisors of the Company passed the "Proposal on Reserved                Shanghai            Stock
Granting Restricted Stocks to Incentive Objects", "Proposal on Adjusting   Exchange
the Repurchase Price of Restricted Stocks and Repurchasing and             (www.sse.com.cn)      on
Cancelling Some Restricted Stocks" ". The Board of Supervisors issued      August 11, 2021.
the Verification Opinions of the Board of Supervisors on Matters Related
to the Company's Reserved Grant of the Restricted Equity incentive
Plan in 2020.
    On November 4, 2021, the Company received the Securities                   For details, see the
Change Registration Certificate issued by the Shanghai Branch of China     Company's


                                                65   / 228
                                           2021 Annual Report


 Securities Depository and Clearing Co., Ltd., and the Company                  announcement on the
 completed the registration of the reserved grant of restricted stocks to       website        of     the
 incentive objects.                                                             Shanghai            Stock
                                                                                Exchange
                                                                                (www.sse.com.cn)       on
                                                                                November 6, 2021.
     On November 17, 2021, the Company applied to China Securities                    For details, see the
 Depository and Clearing Co., Ltd. Shanghai Branch for repurchase and           Company's
 cancellation of restricted stocks that have been granted but not yet lifted    announcement on the
 by some resigned employees. On November 30, 2021, the Company                  website        of     the
 received the "Securities Change Registration Certificate" issued by            Shanghai            Stock
 China Securities Depository and Clearing Co., Ltd. Shanghai Branch,            Exchange
 and the Company has completed the registration of the restricted stock         (www.sse.com.cn)       on
 repurchase and cancellation.                                                   November 26, 2021.



 (ii) Incentives that have not been disclosed in the temporary announcements or had further
      progresses
 Incentive stock option
 □Applicable √Not Applicable

 Other statements
 □Applicable √Not Applicable

 Employee stock ownership plans
 □Applicable √Not Applicable

 Other incentives
 □Applicable √Not Applicable

 (iii) Equity incentives granted to directors and senior executives during the reporting period
 □Applicable √Not Applicable


 √Applicable □Not Applicable
                                                                              Unit: Ten Thousand Shares
                         Number
                             of      Number of                                          Number
                                                                                                      Market
                        restricted   restricted                               Unrel        of
                                                       Grant price     Rele                         price at the
                          stocks       stocks                                 ease     restricted
                                                       of restricted   ased                         end of the
Name        Title        held at       granted                                 d         stocks
                                                           stock       shar                          reporting
                            the      during the                               shar      held at
                                                          (RMB)         es                             period
                        beginning     reporting                                e      the end of
                                                                                                       (RMB)
                          of the        period                                        the period
                           year
ZHAO        Board
                            0             30               2.94         0      30         30        1,455,000
Wenge     chairman
             Vice
WANG      Chairman
                            0             30               2.94         0      30         30        1,455,000
Dong         and
           General

                                                  66   / 228
                                           2021 Annual Report


          Manager
 JIN         Vice
Gengz      general          0             30             2.94        0       30        30        1,455,000
hong      manager
             Vice
 WU
           general          0             30             2.94        0       30        30        1,455,000
Xiubin
          manager
ZHAN         Vice
  G        general          0             30             2.94        0       30        30        1,455,000
Qizhen    manager
GONG         Vice
Cheng      general          0             20             2.94        0       20        20         970,000
 hao      manager
             Vice
YANG
           general          0             20             2.94        0       20        20         970,000
Yang
          manager
           Director
 XU
            Board           0             30             2.94        0       30        30        1,455,000
Hang
          Secretary
ZHAO      Financial
                            0             30             2.94        0       30        30        1,455,000
Difang    Manager
             Vice
WEI
           general          0             30             2.94        0       30        30        1,455,000
Gang
          manager
Total          /            0            280                 /       0      280       280             /


 (iv) The evaluation mechanism for senior managers during the reporting period, as well as
     the establishment and implementation of incentive mechanisms
 √Applicable □Not Applicable
      The salary appraisal of the senior management personnel is completed and determined
 according to the performance appraisal method of the head of the enterprise and the Company's
 operation and related appraisal indicators, then the salary determination is completed.


 XII. Construction and implementation of internal control system during the reporting period
 √Applicable □Not Applicable
 For details, please refer to the "2021 Internal Control Evaluation Report" disclosed by the Company
 on the website of the Shanghai Stock Exchange.

 Explanation of major deficiencies in internal control during the reporting period
 □Applicable √Not Applicable

 XIII. Management and control of subsidiaries during the reporting period
 √Applicable □Not Applicable
 For details, please refer to the "2021 Internal Control Evaluation Report" disclosed by the Company
 on the website of the Shanghai Stock Exchange.

 XIV. Explanation of the internal control audit report
 √Applicable □Not Applicable
      The Company hired Ernst & Young Hua Ming Certified Public Accountants (special general
 partnership) to audit the effectiveness of the Company's internal control in its 2021 financial report.
 The accounting firm has issued a standard unqualified internal control audit report. It is believed
 that the Company maintained effective internal control of financial reporting in all major aspects in

                                                67   / 228
                                          2021 Annual Report


accordance with the Basic Standards for Corporate Internal Control and related regulations on
December 31, 2021. For details of the internal control audit report, please refer to the Shanghai
Stock Exchange website (www.sse.com.cn).
Disclosure of internal control audit report: Yes
Opinion type of internal control audit report: standard unqualified opinion

XV. Self-examination and rectification of the Listed Company's governance special actions
    In the Listed Company's governance special actions, after self-examination, the Company
found that the Company's Articles of Association did not specify that when the shareholders'
general meeting elects directors and supervisors, it "should" implement the cumulative voting
system. The Company held the third provisional general meeting of shareholders in 2021 on
November 4, 2021. With the special resolution of the general meeting of shareholders, the relevant
content of Article 84 of the Company's Articles of Association, i.e., "When the general meeting of
shareholders votes on the election of directors and supervisors, the cumulative voting system may
be implemented in accordance with the provisions of the Articles of Association or the resolutions of
the shareholders' general meeting" was revised to "When the general meeting of shareholders
votes on the election of two or more directors and supervisors, the cumulative voting system shall
be implemented in accordance with the provisions of the Articles of Association or the resolutions of
the general meeting of shareholders.” For details, please refer to the "Announcement on Amending
the Articles of Association" (L 2021-048) disclosed on October 19, 2021 and the "Announcement on
Resolutions of the Third Provisional General Meeting in 2021" disclosed on November 5, 2021 ( L
2021-054).


XVI. Others
□Applicable √Not Applicable




                                               68   / 228
                                        2021 Annual Report



             Section V.         Environmental and Social Responsibilities
I.   Environmental issues
(i)  Description of the environmental protection status of the Company and its main
     subsidiaries that are key pollutant discharging units announced by the environmental
     protection authorities
□Applicable √Not Applicable

(ii) Description of the environmental protection status of the companies other than the key
     pollutant discharging units
□Applicable √Not Applicable

(iii) Relevant information that is conducive to protecting ecology, preventing pollution, and
      fulfilling environmental responsibilities
□Applicable √Not Applicable

(iv) Measures taken to reduce their carbon emissions during the reporting period and the
     effect
□Applicable √Not Applicable

II. Social responsibility
√Applicable □Not Applicable
For details, please refer to the "2021 Sustainability Report" disclosed by the Company on the
website of the Shanghai Stock Exchange.


III. Status of consolidation and expansion of the results of poverty alleviation, rural
     revitalization and other specific work
□Applicable √Not Applicable




                                              69   / 228
                                          2021 Annual Report



                             Section VI. Significant Matters
I.   Fulfillment of commitments
(i) Commitments made by the actual controller, shareholders, affiliates and acquirer of the
    Company, the Company itself and other related parties during the reporting period or as
    of the reporting period
□Applicable √Not Applicable

(ii) If there is a profit forecast for the Company’s assets or projects, and the reporting period
     is still in the profit forecast period, the Company will explain whether the assets or
     projects have reached the original profit forecast and the reason
.
□Reached □Not Reached √Not Applicable

(iii) Completion of performance commitments and its impact on the impairment test of
      goodwill
□Applicable √Not Applicable

II.  Non-operating capital occupation by controlling shareholder and other related parties
     during the reporting period
□Applicable √Not Applicable

III. Illegal guarantees
□Applicable √Not Applicable

IV. The Company's explanation on the ‘non-standard opinion audit report’ of the accounting
     firm
□Applicable √Not Applicable

V.   The Company's analysis and explanation on the reasons and effects of changes in
     accounting policies, accounting estimates or corrections of major accounting errors
(i) The Company's analysis and explanation on the reasons and effects of changes in
     accounting policies and accounting estimates
√Applicable □Not Applicable
    For details, please refer to “44. Changes in Significant Accounting Policies and Accounting
Estimates” in “V. Significant Accounting Policies and Accounting Estimates” in “Chapter X Financial
Reprot” of this report.


(ii) The Company's analysis and explanation on the reasons and effects of major
     accounting errors correction
□Applicable √Not Applicable

(iii) Communication with the former accounting firm
□Applicable √Not Applicable

(iv) Other statements
□Applicable √Not Applicable




                                               70   / 228
                                            2021 Annual Report



VI. Engagement and termination of engagement of accounting firm
                                                                                          Unit: RMB10,000
                                                                            Now engaging
                                                               Ernst & Young Hua Ming Certified Public
Name of the engaged domestic accounting firm
                                                               Accountants (special general partnership)
      Remuneration of the engaged domestic
                                                                                200
                  accounting firm
       Audit period of the engaged domestic
                                                                                 14
                  accounting firm

                                                         Name                               Remuneration
      Internal control auditing          Ernst & Young Hua Ming Certified Public
                                                                                                   55
          accounting firm                Accountants (special general partnership)

Statement on the engagement or termination of engagement of accounting firm
√Applicable □Not Applicable
    After deliberation at the 32th meeting of the eighth Board of Directors of the Company held on
April 28, 2021, and the Company’s 2020 annual general meeting of shareholders held on May 25,
2021, the Proposal on Renewing the Appointment of the Accounting Firm was passed, and agreed
to continue Appoint Ernst & Young Hua Ming Certified Public Accountants (Special General
Partnership) as the Company's 2021 financial and internal control audit agency. For details, please
refer to the Announcement on Renewing the Appointment of Accounting Firms (L2021-022) issued
by the Company on the Shanghai Stock Exchange website www.sse.com.cn on April 30, 2021, and
the Announcement on Resolutions of the 2020 Annual General Meeting of Shareholders (L2021-
030) issued by the Company on the Shanghai Stock Exchange website www.sse.com.cn on May
26, 2021.

Statement on replacing the accounting firm during the audit
□Applicable √Not Applicable

VII. Situations at risk of delisting
(i) Reasons for the delisting risk warning
□Applicable √Not Applicable

(ii) The Company's proposed response measures
□Applicable √Not Applicable

(iii) Termination of listing and reasons
□Applicable √Not Applicable

VIII. Matters relating to bankruptcy and reorganization
□Applicable √Not Applicable

IX. Material litigations and arbitrations
√There are material litigations or arbitrations in current reporting period □No material litigations or
arbitrations in current reporting period

(i)  Litigations and arbitrations have been disclosed in the temporary announcements and
     have had no further progresses
□Applicable √Not Applicable
                                                  71   / 228
                                                                                       2021 Annual Report

(ii) Litigations and arbitrations that have not been disclosed in the temporary announcements or have had further progresses
√Applicable □Not Applicable
                                                                                                                                                                                 Unit: RMB10,000
During the reporting period:


                                                                                                                                     Does the
                                                                                                                                      litigation
                                                                                                                                    (arbitration)
                                                            Party                                                        Value
                                                                        Litigation                                                      cause        Status of       Results of litigation   Enforcement
  Plaintiff                                                Bearing                        Basic information of       involved in
                         Defendant (respondent)                             or                                                       estimated        litigation      (arbitration) and      of judgment
 (claimant)                                                 Joint                        litigation (arbitration)      litigation
                                                                        arbitration                                                   liabilities   (arbitration)       effect thereof         (award)
                                                          Liabilities                                               (arbitration)
                                                                                                                                       and the
                                                                                                                                       amount
                                                                                                                                       thereof
                                                                                      Unfair Competition and
                Xi'an Honghua Instrument Factory,                                                                                                                   The defendant shall
                                                                                      Trademark    Infringement                                     Judgment
The             Shaanxi Yiwu Shangcheng Property                                                                                                                    pay the plaintiff RMB
                                                            None        Litigation    Dispute   Case     [(2021)            812         No          has been
Company         Management Co., Ltd., Xi'an Caixin                                                                                                                  3      million      in
                                                                                      Shaan 01 Zhi Min Chu No.                                      made
                Real Estate Development Company                                                                                                                     compensation
                                                                                      604]
                                                                                                                                                                    The defendant shall
                Jiangxi Anlong Investment Co., Ltd.,                                  Unfair Competition and
                                                                                                                                                    Judgment        pay the plaintiff a
The             Pingxiang Yiwu Small Commodity                                        Trademark     Infringement
                                                            None        Litigation                                          812         No          has been        joint and several
Company         Wholesale City Property Service                                       Dispute Case [(2021) Gan
                                                                                                                                                    made            compensation      of
                Management Co., Ltd.                                                  03 Min Chu No. 29]
                                                                                                                                                                    RMB 2.1037 million
                Jiangsu     Zhonghaojiayuan     Holding
                Group Co., Ltd., Suqian Yiwu                                          Dispute     over     unfair                                   Judgment
The                                                                                                                                                                 The plaintiff's claims
                International   Trade    City    Market     None        Litigation    competitions [(2021) Su 01            512         No          has been
Company                                                                                                                                                             were dismissed
                Management Co., Ltd., Suqian Maike                                    Min Chu No. 497]                                              made
                Information Technology Co., Ltd.
                                                                                                                                                                    The defendant shall
                                                                                      Unfair competition dispute                                    Judgment        jointly compensate
The             Yingde    Yiwu   Small    Commodity
                                                            None        Litigation    case [(2021) Yu 18 Min Chu            812         No          has been        the    plaintiff for
Company         Business Development Co., Ltd.
                                                                                      No. 20]                                                       made            economic losses of
                                                                                                                                                                    RMB 3 million.
                Puyang Lidu Real Estate Development                                   Unfair Competition and                                                        The defendant shall
                Co., Ltd., Puyang Yiwu International                                  Infringement of Trademark                                     Judgment        jointly compensate
The
                Trade City Commercial Management            None        Litigation    Exclusive Rights Dispute              512         No          has been        the    plaintiff for
Company
                Co., Ltd., Puyang Yanbin Building                                     Case [(2021) Yu 09 Zhi Min                                    made            economic losses of
                Catering Culture Co., Ltd.                                            Chu No. 37]                                                                   RMB 3.1038 million.
                                                                                      Unfair Competition and                                                        The defendant shall
                Pingdingshan Yuhong Jiaye Real
                                                                                      Infringement of Trademark                                     Judgment        jointly compensate
The             Estate   Development    Co.,     Ltd.,
                                                            None        Litigation    Exclusive Rights Dispute              512         No          has been        the    plaintiff for
Company         Pingdingshan Wanshang Yiwu Small
                                                                                      Case [(2021) Yu 04 Zhi Min                                    made            economic losses of
                Commodity Market Operation Co., Ltd.
                                                                                      Chu No. 82]                                                                   RMB 1.5 million.



                                                                                             72   / 228
                                                                         2021 Annual Report

                                                                                                                            The           defendant
                                                                                                                            Qingzhou         Yifeng
                                                                                                                            Hanjin Real Estate
          Qingzhou Yifeng Hanjin Real Estate                                                                                Co.,       Ltd.    shall
                                                                        Unfair Competition and
          Co., Ltd., Qingzhou Yifeng Commercial                                                                  Judgment   compensate          the
The                                                                     Trademark      Infringement
          Property Management Co., Ltd.,            None   Litigation                                 812   No   has been   plaintiff for economic
Company                                                                 Dispute Case [(2021) Lu 07
          Shandong Yifeng Industrial Group Real                                                                  made       losses of RMB 2
                                                                        Min Chu No. 38]
          Estate Co., Ltd.                                                                                                  million             and
                                                                                                                            reasonable
                                                                                                                            expenses of RMB
                                                                                                                            101,100
                                                                                                                            The defendant shall
                                                                                                                            jointly and severally
                                                                                                                            compensate          the
          Nanjing Yiwu Small Commodity City
                                                                        Dispute     over     unfair              Judgment   plaintiff for economic
The       Co., Ltd., Nanjing Zheshang Investment
                                                    None   Litigation   competitions [(2021) Su 01    812   No   has been   losses of RMB 6
Company   Co., Ltd., Nanjing Xiezhong Group Real
                                                                        Min Chu No. 630]                         made       million             and
          Estate Development Co., Ltd.
                                                                                                                            reasonable
                                                                                                                            expenses of RMB
                                                                                                                            103,600
                                                                                                                            The defendant shall
                                                                                                                            compensate          the
                                                                        Unfair Competition and                              plaintiff for economic
                                                                                                                 Judgment
The       Shanxi Yuheng Shengshi Real Estate                            Trademark      Infringement                         losses of RMB 1
                                                    None   Litigation                                 812   No   has been
Company   Development Co., Ltd.                                         Dispute Case [(2021) Jin 01                         million             and
                                                                                                                 made
                                                                        Min Chu No. 394]                                    reasonable
                                                                                                                            expenses of RMB
                                                                                                                            101,200
                                                                                                                            The defendant shall
                                                                                                                            jointly and severally
          Zhenjiang Hongda Real Estate Co.,                                                                                 compensate          the
                                                                        Dispute     over     unfair              Judgment
The       Ltd., Zhenjiang Hongda Yiwu Small                                                                                 plaintiff     RMB      6
                                                    None   Litigation   competitions [(2021) Su 01    812   No   has been
Company   Commodity Market Management Co.,                                                                                  million             and
                                                                        Min Chu No. 1336]                        made
          Ltd.                                                                                                              reasonable
                                                                                                                            expenses of RMB
                                                                                                                            101,100
                                                                                                                            The defendant shall
                                                                                                                            jointly and severally
                                                                                                                            compensate RMB 6
          Dongguan    Xingying     Yiwu     Small                       Unfair competition dispute               Judgment
The                                                                                                                         million for economic
          Commodity City Co., Ltd., Dongguan        None   Litigation   case [(2021) Yu 19 Min Chu    812   No   has been
Company                                                                                                                     losses and RMB
          Hongyu Industrial Investment Co., Ltd.                        No. 76]                                  made
                                                                                                                            101,100              for
                                                                                                                            reasonable
                                                                                                                            expenses
          Zhejiang Yiwu Chuanglian Market                               Unfair Competition Dispute               Judgment   The defendant shall
The
          Investment Management Co., Ltd.,          None   Litigation   Case [(2021) Xiang 07 Zhi     792   No   has been   jointly and severally
Company
          Hunan Zotye Real Estate Development                           Min Chu No. 167]                         made       compensate          the



                                                                               73   / 228
                                                                            2021 Annual Report

               Co., Ltd.,   Deng   Shenping,   Wang                                                                                      plaintiff           RMB
               Zhiyong                                                                                                                   200,000              and
                                                                                                                                         reasonable
                                                                                                                                         expenses of RMB
                                                                                                                                         103,700
                                                                           Unfair Competition Disputes                                   The defendant shall
               Chongqing Jingtou Investment Group                          and     Infringement     of                    Judgment       jointly compensate
The
               Co., Ltd., Chongqing Jingtou Wanyu      None   Litigation   Trademark Exclusive Rights         512    No   has been       the       plaintiff   for
Company
               Real Estate Co., Ltd.                                       [(2021) Yu 01 Min Chu No.                      made           economic losses of
                                                                           663]                                                          RMB 3 million.
Zhejiang
                                                                           Dispute     over      unfair                   Judgment
Yiwugou E-                                                                                                                               The plaintiff's claims
commerce
               The Company                             None   Litigation   competitions [(2020) Z 01 M      1,000    No   has been
                                                                                                                                         were dismissed
                                                                           C No. 2202]                                    made
Co., Ltd.
                                                                                                                                         The defendant shall
                                                                                                                                         pay the plaintiff RMB
                                                                                                                                         6,000,600 in rent,
                                                                           Leasing Contract Dispute                       Judgment
Supply Chain   Zhejiang Jielian Network Technology                                                                                       RMB 261,300 in
                                                       None   Litigation   Case [(2021) Zhe 0782 Min      1,328.67   No   has been
Company        Co., Ltd.                                                                                                                 public         energy
                                                                           Chu No. 19808]                                 made
                                                                                                                                         consumption,       and
                                                                                                                                         pay        liquidated
                                                                                                                                         damages
               Shenzhen Maojun Investment Co., Ltd.,                                                                      Trial   has
               Shenzhen Yiwu Small Commodity                               Second     instance     of                     started, but
The            Wholesale City Co., Ltd., Shenzhen                          trademark     infringement                     no
                                                       None   Litigation                                    1,212    No
Company        Longgang District Weifa Enterprise                          dispute [(2021) Yu Min                         judgment
               Development Co., Ltd., Zhejiang Yiwu                        Zhong No. 1431]                                has been
               Shangdu Market Development Co., Ltd.                                                                       made
                                                                                                                          Trial   has
               Yiwu Wankexing Market Development
                                                                                                                          started, but
               Co., Ltd., Xinyang Wanjia Denghuo                           Dispute     over      unfair
The                                                                                                                       no
               Industry Co., Ltd., Henan Zhongda       None   Litigation   competitions [(2021) Zhe 07        792    No
Company                                                                                                                   judgment
               Commercial Operation Management                             Min Chu No. 58]
                                                                                                                          has been
               Co., Ltd.
                                                                                                                          made
                                                                                                                          Trial   has
               Guangxi Huading Century Investment
                                                                                                                          started, but
               Group Co., Ltd., Yulin Huading                              Dispute     over      unfair
The                                                                                                                       no
               Investment   Co.,    Ltd.,    Yulin     None   Litigation   competitions [(2021) Gui 01        812    No
Company                                                                                                                   judgment
               Wanshanghui Commercial Operation                            Min Chu No. 817]
                                                                                                                          has been
               Co., Ltd.
                                                                                                                          made




                                                                                  74   / 228
                                                                  2021 Annual Report



              (iii) Other statements
              √Applicable □Not Applicable
                    In March 2018, the Company and Yiwu China Commodities City (the Company’s former
              holding subsidiary, present participating company, in which the Company holds 35.8% of shares)
              was sued by Bank of China Co., Ltd. Yiwu Branch (hereinafter referred to as “Bank of China Yiwu
              Branch”) due to a letter of credit dispute” to the Jinhua Intermediate People’s Court of Zhejiang
              Province (hereinafter referred to as “Jinhua Intermediate Court”). For details, see the
              “Announcement on Litigation Involved in the Company and Its Holding Subsidiaries" (Lin 2018-008)
              disclosed by the Company on March 2, 2018. Later, the lawsuit was dismissed by Jinhua
              Intermediate Court.
                   On May 18, 2018, Bank of China Yiwu Branch transferred all the rights of the principal and
              interest, compound interest, liquidated damages, compensation and other claims under the letter of
              credit involved to China Cinda Asset Management Co., Ltd. Zhejiang Branch (hereinafter referred to
              as "Cinda Assets").
                   On June 25, 2021, Cinda Assets again filed a civil lawsuit with the Jinhua Intermediate
              People's Court on the dispute over the letter of credit. For details, see the “Announcement on the
              Progress of Litigation Involved in the Company and its Subsidiaries” (Lin 2021-036) disclosed by
              the Company on July 21, 2021.
                   No hearings have been held as of the end of the reporting period.


              X.   Information of the listed company and its directors, supervisors, senior management,
                   controlling shareholder, and actual controller suspected of violations of laws and
                   regulations, penalties and rectification
              □Applicable √Not Applicable

              XI. Credit standing of the Company and its controlling shareholder and actual controller
              √Applicable □Not Applicable
                  There was no outstanding court judgment or overdue debt of a large amount involving the
              Company or its controlling shareholder or actual controller during the reporting period.


              XII. Material related-party transactions
              (i) Related-party transactions relating to regular corporate operation
               1. Matters that have been disclosed in the temporary announcements and had no further
                   progresses or changes
              □Applicable √Not Applicable
               2. Matters that have been disclosed in the temporary announcements but had further
                   progresses or changes
              □Applicable √Not Applicable

                3. Matters that have not been disclosed in the temporary announcements
              √Applicable □Not Applicable
                                                                                                                             Unit: RMB
                                                                                                      Percentage                     Reasons
                            Type of
                                       Contents of                                      Amount of         in the                       for the
  Related                   related-                   Pricing    Price of related-                                Settlement Market
             Relationship             related-party                                   related-party     amount of                       large
counterparty                 party                    principle   party transaction                                 method M/Price
                                       transaction                                     transaction       similar                     difference
                          transaction
                                                                                                      transactions                    between

                                                                        75   / 228
                                                                       2021 Annual Report


                                                                                                          (%)                    the price of
                                                                                                                                      the
                                                                                                                                 transaction
                                                                                                                                     and
                                                                                                                                  reference
                                                                                                                                    market
                                                                                                                                     price
                                           Epidemic
                 Subsidiaries
                                           prevention
                 of
Yiwu Security                  Acceptance and control
                 controlling                              Market                                                  Account
Service Co.,                   of labor    and                          23,927,708.38     23,927,708.38   47.51
                 shareholder                              price                                                   transfer
Ltd.                           service     exhibition
                 parent
                                           security
                 company
                                           service fee
                                           Property
Yiwu China Controlling
                                           service fee
Commodities subsidiaries Acceptance
                                           and            Market                                                  Account
City Property of               of labor                                 13,721,576.38     13,721,576.38   27.24
                                           greening       price                                                   transfer
Service Co., controlling service
                                           maintenance
Ltd.             shareholder
                                           fee
                 Controlling               Warehouse      Market                                                  Account
CCCH                           Rent                                      3,947,798.16      3,947,798.16    7.84
                 shareholder               space rental   price                                                   transfer
                 Controlling
                 subsidiaries
                                           Office space   Market                                                  Account
CCCP             of            Lease out                                 3,767,104.11      3,767,104.11    7.48
                                           rental         price                                                   transfer
                 controlling
                 shareholder
Yiwu China
Commodities
City Creative                  Acceptance
                                                          Market                                                  Account
Design and Associates of labor             Design fee                    1,953,465.33      1,953,465.33    3.88
                                                          price                                                   transfer
Development                    service
Services Co.,
Ltd.
Yourworld
International
                 Branches of
Conference
                 the
Center,                        Acceptance
                 controlling               Laundering     Market                                                  Account
subordinated                   of labor                                  1,594,054.55      1,594,054.55    3.17
                 shareholder               fees           price                                                   transfer
to Yiwu                        service
                 parent
Market
                 company
Development
Group
Yourworld
International
                 Branches of
Conference
                 the                       Entrusted
Center,
                 controlling Other         management     Negotiated                                              Account
subordinated                                                             1,453,314.18      1,453,314.18    2.88
                 shareholder inflow        fees and       price                                                   transfer
to Yiwu
                 parent                    license fees
Market
                 company
Development
Group
                            Total                             /               /           50,365,021.09     100     /        /        /
Return of large-value goods sales
Illustration on related-party transactions


               (ii) Related transactions in the acquisition or sale of assets or equity
                1. Matters that have been disclosed in the temporary announcements and had no further
                    progresses or changes
               □Applicable √Not Applicable

               2. Matters that have been disclosed in the temporary announcements but had further
                    progresses or changes
               □Applicable √Not Applicable

               3. Matters that have not been disclosed in the temporary announcements
               □Applicable √Not Applicable


                                                                            76    / 228
                                        2021 Annual Report


4. If any agreement on the operating results is involved, the achievement of operating
     results during the reporting period shall be disclosed
□Applicable √Not Applicable

(iii) Related-party transactions arising from joint external investment
  1. Matters that have been disclosed in the temporary announcements and had no further
      progresses or changes
□Applicable √Not Applicable
  2. Matters that have been disclosed in the temporary announcements but had further
      progresses or changes
√Applicable □Not Applicable
      (1) The Company and the controlling shareholder CCCH increased the capital of CCCP in
monetary form according to the shareholding ratio. CCCH increased the capital by RMB 1.275
billion, the Company increased the capital by RMB 1.225 billion. After the capital increase, the
registered capital of CCCP was RMB 5 billion, and the shareholding ratio of both parties maintained
unchanged. For details, see the “Announcement on Capital Increase to Participating Companies
and Related Transactions” (Announcement No.: Lin 2021-014).
    By the end of the reporting period, the Company and CCCH have completed capital
contributions, and CCCP has completed its industrial and commercial alteration registration.
    (2) The Company and the controlling shareholder CCCH proposed to increase the capital of
CCCP in monetary form according to the shareholding ratio. CCCH increased the capital by RMB
2.55 billion, the Company increased the capital by RMB 2.45 billion. After the capital increase, the
registered capital of CCCP was RMB 10 billion, and the shareholding ratio of both parties
maintained unchanged. For details, see the “Announcement on Capital Increase to Participating
Companies and Related Transactions” (Announcement No.: L 2021-049).
    The Company held the thirty-ninth meeting of the eighth Board of Directors of the Company on
October 29, 2021, at which it reviewed and approved the "Proposal on Revocation of the "Proposal
on the Capital Increase and Related Party Transactions of the Equity Participating Company" and
submitted to the General Meeting of Shareholders for deliberation, agreeing to cancel the above-
mentioned capital increase. For details, see the “Announcement on Capital Increase to Participating
Companies and Related Transactions” (Announcement No.: L 2021-052).

  3. Matters that have not been disclosed in the temporary announcements
□Applicable √Not Applicable
(iv) Related-party credits and debts
  1. Matters that have been disclosed in the temporary announcements and had no further
     progresses or changes
□Applicable √Not Applicable
  2. Matters that have been disclosed in the temporary announcements but had further
     progresses or changes
√Applicable □Not Applicable
     In order to meet the development needs of Handing Shangbo, a wholly-owned subsidiary of the
Company's subsidiary CCCP for the development of real estate project on the east side of the
intersection of Fotang Avenue and Shuangfeng Road, Fotang Town, Yiwu, the Company provided
Handing Shangbo with a financial aid of no more than RMB 490 million. CCCH, the Company’s

                                              77   / 228
                                        2021 Annual Report


controlling shareholder, will provide Handing Shangbo with the financial aid in the same proportion
of its indirect shareholding in Handing Shangbo. For details, please refer to the Announcement on
Providing External Financial Assistance and Related Party Transactions (Announcement Number:
L2020-098).
    As of the end of the reporting period, the Company provided financial aid of RMB 220 million,
and CCCH has provided financial aid of RMB 231 million.

 3. Matters that have not been disclosed in the temporary announcements
□Applicable √Not Applicable
(v) Financial business between the Company and the associated financial companies, the
    Company's holding financial company and the related parties
□Applicable √Not Applicable

(vi) Others
□Applicable √Not Applicable

XIII. Material contracts and performance thereof
(i) Trusteeship, contracting and leases
 1. Trusteeship
□Applicable √Not Applicable

2. Contracting
□Applicable √Not Applicable

3. Lease
□Applicable √Not Applicable




                                             78   / 228
                                                                              2021 Annual Report




(ii) Guarantees
√Applicable □Not Applicable
                                                                                                                                                       Unit: RMB10,000
                                        External guarantees provided by the Company (excluding those provided for the subsidiaries)
          Relationship
                                            Date of
          between the                                                                                 Is the               Overdue               Is it a
                                           guarantee        Guarantee Guarantee                                   Is the
            guarantor     The   Amount of                                        Type of Collateral guarantee             amount of Counter     related-   Related
Guarantor                                   (signing         Starting  Maturity                                 guarantee
             and the guaranteed guarantee                                       guarantee (if any) fulfilled in              the    guarantees   party   Relationship
                                          date of the         date      date                                     overdue
              Listed                                                                                    full              guarantee            guarantee
                                          agreement)
            Company
The       The          Yiwu     14,528.77 December          July 1,      December Joint and            No         No                  SCO        Yes           Joint
Company Company        Shanglv            16, 2015          2015         15, 2026 several                                             provided a              venture
          itself                                                                  liability                                           counter-
                                                                                  guarantee                                           guarantee
The        The          Yiwu           828.31 August 13, December December Joint and                   No         No                  CCCH       Yes           Joint
Company Company         Shanglv                 2020         25, 2020 24, 2023 several                                                provided a              venture
           itself                                                                 liability                                           counter-
                                                                                  guarantee                                           guarantee
Hangzhou Wholly-        House                                                     Joint and            No         No                             No
Shangbo owned           purchaser                                                 several
                                       506.33
Nanxing subsidiary                                                                liability
                                                                                  guarantee
Amount of guarantees made during the reporting period (excluding the                                                                                        -81,535.84
guarantees provided for subsidiaries)
Balance of guarantees at the end of the reporting period (A) (excluding the                                                                                  15,863.41
guarantees provided for subsidiaries)
                                                   The guarantee of the Company and its subsidiaries to the subsidiaries
Amount of guarantees provided for subsidiaries during the reporting period                                                                                              -
Balance of guarantees provided for subsidiaries at the end of the reporting                                                                                             -
period (B)
                                         Total guarantees provided by the Company (including those provided for the subsidiaries)

Total amount of guarantees (A+B)                                                                                                                             15,863.41
Ratio of the total amount of guarantees to the Company’s net assets (%)                                                                                          1.08
Among which:
Amount of guarantees provided for shareholders, actual controller and their                                                                                             -

                                                                                   79   / 228
                                                                             2021 Annual Report




related parties (C)
Amount of guarantees provided directly or indirectly for the debtors whose                                                                                                   -
debt-to-asset ratio exceed 70% (D)
Portion of total amount of guarantees in excess of 50% of net assets (E)                                                                                                     -

Total (C+D+E)                                                                                                                                                                 -
Statement on the joint and several liability that may be assumed due to
outstanding guarantees
Statement on guarantees                                                 1. According to the resolution of the 15th Meeting of the 7th Board of Directors on July 1, 2015,
                                                                        the Group applied for a RMB 750 million loan with Agricultural Bank of China Yiwu Branch for
                                                                        Yiwu Shanglv and provided guarantees in accordance with the shareholding ratio. The guarantee
                                                                        method was joint liability guarantee, the highest guarantee amount was RMB 367.5 million and
                                                                        the guarantee term was11 years. As of December 31, 2021, Yiwu Shanglv actually borrowed
                                                                        RMB 296,505,577.63 (December 31, 2020: RMB 477,659,739.88) from the banks in total.
                                                                        According to the agreement of the guarantee contract, it assumed the guarantee liability of RMB
                                                                        145,287,733.04 (December 31, 2020: RMB 234,053,272.54) for the Agricultural Bank of China
                                                                        Yiwu Branch. Yiwu State-owned Capital Operation Co., Ltd. provided a counter guarantee for this
                                                                        guarantee.
                                                                        2. According to the resolution of the 19th Meeting of the 8th Board of Directors on August 13,
                                                                        2020, the Group applied for a loan with a total amount of not more than RMB 100 million for Yiwu
                                                                        Shanglv with the Bank of Communications Co., Ltd. Yiwu Branch and provided a guarantee in
                                                                        proportion to the shareholding ratio. The guarantee method was under joint liability, the
                                                                        maximum amount of the guarantee was RMB 49 million, and the guarantee period was two
                                                                        years, from the date of the expiry of the debt performance period agreed in the independent
                                                                        contract until the date of the expiration of the debt performance period of all last due main debt
                                                                        under the master contract. As of December 31, 2021, Yiwu Shanglv actually borrowed RMB
                                                                        28,404,291.89 (December 31, 2020: RMB 11,500,000.00) from banks in total. According to the
                                                                        agreement of the guarantee contract, it assumed the guarantee liability of RMB 8,283,103.03
                                                                        (December 31, 2020: RMB 5,635,000.00) for the Agricultural Bank of China Yiwu Branch. CCCH
                                                                        provided a counter-guarantee
                                                                        3. According to relevant regulations, before the purchaser of the commercial housing sold by the
                                                                        Group has obtained the property certificate, the Group shall provide the purchaser with a bank
                                                                        mortgage guarantee. As of December 31, 2021, the unsettled guarantee amount was RMB
                                                                        5,063,333.60 (December 31, 2020: RMB 16,170,141.08). Those guarantees would be released
                                                                        after the issuance of the property ownership certificates and are thus little likely to incur losses.
                                                                        Therefore, the management believed that it was not necessary to make provision for the
                                                                        guarantees.




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                                          2021 Annual Report



(iii) Entrust the management of the cash assets of others
1.   Entrusted financial management
(1). The totality of entrusted financial management
√Applicable □Not Applicable
                                                                                  Unit: RMB10,000
                                                                                     Overdue
                                                                    Unexpired
          Type              Source of funds      Amount                            unrecovered
                                                                     balance
                                                                                     amount
Non-guaranteed           Self-owned                         1,850         1,000                 -
floating income          funds
Principal Guaranteed     Self-owned                         1,500         1,500                     -
Fixed Income             funds



Other information
□Applicable √Not Applicable


(2). Individual entrusted financial management
□Applicable √Not Applicable


Other information
□Applicable √Not Applicable




(3). Entrusted financial management impairment provision
□Applicable √Not Applicable


2.   Entrusted Loan
(1). Total entrusted loan
□Applicable √Not Applicable


Other information
√Applicable □Not Applicable
     1. After review and approval at the 44th meeting of the sixth Board of Directors of the Company

in April 2014 and the 22nd meeting of the seventh Board of Directors of the Company in March

2016, the Company applied to the Export-Import Bank of China for a total loan of RMB 700 million.

Special entrusted loans to market merchants are valid within 2 years from the date of approval by

the Board of Directors. The Company's loans to the Export-Import Bank of China are guaranteed by

MDG, and Shanghai Pudong Development Bank Yiwu Branch acts as an entrusted loan processing



                                               81   / 228
                                               2021 Annual Report



bank. Market traders who entrust loans are pledged with the right to use shops in China Commodity

City.

        There are no new entrusted loans in this period, and all entrusted loans issued in the previous

period have expired.
        As of December 31, 2021, there were 13 overdue loans with an amount of RMB 2.9173 million
(if there is any loss outside the quota after the auction of the right to use the shop, it will be
compensated).



(2). Single Entrusted Loan
□Applicable √Not Applicable


Other information
□Applicable √Not Applicable


(3). Entrusted loan impairment provision
□Applicable √Not Applicable


 3.     Other information
□Applicable √Not Applicable


(iv) Other material contracts
√Applicable □Not Applicable

                                                                                                    Contract price
No.                      Name of contract                                Contracting party
                                                                                                    (RMB10,000)
         Yiwu International Trade City Zone II East Parking       Yiwu Haoyang Construction Co.,
1                                                                                                         28,450.06
             Building Project Construction Contract 1                           Ltd.
                                                                  Haier Group (Qingdao) Financial
2                   Equity Transfer Agreement                                                             44,930.00
                                                                         Holdings Co., Ltd.
          Yiwu Comprehensive Bonded Zone New Import                    Zhejiang Construction
3                                                                                                         63,710.82
             Market - South Zone Engineering Contract               Engineering Group Co., Ltd.
          Yiwu Comprehensive Bonded Zone New Import                 China Construction Seventh            72,323.68
4
            Market - North Zone Engineering Contract                Engineering Bureau Co., Ltd.
           Yiwu Digital Trade Industrial Park Engineering          Zhongtian Construction Group           23,752.62
5
            Construction Project Construction Contract                        Co., Ltd.




XIV. Explanation on other major events that have a significant impact on investors' value
        judgments and investment decisions
□Applicable √Not Applicable




                                                     82   / 228
                                               2021 Annual Report




                     Section VII. Changes in Shares and Shareholders
     I.   Changes in equity
     (i) Exhibition of changes in shares
     1. Exhibition of changes in shares
                                                                             Unit: Ten Thousand Shares
                                                Increase or decrease in the current
                       Before this change                                                 After this change
                                                            period (+, -)
                                                               Shar
                                                                  es
                                                               conv
                                                        Bo
                                       Prop     New            erted                                     Propor
                                                        nus             Oth   Sub-
                        Quantity       ortio   shares           from                     Quantity         tion
                                                        sha              ers  total
                                       n (%)   issued          capit                                      (%)
                                                        res
                                                                  al
                                                               reser
                                                                  ve
I. Restricted
                            0            0      4,904         0     0   -98   4,806        4,806         0.88
shares
1. Shares held by
other domestic              0            0      4,904         0     0   -98   4,806        4,806         0.88
capitals
In which: shares
held by domestic
                            0            0      4,904         0     0   -98   4,806        4,806         0.88
non-state-owned
natural persons
II. Unrestricted
                     544,321.4176       100       0           0     0   0          0   544,321.4176     99.12
shares
1. RMB-
denominated          544,321.4176       100       0           0     0   0          0   544,321.4176     99.12
common shares
III. Total number
                     544,321.4176       100     4,904         0     0   -98   4,806    549,127.4176      100
of shares


     2. Description of changes in shares
     √Applicable □Not Applicable
          On January 15, 2021, due to the first grant of the 2020 restricted equity incentive plan, an

     additional 46.7 million shares of restricted shares were issued.

          On November 4, 2021, due to the reserved grant of the 2020 Restricted Equity incentive Plan,

     an additional 2.34 million shares of restricted tradable shares were added.

          On November 30, 2021, because some incentive objects no longer met the incentive

     conditions, the Company repurchased and cancelled 980,000 shares of restricted shares.


     3. The impact of changes in shares on financial indicators such as earnings per share and
          net assets per share in the most recent year and the most recent period (if any)
     √Applicable □Not Applicable

                                                      83   / 228
                                            2021 Annual Report



       During the reporting period, the Company's share capital changed due to the implementation of

the restricted equity incentive plan. For details, please refer to "Section II, VII. Major accounting

data and financial indicators in the past three years."


4. Other matters the Company deems it necessary to disclose or required by the securities
       regulatory authority to be disclosed
□Applicable √Not Applicable
(ii) Changes in non-tradable shares
√Applicable □Not Applicable
                                                                                            Unit: 10,000 shares
                      Number
                                    Number                        Number
                         of                       Number of
                                       of                            of
                     restricted                   increased                    Reasons
                                   restricted                    restricted
                     shares at                    restricted                      for
      Shareholder                    shares                      shares at                     Release date
                        the                         shares                    restriction
                                   released                       the end
                     beginning                    during the                   on trade
                                     during                        of the
                       of the                        year
                                    the year                        year
                       year
                                                                                 The          lock-up
                                                                                 period      is    24
386      incentive
                                                                                 months,           36
objects for first-
                                                                   Restricted months and 48
time grand of the
                     0          0           4,572       4,572      equity        months from the
restricted equity
                                                                   incentives date when the
incentive plan in
                                                                                 registration of the
2020
                                                                                 reserved grant is
                                                                                 completed.
                                                                                 The          lock-up
                                                                                 period      is    24
31       incentive
                                                                                 months,           36
objects          for
                                                                   Restricted months and 48
reserved grant
                     0          0            234         234       equity        months from the
of       restricted
                                                                   incentives date when the
equity incentive
                                                                                 registration of the
plan in 2020
                                                                                 reserved grant is
                                                                                 completed.
       Total         0          0           4,806       4,806           /                  /
Note: The Company granted 46.7 million shares to 395 incentive objects for the first time. Because
9 incentive objects no longer met the incentive conditions, the Company repurchased and cancelled
980,000 shares of restricted shares. As of the end of the reporting period, there were 386 surviving
first-time incentive objects, holding a total of 45.72 million restricted shares.


II.     Securities issuance and listing
(i)     Securities issuance as of the reporting period
√Applicable □Not Applicable
                                                                 Currency: 10,000 shares Currency: RMB
      Stocks and                      Issuing                                   Number of Transaction
                                                         Issuing
      derivatives     Issue date      price (or                   Listing date   approved   termination
                                                         number
       Types of                       interest                                     listing     date
                                                    84   / 228
                                          2021 Annual Report


  securities                          rate)                                 transactions
Common stock class
                    January      RMB 2.94                 January
       A share                                 4,670                       4,670
                    15, 2021       /share                 15, 2021
                   November     RMB 2.39 /               November
     A share                                    234                         234
                     4, 2021        share                  4, 2021
Bonds (including corporate bonds, corporate bonds, and non-financial corporate debt financing
instruments)
 19 YIWU CCC         June 3,                              June 18,                       June 5,
                                   4.30%        800                         800
       01             2019                                   2019                         2022
 19 YIWU CCC       September                              October                      September
                                   3.99%        700                         700
       02           26, 2019                              15, 2019                      27, 2022

Notes on the issuance of securities as of the reporting period (for bonds with different interest rates
during the duration, please specify separately):
√Applicable □Not Applicable
       In accordance with the CSRC License [2019] 380 document issued by the China Securities

Regulatory Commission on March 14, 2019, the Company publicly issued RMB 800,000,000 of

corporate bonds on June 3, 2019. The face value of the current bonds is RMB 100 and the coupon

rate is 4.30 %. It was listed and traded on the Shanghai Stock Exchange on June 18, 2019. The

abbreviation of the bond is 19XS01 and the bond code is 155450.

       In accordance with the document Zheng Jian Li [2019] No. 380 issued by the China Securities

Regulatory Commission on March 14, 2019, the Company publicly issued RMB 700,000,000 of

corporate bonds on September 26, 2019. The face value of the current bonds is RMB 100, and the

coupon rate is 3.99%. It was listed and traded on the Shanghai Stock Exchange on October 15,

2019. The abbreviation of the bond is 19XS02 and the bond code is 155750.


(ii) Changes in the total number of shares of the Company, the shareholder structure, and
       changes in the Company's assets and liabilities structure
□Applicable √Not Applicable


(iii) Existing internal employee shares
□Applicable √Not Applicable
III.   Shareholders and actual controllers
(i)    Total number of shareholders
The total number of common shareholders as of the end of                                       178,184
the reporting period
The total number of common shareholders (households) at                                        174,429
the end of the previous month before the disclosure of the
annual report



                                                85   / 228
                                              2021 Annual Report



      (ii) Shareholdings of the top 10 shareholders and top 10 holders of tradable shares (or
          shareholders not subject to trading restrictions)
                                                                                              Unit: share
                                 Shares held by top 10 shareholders
                                 Number of                 Number       Pledge, mark or
                  Change
                               shares held at               of non-         freezing             Ownership
Shareholder      during the                    Proportion
                               the end of the              tradable                                  of
 (full name)     reporting                        (%)                  Status of
                                  reporting                 shares                 Quantity     shareholder
                  period                                                shares
                                   period                    held
 Yiwu China                                                                                       State-
Commodities                                                                                       owned
                      0        3,038,179,392        55.33          0    None          0
City Holdings                                                                                      legal
   Limited                                                                                        person
  Zhejiang
                                                                                                  State-
  Provincial
                                                                                                  owned
   Finance            0         147,466,528         2.69           0    None          0
                                                                                                   legal
Development
                                                                                                  person
     Ltd.
 Hong Kong
  Securities
   Clearing      50,437,703      63,910,325         1.16           0   Unknown        0           Others
  Company
Ltd.(HKSCC)
                                                                                                 Domestic
 LI Guoping      41,954,500      41,954,500         0.76           0   Unknown        0           natural
                                                                                                  person
                                                                                                 Domestic
 LIU Jiaxuan     30,401,500      30,401,500         0.55           0   Unknown        0           natural
                                                                                                  person
Bosera Funds
-Agricultural
Bank of China
   -Bosera
     China            0          27,672,800         0.50           0   Unknown        0          Unknown
  Securities
   Financial
     Assets
Management
   Scheme
   E Fund-
  Agricultural
Bank of China
   -E Fund
     China            0          27,672,800         0.50           0   Unknown        0          Unknown
  Securities
   Financial
     Assets
Management
   Scheme




                                                   86   / 228
                                             2021 Annual Report


Dacheng Fund
-Agricultural
Bank of China
   -Dacheng
      China            0        27,672,800         0.50           0    Unknown        0        Unknown
   Securities
    Financial
      Assets
 Management
     Scheme
   GF Fund-
   Agricultural
Bank of China
  -GF China
   Securities          0        27,672,800         0.50           0    Unknown        0        Unknown
    Financial
      Assets
 Management
     Scheme
   Zhong Ou
     AMC-
   Agricultural
Bank of China
 -Zhong Ou
      China            0        27,672,800         0.50           0    Unknown        0        Unknown
   Securities
    Financial
      Assets
 Management
     Scheme
    Southern
      Asset
 Management
-Agricultural
Bank of China
  -Southern
                       0        27,672,800         0.50           0    Unknown        0        Unknown
      China
   Securities
    Financial
      Assets
 Management
     Scheme
  ICBC Credit
 Suisse Asset
 Management
-Agricultural
Bank of China
-ICBC Credit
                       0        27,672,800         0.50           0    Unknown        0        Unknown
Suisse China
   Securities
    Financial
      Assets
 Management
     Scheme
                           Shares held by top 10 holders of tradable shares
                               Number of tradable shares              Type and quantity of shares
         Shareholder
                                          held                       Type                  Quantity


                                                  87   / 228
                                                2021 Annual Report


 Yiwu China Commodities City                                      RMB-denominated
                                         3,038,179,392                                       3,038,179,392
        Holdings Limited                                           common share
  Zhejiang Provincial Finance                                     RMB-denominated
                                          147,466,528                                         147,466,528
       Development Ltd.                                            common share
 Hong Kong Central Clearing                                       RMB-denominated
                                           63,910,325                                         63,910,325
       Company Limited                                             common share
                                                                  RMB-denominated
          LI Guoping                       41,954,500                                         41,954,500
                                                                   common share
                                                                  RMB-denominated
          LIU Jiaxuan                      30,401,500                                         30,401,500
                                                                   common share
  Bosera Funds-Agricultural
 Bank of China-Bosera China                                      RMB-denominated
                                           27,672,800                                         27,672,800
   Securities Financial Assets                                     common share
     Management Scheme
 E Fund-Agricultural Bank of
     China-E Fund China                                          RMB-denominated
                                           27,672,800                                         27,672,800
   Securities Financial Assets                                     common share
     Management Scheme
  Dacheng Fund-Agricultural
Bank of China-Dacheng China                                      RMB-denominated
                                           27,672,800                                         27,672,800
   Securities Financial Assets                                     common share
     Management Scheme
GF Fund-Agricultural Bank of
  China-GF China Securities                                      RMB-denominated
                                           27,672,800                                         27,672,800
 Financial Assets Management                                       common share
             Scheme
 Zhong Ou AMC-Agricultural
   Bank of China-Zhong Ou                                        RMB-denominated
                                           27,672,800                                         27,672,800
   China Securities Financial                                      common share
 Assets Management Scheme
Southern Asset Management-
  Agricultural Bank of China-
                                                                  RMB-denominated
   Southern China Securities               27,672,800                                         27,672,800
                                                                   common share
 Financial Assets Management
             Scheme
   ICBC Credit Suisse Asset
   Management-Agricultural
  Bank of China-ICBC Credit                                      RMB-denominated
                                           27,672,800                                         27,672,800
    Suisse China Securities                                        common share
 Financial Assets Management
             Scheme
                                   Zhejiang Finance Development Co., Ltd. holds 9.44% of the shares of
Explanation on the relationship
                                   Yiwu State-owned Capital Operation Co., Ltd., the controlling shareholder
or concerted action between the
                                   of Yiwu China Commodity City Holding Limited, the controlling shareholder
above shareholders
                                   of Yiwu Market Development Group Co., Ltd.
Explanation on the preferred
shareholders whose voting
rights had been restituted and     None
the quantity of shares held
thereby
        Number of shares held by the top 10 shareholders subject to trading restrictions and the trading
      restriction conditions
      □Applicable √Not Applicable




                                                     88   / 228
                                          2021 Annual Report



(iii) Strategic investors or general legal persons became the top 10 shareholders due to the
      placement of new shares.
□Applicable √Not Applicable
IV.   Controlling shareholder and actual controller
(i)   Controlling shareholder
1. Legal person
√Applicable □Not Applicable
                                                               Yiwu China Commodities City Holdings
                          Name
                                                                              Limited
  The person in charge or legal representative of the unit                ZHAO Wenge
                  Date of establishment                                  October 29, 2019
                      Main business                              State-owned shareholding platform
   Shareholdings of other domestic and overseas listed
  companies that hold or participate in shares during the                       None
                     reporting period
                    Other statements                                            None
2. Natural person
□Applicable √Not Applicable
3. Special statement that the Company does not have a controlling shareholder
□Applicable √Not Applicable


4. Explanation on Changes in Controlling shareholder During the Reporting Period
□Applicable √Not Applicable
5. Block diagram of the property rights and control relationship between the Company and
      the controlling shareholder
√Applicable □Not Applicable




                                                        55.33%




(ii) The actual controller
1.    Legal person
√Applicable □Not Applicable
                                                                 State-owned Assets Supervision and
                         Name                                    Administration Office of the People’s
                                                                         Government of Yiwu
                                               89   / 228
                                         2021 Annual Report


The person in charge or legal representative of the unit                 YU Huazhong
                Date of establishment                                   March 26, 2009
                                                              State-owned capital management and
                    Main business
                                                                state-owned equity management
 Shareholdings of other domestic and overseas listed
companies that hold or participate in shares during the                     None
                   reporting period
                  Other statements                                          None


2.   Natural person
□Applicable √Not Applicable
3.   Special explanation that the Company does not have an actual controller
□Applicable √Not Applicable


4.   Explanation on changes in the Company's control during the reporting period
□Applicable √Not Applicable


5.   Block diagram of the property rights and control relationship between the Company and
     the actual controller
√Applicable □Not Applicable




                                               55.33%




                                               90   / 228
                                      2021 Annual Report



6.    The actual controller controls the Company through trust or other asset management
      methods.
□Applicable √Not Applicable


(iii) Other introductions of controlling shareholder and actual controllers
□Applicable √Not Applicable


V.    The controlling shareholder or the largest shareholder of the Company and its persons
      acting in concert have accumulatively pledged shares that account for more than 80%
      of the Company's shares held by them
□Applicable √Not Applicable
VI.   Other corporate shareholders holding more than 10% of the shares
□Applicable √Not Applicable
VII. Description of share restriction reduction
□Applicable √Not Applicable


VIII. The specifics of implementation of share repurchase during the reporting period
□Applicable √Not Applicable




                                            91   / 228
                                        2021 Annual Report




                                Section VIII. Preferred Shares
□Applicable √Not Applicable




                                             92   / 228
                                           2021 Annual Report



                                        Section IX. Bonds
I.   Corporate bonds, corporate bonds and non-financial corporate debt financing
     instruments
√Applicable □Not Applicable

(i) Corporate bonds
□Applicable √Not Applicable

(ii) Corporate bonds
√Applicable □Not Applicable

1.   Basic information on corporate bonds
                                                                    Unit: RMB 100 million Currency: RMB
                                                                                                         Wheth
                                                                                                            er
                                                                                 Method                 there is
                                                                                     of                   a risk
                                                                         Inter   principal                  of
                                                               Outstan
Name of    Abbrevi   Cod        Issue    Value    Maturit                 est    repaym      Marketp    termina
                                                                ding
 bond       ation     e          date    date     y date                 rate    ent and      lace      ting the
                                                               amount
                                                                          (%)    interest               transac
                                                                                 paymen                  tion in
                                                                                      t                    the
                                                                                                          stock
                                                                                                         market
                                                                                 For the
                                                                                 principal
                                                                                 repaym
                                                                                 ent and
                                                                                 interest
                                                                                 paymen
                                                                                 t of the
                                                                                 bond,
                                                                                 the list
                                                                                 of
                                                                                 bondhol
Publicly                                                                         ders
offered                                                                          would
corporat                                                                         be
e bond                                                                           made
2019 of                                                                          accordi
Zhejiang                                                                         ng     to   Shangh
           19
China                1554   June 3,     June 5,   June 5,                        the         ai Stock
           YIWU                                                8         4.3                            No
Commo                50     2019        2019      2022                           relevant    Exchan
           CCC 01
dities                                                                           provisio    ge
City                                                                             ns     of
Group                                                                            the
Co., Ltd                                                                         bond
(Phase                                                                           registrat
I)                                                                               ion
                                                                                 authorit
                                                                                 y. The
                                                                                 specific
                                                                                 matters
                                                                                 shall be
                                                                                 handled
                                                                                 accordi
                                                                                 ng     to
                                                                                 the
                                                                                 relevant
                                                                                 provisio

                                                  93   / 228
                                       2021 Annual Report


                                                                      ns     of
                                                                      the
                                                                      bond
                                                                      registrat
                                                                      ion
                                                                      authorit
                                                                      y.
                                                                      For the
                                                                      principal
                                                                      repaym
                                                                      ent and
                                                                      interest
                                                                      paymen
                                                                      t of the
                                                                      bond,
                                                                      the list
                                                                      of
                                                                      bondhol
                                                                      ders
                                                                      would
                                                                      be
                                                                      made
Publicly
                                                                      accordi
offered
                                                                      ng     to
corporat
                                                                      the
e bond
                                                                      relevant
2019 of
                                                                      provisio
Zhejiang                   Septe             Septe                                Shangh
           19                      Septem                             ns     of
China               1557   mber              mber                                 ai Stock
           YIWU                    ber,                  7     3.99   the                    No
Commo               50     26,               27,                                  Exchan
           CCC 02                  2019                               bond
dities                     2019              2022                                 ge
                                                                      registrat
City
                                                                      ion
Group
                                                                      authorit
Co., Ltd
                                                                      y. The
(Phase
                                                                      specific
II)
                                                                      matters
                                                                      shall be
                                                                      handled
                                                                      accordi
                                                                      ng     to
                                                                      the
                                                                      relevant
                                                                      provisio
                                                                      ns     of
                                                                      the
                                                                      bond
                                                                      registrat
                                                                      ion
                                                                      authorit
                                                                      y.


The Company's measures to deal with the risk of bond termination
□Applicable √Not Applicable

Bonds overdue
□Applicable √Not Applicable
Bond interest payment during the reporting period
√Applicable □Not Applicable
             Name of bond                         Description of interest payment
Publicly offered corporate bond 2019 On June 7, 2021, the Company paid interest to all "19XS01"
of Zhejiang China Commodities City     holders on time from June 5, 2020 to June 4, 2021.
Group Co., Ltd (Phase I)


                                            94   / 228
                                              2021 Annual Report



   Publicly offered corporate bond 2019       On September 27, 2021, the Company paid interest to all
   of Zhejiang China Commodities City         "19XS02" holders on time from September 27, 2020 to
   Group Co., Ltd (Phase II)                  September 26, 2021.

   2. Issuer or investor option clause, investor protection clause trigger and enforcement
   □Applicable √Not Applicable
   3.    Intermediaries providing services for bond issuance and duration business
                                                              Name of the
        Intermediary                                        Signing Certified      Contact     Contact
                                  Office address
            name                                                 Public            person      number
                                                              Accountants
                          15/F Yuanxiangtai Building,
   Haitong Securities                                       XU Kangwei, YE           HU
                              No.5 Anding Road,                                              17701835535
        Co., Ltd.                                             Shaokuan            Chenghao
                           Chaoyang District, Beijing

   Changes to the above intermediaries
   □Applicable √Not Applicable
   4. Use of raised funds at the end of the reporting period
   √Applicable □Not Applicable
                                                                     Unit: RMB 100 million Currency: RMB
                                                                                             Whether it is
                          Total                         Operation of                      consistent with the
                                                                          Rectification
                        amount                           the special                     purpose, using plan
                                   Amount   Amount                        of illegal use
  Name of bond             of                            account for                          and other
                                    used    unused                          of raised
                         funds                          raised funds                         agreements
                                                                         funds (if any)
                         raised                            (if any)                        promised in the
                                                                                             prospectus
Publicly    offered
corporate     bond
2019 of Zhejiang
                          8          8         0            None                None             Yes
China Commodities
City Group Co., Ltd
(Phase I)
Publicly    offered
corporate     bond
2019 of Zhejiang
                          7          7         0            None                None             Yes
China Commodities
City Group Co., Ltd
(Phase II)

   The progress and operational benefits of raised funds used for construction projects
   □Applicable √Not Applicable

   Explanation on changing the use of the above-mentioned bonds raised during the reporting period
   □Applicable √Not Applicable

   Other statements
   □Applicable √Not Applicable

   5. Adjustment in credit rating results
   □Applicable √Not Applicable
   Other statements
   √Applicable □Not Applicable
       Shanghai Brilliance Credit Rating & Investors Service Co., Ltd. issued the Credit Rating
   Surveillance Report on Zhejiang China Commodities City Group Co., Ltd. and Bonds Publicly

                                                   95   / 228
                                                       2021 Annual Report


               Issued by It [Brilliance Surveillance (2021) 100719] on Jun 28, 2021. The Company had an issuer
               rating of AAA with stable outlook, and the bonds had a rating of AAA.

               6.   The implementation, changes and impacts of guarantees, debt repayment plans and
                    other debt repayment protection measures during the reporting period and their
                    impacts
               □Applicable √Not Applicable

               7. Other statement on corporate bonds
               □Applicable √Not Applicable
               (iii) Non-financial corporate debt financing instruments in the inter-bank bond market
               √Applicable □Not Applicable
               1. Non-financial corporate debt financing instruments
                                                                          Unit: RMB 100 million Currency: RMB
                                                                                                                            Whe
                                                                                                                             ther
                                                                                                                            there
                                                                                                                       Tr    is a
                                                                                                              Inve
                                                                                                                       a     risk
                                                                                                              stor
                                                                            Out            Method                      d       of
                                                                                                        M     appr
                                                                            sta               of                       e    termi
                                                                                  Inter                 ar    opria
                                                                            ndi           principal                    m    natin
 Name of        Abbrev    Co                                   Maturity             est                 ke      te
                                 Issue date    Value date                    ng           repayme                      ec   g the
  bond           iation   de                                    date               rate                 tpl   arra
                                                                            am              nt and                     h    trans
                                                                                   (%)                  ac    nge
                                                                            oun            interest                    a    actio
                                                                                                         e    ment
                                                                              t           payment                      ni    n in
                                                                                                               s (if
                                                                                                                        s     the
                                                                                                              any)
                                                                                                                       m     stoc
                                                                                                                               k
                                                                                                                            mark
                                                                                                                               et
Zhejiang                                                                                                In
                                                                                          One-time
China            19                                                                                     te
                                                                                          repayme
Commodit        Zhejia                                                                                  rb
                                  July 11,                                                nt       of
ies   City       ng       101                                                                           a
                                  2019 to       July 15,       July 15,                   principal           Non
Group           Yiwu      900                                               10    3.99                  nk                   No
                                  July 12,       2019           2022                      and                  e
Co., Ltd.’s    CCC       921                                                                           m
                                   2019                                                   interest
2019            MTN0                                                                                    ar
                                                                                          at
MTN              01                                                                                     ke
                                                                                          maturity.
(Issue 1)                                                                                               t
Zhejiang                                                                                                In
                                                                                          One-time
China            19                                                                                     te
                                                                                          repayme
Commodit        Zhejia                                                                                  rb
                                October 17,                                               nt       of
ies   City       ng       101                                                                           a
                                 2019 to      October 21,    October 21,                  principal           Non
Group           Yiwu      901                                               10    3.97                  nk                   No
                                October 18,      2019           2022                      and                  e
Co., Ltd.'s     CCC       396                                                                           m
                                   2019                                                   interest
2019            MTN0                                                                                    ar
                                                                                          at
MTN              02                                                                                     ke
                                                                                          maturity.
(Issue 2)                                                                                               t
Zhejiang                                                                                  One-time      In
                  21
China                                                                                     repayme       te
                Zhejia
Commodit                        October 25,                                               nt       of   rb
                  ng      012
ies   City                       2021 to      October 27,      July 22,                   principal     a     Non
                 Yiwu     103                                               10    2.98                                       No
Group                           October 26,      2021           2022                      and           nk     e
                 CCC      893
Co., Ltd.’s                       2021                                                   interest      m
                SCP00
2021                                                                                      at            ar
                   8
Super                                                                                     maturity.     ke

                                                             96   / 228
                                                         2021 Annual Report


Short-                                                                                                    t
term
Financing
Bonds
(Issue 8)
Zhejiang
China
Commodit                                                                                                  In
                                                                                            One-time
ies    City       21                                                                                      te
                                                                                            repayme
Group           Zhejia                                                                                    rb
                                   November                                                 nt       of
Co., Ltd.’s      ng      012                                                                             a
                                   11, 2021 to    November     August 12,                   principal          Non
2021             Yiwu     104                                                 10    2.87                  nk              No
                                   November        15, 2021      2022                       and                 e
Super            CCC      113                                                                             m
                                    12, 2021                                                interest
Short-          SCP00                                                                                     ar
                                                                                            at
term               9                                                                                      ke
                                                                                            maturity.
Financing                                                                                                 t
Bonds
(Issue 9)
Zhejiang
China
Commodit                                                                                                  In
                                                                                            One-time
ies    City       21                                                                                      te
                                                                                            repayme
Group           Zhejia                                                                                    rb
                                   November                                                 nt       of
Co., Ltd.’s      ng      012                                                                             a
                                   26, 2021 to    November     August 26,                   principal          Non
2021             Yiwu     105                                                 10    2.84                  nk              No
                                   November        30, 2021      2022                       and                 e
Super            CCC      209                                                                             m
                                    29, 2021                                                interest
Short-          SCP01                                                                                     ar
                                                                                            at
term               0                                                                                      ke
                                                                                            maturity.
Financing                                                                                                 t
Bonds
(Issue 10)

               The Company's measures to deal with the risk of bond termination
               □Applicable √Not Applicable

               Bonds overdue
               □Applicable √Not Applicable

               Bond interest payment during the reporting period
               √Applicable □Not Applicable
                     Name of bond                                     Description of interest payment
       Zhejiang China Commodities City            On September 6, 2021, the Company paid the interest to the holders
       Group Co., Ltd.’s 2018 MTN (Issue         of "18 Zhejiang Yiwu CCC MTN001" for the period from September 6,
       1)                                         2020 to September 5, 2021 on time.
       Zhejiang China Commodities City            On July 15, 2021, the Company paid the interest to the holders of "19
       Group Co., Ltd.’s 2019 MTN (Issue         Zhejiang Yiwu CCC MTN001" for the period from July 15, 2020 to
       1)                                         July 14, 2021 on time.
       Zhejiang China Commodities City            On October 21, 2021, the Company paid the interest to the holders of
       Group Co., Ltd.’s 2019 MTN (Issue         "19 Zhejiang Yiwu CCC MTN002" for the period from October 21,
       2)                                         2020 to October 20, 2021 on time.
       Zhejiang China Commodities City            On March 9, 2021, the Company paid the interest for the period from
       Group      Co.,   Ltd.’s   2020   Super   December 9, 2020 to March 8, 2021 and principal to the holders of
       Short-term Financing Bonds (Issue          "20 Zhejiang Yiwu CCC SCP007" on time.

                                                              97   / 228
                                                  2021 Annual Report


7)
Zhejiang China Commodities City
                                           On January 22, 2021, the Company paid the interest for the period
Group     Co.,   Ltd.’s   2020    Super
                                           from December 25, 2020 to January 21, 2021 and principal to the
Short-term Financing Bonds (Issue
                                           holders of "20 Zhejiang Yiwu CCC SCP008" on time.
8)
Zhejiang China Commodities City
                                           On April 16, 2021, the Company paid the interest for the period from
Group     Co.,   Ltd.’s   2021    Super
                                           January 18, 2021 to April 15, 2021 and principal to the holders of "21
Short-term Financing Bonds (Issue
                                           Zhejiang Yiwu CCC SCP001" on time.
1)
Zhejiang China Commodities City
                                           On August 24, 2021, the Company paid the interest for the period
Group     Co.,   Ltd.’s   2021    Super
                                           from February 23, 2021 to August 23, 2021 and principal to the
Short-term Financing Bonds (Issue
                                           holders of "21 Zhejiang Yiwu CCC SCP002" on time.
2)
Zhejiang China Commodities City
                                           On June 4, 2021, the Company paid the interest for the period from
Group     Co.,   Ltd.’s   2021    Super
                                           March 8, 2021 to June 3, 2021 and principal to the holders of "21
Short-term Financing Bonds (Issue
                                           Zhejiang Yiwu CCC SCP003" on time.
3)
Zhejiang China Commodities City
                                           On July 13, 2021, the Company paid the interest for the period from
Group     Co.,   Ltd.’s   2021    Super
                                           April 14, 2021 to July 12, 2021 and principal to the holders of "21
Short-term Financing Bonds (Issue
                                           Zhejiang Yiwu CCC SCP004" on time.
4)
Zhejiang China Commodities City
                                           On October 29, 2021, the Company paid the interest for the period
Group     Co.,   Ltd.’s   2021    Super
                                           from June 2, 2021 to October 28, 2021 and principal to the holders of
Short-term Financing Bonds (Issue
                                           "21 Zhejiang Yiwu CCC SCP005" on time.
5)
Zhejiang China Commodities City
                                           On October 7, 2021, the Company paid the interest for the period
Group     Co.,   Ltd.’s   2021    Super
                                           from July 8, 2021 to December 6, 2021 and principal to the holders of
Short-term Financing Bonds (Issue
                                           "21 Zhejiang Yiwu CCC SCP006" on time.
6)
Zhejiang China Commodities City
                                           On November 18, 2021, the Company paid the interest for the period
Group     Co.,   Ltd.’s   2021    Super
                                           from August 20, 2021 to November 17, 2021 and principal to the
Short-term Financing Bonds (Issue
                                           holders of "21 Zhejiang Yiwu CCC SCP007" on time.
7)


     2. Issuer or investor option clause, investor protection clause trigger and enforcement
     □Applicable √Not Applicable

     3.    Intermediaries providing services for bond issuance and duration business
                                                                   Name of the
                                                                                     Contact       Contact
        Intermediary name             Office address             Signing Certified
                                                                                     person        number
                                                                Public Accountants
     China Merchants              No. 7088 Shennan              ZHU Wei, ZENG        BAO        18257915891
                                                        98   / 228
                                              2021 Annual Report


    Bank Co., Ltd.         Avenue, Futian District,        Hao                   Chentao
                           Shenzhen, Guangdong,
                           China
                           No. 69, Jianguomen Inner
    Agricultural Bank of                                   Han Dan, Zhang        CHEN
                           Street, Dongcheng                                               15215859317
    China Limited                                          Honglei               Jie
                           District, Beijing, China
    Shanghai Pudong
                           No. 12, Zhongshan East          SHI Haiyun, DOU       XU
    Development Bank                                                                       13732437619
                           1st Road, Shanghai              Youming               Haokang
    Co., Ltd.
    Industrial and         No. 55, Fuxingmen Inner
                                                                                 WANG
    Commercial Bank of     Street, Xicheng District,       Li Li, He Qi                    18857980520
                                                                                 Ziqiang
    China Limited          Beijing, China
                                                           Wang Pengcheng,
    China Construction     No. 25 Jinron Street,                                 WU
                                                           Tian Zhiyong, Feng              15067057702
    Bank Corporation       Xicheng District, Beijing                             Yanting
                                                           Suoteng

    Changes to the above intermediaries
    □Applicable √Not Applicable

    4. Use of raised funds at the end of the reporting period
    √Applicable □Not Applicable
                                                                  Unit: RMB 100 million Currency: RMB
                                                                                              Whether it is
                                                                                               consistent
                                                                   Operation
                                                                                                 with the
                                      Total                           of the  Rectification
                                                                                                purpose,
                                    amount                           special    of illegal
                                               Amount      Amount                            using plan and
         Name of bond                  of                           account       use of
                                                used       unused                                 other
                                     funds                         for raised raised funds
                                                                                              agreements
                                     raised                         funds (if    (if any)
                                                                                              promised in
                                                                      any)
                                                                                                   the
                                                                                               prospectus
Zhejiang China Commodities City
Group Co., Ltd.’s 2021 Super
                                      10          10            0         None      None          Yes
Short-term Financing Bonds
(Issue 1)
Zhejiang China Commodities City
Group Co., Ltd.’s 2021 Super
                                      10          10            0         None      None          Yes
Short-term Financing Bonds
(Issue 2)
Zhejiang China Commodities City
Group Co., Ltd.’s 2021 Super
                                      10          10            0         None      None          Yes
Short-term Financing Bonds
(Issue 3)
Zhejiang China Commodities City
Group Co., Ltd.’s 2021 Super
                                      10          10            0         None      None          Yes
Short-term Financing Bonds
(Issue 4)
Zhejiang China Commodities City
Group Co., Ltd.’s 2021 Super
                                      10          10            0         None      None          Yes
Short-term Financing Bonds
(Issue 5)
Zhejiang China Commodities City
Group Co., Ltd.’s 2021 Super
                                      10          10            0         None      None          Yes
Short-term Financing Bonds
(Issue 6)
Zhejiang China Commodities City
                                      10          10            0         None      None          Yes
Group Co., Ltd.’s 2021 Super

                                                   99   / 228
                                            2021 Annual Report


Short-term Financing Bonds
(Issue 7)
Zhejiang China Commodities City
Group Co., Ltd.’s 2021 Super
                                      10         10            0     None         None          Yes
Short-term Financing Bonds
(Issue 8)
Zhejiang China Commodities City
Group Co., Ltd.’s 2021 Super
                                      10         10            0     None         None          Yes
Short-term Financing Bonds
(Issue 9)
Zhejiang China Commodities City
Group Co., Ltd.’s 2021 Super
                                      10         10            0     None         None          Yes
Short-term Financing Bonds
(Issue 10)

    The progress and operational benefits of raised funds used for construction projects
    □Applicable √Not Applicable

    Explanation on changing the use of the above-mentioned bonds raised during the reporting period
    □Applicable √Not Applicable
    Other statements
    □Applicable √Not Applicable

    5. Adjustment in credit rating results
    □Applicable √Not Applicable
    Other statements
    √Applicable □Not Applicable
        Shanghai Brilliance Credit Rating & Investors Service Co., Ltd. issued the Credit Rating
    Surveillance Report on Zhejiang China Commodities City Group Co., Ltd. and Bonds Publicly
    Issued by It [Brilliance Surveillance (2021) 100719] on Jun 28, 2021. The Company had an issuer
    rating of AAA with stable outlook, and the bonds had a rating of AAA.


    6.   The implementation, changes and impacts of guarantees, debt repayment plans and
         other debt repayment protection measures during the reporting period and their
         impacts
    □Applicable √Not Applicable
    7. Explanation on other situations relevant to non-financial corporate debt financing
         instruments
    □Applicable √Not Applicable

    (iv) During the reporting period, the Company's loss in the scope of consolidated
         statements exceeded 10% of its net assets as of the the end of the previous year.
    □Applicable √Not Applicable
    (v) Interest-bearing debts other than bonds overdue at the end of the reporting period
    □Applicable √Not Applicable

    (vi) Influence of violations of laws and regulations, the Company's Articles of Association,
    information disclosure affairs management system and the stipulations or commitments in
    the bond prospectus during the reporting period on the rights and interests of bond
    investors
    □Applicable √Not Applicable




                                                 100   / 228
                                      2021 Annual Report


(vii)      The Company's accounting data and financial indicators for the past 2 years as of
      the end of the reporting period
√Applicable □Not Applicable
                                                                                     Unit: RMB
                                                                Increase/decrease
                                                                   in the current
                                                                     period as        Reasons
        Major indicator               2021            2020       compared to the          for
                                                                        prior         change
                                                                  corresponding
                                                                     period (%)
Net profit after deduction of   1,221,808,001.15 517,246,267.88               136.21
non-recurring gains and
losses
Current ratio                            58.91%         91.44%                -35.57
Quick ratio                              50.12%         79.45%                -36.91
Debt-to-asset ratio (%)                    52.83          52.78                 0.08
EBITDA to total debt ratio                  0.32           0.27                20.94
Interest coverage ratio                     5.85           4.42                32.55
Cash interest protection                    7.19           3.13               129.75
multiple
EBITDA-to-interest coverage                 7.99           6.04                32.26
ratio
Loan repayment rate (%)                      100            100
Interest payment rate (%)                    100            100

II. Convertible corporate bonds
□Applicable √Not Applicable




                                           101   / 228
                                       2021 Annual Report



                                Section X.     Financial Report
I.   Auditor’s report
√Applicable □Not Applicable
All the shareholders of Zhejiang China Commodities City Group Co., Ltd.
      1. Audit opinion
      We have audited the financial statements of Zhejiang China Commodities City Group Co.,
Ltd., including Consolidated & Corporate Balance Sheets as of December 31, 2021,
Consolidated & Corporate Income Statements, Consolidated & Corporate Cash Flow
Statements, Consolidated & Corporate Statements of Changes in Owner’s Equity for 2021 and
Notes to the Financial Statements.
      We believe that the attached financial statements were prepared according to Accounting
Standards for Zhejiang China Commodities City Group Co., Ltd. in all material aspects as a fair
reflection of the consolidated and parent company’s financial status of Zhejiang China
Commodities City Group Co., Ltd. on the December 31, 2021 and the operation outcomes and
cash flows of the Company for 2021.
      2. Basis of audit opinion
      We conducted our audit in accordance with the Auditing Standards for Chinese Certified
Public Accountants. The section “CPAs’ Responsibility for Audit of Financial Statements” in the
audit report further describes on our responsibilities under these standards. In accordance with
the CPA Code of Ethics in China, we are independent of Zhejiang China Commodities City
Group Co., Ltd. and have performed other responsibilities in respect of professional ethics.
We believe that the audit evidence we have acquired is sufficient and effective, providing a rea
sonable basis for our opinion.
    3. Key audit matters
      Key audit matters are matters that we believe are the most important matters for the audit
of the financial statements for 2018 based on professional judgment. The response to such
matters is based on the background of auditing the financial statements as a whole and
forming an audit opinion. We do not express independent opinions on such matters. This was
also the background for our description for how every matter below was responded in the
audit.
      We have fulfilled the responsibilities described in the "Certified Accountants'
Responsibilities for the Audit of Financial Statements" section of this report, including those
related to these key audit matters. Correspondingly, our audit work included the
implementation of audit procedures designed to deal with the assessed risk of material
misstatement in the financial statements. The results of our audit procedures, including the
procedures performed in response to the following key audit matters, provide a basis for the
expression of the audit opinion in the financial statements as a whole.




                                             102   / 228
                                        2021 Annual Report




 Key audit matters:                            Audit response to the matter:
 Impairment of non-goodwill long-term assets with certain useful life
 As of December 31, 2021, the book value of We reviewed the judgment of the
 the non-goodwill assets with certain useful management on the indications of impairment
 life in the Group’s market and supporting of long-term assets during the audit:
 hotels, exhibition halls and commercial 1. For long-term assets that involve
 buildings, such as the corresponding impairment testing for indications of
 property, plant and equipment, investment impairment,         we     have  assessed     the
 real estate, land use rights, construction in reasonableness of the asset Groups identified
 progress, right-of-use assets and long-term by the management;
 deferred expenses(hereinafter collectively 2. With the assistance of internal valuation
 referred to as "long-term assets") totaled experts, we assessed the reasonableness of
 RMB 13.60020 billion, accounting for 44% of the major assumptions and evaluation
 the total book value of the consolidated methods used by the Group management, like
 assets of the Group. When identifying discount rates;
 whether the above-mentioned long-term 3. We assessed the reasonableness of key
 assets have any indications of impairment, assumptions such as estimated sales income,
 and when carrying out impairment tests on gross profit, operating costs, and disposal
 the long-term assets with indications of value predictions at the end of the useful life
 impairment, the Group needs to review the of related assets in the future years, and
 recoverable amount of the asset or asset checked basic data on the present value of
 Group. This requires the management to use expected future cash flows with relevant
 major judgments and estimates to determine supporting evidence.
 the estimated future sales income, gross 4. We compared and analyzed the actual
 profit, operating costs, the disposal value performance of the current year with the
 forecast and discount rate at the end of the predicted performance of the previous year;
 useful life of the relevant assets and other 5. We checked the adequacy and
 key assumptions when predicting the completeness of the relevant disclosures of
 present value of future cash flows.The the Group in the notes to the financial
 evaluation process is complicated, so we statements.
 identify them as key audit matters.
 Relevant information has been disclosed in
 Note V. 43 and Notes VII. 20, 21, 22, 25, 26
 and 29 to the financial statements.


     4. Other information
     Zhejiang China Commodities City Group Co., Ltd.’s management is responsible for other
information. Such information includes the information covered by the annual report, but the
financial statements and the audit report provided by us are excluded.
     Our audit opinion released in the financial statements does not cover other information and
we do not release any form of assurance conclusion on other information.
     Our responsibility is to read other information in conjunction with our audit of the financial
statements. During the process, we consider whether there is a material inconsistency or other
material misstatement in the financial statements with the knowledge acquired by us during the
audit process.
     Based on the work we have performed, if we determine that there is a material
misstatement of other information, we should report the fact. We have nothing to report in this
aspect.
     5. Responsibility of management and governance for financial statements
     The management is responsible for preparing financial statements in accordance with the
provisions of the Accounting Standards for Business Enterprises to achieve fair reflection, and
designing,      implementing       and       maintaining     necessary       internal     controls
to prevent these financial statements from material misstatement arising from fraud or error.

                                             103   / 228
                                        2021 Annual Report


     During preparing the financial statements, the management is responsible for assessing
the sustainable operation capabilities of Zhejiang China Commodities City Group Co., Ltd.,
disclosing, as applicable, going-concern-related matters and applying the going-concern
assumption unless the management plans to liquidate Zhejiang China Commodities City Group
Co., Ltd. and discontinue operations or has no other realistic choices.
     The governance is responsible for supervising the financial reporting process of Zhejiang
China Commodities City Group Co., Ltd.
     6. Certified Public Accountants’ responsibility for audit of financial statements
     Our goal is to obtain reasonable assurance about whether the financial statements are
free from material misstatement caused by fraud or error and express an opinion on these
financial statements based on our audits. The reasonable assurance is a guarantee at a high
level, but there is no guarantee that an audit performed in accordance with the auditing
standards will always identify existing material misstatement. Misstatements may be caused by
fraud or error. Misstatement is generally considered to be material if it is reasonably expected
that the misstatement, alone or aggregated, may affect the financial decision made by the
users of the financial statements based on the financial statements.
     We applied professional judgment and professional skepticism during conducting audit
work in accordance with the Auditing Standards for CPA while performing following works:
(1)    Identifying and evaluating the risk of material misstatements of financial statements for
       fraud or error designing and implementing audit procedures to deal with these risks and
       obtaining adequate and appropriate audit evidence as a basis for release of our audit
       opinion. As fraud may involve collusion, forgery, willful omission, misrepresentation or
       override of internal control, the risk of not discovering a material misstatement due to
       fraud is higher than the risk of not discovering a material misstatement resulting from an
       error.
(2)    Understanding the internal control related to the audit in order to design the appropriate
       audit procedures.
(3)    Evaluating the appropriateness of the accounting policies selected by management level
       and the reasonableness of accounting estimates and related disclosures.
(4)    Concluding the appropriateness of management level’s use of the going concern
       assumption while drawing a conclusion as to whether there is any material uncertainty
       about the issues or circumstances that may cause major doubts about the ability of the
       Zhejiang China Commodities City Group Co., Ltd. to continue as a going concern on
       basis of the audit evidence acquired. If we conclude that there is a significant
       uncertainty, the auditing standards require us to remind user of the statements of the
       relevant disclosures in the financial statements in the audit report. If the disclosures are
       inadequate, we should release an unqualified opinion. Our conclusion is based on the
       information available by the date of the audit report. However, future events or
       circumstances may result in Zhejiang China Commodities City Group Co., Ltd. being
       unable to continue as a going concern.
(5)    Evaluating the overall presentation, structure and content (including disclosure) of the
       financial statements as well as whether the financial statements are a fair reflection of
       the related transactions and matters.
(6)    Obtaining adequate and appropriate audit evidence on the financial information of the
       entities or business activities in Zhejiang China Commodities City Group Co., Ltd. to
       express an opinion on the financial statements. We are responsible for directing,
       supervising and implementing the Group’s audit and assume full responsibility for the
       audit opinion.
     We have communicated with the governance on the matters such as the scope and timing
of audit and major audit findings, including the notable defects of internal control identified in
our audit.
     We also provided a statement to the governance that we had complied with the
professional ethics requirements related to independence, and communicated with the
governance all relationships and other matters that may be reasonably believed to affect our
independence, and related preventive measures (if applicable) .
     In the matters communicated with the governance, we determined which matters should
be the most important to the audit of the financial statements of the current period, and should
                                             104   / 228
                                       2021 Annual Report


constitute the key audit matters accordingly. We described such matters in the audit report,
unless laws and regulations had prohibited public disclosure of these matters, or in rare cases,
we determined that such matters should not be communicated in the audit report if the
negative consequences of communicating a matter in the audit report are reasonably expected
to outweigh the public interests.




 Ernst & Young Hua Ming Certified Public Accountants (special general partnership) Chinese
CPA: YIN Guowei
                                    (Project Partner)




    Chinese CPA: Huang Zhigang


    Beijing, China    Mar 22, 2022




                                           105   / 228
                                                         2021 Annual Report


II.    Financial statements
                               Consolidated Balance Sheet
                                     December 31, 2021
Prepared by: Zhejiang China Commodities City Group Co., Ltd.
                                                                                                               Unit: RMB
                         Item                            Note           December 31, 2021           December 31, 2020
Current assets:
   Monetary capital                                                              4,831,468,386.25           5,612,642,932.21
   Held-for-trading financial assets                                                75,375,083.20              51,712,734.31
   Accounts receivable                                                             185,237,530.89             153,573,476.86
   Prepayments                                                                     875,167,709.48             105,187,528.26
   Other receivables                                                             1,355,924,282.96           2,708,478,136.25
   In which: interest receivable                                                    92,249,275.44             121,401,210.48
   Inventory                                                                     1,327,402,567.99           1,329,467,728.17
   Other current assets                                                            248,662,219.40             179,724,694.17
      Total current assets                                                       8,899,237,780.17          10,140,787,230.23
Non-current assets:
   Long-term receivables                                                           222,307,363.40             126,756,573.81
   Long-term equity investment                                                   5,772,455,242.84           3,832,897,502.71
   Other equity instruments investment                                             642,187,968.77             662,256,342.79
   Other non-current financial assets                                            1,524,819,255.41           1,523,925,249.81
   Property investment                                                           2,973,936,400.46           1,960,426,291.73
   Fixed assets                                                                  5,078,590,929.75           5,234,293,786.87
   Construction in progress                                                      1,090,577,963.27             982,891,877.14
   Right-of-use assets                                                             225,347,077.14                          -
   Intangible assets                                                             4,043,564,662.35           3,900,780,981.92
   Development expenses                                                              6,359,814.02              22,223,061.09
   Long-term prepaid expenses                                                      188,184,376.43             110,728,723.36
   Deferred income tax assets                                                      135,737,028.89              99,664,328.84
   Other non-current assets                                                        211,329,650.45             152,495,196.56
      Total non-current assets                                                  22,115,397,733.18          18,609,339,916.63
        Total assets                                                            31,014,635,513.35          28,750,127,146.86
Current liabilities:
   Short-term borrowings                                                           942,736,046.04           1,257,179,389.40
   Accounts payable                                                                493,360,429.02             636,463,802.23
   Advances from customers                                                         153,566,311.13             112,752,897.25
   Contract liabilities                                                          4,058,419,224.84           2,442,211,788.88
   Payroll payable                                                                 243,964,755.38             161,498,997.53
   Tax payable                                                                     559,496,547.34             495,400,499.73
   Other payables                                                                1,908,742,835.15           1,646,345,561.62
   Non-current liabilities due within one year                                   3,664,241,923.08           1,315,026,574.43
   Other current liabilities                                                     3,081,384,800.50           3,023,608,041.68
      Total current liabilities                                                 15,105,912,872.48          11,090,487,552.75
Non-current liabilities:
   Long-term borrowings                                                            771,250,000.00             282,000,000.00
   Bonds payable                                                                                -           3,552,161,709.68
   Lease liabilities                                                               205,942,673.93                          -
   Estimated liabilities                                                           110,620,306.10             110,620,306.10
   Deferred income                                                                  78,170,103.62              26,545,277.30
   Deferred income tax liabilities                                                 111,897,463.42             113,602,923.79
      Total non-current liabilities                                              1,277,880,547.07           4,084,930,216.87
        Total liabilities                                                       16,383,793,419.55          15,175,417,769.62
Owners’ equity (or shareholders’ equity)
   Paid-in capital (share capital)                                               5,491,274,176.00           5,489,914,176.00
   Capital reserve                                                               1,631,509,114.96           1,594,906,524.67
   Less: treasury stocks                                                           137,494,800.00             137,298,000.00
   Other comprehensive income                                                       60,850,735.02              78,149,661.33
   Surplus reserve                                                               1,505,209,795.50           1,364,257,808.58
   Undistributed profits                                                         6,059,496,846.85           5,168,298,206.50
   Total equity attributable to owners (shareholders)
                                                                                14,610,845,868.33          13,558,228,377.08
of the parent company
   Minority interest                                                                19,996,225.47              16,481,000.16
      Total owners’ equity (or shareholders’ equity)                          14,630,842,093.80          13,574,709,377.24
        Total liabilities and owners’ equity (or
                                                                                31,014,635,513.35          28,750,127,146.86
shareholders’ equity)


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                                                        2021 Annual Report


Legal Representative: Zhao Wenge Person in Charge of Finance: Wang Dong Head of Finance
Department: Zhao Difang
                             Balance Sheet of Parent Company
                                     December 31, 2021
Prepared by: Zhejiang China Commodities City Group Co., Ltd.
                                                                                                              Unit: RMB
                         Item                           Note           December 31, 2021           December 31, 2020
Current assets:
  Monetary capital                                                              4,327,117,133.34           5,435,867,497.50
  Held-for-trading financial assets                                                     1,484.70                   6,632.72
  Accounts receivable                                                              23,629,682.69              14,671,577.47
  Prepayments                                                                      11,213,809.02              29,452,445.04
  Other receivables                                                             1,207,086,885.99           2,651,640,610.06
  In which: interest receivable                                                    92,249,275.44             121,401,210.48
  Inventory                                                                         7,308,939.20              10,144,965.06
  Other current assets                                                          3,282,706,248.36           3,082,340,716.76
     Total current assets                                                       8,859,064,183.30          11,224,124,444.61
Non-current assets:
  Long-term receivables                                                            41,668,837.64              61,250,000.00
  Long-term equity investment                                                   8,246,000,020.80           6,083,135,428.02
  Other equity instruments investment                                             642,187,968.77             662,256,342.79
  Other non-current financial assets                                              179,632,207.32             266,722,811.41
  Property investment                                                           2,533,374,736.14           1,501,734,504.79
  Fixed assets                                                                  4,333,691,395.01           4,444,239,239.28
  Construction in progress                                                        936,297,029.41             856,248,099.10
  Right-of-use assets                                                             118,591,035.63                          -
  Intangible assets                                                             3,878,208,204.47           3,777,092,772.41
  Long-term prepaid expenses                                                      165,720,500.56              58,705,952.97
  Deferred income tax assets                                                      122,565,730.38              85,739,381.21
  Other non-current assets                                                         65,607,343.55                          -
     Total non-current assets                                                  21,263,545,009.68          17,797,124,531.98
       Total assets                                                            30,122,609,192.98          29,021,248,976.59
Current liabilities:
  Short-term borrowings                                                           942,736,046.04           1,257,179,389.40
  Accounts payable                                                                349,268,967.90             444,254,309.61
  Advances from customers                                                         104,805,243.57              97,380,931.49
  Contract liabilities                                                          3,029,673,931.75           2,283,994,068.70
  Payroll payable                                                                 203,724,767.47             131,469,702.81
  Tax payable                                                                     527,641,861.33             546,100,633.28
  Other payables                                                                1,596,947,195.91           1,333,312,494.36
  Non-current liabilities due within one year                                   3,656,595,072.25           1,315,026,574.43
  Other current liabilities                                                     3,452,451,678.36           3,556,664,822.79
     Total current liabilities                                                 13,863,844,764.58          10,965,382,926.87
Non-current liabilities:
  Long-term borrowings                                                            771,250,000.00             282,000,000.00
  Bonds payable                                                                                -           3,552,161,709.68
  Lease liabilities                                                               113,367,062.05                          -
  Estimated liabilities                                                           110,620,306.10             110,620,306.10
  Deferred income                                                                  78,170,103.62              26,545,277.30
  Deferred income tax liabilities                                                  43,870,176.87              69,623,249.14
     Total non-current liabilities                                              1,117,277,648.64           4,040,950,542.22
       Total liabilities                                                       14,981,122,413.22          15,006,333,469.09
Owners’ equity (or shareholders’ equity)
  Paid-in capital (share capital)                                               5,491,274,176.00           5,489,914,176.00
  Capital reserve                                                               1,866,141,278.50           1,833,256,515.22
  Less: treasury stocks                                                           137,494,800.00             137,298,000.00
  Other comprehensive income                                                       66,421,903.33              81,473,183.84
  Surplus reserve                                                               1,505,156,319.67           1,364,204,332.75
  Undistributed profits                                                         6,349,987,902.26           5,383,365,299.69
     Total owners’ equity (or shareholders’ equity)                          15,141,486,779.76          14,014,915,507.50
       Total liabilities and owners’ equity (or
                                                                               30,122,609,192.98          29,021,248,976.59
shareholders’ equity)
Legal Representative: Zhao Wenge Person in Charge of Finance: Wang Dong Head of Finance
Department: Zhao Difang




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                                                 Consolidated Income Statement
                                                    January-December 2021
                                                                                                        Unit: RMB
                                Item                                       Note    2021               2020
I. Gross revenue                                                                   6,033,842,972.95   3,725,686,100.39
In which: operating revenue                                                        6,033,842,972.95   3,725,686,100.39
II. Gross cost                                                                     5,037,812,165.29   2,797,025,785.03
In which: Operating cost                                                           4,027,543,138.56   1,811,136,443.99
           Taxes and surcharges                                                      161,759,208.82     165,885,982.83
           Sales expenses                                                            204,745,974.57     241,889,186.44
           Administrative expenses                                                   453,543,427.80     377,516,845.45
           R&D expenses                                                               10,308,801.84      18,507,626.99
           Financial expenses                                                        179,911,613.70     182,089,699.33
           In which: interest expenses                                               341,313,765.39     416,095,890.57
                  Interest income                                                    177,964,682.68     230,212,773.93
     Plus: other income                                                               23,556,948.01      17,986,332.14
           Investment income (loss is indicated by “-”)                            634,227,991.02     524,214,123.84
           In which: income from investment in associates and joint
                                                                                    599,180,325.58      34,968,640.68
ventures
           Changes in fair value (loss is indicated by “-”)                          7,231,321.84     -32,955,861.63
           Credit impairment loss (loss is indicated by “-”)                        -7,299,694.67      -2,282,683.90
           Income from disposal of assets (loss is indicated by “-”)                    76,006.41       8,180,591.72
III. Operating profit (loss is indicated by “-”)                                 1,653,823,380.27   1,443,802,817.53
     Plus: income from non-operating activities                                        5,766,372.46       4,425,072.97
     Less: expenses from non-operating activities                                      2,895,928.76      26,636,816.07
IV. Profits before tax (loss is indicated by “-”)                                1,656,693,823.97   1,421,591,074.43
     Less: income tax                                                                327,525,237.95     499,755,019.22
V. Net profits (net loss is indicated by “-”)                                    1,329,168,586.02     921,836,055.21
(I) Categorized by continuity of operation
        Net profits from continuing operation (net loss is indicated by
                                                                                   1,329,168,586.02    921,836,055.21
“-”)
(II) Categorized by ownership
        Net profits attributable to shareholders of the parent company
                                                                                   1,334,095,906.95    926,626,706.42
(net loss is indicated by “-”)
        Minority interest(net loss is indicated by “-”)                             -4,927,320.93     -4,790,651.21
VI. Other comprehensive income, net of tax                                           -17,256,380.07     11,916,631.45
     (I) Other comprehensive income attributable to owners of the
                                                                                     -17,298,926.31     11,882,468.59
parent company, net of tax
        1. Other comprehensive income that cannot be reclassified as
                                                                                     -15,051,280.51     15,051,280.51
profits or loss
     (3) Changes in fair value of investments in other equity
                                                                                     -15,051,280.51     15,051,280.51
instruments
        2 . Other comprehensive income that will be reclassified as
                                                                                      -2,247,645.80      -3,168,811.92
profits or loss
     (6) Difference arising from the translation of foreign currency
                                                                                      -2,247,645.80      -3,168,811.92
financial statements
     (2) After -tax net of other comprehensive income attributable to
                                                                                         42,546.24          34,162.86
minority shareholders
VII. Total comprehensive income                                                    1,311,912,205.95    933,752,686.66
     (I) Total comprehensive income attributable to owners of the
                                                                                   1,316,796,980.64    938,509,175.01
parent company
     (II) Total comprehensive income attributable to minority
                                                                                      -4,884,774.69      -4,756,488.35
shareholders
VIII. Earnings per share:
     (I) Basic earnings per share                                                              0.25               0.17
     (II) Diluted earnings per share                                                           0.25               0.17


For merger of the enterprises under common control during the current period, net profits of the
merged party prior to the merger were RMB 0, and net profits of the merged party during the
previous period were RMB 0.
Legal Representative: Zhao Wenge Person in Charge of Finance: Wang Dong Head of Finance
Department: Zhao Difang




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                                      Income Statement of Parent Company
                                            January-December 2021
                                                                                                    Unit: RMB
                           Item                                 Note         2021               2020
I. Operating revenue                                                     2,922,125,402.93    3,004,461,701.48
    Less: Operating cost                                                 1,062,881,897.31    1,057,141,636.22
          Taxes and surcharges                                             132,198,523.20      132,358,447.92
          Sales expenses                                                   158,004,638.76      239,654,404.97
          Administrative expenses                                          239,151,835.56      214,977,084.50
          Financial expenses                                               175,493,659.20      187,866,954.47
          In which: interest expenses                                      341,313,765.39      416,572,917.39
                 Interest income                                           177,964,682.68      230,214,546.47
    Plus: other income                                                      13,716,900.72        8,780,068.91
          Investment income (loss is indicated by “-”)                   598,320,996.73      658,729,792.04
          In which: income from investment in
                                                                          544,982,046.87       64,824,176.63
associates and joint ventures
          Changes in fair value (loss is indicated by “-”)               -83,904,126.09     -103,343,955.11
          Credit impairment loss (loss is indicated by “-
                                                                              -989,960.58           205,158.05
”)
          Income from disposal of assets (loss is
                                                                               -32,610.97        7,092,990.67
indicated by “-”)
II. Operating profits (loss is indicated by “-”)                       1,681,506,048.71    1,743,927,227.96
    Plus: income from non-operating activities                               5,508,893.78        2,350,534.71
    Less: expenses from non-operating activities                             3,187,712.27       20,162,609.18
III. Profits before tax (loss is indicated by “-”)                     1,683,827,230.22    1,726,115,153.49
       Less: income tax                                                    274,307,361.05      445,206,185.75
IV. Net profits (net loss is indicated by “-”)                         1,409,519,869.17    1,280,908,967.74
    (I) Categorized by continuity of operation(net loss
                                                                         1,409,519,869.17    1,280,908,967.74
is indicated by “-”)
V. Other comprehensive income, net of tax                                  -15,051,280.51      15,051,280.51
    (I) Other comprehensive income that cannot be
                                                                           -15,051,280.51      15,051,280.51
reclassified as profit or loss
       3. Changes in fair value of investments in other
                                                                           -15,051,280.51      15,051,280.51
equity instruments
VI. Total comprehensive income                                           1,394,468,588.66    1,295,960,248.25

Legal Representative: Zhao Wenge                           Person in Charge of Finance: Wang Dong
Head of Finance Department: Zhao Difang




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                                                 2021 Annual Report


                                     Consolidated Cash Flow Statement
                                          January-December 2021
                                                                                                Unit: RMB
                           Item                             Note          2021                2020
I. Cash flow from operating activities:
    Cash received from sale of goods and rendering
                                                                       8,099,404,766.59    4,448,611,152.91
of services
    Cash received for taxes and surcharges refunded                                  -        4,456,323.70
    Other cash receipts relating to operating activities                525,408,330.58      408,789,146.30
       Sub-total of cash inflow from operating
                                                                       8,624,813,097.17    4,861,856,622.91
activities
    Cash paid for goods and services                                   4,655,490,266.98    2,379,428,567.25
    Cash paid to and on behalf of employees                              551,082,829.16      585,624,913.63
    Payments of taxes                                                    786,973,453.98      473,925,483.80
    Other cash payments relating to operating
                                                                        598,184,039.29      594,089,396.28
activities
       Sub-total of cash outflow from operating
                                                                       6,591,730,589.41    4,033,068,360.96
activities
         Net cash flow from operating activities                       2,033,082,507.76     828,788,261.95
II. Cash flow from investing activities:
    Cash received from recovery of investment                          6,124,327,288.57   13,116,015,960.26
    Cash received from investment income                                 325,898,607.79      297,606,559.61
    Net cash received from disposal of property,
plant and equipment, intangible assets and other                         44,446,864.25       10,313,579.94
long-term assets
    Net cash received from disposal of subsidiaries
                                                                                      -     192,466,418.65
and other business units
    Other cash receipts relating to investing activities               3,746,899,831.00    4,450,486,259.27
       Sub-total of cash inflow from investing
                                                                      10,241,572,591.61   18,066,888,777.73
activities
    Cash paid to acquire and construct fixed assets,
                                                                       2,042,626,824.44    1,212,154,493.64
intangible assets and other long-term assets
    Cash paid to acquire investments                                   4,915,716,783.24   13,865,803,003.64
    Other cash paid related to investing activities                    1,632,462,005.00    2,352,817,932.28
       Sub-total of cash outflow from investing
                                                                       8,590,805,612.68   17,430,775,429.56
activities
         Net cash flow from investing activities                       1,650,766,978.93     636,113,348.17
III. Cash flow from financing activities:
    Cash received for investment taking                                  13,992,600.00      156,298,000.00
    Including: cash received by subsidiaries from
                                                                           8,400,000.00      19,000,000.00
absorbing minority shareholders' investment
    Cash received from borrowings                                     12,319,250,000.00   13,142,000,000.00
       Sub-total of cash inflow from financing
                                                                      12,333,242,600.00   13,298,298,000.00
activities
    Cash paid for debts repayment                                     13,344,000,000.00   15,552,228,773.17
    Cash paid for distribution of dividends or profits
                                                                        650,819,017.71      537,445,865.52
or payment of interest
    In which: dividends or profits paid by subsidiaries
                                                                                      -         114,400.00
to minority shareholders
    Other cash paid related to financing activities                      40,358,783.07       64,460,000.00
       Sub-total of cash outflow from financing
                                                                      14,035,177,800.78   16,154,134,638.69
activities
         Net cash flow from financing activities                      -1,701,935,200.78   -2,855,836,638.69
IV. Effect of foreign exchange rate changes on
                                                                          -8,088,832.07       -3,134,649.06
cash and cash equivalents
V. Net increase in cash and cash equivalents                           1,973,825,453.84   -1,394,069,677.63
    Plus: opening balance of cash and cash
                                                                       2,032,642,871.63    3,426,712,549.26
equivalents
VI. Closing balance of cash and cash
                                                                       4,006,468,325.47    2,032,642,871.63
equivalents

Legal Representative: Zhao Wenge      Person in Charge of Finance: Wang Dong
Head of Finance Department: Zhao Difang

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                                  Cash Flow Statement of Parent Company
                                          January-December 2021
                                                                                               Unit: RMB
                         Item                              Note          2021                2020
I. Cash flow from operating activities:
    Cash received from sale of goods and
                                                                     3,748,589,385.84    2,446,781,848.92
rendering of services
    Cash received for taxes and surcharges
                                                                                    -        1,149,176.75
refunded
    Other cash receipts relating to operating
                                                                      349,377,861.57      241,467,188.43
activities
      Sub-total of cash inflow from operating
                                                                     4,097,967,247.41    2,689,398,214.10
activities
    Cash paid for goods and services                                  571,281,536.76      556,362,710.98
    Cash paid to and on behalf of employees                           353,270,873.06      401,702,437.14
    Payments of taxes                                                 691,067,319.78      258,399,863.90
    Other cash payments relating to operating
                                                                      674,684,402.42      450,114,859.64
activities
      Sub-total of cash outflow from operating
                                                                     2,290,304,132.02    1,666,579,871.66
activities
    Net cash flow from operating activities                          1,807,663,115.39    1,022,818,342.44
II. Cash flow from investing activities:
    Cash received from recovery of investment                        6,200,000,000.00   13,081,060,305.96
    Cash received from investment income                               327,497,449.71      225,062,189.56
    Net cash received from disposal of property,
plant and equipment, intangible assets and other                       42,475,671.66          474,396.78
long-term assets
    Net cash received from disposal of subsidiaries
                                                                                    -    2,232,000,000.00
and other business units
    Other cash receipts relating to investing
                                                                     3,746,899,831.00    2,775,280,817.96
activities
      Sub-total of cash inflow from investing
                                                                   10,316,872,952.37    18,313,877,710.26
activities
    Cash paid to acquire and construct fixed
assets, intangible assets and other long-term                        1,973,252,137.98    1,192,740,121.04
assets
    Cash paid to acquire investments                                 5,193,070,000.00   14,745,855,008.73
    Other cash paid related to investing activities                  1,632,462,005.00    2,007,512,948.00
      Sub-total of cash outflow from investing
                                                                     8,798,784,142.98   17,946,108,077.77
activities
        Net cash flow from investing activities                      1,518,088,809.39     367,769,632.49
III. Cash flow from financing activities:
    Cash received for investment taking                                 5,592,600.00       137,298,000.00
    Cash received from borrowings                                  12,319,250,000.00    13,142,000,000.00
      Sub-total of cash inflow from financing
                                                                   12,324,842,600.00    13,279,298,000.00
activities
    Cash paid for debts repayment                                  13,344,000,000.00    15,552,228,773.17
    Cash paid for distribution of dividends or profits
                                                                      650,819,017.71      537,331,465.52
or payment of interest
    Other cash paid related to financing activities                    14,525,871.43                    -
      Sub-total of cash outflow from financing
                                                                   14,009,344,889.14    16,089,560,238.69
activities
        Net cash flow from financing activities                    -1,684,502,289.14    -2,810,262,238.69
IV. Effect of foreign exchange rate changes on
                                                                                                        -
cash and cash equivalents
V. Net increase in cash and cash equivalents                         1,641,249,635.64   -1,419,674,263.76
    Plus: opening balance of cash and cash
                                                                     1,885,867,436.92    3,305,541,700.68
equivalents
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                                        2021 Annual Report


VI. Closing balance of cash and cash
                                                             3,527,117,072.56   1,885,867,436.92
equivalents

   Legal Representative: Zhao Wenge      Person in Charge of Finance: Wang Dong             Head
   of Finance Department: Zhao Difang




                                            112   / 228
                                                                                                   2021 Annual Report

                                                                          Statement of Changes in Consolidated Owners’ Equity
                                                                                         January-December 2021
                                                                                                                                                                                                           Unit: RMB
                                                                                                                                      2021
                                                                         Equity attributable to owners of the parent company
       Item                                                                                  Other
                        Paid-in capital                             Less: treasury                                                                                                 Minority interest        Total owners’ equity
                                              Capital reserve                            comprehensive         Surplus reserve         Undistributed profits      Sub-total
                        (share capital)                                stocks
                                                                                            income
1. Balance at the
end of previous        5,489,914,176.00       1,594,906,524.67      137,298,000.00        78,149,661.33            1,364,257,808.58      5,168,298,206.50      13,558,228,377.08     16,481,000.16            13,574,709,377.24
year
II. Opening balance
                       5,489,914,176.00       1,594,906,524.67      137,298,000.00        78,149,661.33            1,364,257,808.58      5,168,298,206.50      13,558,228,377.08     16,481,000.16            13,574,709,377.24
of the current year
III. Change in the
period (decrease is        1,360,000.00          36,602,590.29          196,800.00        -17,298,926.31            140,951,986.92           891,198,640.35     1,052,617,491.25      3,515,225.31             1,056,132,716.56
indicated by “-”)
(I) Total
comprehensive                             -                     -                    -    -17,298,926.31                          -      1,334,095,906.95       1,316,796,980.64      -4,884,774.69            1,311,912,205.95
income
(II)Owners’
contribution to and        1,360,000.00          32,884,763.28          196,800.00                       -                        -                        -      34,047,963.28       8,400,000.00                42,447,963.28
reduction in capital
1. Common shares
contributed by             1,360,000.00           1,351,400.00          196,800.00                       -                        -                        -        2,514,600.00      8,400,000.00                10,914,600.00
owners
3. Amount of
share-based
                                          -      31,533,363.28                       -                   -                        -                        -      31,533,363.28                        -          31,533,363.28
payment into
owner’s equity
(III) Profits
                                          -                     -                    -                   -          140,951,986.92        -442,897,266.60        -301,945,279.68                       -        -301,945,279.68
distribution
1. Withdrawal of
                                          -                     -                    -                   -          140,951,986.92        -140,951,986.92                      -                       -                        -
surplus reserve
3. Distribution to
owners (or                                -                     -                    -                   -                        -       -301,945,279.68        -301,945,279.68                       -        -301,945,279.68
shareholders)
(VI) Others                               -       3,717,827.01                       -                   -                        -                        -        3,717,827.01                       -           3,717,827.01
IV. Closing balance
of the current         5,491,274,176.00       1,631,509,114.96      137,494,800.00        60,850,735.02            1,505,209,795.50      6,059,496,846.85      14,610,845,868.33     19,996,225.47            14,630,842,093.80
period


                                                                                                                                      2020
      Item
                                                                        Equity attributable to owners of the parent company                                                        Minority interest        Total owners’ equity



                                                                                                             113   / 228
                                                                                                        2021 Annual Report

                                                                                                Other
                         Paid-in capital                              Less: treasury
                                                Capital reserve                             comprehensive          Surplus reserve       Undistributed profits        Sub-total
                         (share capital)                                 stocks
                                                                                               income
1. Balance at the end
                        5,443,214,176.00        1,524,183,779.64                       -      66,267,192.74        1,236,166,911.81        4,750,787,389.17        13,020,619,449.36         63,679,633.85         13,084,299,083.21
of previous year
II. Opening balance
                        5,443,214,176.00        1,524,183,779.64                       -      66,267,192.74        1,236,166,911.81        4,750,787,389.17        13,020,619,449.36         63,679,633.85         13,084,299,083.21
of the current year
III. YoY change
(decrease is               46,700,000.00           70,722,745.03       137,298,000.00         11,882,468.59            128,090,896.77        417,510,817.33           537,608,927.72        -47,198,633.69           490,410,294.03
indicated by “-”)
(I) Total
comprehensive                               -                     -                    -      11,882,468.59                          -       926,626,706.42           938,509,175.01          -4,756,488.35          933,752,686.66
income
(II)Owners’
contribution to and        46,700,000.00           70,905,533.03       137,298,000.00                        -                       -                       -        -19,692,466.97        -42,327,745.34            -62,020,212.31
reduction in capital
1. Common shares
contributed by             46,700,000.00           90,598,000.00       137,298,000.00                        -                       -                       -                      -        19,000,000.00             19,000,000.00
owners
3. Amount of share-
based payment into                          -       1,880,981.38                       -                     -                       -                       -          1,880,981.38              17,483.68             1,898,465.06
owner’s equity
4.Others                                         -21,573,448.35                                                                                                      -21,573,448.35        -61,345,229.02            -82,918,677.37
(III) Profits
                                            -                     -                    -                     -         128,090,896.77       -509,115,889.09          -381,024,992.32            -114,400.00          -381,139,392.32
distribution
1. Withdrawal of
                                            -                     -                    -                     -         128,090,896.77       -128,090,896.77                         -                       -                        -
surplus reserve
3. Distribution to
owners (or                                  -                     -                    -                     -                       -      -381,024,992.32          -381,024,992.32            -114,400.00          -381,139,392.32
shareholders)
(VI) Others                                 -        -182,788.00                       -                     -                       -                       -           -182,788.00                        -            -182,788.00
IV. Closing balance
                        5,489,914,176.00        1,594,906,524.67       137,298,000.00         78,149,661.33        1,364,257,808.58        5,168,298,206.50        13,558,228,377.08         16,481,000.16         13,574,709,377.24
of the current period

                Legal Representative: Zhao Wenge                            Person in Charge of Finance: Wang Dong           Head of Finance Department: Zhao Difang
                                                                         Statement of Changes in Owners’ Equity of Parent Company
                                                                                            January-December 2021
                                                                                                                                                                                                                Unit: RMB
                                                                                                                                                2021
                           Item                                                                                                              Other
                                                            Paid-in capital (share                                 Less: treasury
                                                                                           Capital reserve                               comprehensive           Surplus reserve        Undistributed profits     Total owners’ equity
                                                                   capital)                                           stocks
                                                                                                                                            income
   I. Balance at the end of previous year                         5,489,914,176.00         1,833,256,515.22            137,298,000.00      81,473,183.84         1,364,204,332.75          5,383,365,299.69         14,014,915,507.50



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II. Opening balance of the current year                          5,489,914,176.00     1,833,256,515.22         137,298,000.00      81,473,183.84        1,364,204,332.75             5,383,365,299.69           14,014,915,507.50
III. Change in the period (decrease is indicated by “-”)           1,360,000.00        32,884,763.28             196,800.00     -15,051,280.51          140,951,986.92               966,622,602.57            1,126,571,272.26
(I) Total comprehensive income                                                  -                    -                      -     -15,051,280.51                       -             1,409,519,869.17            1,394,468,588.66
(II)Owners’ contribution to and reduction in capital                1,360,000.00        32,884,763.28             196,800.00                  -                       -                            -               34,047,963.28
1.Common shares contributed by owners                                1,360,000.00         1,351,400.00             196,800.00                  -                       -                            -                2,514,600.00
3. Amount of share-based payment into owner’s
                                                                                  -      31,533,363.28                      -                     -                         -                           -            31,533,363.28
equity
(III) Profits distribution                                                      -                    -                      -                  -          140,951,986.92              -442,897,266.60             -301,945,279.68
1. Withdrawal of surplus reserve                                                -                    -                      -                  -          140,951,986.92              -140,951,986.92                           -
2. Distribution to owner (or shareholders)                                      -                    -                      -                  -                       -              -301,945,279.68             -301,945,279.68
IV. Closing balance of the current period                        5,491,274,176.00     1,866,141,278.50         137,494,800.00      66,421,903.33        1,505,156,319.67             6,349,987,902.26           15,141,486,779.76




                                                                                                                                     2020
                                                                                                                                    Other
                          Item                               Paid-in capital (share                        Less: treasury
                                                                                      Capital reserve                           comprehensive         Surplus reserve           Undistributed profits       Total owners’ equity
                                                                    capital)                                  stocks
                                                                                                                                   income
I. Balance at the end of previous year                           5,443,214,176.00     1,489,516,614.19                      -    66,421,903.33        1,236,113,435.98             4,363,644,248.36           12,598,910,377.86
II. Opening balance of the current year                          5,443,214,176.00     1,489,516,614.19                      -    66,421,903.33        1,236,113,435.98             4,363,644,248.36           12,598,910,377.86
III. Change in the period (decrease is indicated by “-”)          46,700,000.00       343,739,901.03         137,298,000.00    15,051,280.51          128,090,896.77             1,019,721,051.33            1,416,005,129.64
(I) Total comprehensive income                                                  -                    -                      -    15,051,280.51                       -             1,280,908,967.74            1,295,960,248.25
(II)Owners’ contribution to and reduction in capital               46,700,000.00       343,739,901.03         137,298,000.00                 -                      -                            -              253,141,901.03
1. Common shares contributed by owners                              46,700,000.00        90,598,000.00         137,298,000.00                 -                      -                            -                           -
3. Amount of share-based payment into owner’s
                                                                                  -       1,880,981.38                      -                 -                         -                           -               1,880,981.38
equity
4. Others                                                                               251,260,919.65                                                                                                           251,260,919.65
(III) Profits distribution                                                      -                    -                      -                -          128,090,896.77              -509,115,889.09             -381,024,992.32
1. Withdrawal of surplus reserve                                                -                    -                      -                -          128,090,896.77              -128,090,896.77                           -
2. Distribution to owner (or shareholders)                                      -                    -                      -                -                       -              -381,024,992.32             -381,024,992.32
(VI) Others                                                                     -                    -                      -                -                       -               247,927,972.68              247,927,972.68
IV. Closing balance of the current period                        5,489,914,176.00     1,833,256,515.22         137,298,000.00    81,473,183.84        1,364,204,332.75             5,383,365,299.69           14,014,915,507.50

             Legal Representative: Zhao Wenge                         Person in Charge of Finance: Wang Dong                         Head of Finance Department: Zhao Difang




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III.   Basic information of the Company
1. Company profile
√Applicable □Not Applicable
     Zhejiang China Commodities City Group Co., Ltd. (the “Company”) is a company limited by
share and was incorporated on Dec 28, 1993 in Zhejiang province of the People’s Republic of
China. The RMB-denominated common A shares issued by the Company got listed on Shanghai
Stock Exchange on May 9, 2002. The Company is headquartered at No.105 Futian Road, Yiwu,
Zhejiang.
     The Group’s main business activities: market development and operation and supporting
services, sales of commodities, provision of online trading platforms and services, development and
management of online trading market, etc., in the category of comprehensive services.
     The parent company of the Group is Yiwu China Commodities City Holdings Limited
(hereinafter referred to as “CCCH”) and the final controller of the Group is the State-owned Assets
Supervision and Administration Office of the People’s Government of Yiwu.
     The Financial Statements were approved by the Company's Board of Directors on March 22,
2022. According to the Company's articles of association, these financial statements are to be
submitted to the general meeting of shareholders for deliberation.


2. Consolidation scope of financial statements
√Applicable □Not Applicable
    The consolidation of financial statements is determined on the basis of control. For the
changes in the current year, please refer to Note VIII. Changes in consolidation scope.

IV. Basis of preparation of financial statements
1.   Basis of preparation
     The financial statements of the Company were prepared on a going-concern basis.
     The financial statements were prepared in accordance with the Accounting Standards for
Enterprises-Basic Standards and the specific accounting standards, application guidelines,
interpretations and other related regulations promulgated and amended thereafter (collectively
referred to as “Accounting Standards”).
     The financial statements were all prepared based on the valuation principle of historical cost,
except for certain financial instruments. In case of assets impairment, corresponding impairment
provision was made in accordance with relevant provisions.

2. Going concern
√Applicable □Not Applicable
     The Company prepared its financial statements on a going-concern basis. The management of
the Company expected that the Group would generate adequate cash inflow from the future day-to-
day operation, which in combination with the Group’s adequate lines of credit from banks could be
sufficient to repay its due debts.

V. Important Accounting Policies and Accounting Estimates
Reminders on specific accounting policies and accounting estimates:
√Applicable □Not Applicable
     The Group has formulated specific accounting policies and accounting estimates based on the
characteristics of actual production and operation, which are mainly reflected in the bad debt
provisions for receivables, inventory valuation methods, depreciation of fixed assets, amortization of
intangible assets, income recognition and measurement, recognition of property investments and
fixed assets, and service life and residual value of fixed assets.

1.  Statement of compliance with the Accounting Standards
    The financial statements prepared by the Company comply with the requirements of the
Accounting Standards, and truly and completely reflect the Company’s financial conditions,
operating results, changes in shareholders’ equity, cash flows and other related information.


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2.   Accounting period
     The Company’s accounting year is from Jan 1 to Dec 31 of each calendar year.

  3. Operating cycle
√Applicable □Not Applicable
     The business cycle of the Company is relatively short, and 12 months are used as the standard
for defining the liquidity of assets and liabilities.

4.   Functional currency
    The Company’s functional currency is RMB. The Group uses RMB as its functional currency
and in the preparation of financial statements. Unless specifically stated, all amounts are expressed
in RMB.

5.    Accounting methods for merger of the enterprises under common control and merger of
      the enterprises not under common control
√Applicable □Not Applicable
      The mergers of enterprises are divided into the mergers of the enterprises under common
control and mergers of the enterprises not under common control.
      Mergers of the enterprises under common control
      Merger of the enterprises under common control refers to the merger of the enterprises that are
under ultimate control of the same party or parties before and after the merger and the control is not
temporary. For a merger of the enterprises under common control, the party obtaining control over
the other(s) involved in the merger on the date of merger is the merging party and the other(s)
is(are) the merged party. The date of merger refers to the date when the merging party actually
obtains control over the merged party.
      The assets and liabilities acquired by the merging party in a merger of the enterprises under
common control (including the goodwill formed through the acquisition of the merged party by the
ultimate controller) are accounted according to the book value thereof in the ultimate controller’s
financial statements on the date of merger. For the difference between the book value of the net
assets obtained by the merging party and the book value of the consideration paid for the merger
(or the total nominal value of the shares issued), the share capital premium in the capital reserve
shall be adjusted; if the share capital premium is not sufficient to absorb the difference, the retained
earnings shall be adjusted.
      Mergers of the enterprises not under common control
      Merger of the enterprises not under common control refers to the merger of the enterprises that
are not under ultimate control of the same party or parties before and after the merger. For a
merger of the enterprises not under common control, the party obtaining control over the other(s)
involved in the merger on the date of acquisition is the acquirer and the other(s) is(are) the acquiree.
The date of acquisition refers to the date when the acquirer actually obtains control over the
acquiree.
      The acquiree’s identifiable assets, liabilities and contingent liabilities obtained from the merger
of the enterprises not under common control are measured at their fair values on the date of
acquisition.
      If the sum of the fair value of the consideration paid for the merger (or fair value of the equity
securities issued) and the fair value of the acquiree’s equity held before the date of acquisition is
higher than the share in the fair value of the acquiree’s identifiable net assets acquired from the
merger, the difference between them is recognized as goodwill, which will be subsequently
measured by the cost less accumulated impairment loss. If the sum of the fair value of the
consideration paid for the merger (or fair value of the equity securities issued) and the fair value of
the acquiree’s equity held before the date of acquisition is lower than the share in the fair value of
the acquiree’s identifiable net assets acquired from the merger, the measurement of the fair value
of the acquiree’s identifiable assets, liabilities and contingent liabilities, the fair value of the
consideration paid for the merger (or fair value of the equity securities issued) and the fair value of
the acquiree’s equity held before the date of acquisition will be reviewed, and if the sum of the fair
value of the consideration paid for the merger (or fair value of the equity securities issued) and the
fair value of the acquiree’s equity held before the date of acquisition is still lower than the share in
the fair value of the acquiree’s identifiable net assets acquired from the merger after such review,
the difference will be recognized in the profit or loss for the current period.

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     For mergers of the enterprises not under common control that are executed through multiple
transactions, the long-term equity investment of the acquiree before the date of acquisition shall be
re-measured based on the fair value thereof on the date of acquisition and any difference between
the fair value and book value thereof shall be recognized in the profit or loss for the current period;
other comprehensive income from the long-term equity investment of the acquiree before the date
of acquisition under the equity method shall be accounted on the same basis as that for the direct
disposal of related assets or liabilities by the investee, and other changes in shareholders’ equity
than net gains or losses, other comprehensive income and profit distribution shall be recognized in
the profit or loss for the period where the date of acquisition falls.

  6. Preparation method of consolidated financial statements
√Applicable □Not Applicable
      The financial statements to be consolidated is determined on the basis of control, including
those of the Company and all of its subsidiaries. Subsidiaries refer to the entities controlled by the
Company (including the severable parts of enterprises and invested entities, and the structured
entities controlled by the Company).
      In the preparation of consolidated financial statements, the subsidiaries adopt the same
accounting year and accounting policies as those adopted by the Company. Assets, liabilities,
equity, income, expenses and cash flows generated from all deals between companies within the
Group are fully offset at the time of merger.
      If the amount of loss for the current period attributable to the minority shareholders of a
subsidiary exceeds the minority shareholders’ share in the opening balance of shareholders’ equity
in the subsidiary, the excess will still be recognized against minority interest.
      For a subsidiary acquired through a business merger not under the same control, the operating
results and cash flows of the acquiree will be included in the consolidated financial statements from
the day when the Group acquires control, until the control of the Group ceases. In the preparation of
consolidated financial statements, adjustments will be made to the financial statements of the
subsidiary based on the fair value of its identifiable assets, liabilities or contingent liabilities
determined on the date of acquisition.
      For a subsidiary acquired through a business merger under the same control, the operating
results and cash flows of merged party will be included in the consolidated financial statements
since the beginning of the current period of the merger. In the preparation of consolidated financial
statements, adjustments will be made to the related items in its previous financial statements as if
the reporting entity formed after the merger has been existing as from the ultimate controller starts
to exercise control.
      In case of any change to one or more elements of the control due to the changes in related
facts and circumstances, the Group will re-evaluate whether to control the investee.

  7. Classification of joint arrangements and accounting treatment of joint operations
√Applicable □Not Applicable
      Joint arrangements are divided into joint operations and joint ventures. Joint operation refers to
a joint arrangement in which the parties thereto enjoy the assets relating to such arrangement and
assume the liabilities relating to such arrangement. Joint venture refers to a joint arrangement in
which the parties thereto only enjoy rights to the net assets in this arrangement.
      Each party to a joint arrangement recognizes the following items relating to its share in the joint
operation: assets held individually by it and assets held jointly based on its share; liabilities
assumed individually by it and liabilities assumed jointly based on its share; revenue from the sale
of its share in the output of the joint operation; revenue from the sale of the output of the joint
operation based on its share; expenses incurred individually by it and expenses incurred by the joint
operation based on its share.

8.   Criteria for the identification of cash and cash equivalents
    Cash refers to the Group’s cash on hand and deposits that can be used for payment at any
time; cash equivalent refers to the investment held by the Group with a short term, strong liquidity,
easy to convert into cash with a known amount, and with low risk of value changes.

  9. Foreign currency transactions and translation of foreign currency financial statements
√Applicable □Not Applicable
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      For foreign currency transactions, the Group will translate the foreign currency amounts into its
functional currency amounts.
      In the initial recognition of a foreign currency transaction, the foreign currency amount is
translated to a functional currency amount according to the spot exchange rate on the date of
transaction. On the balance sheet date, the foreign currency monetary items are translated
according to the spot exchange rate on the balance sheet date. The translation difference between
settlement and monetary items is recognized in the profit or loss for the current period, except for
the difference arising from the special foreign currency borrowing relating to the acquisition and
construction of the assets qualified for capitalization, which will be treated based on the principles
for the capitalization of borrowing expenses. The foreign currency non-monetary items measured by
historical cost are also translated according to the spot exchange rate on the date of transaction,
without changing the functional currency amounts thereof. The foreign currency non-monetary
items measured by fair value are translated according to the spot exchange rate on the fair value
determination date and the difference arising therefrom is recognized in the profit or loss or other
comprehensive income for the current period based on the nature of the items.
      The Group translates the functional currency of its foreign business into RMB while preparing
the financial statements. The assets and liabilities items in the balance sheet are translated
according to the spot exchange rate on the balance sheet date, the shareholders’ equity items are
translated according to the spot exchange rate at the occurrence of the items except for
“undistributed profits”; revenue and expenses items in the income statement are translated
according to the average exchange rate during the period in which the transaction happens. The
translation differences of foreign currency statements arising from the above translations are
recognized as other comprehensive income. For the disposal of foreign business, other
comprehensive income relating to the foreign business is recognized in the profit or loss of the
disposal for the current period and is calculated pro rata for partial disposal.
      The foreign currency cash flow and cash flow of foreign subsidiaries are translated according to
the spot exchange rate on the occurrence date of cash flow/average exchange rate during the
period in which the cash flow occurs. The amount of impact of the changes in exchange rate on
cash is separately stated in the cash flow statement as an adjustment item.

  10. Financial instruments
√Applicable □Not Applicable
      Financial instruments refer to the contracts which form financial assets of an enterprise and
form financial liabilities or equity instruments of other entities.
      Recognition and de-recognition of financial instruments
      The Group recognizes a financial asset or financial liability at the time of becoming a party to a
financial instrument contract.
      The Group will derecognize a financial asset (or a part of the financial asset or a part of a
Group of similar financial assets), i.e. writing off the asset from its account and balance sheet, if:
      (1) the right to collect cash flow from the financial asset has expired;
      (2) The right to collect cash flows of financial assets has been transferred, or the obligation to
pay the collected cash flows in full and in time to a third party under the “handover agreement” has
been undertaken; and (a) all risks and rewards in the ownership of the financial assets have been
substantially transferred, or (b) almost all risks and rewards in the ownership of the financial asset
have been neither transferred nor retained, but control of the financial asset has been waived.
      If a financial liability has been fulfilled, revoked or expired, it will be derecognized. If an existing
financial liability is replaced by the same creditor with another financial liability under substantially
different terms or the terms of the existing liability are substantially modified in whole, the existing
liability will be derecognized and the new liability will be recognized, and the difference will be
recognized in the profit or loss for the current period.
      For the transactions of financial assets in regular ways, the recognition and de-recognition
thereof will be conducted based on the accounting on the transaction date. Transactions of financial
assets in regular ways refer to the collection or delivery of financial assets within the time limit
prescribed by laws and regulation or prevailing practices in accordance with the contract terms. The
transaction date refers to the date when the Group promises to buy or sell the financial assets.
      Classification and measurement of financial assets
      Based on the Group’s business model for the management of financial assets and the features
of the contractual cash flow of financial assets, the Group’s financial assets are classified at initial
recognition into the financial assets that are measured by fair value and of which the changes in fair

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                                              2021 Annual Report


value are recognized in the profit or loss for the current period, the financial assets measured by
amortized cost and the financial assets that are measured by fair value and of which the changes in
fair value are recognized in other comprehensive income.
      If a financial asset is measured by fair value at initial recognition, but the accounts receivable or
notes receivable from the sale of goods or rendering of service do not include significant financing
components or the financing components with a term no longer than one year are not considered,
the initial measurement will be made based on the transaction price.
      For the financial assets that are measured by fair value and of which the changes in fair value
are recognized in the profit or loss for the current period, the related transaction fees will be directly
recognized in the profit or loss for the current period; the related transaction fees of other financial
assets will be recognized in the initially recognized amounts thereof.
      The subsequent measurement of financial assets depends on the classification thereof:
      Investment in debt instruments measured by amortized cost
      A financial asset is classified into those measured by amortized cost, if the business model for
the management of the asset is for the purpose of collecting contractual cash flow; and the terms of
the contract of the asset stipulate that the cash flow generated on the specific date is only the
repayment of principal and the payment of interest on the outstanding principal. The interest income
of such financial assets is recognized with the effective interest method, and the gains or losses
from the de-recognition, modification or impairment thereof are all recognized in the profit or loss for
the current period.
      Investment in the equity instruments that are measured by fair value and of which the
changes in fair value are recognized in other comprehensive income
      The Group has irrevocably chosen to designate some non-trading equity instrument
investments as the financial assets that are measured by fair value and of which the changes in fair
value are recognized in other comprehensive income. Only the related dividend income (except for
the dividend income expressly acting as a recovery of investment cost) is recognized in the profit or
loss for the current period, while the subsequent changes in fair value are recognized in other
comprehensive income, and no provision is required for impairment. When the financial assets are
derecognized, the accumulated gains or losses previously recognized in other comprehensive
income will be moved out of other comprehensive income and recognized in retained earnings.
      Financial assets that are measured by fair value and of which the changes in fair value
are recognized in the profit or loss for the current period
      The financial assets other than the above financial assets measured by amortized cost and the
above financial assets that are measured by fair value and of which the changes in fair value are
recognized in other comprehensive income are classified as the financial assets that are measured
by fair value and of which the changes in fair value are recognized in the profit or loss for the
current period. Those financial assets are subsequently measured by fair value and all changes in
the fair value thereof are recognized in the profit or loss for the current period.
      Classification and measurement of financial liabilities
      The Group’s financial liabilities are classified at initial recognition into the financial liabilities that
are measured by fair value and of which the changes in fair value are recognized in the profit or
loss for the current period and other financial assets. For the financial liabilities that are measured
by fair value and of which the changes in fair value are recognized in the profit or loss for the
current period, the related transaction fees are recognized directly in the profit or loss for the current
period, while the related transaction fees of other financial liabilities are recognized in the initially
recognized amounts thereof.
      The subsequent measurement of financial liabilities depends on the classification thereof:
      Financial liabilities that are measured by fair value and of which the changes in fair
value are recognized in the profit or loss for the current period
      The financial liabilities that are measured by fair value and of which the changes in fair value
are recognized in the profit or loss for the current period include financial liabilities held for trading
(including the derivative instruments as financial liabilities) and the liabilities that are designated at
initial recognition as the financial liabilities that are measured by fair value and of which the changes
in fair value are recognized in the profit or loss for the current period. The financial liabilities held for
trading (including the derivative instruments as financial liabilities) are subsequently measured by
fair value and all changes in the fair value are recognized in the profit or loss for the current period.
      Other financial liabilities
      Those financial liabilities are subsequently measured by amortized cost with the effective
interest method.
      Impairment of financial instruments
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      The Group has treated and recognized the impairment of the financial assets measured by
amortized cost based on the expected credit loss.
      For receivables that do not contain significant financing components, the Group measures the
loss provision based on the amount of expected credit loss equivalent to the entire duration under a
simplified measurement method,
      For the financial assets not measured with the simplified method, the Group evaluates on each
balance sheet date whether their credit risks have increased significantly since the initial recognition.
If the credit risk of a financial asset has not increased significantly since the initial recognition, the
asset is in the first stage and the Group will make provision for loss based on the amount of
expected credit loss within the coming 12 months and calculate interest income based on the book
balance and effective interest rate; if the credit risk has increased significantly since the initial
recognition, but credit has not been impaired, the asset is in the second stage and the Group will
make provision for loss equivalent to the amount of expected credit loss during the entire term and
calculate interest income based on the book balance and effective interest rate; if credit has been
impaired after the initial recognition, the asset is in the third stage and the Group will make provision
for loss equivalent to the amount of expected credit loss during the entire term and calculate
interest income based on the amortized cost and effective interest rate.
      The Group evaluates the expected credit losses of financial instruments on the individual and
Group bases. It evaluates the expected credit loss of accounts receivable by taking into account the
credit risk characteristics of different clients and based on the account aging-based asset Groups.
      For the disclosure of the Group’s criteria for a significant increase in credit risk, definition of the
assets whose credit has been impaired and assumptions for the measurement of expected credit
loss, please refer to Notes X. 2.
      When the Group no longer reasonably expects that it can recover the contractual cash flow of a
financial asset in whole or in part, it will directly write down the book balance of the asset.

11. Notes receivable
Determination and accounting treatment of the expected credit loss of notes receivable
□Applicable √Not Applicable

  12. Accounts receivable
Determination and accounting treatment of the expected credit loss of accounts receivable
√Applicable □Not Applicable
      Please refer to Notes X. Risks Associated with Financial Instruments

13. Accounts receivable financing
□Applicable √Not Applicable

  14. Other receivables
Determination and accounting treatment of the expected credit loss of other receivables
√Applicable □Not Applicable
      Please refer to Notes X. Risks Associated with Financial Instruments

  15. Inventory
√Applicable □Not Applicable
      Inventory includes raw materials, work-in-progress materials, finished goods, real estate
development costs and real estate development products.
      Inventory is initially measured by cost. The costs of inventory except development costs and
development products include the procurement cost, processing cost and other costs. The actual
costs of items out of inventory are determined with the weighted average method. Work-in-progress
materials include low-value consumables and packages, which are amortized with the one-off
amortization method.
      Development costs refer to the properties that have not been completed and are developed for
the purpose of being sold. Development products refer to the properties that have been completed
and are ready for sale. The actual costs of real estate development costs and development
products include the land acquisition cost, expenditures on construction and installation works,

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capitalized interest and other direct and indirect development expenses. The use right of the land
for development purpose at the development of a project is amortized and recognized as the
development cost of the project based on the site area of the development product, and the
development cost will be changed over to development product after being completed.
      If the public auxiliary facilities are completed earlier than the related development product, the
facilities will be allocated to and recognized in the development cost of related development project
based on the floor space of the project after final accounting of the facilities upon completion; if the
public auxiliary facilities are completed later than the related development product, they will be
recognized in the development cost of related development project based on the predicted cost of
the public auxiliary facilities.
      Hotel, catering and fresh goods inventories are subject to onsite inventory, while other
inventories are subject to perpetual inventory.
      On the balance sheet date, inventory is measured by cost and net realizable value, whichever
is lower. If the cost is higher than the net realizable value, provision will be made for inventory
depreciation, which will be recognized in the profit or loss for the current period. If the impact of the
previous provision for inventory depreciation has disappeared and the net realizable value of the
inventory becomes higher than the book value thereof, the amounts written down previously in the
original provision for inventory depreciation will be restituted and recognized in the profit or loss for
the current period.
      Net realizable value is the estimated selling price of inventory less the cost estimated to occur
as of completion, estimated sales expenses and related taxes. In principle, provisions for inventory
depreciation shall be made for inventory items individually. For the inventory with a large quantity
and a low unit price, inventory depreciation provision will be made based on the Groups of items.

16. Contract assets
(1). Determination and criteria for contract assets
□Applicable √Not Applicable


(2). Determination and accounting treatment of the expected credit loss of contract assets
□Applicable √Not Applicable

17. Held-for-sale assets
□Applicable √Not Applicable

18. Debt investments
(1). Determination and accounting treatment of the expected credit loss of debt investments
□Applicable √Not Applicable

19. Other debt investments
(1). Determination and accounting treatment of the expected credit loss of other debt
     investments
□Applicable √Not Applicable

20. Long-term receivables
(1). Determination and accounting treatment of the expected credit loss of long-term
     receivables
√Applicable □Not Applicable
Please refer to Notes X. Risks Associated with Financial Instruments

  21. Long-term equity investment
√Applicable □Not Applicable
      Long-term equity investment includes equity investment in subsidiaries, joint ventures and
associates.


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      Long-term equity investment is initially measured by the initial investment cost at the time of
being acquired. For a long-term equity investment acquired through a business merger under the
same control, the initial investment cost is the share of the book value of the merged party’s
owner’s equity acquired on the merger date in the ultimate controlling party’s consolidated financial
statements; The difference between the initial investment cost and the book value of the merger
consideration is adjusted to the capital reserve (if it is insufficient to offset, the retained earnings will
be offset); other comprehensive income before the merger date is accounted for on the same basis
as that for the investee’s direct disposal of related assets or liabilities when disposing of the
investment. The shareholders’ equity recognized by the investee due to the changes in
shareholders’ equity other than net profit and loss, other comprehensive income, and profit
distribution is transferred to the current profit and loss when the investment is disposed of; those
that are still long-term equity investments after disposal are carried forward in proportion, and those
that are converted into financial instruments after disposal are carried forward in full. For a long-
term equity investment acquired through a business merger not under the same control, the merger
cost shall be used as the initial investment cost (for the business merger not under the same control
realized step by step in a package deal, the sum of the book value and the new investment cost on
the acquisition date is used as the initial investment cost). The merger cost includes the sum of fair
values of the assets paid, the liabilities incurred or assumed, and the equity securities issued by the
acquirer; the other comprehensive income held prior to the acquisition date that is recognized for
accounting under the equity method is accounted for on the same basis as that for the investee’s
direct disposal of related assets or liabilities when disposing of the investment. The shareholders’
equity recognized by the investee due to the changes in shareholders’ equity other than net profit
and loss, other comprehensive income, and profit distribution is transferred to the current profit and
loss when the investment is disposed of; those that are still long-term equity investments after
disposal are carried forward in proportion, and those that are converted into financial instruments
after disposal are carried forward in full. The initial investment costs of the long-term equity
investment acquired other than through merger are determined with the following methods: if an
investment is acquired through the payment of cash, its initial investment cost consists of the
purchase price actually paid and the expenses, taxes and other necessary expenses directly
relating to the acquisition of the investment; and if an investment is acquired through the offering of
equity securities, its initial investment cost is the fair value of the equity securities offered.
      For the accounting of the long-term equity investment through which the Company can
exercise control over the investees, the Company adopts the cost method in individual financial
statements. Control refers to the power over an investee, with which the investor enjoys variable
return by participating in the investee’s related activities and is able to exercise its power over the
investee to affect the amount of return.
      In the cost method, the long-term equity investment is measured by initial investment cost. If
the investment is added or recovered, the cost of long-term equity investment will be adjusted. The
cash dividend or profit declared by the investees to be distributed is recognized as the investment
income for the current period.
      If the Group has joint control over or significant influence on the investee, the long-term equity
investment will be measured with the equity method. Joint control refers to joint control over an
arrangement in accordance with related agreements, and decisions on the activities relating to the
arrangement shall be made only after the parties sharing the control reach an agreement.
Significant influence refers to the power over the decision-making on the financial affairs and
business policies of the investee, but the investor does not have control or joint control with others
over the formulation of those policies.
      In the equity method, if the initial investment cost of long-term equity investment is higher than
the share enjoyed by the Group in the fair value of the investee’s identifiable net assets at
investment, the excess will be recognized in the initial investment cost of the long-term equity
investment; if the initial investment cost of long-term equity investment is lower than the share
enjoyed by the Group in the fair value of the investee’s identifiable net assets at investment, the
difference will be recognized in the profit or loss for the current period and the cost of the long-term
equity investment will be adjusted simultaneously.
      In the equity method, after long-term equity investment is acquired, the investment gains or
losses and other comprehensive income shall be recognized and the book value of the long-term
equity investment shall be adjusted based on the share in the net gains or losses and other
comprehensive income realized by the investees to be enjoyed or assumed. The share in the
investee’s net gains or losses to be enjoyed shall be determined based on the fair value of the
investee’ s identifiable assets at the acquisition of investment, according to the Group’s accounting
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policies and accounting periods and after net profits of the investee are adjusted with the portion of
gains or losses from the internal transactions with its associates and joint ventures that is
attributable to the investor based on the share to be enjoyed by it (but if the loss from internal
transactions falls in the assets impairment loss, it shall be recognized in full) offset, except for the
invested and sold assets that constitute businesses. The book value of long-term equity investment
shall be reduced according to the share to be enjoyed by it in the profits or cash dividend declared
by the investees to be distributed. For an investee’s net losses recognized by the Group, the book
value of the long-term equity investment and other long-term equity that substantially constitute net
investment in the investee shall be written down to zero at maximum, except for the extra losses for
which the Group is liable. For the investee’s other changes in shareholders’ equity other than net
gains or losses, other comprehensive income and profit distribution, the book value of the long-term
equity investment will be adjusted and the changes will be recognized in the shareholders’ equity.
      For the disposal of long-term equity investment, the difference between the book value of long-
term equity investment and the proceeds actually received from the disposal thereof is recognized
in the profits or loss for the current period. For the long-term equity investment measured with the
equity method, if the equity method is terminated due to the disposal, the original related other
comprehensive income measured with the equity method will be accounted on the same basis as
that for the direct disposal of related assets or liabilities by the investees, and the shareholders’
equity recognized due to the investees’ other changes in shareholders’ equity than net gains or
losses, other comprehensive income and profit distribution will be recognized in the profits or loss
for the current period in full; if the equity method is still adopted, the original related other
comprehensive income measured with the equity method will be accounted on the same basis as
that for the direct disposal of related assets or liabilities by the investees and recognized in the
profits or loss for the current period pro rata, and the shareholders’ equity recognized due to the
investees’ other changes in shareholders’ equity than net gains or losses, other comprehensive
income and profit distribution will be recognized in the profit or loss for the current period pro rata.
      Where the Company loses control over a subsidiary due to step-by-step disposal of its equity
investment in the subsidiary through multiple transactions, if the transactions constitute a package
of deals, each transaction will be accounted as a transaction that disposes of the subsidiary and
causes the loss of control over the subsidiary; however, the difference between the proceeds from
each disposal and the book value of the corresponding long-term equity investment disposed of is
recognized as other comprehensive income in individual financial statements before the Company
loses control and is recognized in the profits or loss for the period in which the control is lost at the
loss of control. If the transactions do not constitute a package of deals, each transaction will be
accounted separately. In the event that the Company loses control, if the residual equity after the
disposal enables the Company to have joint control over or significant influence on the subsidiary, it
will be recognized as long-term equity investment in individual financial statements and be
accounted in accordance with the relevant rules for changing the cost method to the equity method;
otherwise, it will be recognized as a financial instrument and the difference between its fair value on
the date of the loss of control and its book value will be recognized in the profit or loss for the
current period.

22. Property investment
(1). In cost measurement model:
      Depreciation or amortization methods
      A property investment is a real estate property held with the intention of earning rents or of
capital appreciation or both, including land use rights that have been leased, land use rights that are
held and ready to be transferred after appreciation, and buildings that have been leased.
      Property investments are initially measured by cost. The subsequent expenses relating to an
property investment will be recognized in the cost of the property investment if the economic
benefits relating to the asset are very likely to flow in and the cost thereof can be measured reliably.
Otherwise, they will be recognized in the profit or loss for the current period at the time of being
incurred.
      The Group subsequently measures its property investments with the cost model. The
depreciation/amortization of investment property is calculated on a straight line basis. The service
life, estimated net residual value and annual depreciation rate of property investments are as
follows:
Category                               Service life Estimated net residual        Annual depreciation
                                                                        value                      rate

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Buildings          and               20-30 years                         4%                3.2%-4.8%
structures
Land use right                       40-70 years                            -              1.4%-2.5%


23. Fixed assets
(1). Recognition requirements
√Applicable □Not Applicable
     A fixed asset will be recognized only if the economic benefits relating thereto are very likely to
flow into the Group and its cost can be measured reliably. If meeting the above recognition
requirement, the subsequent expenses relating to a fixed asset will be recognized in the cost of the
fixed asset, and the book value of the replaced part will be deleted; otherwise, the subsequent
expenses will be recognized in the profit or loss for the current period at the time of being incurred.
     Fixed assets are initially measured by cost. The costs of purchasing a fixed asset include the
purchase price, related taxes and other expenses that are incurred before the fixed asset is made
to the predetermined ready-for-use status and are directly attributable to the asset.

(2). Depreciation methods
√Applicable □Not Applicable
                                                Depreciation
                    Depreciation                                    Residual value                Annual
Category                                   period (number of
                    methods                                                   rate      depreciation rate
                                                      years)
Buildings and       Straight-line                                               4%            2.4%-9.6%
                                                         10-40
structures          method
General             Straight-line                                               4%           9.6%-19.2%
                                                          5-10
equipment           method
Transportation      Straight-line                                               4%                 16.0%
                                                              6
equipment           method

(3). Identification basis, pricing and depreciation method of the fixed assets under financial
     lease
√Applicable □Not Applicable
     The depreciation method for the fixed assets under financial lease is the same as that for
proprietary fixed assets. If it can be reasonably determined that the ownership of a leased asset will
be acquired upon expiry of the lease term, the depreciation will be based on its service life; if it
cannot be reasonably determined that the ownership of a leased asset can be acquired upon expiry
of the lease term, the depreciation will be based on the lease term or the service life of the asset,
whichever is shorter.

  24. Construction in progress
√Applicable □Not Applicable
      The cost of construction in progress is determined based on the actual expenses, including the
necessary expenses on the works incurred during the construction, the borrowing costs incurred
before the works reach the predetermined ready-for-use status that shall be capitalized and other
related expenses.
      The construction in progress will be recognized as fixed assets, property investment and long-
term prepaid expenses when reaching the predetermined ready-for-use status.

  25. Borrowing costs
√Applicable □Not Applicable
      Borrowing costs refer to the interests incurred by the Group for its borrowings and other related
costs, including interest, amortization of discounts or premiums, ancillary costs and exchange
difference arising from foreign currency borrowings.
      Borrowing costs that are directly attributable to the acquisition, construction or production of the
assets qualified for capitalization shall be capitalized, and other borrowing costs shall be recognized
in the profit or loss for the current period. The assets qualified for capitalization refer to the fixed

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assets, property investment, inventory and other assets that can reach the predetermined ready-for-
use or sale status only after a quite long time of acquisition, construction or production.
     Borrowing costs can start to be capitalized only if they meet the following requirements
simultaneously:
     (1) the expenses on assets have been incurred;
     (2) the borrowing costs have been incurred;
     (3) The purchase, construction or production activities necessary to make the asset reach the
intended usable or saleable status have started.
     The borrowing costs for the assets qualified for capitalization shall cease being capitalized
when the assets reach the predetermined ready-for-use or sale status after the acquisition,
construction or production. The borrowing costs incurred subsequently will be recognized in the
profit or loss for the current period.
     During capitalization, the amount of interest to be capitalized during each accounting period is
determined as follows:
     For special borrowings, the amount of interest to be capitalized is the interest expenses
actually incurred during the current period less the temporary deposits interest income or
investment income.
     (2) For occupied general borrowings, it is calculated and determined based on the weighted
average of asset expenditures of the accumulated asset expenditure exceeding the portion of
special borrowings multiplied by the weighted average interest rate of the occupied general
borrowings.
     If an asset qualified for capitalization is interrupted abnormally for more than three months
during its acquisition, construction or production except due to the necessary procedures for it to
reach the predetermined ready-for-use or sale status, the capitalization of its borrowing costs will be
suspended. The borrowing costs incurred during the interruption will be recognized as expenses
and in the profit or loss for the current period until the acquisition, construction or production of the
asset is resumed.

26. Biological assets
□Applicable √Not Applicable

27. Oil and gas assets
□Applicable √Not Applicable

  28. Right-of-use assets
√Applicable □Not Applicable
     The Group's right-of-use asset classes mainly include buildings.
      On the commencement date of the lease term, the Group recognizes its right to use the leased
assets during the lease term as the right to use them, including: the initial measurement amount of
the liabilities of the lease; The amount of the lease payment paid on or before the commencement
date of the lease term, where there is a lease incentive, shall be deducted from the amount of the
lease incentive already enjoyed; Initial direct costs incurred by lessee; Costs expected to be
incurred by the Lessee to disassemble and remove the leased asset, restore the leased asset to
the site, or restore the leased asset to the state agreed upon in the lease terms. The Group
subsequently shall adopt the straight-line method for the depreciation of the usufruct assets. Where
the ownership of the leased asset can be reasonably determined at the end of the lease term, the
Group shall take depreciation during the remaining useful life of the leased asset. Where it is not
reasonably certain that ownership of the leased asset will be acquired at the end of the lease term,
the Group shall make depreciation within the shorter period of the lease term or the remaining
useful life of the leased asset.
      When the Group measures the lease liabilities again according to the present value of the
changed lease payment amount and adjusts the book value of the right to use assets accordingly, if
the book value of the right to use assets has been reduced to zero, but the lease liabilities still need
to be further reduced, the Group shall record the remaining amount into the current profit and loss.




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29. Intangible assets
(1). Measurement method, service life and impairment test
√Applicable □Not Applicable
      Intangible assets will be recognized only if the economic benefits relating thereto are very likely
to flow into the Group and the costs thereof can be measured reliably, and will be initially measured
by cost. However, the intangible assets acquired from the merger of the enterprises not under
common control will be individually recognized so long as the fair values thereof can be measured
reliably, and will be measured by fair value.
      The service life of an intangible asset is determined based on the term during which it can bring
economic benefits to the Group. If the term during which an intangible asset can bring economic
benefits to the Group is unforeseeable, it will be deemed as an intangible asset with uncertain
service life.
      The service life of intangible assets is as follows:
Category                                                                                      Service life
Land use right                                                                               40-50 years
Software                                                                                        10 years
      The land use rights acquired by the Group are generally accounted as intangible assets. The
buildings constructed by the Group itself, the related land use rights and buildings are accounted as
intangible assets and fixed assets respectively. The price paid for the land and buildings purchased
externally shall be allocated between the land use rights and buildings. If it is hard to reasonably
allocate the price, the price in full will be treated as fixed assets.
      The intangible assets with finite service life shall be amortized with the straight-line method
during their service life. The Group reviews and makes adjustment to, if necessary, the service life
and amortization method of its intangible assets with finite service life at least at the end of each
year.

(2). Accounting policies for internal R&D expenses
√Applicable □Not Applicable
      The Group divides expenditures for internal R & D projects into research expenditures and
development expenditures. Research expenses are recognized in the profit or loss for the current
period at the time of being incurred. Development expenditures can be capitalized only when all of
the following conditions are met at the same time, that is, it is technically feasible to complete the
intangible asset to make them usable or saleable; there is an intention to complete the intangible
asset and use or sell it; the way for intangible assets to generate economic benefits, including the
ability to prove that there are markets for the products generated by the intangible assetsor the
intangible assets themselves. Intangible assets that will be used internally can prove their
usefulness; there are sufficient technology, financial resources and other resource supports to
complete the development of the intangible asset and ability to use or sell the intangible asset; the
expenditure attributable to the development of such intangible asset can be reliably measured.
Development expenditures that do not satisfy the above conditions are included in the current
profits and losses when incurred.

  30. Impairment of long-term assets
√Applicable □Not Applicable
      The Group determines the impairment of the assets other than inventory, deferred income tax
and financial assets with the following methods.
      The Group decides on the balance sheet date whether an asset has a sign of impairment. If it
has a sign of impairment, the Group will estimate its recoverable value and carry out an impairment
test. For the goodwill formed due to the merger of enterprises and the intangible assets with
uncertain service life, the Group carries out impairment tests at least at the end of each year,
regardless of the impairment signs. For the intangible assets that have not been ready for use, the
Group also carries out impairment tests every year.
      The recoverable value of an asset is determined based on the fair value of the asset less the
disposal expenses or the present value of the expected future cash flows of the asset, whichever is
higher. The Group estimates the recoverable value of each asset. For an asset whose recoverable
value is hard to be estimated, the Group estimates the recoverable value of the assets Group which
the asset belongs to. An assets Group is identified based on whether the main cash inflows from
the Group are independent from the cash inflows from other assets or assets Groups.

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     When the recoverable value of an asset or assets Group is lower than its book value, the
Group will write down its book value to the recoverable value and the amount written down will be
recognized in the profit or loss for the current period; meanwhile, it will make provision for the
impairment thereof.
     The above assets impairment loss will not be reversed during the subsequent accounting
periods.

  31. Long-term prepaid expenses
√Applicable □Not Applicable
      Long-term prepaid expenses are amortized with the straight-line method and the amortization
periods are as follows:
Category                                                                     Amortization period
Architectural ornaments of buildings                                                   3-5 years
Advertising facilities                                                                 3-5 years


32. Contract liabilities
(1). Recognition of contract liabilities
√Applicable □Not Applicable
     The Group presents contractual assets or contractual liabilities in the balance sheet based on
the relationship between performance obligations and customers’ payments. The Group offsets the
contractual assets and contractual liabilities under the same contract as a net amount.
     A contractual liability refers to an obligation to transfer goods or services to a customer for the
consideration received or receivable from the customer, such as the amount received by the
enterprise before the transfer of committed goods or services.

33. Employee salary
(1). Accounting treatment of short-term salary
√Applicable □Not Applicable
     The short-term salary actually incurred during the accounting period when the employees
provide service for the Group are recognized as liabilities and are recognized in the profit or loss for
the current period or costs of related assets.

(2). Accounting treatment of post-employment benefits
√Applicable □Not Applicable
     The employees of the Group participate in the endowment insurance and unemployment
insurance managed by the local government, as well as the enterprise annuity, and the
corresponding expenditures are included in the relevant asset cost or current profit and loss when
incurred.

(3). Accounting treatment of severance benefits
√Applicable □Not Applicable
      When the Group provides severance benefits to its employees, the employee compensation
liabilities arising from the severance benefits will be recognized, and the amount will be recognized
in the profit or loss for the current period on the earlier date below: the date when the Group cannot
unilaterally withdraw the severance benefits provided as a result of the employment termination
plan or downsizing proposal; or the date when the Group recognizes the costs or expenses relating
to the reorganization involving the payment of severance benefits.

(4). Accounting treatment of other long-term employee benefits
□Applicable √Not Applicable

  34. Lease liabilities
√Applicable □Not Applicable


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      At the commencement date of the lease period, the Group recognizes the present value of the
outstanding lease payments as a lease liability, except for short term and low value leases. In
calculating the present value of the lease payments, the Group uses the lease embedded interest
rate as the discount rate; If the inherent interest rate of the lease cannot be determined, the lessee's
incremental borrowing rate shall be used as the discount rate. The Group calculates the interest
expense of the lease liability in each period of the lease term in accordance with the fixed cyclical
interest rate and records it into the current profit and loss, except as otherwise stipulated in the cost
of the relevant assets. The variable lease payment not included in the measurement of lease
liabilities shall be recorded into the profit and loss of the current period when it actually occurs,
except for those included in the cost of related assets as otherwise stipulated.
After the lease term begins, in the future when substantial changes occurred in the fixed payment,
the guaranteed residual value is expected to cope with the amount of change, is used to determine
the lease payment ratio index or change, call options, renewal options or terminate the option
evaluation results or the actual exercise changes, after the Group according to the change of the
present value of the lease payments to measure lease liability.

  35. Estimated liabilities
√Applicable □Not Applicable
      Except for the contingent considerations and contingent liabilities assumed in the mergers of
enterprises not under common control, an obligation relating to contingent matters will be
recognized by the Group as estimated liabilities if meeting the following requirements
simultaneously:
      (1) The obligation is a current obligation assumed by the Group;
      (2) The performance of the obligation may result in the outflow of economic benefits from the
Group;
      (3) The amount of the obligation can be measured reliably.
      Estimated liabilities are initially measured based on the best estimate of the expenses required
for the performance of related current obligations, and the risks, uncertainties and time value of
money relating to the contingent matters are also factored in. The book value of estimated liabilities
is reviewed on each balance sheet date. If any conclusive evidence indicates that the book value
cannot reflect the current best estimate, the book value will be adjusted based on the current best
estimate.

  36. Share-based payment
√Applicable □Not Applicable
      Share-based payment is divided into equity-settled share-based payment and cash-settled
share-based payment. An equity-settled share-based payment refers to a deal in which the Group
uses shares or other equity instruments as the consideration for settlement to obtain services.
      The equity-settled share-based payment in exchange for services provided by employees shall
be measured at the fair value of the equity instruments granted to employees. If it can be exercised
immediately after the grant, it shall be included in the relevant costs or expenses at fair value on the
grant date, and the capital reserve shall be increased accordingly; if it cannot be exercised until the
service within the waiting period has been completed or the specified performance conditions have
been satisfied on each balance sheet date during the waiting period, the Group will, based on the
best estimate of the number of exercisable equity instruments, include the services acquired in the
current period, as relevant costs or expenses based on the fair value on the grant date, and
increase the capital reserve accordingly .
      None of cost or expense shall be recognized for a share payment that cannot be exercised due
to failure to meet non-market conditions and/or service period conditions. Where market conditions
or non-exercising conditions are stipulated in the share-based payment agreement, regardless of
whether the market conditions or non-exercising conditions are satisfied, it shall be deemed as
exercisable as long as all other performance conditions and/or service period conditions have been
satisfied.
      If the equity-settled share payment is canceled, it will be treated as an accelerated exercise on
the cancellation day, and the unrecognized amount shall be recognized immediately. If an
employee or other party has option to satisfy the non-exercising conditions but fails to satisfy within
the waiting period, it shall be treated as cancellation of equity-settled share-based payment.
However, if a new equity instrument is granted and if it is determined that the new equity instrument
granted is used to replace the canceled equity instrument on the grant date of the new equity
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instrument, the replacement equity instruments granted in the same way shall be treated in the
same way as that for the modification of the terms and conditions for the original equity instrument.

37. Preferred shares, perpetual bonds and other financial instruments
□Applicable √Not Applicable

38. Revenue
(1). Accounting policies for the recognition and measurement of revenue
√Applicable □Not Applicable
     The Group recognizes incomes when it has fulfilled its performance obligations in the contract,
that is, the customer has acquired the control over the relevant goods or services. The acquisition
of the control over related goods or services means the ability to control the use of the goods or the
provision of the service and obtain almost all of the economic benefits from them.
     Commodity sales contracts
     Commodity sales contracts between the Group and customers usually only include
performance obligations for the transferred commodities. The Group generally recognizes incomes
on the basis of comprehensive consideration of the following factors, at the time when the customer
obtains control of the relevant products: the acquisition of the current right to receive payment for
the commodities, the transfer of the major risks and rewards in the ownership of the commodities,
the transfer of the legal ownership of the commodities, the transfer of the physical assets of the
commodities, and the acceptance of the commodities by the customer.
     Service contracts
     The service contracts between the Group and its customers usually include performance
obligations such as the provision of the use of shops in the Commodity City and its operating
supporting services, the provision of hotel accommodation services and hotel catering services, and
the provision of fixed-term paid funding services to related parties outside the Group.
     The use of shops in the Commodity City and its supporting services
     Since customers obtain and consume the economic benefits brought about by the Group’s
performance at the time of the performance by the Group, the Group regards them as a
performance obligation to be fulfilled within a certain period of time and recognizes an income
based on the performance progress, except that the performance progress cannot be reasonably
determined. Under the output method, the Group determines the performance progress of the
provision of the use of shops in the Commodity City and the supporting services for its operation
based on the number of using days of the shops When the performance progress cannot be
reasonably determined, if the cost incurred by the Group is expected to be compensated, the
income shall be recognized according to the amount of the cost incurred until the performance
progress can be reasonably determined.
     Hotel accommodation business
     Since customers obtain and consume the economic benefits brought about by the Group’s
performance at the time of the performance by the Group, the Group regards them as a
performance obligation to be fulfilled within a certain period of time and recognizes an income
based on the performance progress, except that the performance progress cannot be reasonably
determined. In accordance with the output method, the Group determines the performance
progress of hotel accommodation services based on the number of staying days. When the
performance progress cannot be reasonably determined, if the cost incurred by the Group is
expected to be compensated, the income shall be recognized according to the amount of the cost
incurred until the performance progress can be reasonably determined.
     Hotel catering business
     For individual performance obligations in the provision of hotel catering services, the Group
prices hotel catering services separately, and uses the completion of hotel catering services as the
point of income recognition.
     Fixed -time paid funding services
     Since customers obtain and consume the economic benefits brought about by the Group’s
performance at the time of the performance by the Group, the Group regards them as a
performance obligation to be fulfilled within a certain period of time and recognizes an income
based on the performance progress, except that the performance progress cannot be reasonably
determined. Under the output method, the Group determines the performance progress of the
services for the fixed-term paid funding services based on the number of using days of funds. When

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the performance progress cannot be reasonably determined, if the cost incurred by the Group is
expected to be compensated, the income shall be recognized according to the amount of the cost
incurred until the performance progress can be reasonably determined.

(2). Differences in the revenue recognition policies for the same business under different
     business models
□Applicable √Not Applicable

39. Contract cost
□Applicable √Not Applicable

  40. Government grants
√Applicable □Not Applicable
      A government grant is recognized when it can meet the requirements and can be received. If a
government grant falls in monetary assets, it will be measured by the amount received or receivable.
If a government grant does not fall in monetary assets, it will be measured by fair value. If the fair
value of a grant cannot be determined reliably, it will be measured by its nominal amount.
      A government grant prescribed by government documents to be used to acquire or construct or
otherwise form long-term assets will be deemed as an asset-related government grant; if no
government documents have express provisions, the grants that are used to acquire or construct or
otherwise form long-term assets will be deemed as asset-related government grants and others as
income-related government grants.
      The income-related government grants that are used to compensate for the related costs,
expenses or losses during the subsequent periods are recognized as deferred income and will be
recognized in the profit or loss or against the related costs for the period when the related costs,
expenses or losses are recognized. The income-related government grants used to compensate for
the related costs, expenses or losses that have been incurred are directly recognized in the profit or
loss or against the related costs for the current period.
      The asset-related government grants shall be used to offset the book value of related assets;
orrecognized as deferred income, and included in profit and loss in stages under a reasonable and
systematic method during the useful life of the related assets (but government grants measured at a
nominal amount shall be directly included in the current profit and loss); if the relevant asset is sold,
transferred, scrapped or damaged before the end of its useful life, the balance of the undistributed
deferred income shall be transferred to the current profit and loss when the asset is disposal.
      If the finance allocates the discounted funds to the loan bank, and the loan bank provides the
Group with a loan at a policy-oriented preferential interest rate, the Group takes the actual loan
amount received as the book value of the loan, and the loan principal and the policy The
preferential interest rate calculates the relevant borrowing costs.

  41. Deferred income tax assets and deferred income tax liabilities
√Applicable □Not Applicable
      Income tax consists of current income tax and deferred income tax. Except for the income tax
arising from the adjustment of goodwill caused by the mergers of enterprises or the income tax that
is related to the transactions or matters directly recognized in shareholders’ equity, which are
recognized in the shareholders’ equity, income tax will be recognized in the profit or loss for the
current period as income tax expenses or income.
      The Group measures the current income tax liabilities or assets formed during the current
period and the previous periods by the estimated amount of income tax to be paid or refunded as
calculated in accordance with the tax law.
      The Group recognizes deferred income tax with the balance sheet liability method based on
the temporary difference between the book value of assets and liabilities on the balance sheet date
and the tax base and that between the book value of the items that have not been recognized as
assets and liabilities but whose tax base can be determined according to the tax law and the tax
base thereof.
      All taxable temporary differences will be recognized as deferred income tax liabilities, unless:
      (1) The taxable temporary difference is generated in the following types of transactions: the
initial recognition of goodwill, or the initial recognition of assets or liabilities generated in a
transaction with the following characteristics: the transaction is not a business merger, and neither
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                                          2021 Annual Report


affecting accounting profits, nor impacting taxable incomes or deductible losses when transaction
occurs.
      (2) For taxable temporary differences related to investments in subsidiaries, joint ventures and
associated enterprises, the time for the reversal of the temporary differences can be controlled and
the temporary differences may not be reversed in the foreseeable future.
      For the deductible temporary differences and the deductible losses and tax deductions that can
be carried forward to the subsequent years, the Group recognizes the deferred income tax assets
arising therefrom within the limit of the future taxable income that is very likely to be obtained and
used to be offset against the deductible temporary differences, deductible losses and tax
deductions, unless:
      (1) The deductible temporary differences are generated in the following transactions: The
transaction is not a business combination, and when the occurrence of the transaction affects
neither accounting profits nor taxable income or deductible losses.
      (2) For deductible temporary differences related to investments in subsidiaries, joint ventures
and associates, if all of the following conditions are satisfied simultaneously, the corresponding
deferred income tax assets are recognized: the temporary differences are likely to be reversed in
the foreseeable future, and it is likely to obtain taxable income that can be used to offset the
deductible temporary differences in the future.
      The Group measures, on the balance sheet date, the deferred income tax assets and liabilities
based on the applicable tax rate for the period when the assets are expected to be recovered or the
liabilities are expected to be paid off, in accordance with the tax law, which will also reflect the
impact of the way of the expected recovery of assets or repayment of liabilities on the income tax
on the balance sheet date.
      The Group reviews the book value of deferred income tax assets on the balance sheet date. If
it is very likely to be unable to acquire adequate taxable income to be offset against the benefits of
deferred income tax assets in the future, the book value of deferred income tax assets will be
written down. On the balance sheet date, the Group re-evaluates the unrecognized deferred income
tax assets and recognizes the same to the extent that it is very likely to acquire adequate taxable
income to reverse all or part of the deferred income tax assets.
      If all the following requirements are met, deferred income tax assets and liabilities will be
presented in net amount after offsetting: the Group has the legal right to settle the current income
tax assets and liabilities in net amount; the deferred income tax assets and liabilities are related to
the income tax levied by an identical tax authority on an identical taxpayer, or are related to the
income tax levied by an identical tax authority on different taxpayers, but during each important
period when the deferred income tax assets and liabilities are reversed, the involved taxpayers
intend to settle the current income tax assets and liabilities in net amount or acquire assets or pay
off debts simultaneously.

42. Lease
(1). Accounting treatment of operating lease
□Applicable √Not Applicable


(2). Accounting treatment of financial lease
□Applicable √Not Applicable


(3). Determination and accounting treatment of leases under the new lease standards
√Applicable □Not Applicable
     Identification of the lease
     On the commencement date of the contract, the Group evaluates whether the contract is a
lease or an inclusive lease if a party in the contract cedes the right to control the use of one or more
identified assets for a certain period in exchange for consideration. To determine whether the
contract cedes the right to control the use of the identified assets for a certain period, the Group
assesses whether the client in the contract is entitled to receive almost all the economic benefits
arising from the use of the identified assets during the use period and to dominate the use of the
identified assets during the use period.
     Identification of separate leases
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                                          2021 Annual Report


     If the contract contains multiple separate leases at the same time, the Group will split the
contract and account for each separate lease separately. The right to use the identified asset
constitutes a separate lease in the contract if both of the following conditions are met:
     (1) The lessee can profit from the use of the asset alone or in combination with other readily
available resources;
     (2) The asset is not highly dependent or highly related to other assets in the contract.
     Separation of lease and non-lease components
     If the contract contains both lease and non-lease parts, when the Group acts as the lessor and
lessee, the lease and non-lease parts are separated for accounting treatment.
     Evaluation of the lease term
     The lease term is the irrevocable period during which the Group has the right to use the leased
asset. The Group has the option to renew the lease, that is, it has the right to choose to renew the
lease of the asset, and if it is reasonably certain that the option will be exercised, the lease term
also includes the period covered by the renewal option. The Group has the option to terminate the
lease, that is, it has the right to choose to terminate the lease of the asset, but if it is reasonably
certain that the option will not be exercised, the lease term includes the period covered by the
option to terminate the lease. In the event of a major event or change within the control of the
Group and affecting whether the Group is reasonably certain to exercise the corresponding option,
whether the Group is reasonably certain to exercise the option to renew the lease, purchase the
option or not exercise the option to terminate the lease right to be reassessed.
     As a tenant
     See Note V. 28 and Note V. 34 for the general accounting treatment of the Group as a lessee.
     Change in lease
     Change in lease is the change in lease scope, lease consideration and lease term beyond the
original contract terms, including increasing or terminating the right to use one or more leased
assets, extending or shortening the lease term specified in the contract, etc.
     If the lease changes and the following conditions are met at the same time, the Group will
account for the change in lease as a separate lease:
     (1) The change in lease expands the scope of the lease by increasing the right to use one or
more leased assets;
     (2) The increased consideration is equivalent to the amount adjusted by the individual price of
the expanded part of the lease scope according to the contract.
     If the lease modification is not accounted for as a separate lease, on the effective date of the
lease modification, the Group re-determines the lease term and discounts the modified lease
payments using the revised discount rate to remeasure the lease liability . When calculating the
present value of the lease payment after the change, the Group uses the lease embedded interest
rate of the remaining lease period as the discount rate; If it is impossible to determine the
embedded interest rate of the remaining lease period, the Group's incremental loan interest rate on
the effective date of the lease change shall be used as the discount rate.
     Regarding the impact of the above lease liability adjustment, the Group conducts accounting
treatment according to the following situations:
     (1) If the change in lease results in the narrowing of the lease scope or the shortening of the
lease term, the Group reduces the book value of the right-of-use assets to reflect the partial or
complete termination of the lease, and the relevant gains or losses from the partial or complete
termination of the lease are included in profit and loss for the current period;
     (2) For other changes in lease, the Group adjusts the book value of the right-of-use asset
accordingly.
     Short-term leases and leases of low-value assets
     The Group regards leases with a lease term shorter than 12 months and excluding purchase
options as short-term leases on the commencement date of the lease term; leases with a value not
exceeding RMB 40,000 when a single leased asset is a brand-new asset is identified as a low-value
asset lease. If the Group subleases or expects to sublease the leased assets, the original lease is
not recognized as a low-value asset lease. The Group chooses not to recognize right-of-use assets
and lease liabilities for short-term leases and leases of low-value assets. In each period of the lease
term, it is included in the relevant asset cost or current profit and loss on a straight-line basis.
     As a lessor
     The lease that transfers virtually all the risks and rewards related to the ownership of the
leased asset on the lease commencement date is a finance lease, and other leases are operating
leases.
     The Group as the lessor to operating leases
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                                            2021 Annual Report


     Rental income from operating leases is recognised in profit or loss on a straight-line basis over
each period of the lease term, and variable lease payments not included in lease receipts are
included in profit or loss for the current period when actually incurred.
     If an operating lease is changed, the Group will account for it as a new lease from the effective
date of the change, and the advance receipts or lease receivables related to the lease before the
change will regarded as the receipts of the new lease.

  43. Other important accounting policies and accounting estimates
√Applicable □Not Applicable
      Distribution of profits
      The Company’s cash dividend is recognized as liabilities after approval by the shareholders’
meeting.
      Measurement of fair value
      The Group measures the fair values of equity instruments investments on each balance sheet
date. Fair value refers to the price received from the sale of an asset or paid for the transfer of a
liability by a market player in the orderly transactions on the measurement date. The Group
measures the related asset or liability by fair value, assuming that the orderly transaction of selling
the asset or transferring the liability is executed in the principal market of related asset or liability, or
if there is no principal market, assuming that the transaction is executed in the most advantageous
market of related asset or liability. The principal market (or most advantageous market) is the
marketplace which the Group can enter on the measurement date. The Group adopts the
assumptions used by market players to maximize economic benefits in the pricing of the assets or
liabilities.
      When measuring non-financial assets at fair value, consider the ability of market participants to
use the asset for the best use to generate economic benefits, or to sell the asset to other market
participants who can use the asset for the best use to generate economic benefits.
      The Group adopts the valuation technique that is applicable under the current conditions and is
supported with sufficient available data and other information and uses the related observable
inputs with priority. The unobservable inputs will be used only if the observable inputs are
unavailable or it is unfeasible to acquire the observable inputs.
      For the assets and liabilities which are measured or disclosed by fair value in the financial
statements, the levels of fair value are determined based on the lowest-level input of important
significance for the overall measurement of fair values: Level 1 input is the unadjusted offer price for
an identical asset or liability that can be obtained in an active market on the measurement date;
Level 2 inputs are the inputs that are directly or indirectly observable for related assets or liabilities
other than Level 1 inputs; Level 3 inputs are the inputs that are observable for related assets or
liabilities.
      On each balance date, the Group re-evaluates the assets and liabilities that are recognized in
the financial statements and keep being measured by fair value so as to determine whether to
change the measurement levels of fair value.
      Significant accounting judgments and estimates
      In the preparation of financial statements, the management need to make judgments,
estimates and assumptions, which will affect the presented amounts and disclosure of revenue,
expenses, assets and liabilities and the disclosure of contingent liabilities on the balance sheet date.
However, the uncertainties of these assumptions and estimates may cause material adjustment to
the book value of the assets or liabilities that will be affected in the future.
      Judgments
      When applying the Group’s accounting policies, the management have made the following
judgments which have had significant influence on the amounts recognized in the financial
statements:
      Operating lease—as the lessor
      The Group has signed lease contracts for the property investments. The Group thinks that
according to the terms of the lease contracts, the Group retains all major risks and compensations
on the titles of those real estate properties and thus handles them as operating leases.
      Partition between property investments and fixed assets
      The Group classifies the buildings and structures leased out other than for the main businesses
such as market and hotel services as well as the auxiliary land use rights thereof as property
investments, including but not limited to the auxiliary banking and catering outlets for market


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                                           2021 Annual Report


operation and the auxiliary service outlets for hotels. Other buildings and structures leased out are
classified as fixed assets.
       Judgments on assets acquisition and mergers of enterprises
       When determining whether an acquisition transaction constitutes a merger, the Group
assesses various factors, including whether the acquiree constitutes a business, in accordance with
the Accounting Standards for Enterprises No. 20 – Merger of Enterprises. A business refers to a
Group of some production and operation activities or assets and liabilities within an enterprise,
which has the input, processing and output abilities and whose costs and expenses or revenue can
be calculated independently, but an asset or a Group of assets or liabilities can be deemed as a
business so long as it has the input and processing processes. The Group makes comprehensive
judgments by combining the asset acquired and the processing process.
       Business model
       The classification of financial assets at initial recognition depends on the Group’s business
model for the management of financial assets. When judging the business model, the Group factors
in the enterprise evaluation, the way of reporting financial assets performance to key management
personnel, the risks affecting the performance of financial assets, the way of managing financial
assets and the way of related business management personnel obtaining remunerations. When
assessing whether to aim at the collection of contractual cash flow, the Group needs to analyze the
reasons, time, frequency and value for sale of the financial assets to be sold before the expiry dates
thereof.
       Characteristics of contractual cash flow
       The classification of financial assets at initial recognition depends on the characteristics of the
contractual cash flow of the financial assets. For the judgment on whether the contractual cash flow
is the repayment of principal and the payment of interest on outstanding principal, including the
evaluation of the adjustment to the time value of money, it should be judged whether it is
significantly different from the benchmark cash flow; for the financial assets with the early
repayment characteristic, it should be judged whether the fair value of the early repayment
characteristic is extremely low.
       Uncertainties of estimates
       The key assumptions on the balance sheet date for the future and other key sources of the
uncertainties of estimates are shown below, which may cause significant adjustments to the book
values of assets and liabilities during the future accounting periods.
       Impairment of financial instruments
       The Group evaluates the impairment of financial instruments with the expected credit loss
model. To apply the model, the Group needs to make significant judgments and estimates and take
into account all reasonable and evidenced information, including forward-looking information. When
making these judgments and estimates, the Group infers the expected changes in the debtors’
credit risks based on their historical repayment data, in combination with the economic policies,
macroeconomic indicators and industry risks. Different estimates may affect the provisions for
impairment and the provision that has been made for impairment may not necessarily be equal to
the actual amount of impairment loss in the future.
       Net realizable value of property inventory
       The Group’s property inventory is measured by cost or net realizable value, whichever is lower.
For the calculation of net realizable value, assumptions and estimates should be used. If the
management adjust the estimated price and the costs and expenses to be incurred until the
completion, it will affect the estimate of the net realizable value of the inventory and the difference
will affect the provision for inventory depreciation.
       Impairment of non-current assets other than financial assets (excluding goodwill)
The Group determines, on the balance sheet date, whether the non-current assets other than
financial assets have a sign of being impaired. For a non-current asset other than financial asset, if
it is indicated that its book value cannot be recovered, an impairment test will be made. When the
book value of an asset or a Group of assets is higher than its recoverable value, i.e. fair value less
the disposal expenses or the present value of expected future cash flow, whichever is higher, the
asset or Group has been impaired. For the fair value less the disposal expenses, the Group refers
to the agreed selling price or observable market price of the similar asset in a fair transaction, less
the cost increase directly attributable to the disposal of the asset. When predicting the present value
of future cash flows, the management must estimate the expected future cash flows of the asset or
Group of assets and select an appropriate discount rate. When identifying a Group of assets, the
management consider whether the smallest identifiable Group of assets can generate income and
cash flows independently from other departments or units, or the income and cash inflows
                                                135   / 228
                                          2021 Annual Report


generated thereby are mostly independent from other departments or units, and also take into
account the way of managing or monitoring production and operating activities and the way of
making decisions on the continued use or disposal of the asset.
      Fair value of unlisted equity investment
      Valuation of the unlisted equity investment is the expected future cash flows discounted at the
current discount rate of other financial instruments with similar contract terms and risk
characteristics. This requires the Group to estimate the expected future cash flows, credit risk,
volatility and discount rate, which brings uncertainties.
      Development expenses
      When determining the amount of capitalization, management must make assumptions on the
expected future cash flow, the applicable discount rate, and the expected benefit period of the asset.
      Deferred income tax assets
      To the extent that it is very likely for the Group to have enough taxable income to be offset
against the deductible losses, the Group shall recognize deferred income tax assets in connection
with the outstanding deductible losses. This requires the management to use lots of judgments to
estimate the acquisition time and amount of the taxable income to be acquired in the future to
determine the amount of deferred income tax assets to be recognized, in consideration of the tax
payment planning strategy.
      Service life and residual value of fixed assets
      The Group makes provisions for the depreciation of its fixed assets during the expected service
life thereof after considering their residual value. The Group reviews the expected service life and
residual value of related assets on a regular basis to determine the amount of depreciation
expenses to be recognized for each reporting period. The Group determines the service life and
residual value of assets based on its experience in similar assets and in combination with the
expected technology changes. If the previous estimates have material changes, the depreciation
expenses will be adjusted for the future periods.

44. Changes in important accounting policies and accounting estimates
(1). Changes in important accounting policies
√Applicable □Not Applicable
                                                                                         Remarks
                                                                  Approving            (substantially
Contents and reason for changes in accounting policies
                                                                  procedure         affected items and
                                                                                         amounts)
In 2018, the Ministry of Finance promulgated the revised Changes in                 See other notes
Accounting Standards for Business Enterprises No. 21 – statutory                   for details
Leases (“New Lease Standards”), which adopts a single accounting policies
model similar to the current accounting treatment of
financial leases, requiring lessees to All leases other
than leases and leases of low-value assets recognize a
right-of-use asset and a lease liability, with depreciation
and interest expense, respectively. The Group will start
accounting in accordance with the newly revised lease
standards from January 1, 2021.
Other statements
      According to the linking regulations, the information of the comparable period will not be
adjusted, and the retained earnings at the beginning of 2021 will be retrospectively adjusted for the
difference between the new lease standard on the first implementation date and the current lease
standard:
      (1) For financial leases before the date of initial implementation, the Group measures the right-
of-use assets and lease liabilities according to the original book values of the finance leased assets
and finance lease payments payable;
      (2) For operating leases prior to the date of initial application, the Group measures lease
liabilities based on the present value of the remaining lease payments discounted at the
incremental borrowing rate on the date of initial application, and according to the prepaid rent,
makes necessary adjustments to an amount euqal to the lease liability for each lease to measure
the right-of-use asset;
      (3) The Group conducts impairment test on right-of-use assets in accordance with Note V. 30
and performs corresponding accounting treatment.
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                                           2021 Annual Report


     The Group adopts simplified treatment for operating leases whose leased assets are low-value
assets before the date of initial application or operating leases that will be completed within 12
months, and no right-of-use assets and lease liabilities are recognized for them. In addition, the
Group adopts the following simplified treatment for operating leases prior to the date of initial
application:
     (1) When measuring lease liabilities, the same discount rate may be used for leases with
similar characteristics; the measurement of right-of-use assets may not include initial direct costs;
     (2) If there is an option to renew the lease or to terminate the lease, the Group determines the
lease term according to the actual exercise of the option before the date of initial execution and
other latest information;
     (3) As an alternative to the right-of-use asset impairment test, the Group assesses whether a
contract including a lease is a onerous contract before the date of initial application according to
Note V. 28, and adjusts the right-of-use assets according to the amount of the loss provision
recorded in the balance sheet before the date of initial implementation;
     (4) For lease modification prior to the date of initial implementation, the Group conducts
accounting treatment according to the final arrangement of lease modification.
     For the minimum lease payments outstanding for significant operating leases disclosed in the
financial statements for 2020, the Group's adjustment process for the difference between the
discounted present value of the incremental borrowing rate of the Japan Group as the lessee on 1
January 2021 and the lease liabilities recorded on the balance sheet on 1 January 2021 is as
follows:
Major Operating Lease Minimum Lease Payments as of December 31,                                         -
2020
Weighted Average Incremental Borrowing Interest Rate                                        2.78%-8.01%
Present value of operating lease payments as of 1 January 2021                           236,505,193.35
Plus: Finance lease payments payable as of December 31, 2020                                            -
Lease liability as of January 1, 2021                                                    236,505,193.35
     The impact of the implementation of the new lease standard on balance sheet items on
January 1, 2021 is as follows:
     Consolidated Balance Sheet
                                              Number of           Assuming that the              Affected
                                              statements         original standard is             amount
                                                                        implemented
Advance from customers                    98,855,083.89              105,187,528.26        -6,332,444.37
Other receivables                     2,700,742,786.35            2,708,478,136.25         -7,735,349.90
Right-of-use assets                      249,646,048.55                             -    249,646,048.55
Long-term receivables                    133,058,661.88              126,756,573.81         6,302,088.07
Long-term prepaid expenses               105,353,574.36              110,728,723.36        -5,375,149.00
Non-current liabilities due           1,321,957,116.90            1,315,026,574.43          6,930,542.47
within one year
Lease liabilities                        229,574,650.88                             -    229,574,650.88
                                      4,839,187,922.81            4,366,177,536.11       473,010,386.70
     Corporate balance sheet
                                               Number of        Assuming that the       Affected amount
                                              statements       original standard is
                                                                      implemented
Prepayments                               26,853,922.86              29,452,445.04         -2,598,522.18
Other receivables                     2,651,620,610.06           2,651,640,610.06              -20,000.00
Right-of-use assets                      121,203,075.53                           -      121,203,075.53
Long-term receivables                     61,267,392.22              61,250,000.00              17,392.22
Non-current liabilities due           1,317,545,829.95           1,315,026,574.43           2,519,255.52
within one year
Lease liabilities                        116,082,690.05                           -      116,082,690.05
                                      4,294,573,520.67           4,057,369,629.53        237,203,891.14

     The impact of the implementation of the new lease standard on the 2021 Financial Statements
is as follows:
     Consolidated Balance Sheet
                                           Number of        Assuming that the             Affected

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                                       2021 Annual Report


                                         statements         original standard is             amount
                                                                  implemented
Advance from customers              875,167,709.48              878,159,599.98       -2,991,890.50
Other receivables                 1,355,924,282.96           1,364,246,050.50        -8,321,767.54
Right-of-use assets                 225,347,077.14                             -    225,347,077.14
Long-term receivables               222,307,363.40              214,752,001.51        7,555,361.89
Long-term prepaid expenses          188,184,376.43              191,220,571.95       -3,036,195.52
Deferred income tax assets          135,737,028.89              134,914,219.91          822,808.98
Non-current liabilities due       3,664,241,923.08           3,653,879,444.25        10,362,478.83
within one year
Lease liabilities               205,942,673.93                              -       205,942,673.93
                              6,872,852,435.31               6,437,171,888.10       435,680,547.21
    Consolidated Income Statement
                                     Number of             Assuming that the       Affected amount
                                    statements            original standard is
                                                                implemented
Operating cost                    4,027,543,138.56         4,033,717,402.64          -6,174,264.08
Sales expenses                      204,745,974.57            204,817,321.94            -71,347.37
Administrative expenses             463,852,229.64            463,888,003.77            -35,774.13
Financial expenses                  179,911,613.70            167,047,055.27         12,864,558.43
                                  4,876,052,956.47         4,869,469,783.62           6,583,172.85


    Corporate balance sheet
                                         Number of         Assuming that the       Affected amount
                                         statements       original standard is
                                                                implemented
Prepayments                          11,213,809.02             13,767,136.95         -2,553,327.93
Other receivables                 1,207,086,885.99         1,207,106,885.99             -20,000.00
Right-of-use assets                 118,591,035.63                           -      118,591,035.63
Long-term receivables                41,668,837.64             41,650,000.00             18,837.64
Deferred income tax assets          122,565,730.38            121,772,869.30            792,861.08
Non-current liabilities due       3,656,595,072.25         3,653,879,444.25           2,715,628.00
within one year
Lease liabilities                   113,367,062.05                         -        113,367,062.05
                                  5,271,088,432.96          5,038,176,336.49        232,912,096.47

    Company Income Statement
                                         Number of         Assuming that the       Affected amount
                                         statements       original standard is
                                                                implemented
Operating cost                    1,062,881,897.31           1,068,758,634.31         -5,876,737.00
Financial expenses                  175,493,659.20            166,314,343.29           9,179,315.91
                                  1,238,375,556.51          1,235,072,977.60           3,302,578.91

     In addition, starting from the date of initial application, the Company will include the cash
paid for the repayment of the principal and interest of the lease liability in the cash flow
statement in the cash outflow of financing activities, and the short-term lease payments and
low-value assets lease payments made with simplified treatment and variable lease payments
that are not included in the measurement of the lease liability are still included in operating
cash outflows.

     The main effects of retrospective adjustments caused by the above changes in accounting
policies on the Financial Statements are as follows:

        Changes in accounting policies of the Group

                                  December 31, 2020           1. Changes in        January 1, 2021
                                                          accounting policies
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                                      2021 Annual Report


       Prepayments                105,187,528.26             (6,332,444.37)      98,855,083.89
       Other receivables          2,708,478,136.25           (7,735,349.90)   2,700,742,786.35
       Right-of-use assets                       -           249,646,048.55       249,646,048.55
       Long-term prepaid                                     (5,375,149.00)
                                    110,728,723.36                                105,353,574.36
       expenses
       Long-term prepaid
                                    126,756,573.81             6,302,088.07       133,058,661.88
       expenses
       Non-current liabilities
                                  1,315,026,574.43             6,930,542.47     1,321,957,116.90
       due within one year
       Lease liabilities                           -         229,574,650.88       229,574,650.88



       The Company

                                 December 31, 2020           1. Changes in       January 1, 2021
                                                         accounting policies

       Prepayments                   29,452,445.04         (2,598,522.18)        26,853,922.86
       Other receivables          2,651,640,610.06            (20,000.00)     2,651,620,610.06
       Right-of-use assets                       -          121,203,075.53        121,203,075.53
       Long-term receivables         61,250,000.00               17,392.22         61,267,392.22
       Non-current liabilities
                                  1,315,026,574.43            2,519,255.52      1,317,545,829.95
       due within one year
       Lease liabilities                           -        116,082,690.05       116,082,690.05



(2). Changes in important accounting estimates
□Applicable √Not Applicable


(3). The adjustment of the current opening financial statements for the first implementation
      of the New Standard for Lease from 2021
√Applicable □Not Applicable
                                  Consolidated Balance Sheet
                                                                                    Unit: RMB
                                     December 31,
                Item                                    January 1, 2021        Adjustment
                                         2020
Current assets:
   Monetary capital                 5,612,642,932.21     5,612,642,932.21
   Held-for-trading financial
                                       51,712,734.31        51,712,734.31
assets
   Accounts receivable                153,573,476.86       153,573,476.86
   Prepayments                        105,187,528.26        98,855,083.89       -6,332,444.37
   Other receivables                2,708,478,136.25     2,700,742,786.35       -7,735,349.90
   In which: interest receivable      121,401,210.48       121,401,210.48
   Inventory                        1,329,467,728.17     1,329,467,728.17
   Other current assets               179,724,694.17       179,724,694.17
      Total current assets         10,140,787,230.23    10,126,719,435.96      -14,067,794.27
Non-current assets:
   Long-term receivables              126,756,573.81       133,058,661.88        6,302,088.07
   Long-term equity investment      3,832,897,502.71     3,832,897,502.71
   Other equity instruments
                                      662,256,342.79       662,256,342.79
investment
   Other non-current financial
                                    1,523,925,249.81     1,523,925,249.81
assets
   Property investment              1,960,426,291.73     1,960,426,291.73

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  Fixed assets                       5,234,293,786.87         5,234,293,786.87
  Construction in progress             982,891,877.14           982,891,877.14
  Right-of-use assets                               -           249,646,048.55      249,646,048.55
  Intangible assets                  3,900,780,981.92         3,900,780,981.92
  Development expenses                  22,223,061.09            22,223,061.09
  Long-term prepaid expenses           110,728,723.36           105,353,574.36        -5,375,149.00
  Deferred income tax assets            99,664,328.84            99,664,328.84
  Other non-current assets             152,495,196.56           152,495,196.56
     Total non-current assets       18,609,339,916.63        18,859,912,904.25      250,572,987.62
        Total assets                28,750,127,146.86        28,986,632,340.21      236,505,193.35
Current liabilities:
  Short-term borrowings              1,257,179,389.40         1,257,179,389.40
  Accounts payable                     636,463,802.23           636,463,802.23
  Advances from customers              112,752,897.25           112,752,897.25
  Contract liabilities               2,442,211,788.88         2,442,211,788.88
  Payroll payable                      161,498,997.53           161,498,997.53
  Tax payable                          495,400,499.73           495,400,499.73
  Other payables                     1,646,345,561.62         1,646,345,561.62
  Non-current liabilities due                                                         6,930,542.47
                                     1,315,026,574.43         1,321,957,116.90
within one year
  Other current liabilities          3,023,608,041.68         3,023,608,041.68
     Total current liabilities      11,090,487,552.75        11,097,418,095.22        6,930,542.47
Non-current liabilities:
  Long-term borrowings                 282,000,000.00           282,000,000.00
  Bonds payable                      3,552,161,709.68         3,552,161,709.68
  Lease liabilities                                 -           229,574,650.88      229,574,650.88
  Estimated liabilities                110,620,306.10           110,620,306.10
  Deferred income                       26,545,277.30            26,545,277.30
  Deferred income tax liabilities      113,602,923.79           113,602,923.79
     Total non-current liabilities   4,084,930,216.87         4,314,504,867.75      229,574,650.88
        Total liabilities           15,175,417,769.62        15,411,922,962.97      236,505,193.35
Owners’ equity (or shareholders’ equity)
  Paid-in capital (share capital)    5,489,914,176.00         5,489,914,176.00
  Capital reserve                    1,594,906,524.67         1,594,906,524.67
  Less: treasury stocks                137,298,000.00           137,298,000.00
  Other comprehensive income            78,149,661.33            78,149,661.33
  Surplus reserve                    1,364,257,808.58         1,364,257,808.58
  Undistributed profits              5,168,298,206.50         5,168,298,206.50
  Total equity attributable to
owners (shareholders) of the        13,558,228,377.08        13,558,228,377.08
parent company
  Minority interest                     16,481,000.16           16,481,000.16
     Total owners’ equity (or
                                    13,574,709,377.24        13,574,709,377.24
shareholders’ equity)
        Total liabilities and
owners’ equity (or shareholders’  28,750,127,146.86        28,986,632,340.21      236,505,193.35
equity)

Statements on item adjustment:
√Applicable □Not Applicable
     In 2018, the Ministry of Finance revised and issued the “Accounting Standards for Business
Enterprises No. 21-Leases” (Cai Kuai [2018] No. 35) (hereinafter collectively referred to as the
“New Standard for Lease”). The Company will disclose the accounting statements according to the
requirements of the New Standard for Lease. In accordance with the standard transmit regulations,
the Company retrospectively adjusted the figures for the beginning of 2021. The right to use assets
and lease liabilities shall be confirmed in accordance with the lease contract, and the leases
originally included in the prepayments shall be transferred to the right to use assets. The
quantitative impact of the above changes on specific financial statement items is: on January 1,

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2021,in the consolidated balance sheet, prepayments were reduced by RMB 6,332,444.37, other
receivables were reduced by RMB 7,735,349.90, long-term prepaid expenses were reduced by
RMB 5,375,149.00, and long-term prepaid receivables, right-of-use assets, non-current liabilities
due wthin one year and lease liabililities were inreased by RMB 6,302,088.07, RMB 249,646,048.55,
RMB 6,930,542.47 and RMB 229,574,650.88, respectively.


                                     Balance Sheet of Parent Company
                                                                                         Unit: RMB
               Item                    December 31, 2020         January 1, 2021     Adjustment
Current assets:
  Monetary capital                         5,435,867,497.50       5,435,867,497.50
  Held-for-trading financial
                                                   6,632.72               6,632.72
assets
  Accounts receivable                         14,671,577.47          14,671,577.47
  Prepayments                                 29,452,445.04          26,853,922.86    -2,598,522.18
  Other receivables                        2,651,640,610.06       2,651,620,610.06       -20,000.00
  In which: interest receivable              121,401,210.48         121,401,210.48
  Inventory                                   10,144,965.06          10,144,965.06
  Other current assets                     3,082,340,716.76       3,082,340,716.76
     Total current assets                 11,224,124,444.61      11,221,505,922.43    -2,618,522.18
Non-current assets:
  Long-term receivables                       61,250,000.00          61,267,392.22        17,392.22
  Long-term equity investment              6,083,135,428.02       6,083,135,428.02
  Other equity instruments
                                             662,256,342.79        662,256,342.79
investment
  Other non-current financial
                                             266,722,811.41        266,722,811.41
assets
  Property investment                      1,501,734,504.79       1,501,734,504.79
  Fixed assets                             4,444,239,239.28       4,444,239,239.28
  Construction in progress                   856,248,099.10         856,248,099.10
  Right-of-use assets                                               121,203,075.53   121,203,075.53
  Intangible assets                        3,777,092,772.41       3,777,092,772.41
  Long-term prepaid expenses                  58,705,952.97          58,705,952.97
  Deferred income tax assets                  85,739,381.21          85,739,381.21
     Total non-current assets             17,797,124,531.98      17,918,344,999.73   121,220,467.75
       Total assets                       29,021,248,976.59      29,139,850,922.16   118,601,945.57
Current liabilities:
  Short-term borrowings                    1,257,179,389.40       1,257,179,389.40
  Accounts payable                           444,254,309.61         444,254,309.61
  Advances from customers                     97,380,931.49          97,380,931.49
  Contract liabilities                     2,283,994,068.70       2,283,994,068.70
  Payroll payable                            131,469,702.81         131,469,702.81
  Tax payable                                546,100,633.28         546,100,633.28
  Other payables                           1,333,312,494.36       1,333,312,494.36
  Non-current liabilities due                                                          2,519,255.52
                                           1,315,026,574.43       1,317,545,829.95
within one year
  Other current liabilities                3,556,664,822.79       3,556,664,822.79
     Total current liabilities            10,965,382,926.87      10,967,902,182.39     2,519,255.52
Non-current liabilities:
  Long-term borrowings                       282,000,000.00         282,000,000.00
  Bonds payable                            3,552,161,709.68       3,552,161,709.68
  Lease liabilities                                       -         116,082,690.05   116,082,690.05
  Estimated liabilities                      110,620,306.10         110,620,306.10
  Deferred income                             26,545,277.30          26,545,277.30
  Deferred income tax liabilities             69,623,249.14          69,623,249.14
     Total non-current liabilities         4,040,950,542.22       4,157,033,232.27   116,082,690.05
       Total liabilities                  15,006,333,469.09      15,124,935,414.66   118,601,945.57
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                                          2021 Annual Report


Owners’ equity (or shareholders’ equity)
   Paid-in capital (share capital)        5,489,914,176.00         5,489,914,176.00
   Capital reserve                        1,833,256,515.22         1,833,256,515.22
   Less: treasury stocks                    137,298,000.00           137,298,000.00
   Other comprehensive income                 81,473,183.84           81,473,183.84
   Surplus reserve                        1,364,204,332.75         1,364,204,332.75
   Undistributed profits                  5,383,365,299.69         5,383,365,299.69
     Total owners’ equity (or
                                        14,014,915,507.50         14,014,915,507.50
shareholders’ equity)
        Total liabilities and
owners’ equity (or                     29,021,248,976.59         29,139,850,922.16     118,601,945.57
shareholders’ equity)
Statements on item adjustment:
√Applicable □Not Applicable
     In 2018, the Ministry of Finance revised and issued the “Accounting Standards for Business
Enterprises No. 21-Leases” (Cai Kuai [2018] No. 35) (hereinafter collectively referred to as the
“New Standard for Lease”). The Company will disclose the accounting statements according to the
requirements of the New Standard for Lease from Jan 1st, 2021. In accordance with the standard
transmit regulations, the Company retrospectively adjusted the figures for the beginning of 2021.
The right to use assets and lease liabilities shall be confirmed in accordance with the lease contract,
and the leases originally included in the prepayments shall be transferred to the right to use assets.
The quantitative impact of the above changes on specific financial statement items is: On January 1,
2021, in the parent company's balance sheet, prepayments were reduced by RMB 2,598,522.18,
other receivables were reduced by RMB 20,000.00, and long-term receivables, right-of-use assets,
non-current liabilities due wthin one year and lease liabililities were increased by by RMB 17,392.22,
RMB 121,203,075.53, RMB 2,519,255.52 and RMB 116,082,690.05, respectively.

(4). Explanation of the retrospective adjustment of the previous comparative data for the
     first implementation of the New Standard for Lease from 2021.
□Applicable √Not Applicable

45. Others
□Applicable √Not Applicable

VI. Taxes
1. Major taxes and tax rates
Major taxes and tax rates
√Applicable □Not Applicable
         Tax                   Base of taxation                                     Tax rate
VAT                     Sale of goods or rendering of        The Company is a general taxpayer. The taxable
                        taxable service                      income is calculated at 13%, 9% and 6% tax rates
                                                             as output tax, and the value-added tax is
                                                             calculated and paid on the basis of the difference
                                                             after deduction of the input tax allowed to be
                                                             deducted in the current period. In addition, for the
                                                             sale of the self-developed old real estate projects
                                                             (the contract start date indicated in the
                                                             “Construction Project Construction Permit” is
                                                             before April 30, 2016) and the lease of the real
                                                             estate acquired before April 30, 2016, the
                                                             simplified tax calculation method shall apply at the
                                                             rate of 5%.
Urban maintenance
                        Indirect tax actually paid           5% or 7%
and construction tax
Corporate income                                             Domestic enterprises should pay 25% of the
tax                                                          taxable income of corporate income tax; Yiwu
                                                             China Commodities City (Hong Kong)

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                                         2021 Annual Report


                                                             International Trade Co., Ltd. was registered in
                                                             Hong Kong Special Administrative Region, so it is
                                                             subject to the Hong Kong income tax rate,
                                                             16.50%;
                                                             BETTER SILK ROAD FZE was registered in
                                                             Dubai and no corporate income tax is levied.
Land appreciation       Ratio of appreciation value to       Four-bracket progressive tax rate (30%~60%)
tax                     deductible items
Real estate tax         If the tax is levied according       1.2% or 12%
                        to price, the amount is 1.2%
                        of the balance of the original
                        value of the property after a
                        30% deduction; if the tax is
                        levied according to rental, the
                        amount is 12% of the rental
                        income.
Education surcharge     Indirect tax actually paid           3%
Local education         Indirect tax actually paid           2%
surcharge
Cultural undertaking    Advertising turnover                 3%
development fee

Disclosure of taxpayers subject to different income tax rates
√Applicable □Not Applicable
                    Taxpayer                                           Income tax rate (%)
Yiwu China Commodities City (Hong Kong)                                                            16.50
International Trade Co., Ltd.
BETTER SILK ROAD FZE                                                                                   0

2. Tax preference
√Applicable □Not Applicable
     According to the notice “Measures of Yiwu for Implementation of Adjustment of Urban Land
Use Tax Policies to Promote the Intensive and Economical Utilization of Land” (Y D S H [2017] No.
56), the Company enjoys tax incentive of exemption from 90% of land use tax according to the
statistical caliber of taxation on acres .

3. Others
□Applicable √Not Applicable

VII. Notes to items in consolidated financial statements
1. Monetary capital
√Applicable □Not Applicable
                                                                                             Unit: RMB
               Item                            Closing balance                    Opening balance
Cash on hand                                                154,264.94                      292,999.29
Bank deposits                                        4,831,258,722.95                 4,812,189,759.31
Other cash and cash equivalents                              55,398.36                  800,160,173.61
Total                                                4,831,468,386.25                 5,612,642,932.21
    In which: amount deposited
                                                      38,554,320.18                   25,679,209.72
              abroad
Other statements
    For the cash and cash equivalents which are restricted in use, please refer to Notes VII.81
Assets with Restricted Title or Right of Use.
    Interest income of demand deposits is accrued based on the demand deposit rates of banks.
The term of short-term time deposits ranges from three months to half a year and depends on the
Group’s cash demand, and the interest income thereof is accrued based on the corresponding time
deposit rates of banks.
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                                         2021 Annual Report



  2. Held-for-trading financial assets
√Applicable □Not Applicable
                                                                                        Unit: RMB
                            Item                              Closing balance     Opening balance
Financial assets that are measured by fair value and
of which the changes in fair value are recognized in              75,375,083.20      51,712,734.31
the profit or loss for the current period
Among which:
      Bank financing products                                     25,000,000.00                  -
      Equity instrument investment                                50,375,083.20      51,712,734.31
                            Total                                 75,375,083.20      51,712,734.31
Other notes:
□Applicable √Not Applicable

3. Derivative financial assets
□Applicable √Not Applicable


4. Notes receivable
(1). Categorized presentation of notes receivable
□Applicable √Not Applicable
(2). Notes receivable having been pledged by the Company as of the close of the reporting
     period
□Applicable √Not Applicable
(3). Notes receivable having been endorsed or discounted by the Company as of the close
     of the reporting period and having not been due as of the balance sheet date
□Applicable √Not Applicable
(4). Notes turned into accounts receivable due to the drawers’ non-performance at the
     close of the reporting period
□Applicable √Not Applicable
(5). Categorized disclosure based on the bad debt provision method
□Applicable √Not Applicable
Accounts receivable for which bad debt provision is made individually:
□Applicable √Not Applicable

Explanation for making bad debt provision for accounts receivable by Group:
□Applicable √Not Applicable

If the bad debt provision is made according to the general model of expected credit loss, please
refer to the disclosure of other receivables:
□Applicable √Not Applicable

(6). Provisions for bad debts
□Applicable √Not Applicable

(7). Notes receivable actually written off during the current period
□Applicable √Not Applicable

Other statements
□Applicable √Not Applicable




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                                                                        2021 Annual Report


                 5. Accounts receivable
                 (1). Disclosure based on account age
                 √Applicable □Not Applicable
                                                                                                                             Unit: RMB
                                        Account age                                                  Closing book balance
                 Within 1 year                                                                                          191,258,380.84
                 1 to 2 years                                                                                               100,234.00
                 2 to 3 years                                                                                               352,588.44
                                              Total                                                                     191,711,203.28


                 (2). Categorized disclosure based on the bad debt provision method
                 √Applicable □Not Applicable
                                                                                                                                          Unit: RMB
                                                  Closing balance                                                                  Opening balance
                         Book balance                 Bad debt provision                                Book balance                   Bad debt provision
  Category                                                                            Book                                                                          Book
                                                                     Provisi                                                                        Provisi
                                       Proporti                                       value                             Proporti                                    value
                       Amount                         Amount        on ratio                         Amount                            Amount       on ratio
                                       on (%)                                                                           on (%)
                                                                      (%)                                                                             (%)
Accounts
receivable for
which bad debt
                       97,219,393.59    50.71         6,261,907.10      0.22         90,957,486.49     90,795,847.76       59.07                 -             -    90,795,847.76
provision is
made
individually
Accounts
receivable for
which bad debt         94,491,809.69    49.29          211,765.29       6.44         94,280,044.40     62,907,905.93       40.93        130,276.83          0.21    62,777,629.10
provision is
made by Group

     Total            191,711,203.28      /           6,473,672.39      /          185,237,530.89    153,703,753.69        /            130,276.83      /          153,573,476.86



                 Accounts receivable for which bad debt provision is made individually:
                 √Applicable □Not Applicable
                                                                                                                                          Unit: RMB
                                                                                     Closing balance
                   Name                                        Bad debt
                                   Book balance                                      Provision ratio (%)               Reason for provision
                                                               provision
                 Trade
                                   90,957,486.49                               -                         -
                 receivables
                                                                                       Due to deterioration of
                 Lease                                                                 operating conditions,
                                 6,261,907.10    6,261,907.10                 100.00
                 receivables                                                           expected not to be
                                                                                       recovered
                    Total       97,219,393.59    6,261,907.10                   0.22                 /
                 Explanation for making bad debt provision for accounts receivable individually:
                 □Applicable √Not Applicable


                 Explanation for making bad debt provision for accounts receivable by Group:
                 □Applicable √Not Applicable

                 If the bad debt provision is made according to the general model of expected credit loss, please
                 refer to the disclosure of other receivables:
                 √Applicable □Not Applicable

                                                                                End of June 2021
                 Account age           Estimated book balance                  Expected credit loss             Expected credit loss for
                                              in default                            rate (%)                         the duration
                 Within 1 year                    94,038,987.25                                  0.01                        152,655.56
                 1 - 2 years                         100,234.00                                  5.66                            5,674.25
                 2 -3 years                          352,588.44                                15.16                           53,435.48

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                                         2021 Annual Report


Total                      94,491,809.69                                               211,765.29


(3). Provisions for bad debts
√Applicable □Not Applicable
                                                                                          Unit: RMB
                                           Amount of change during the current
                                                         period
        Category      Opening balance                                               Closing balance
                                                                Recovery or
                                             Provision
                                                                  reversal
Bad debt provision
for accounts                130,276.83         6,990,264.17           646,868.61       6,473,672.39
receivable
       Total                130,276.83         6,990,264.17           646,868.61       6,473,672.39


In which the recovered or reversed amount is important:
□Applicable √Not Applicable


(4). Accounts receivable actually written off during the current period
□Applicable √Not Applicable


(5). Accounts receivable from the five debtors with the highest closing balance
√Applicable □Not Applicable
                                                                                          Unit: RMB
                                                       Proportion in the total
                                                         closing balance of      Closing balance of
             Debtor               Closing balance
                                                        accounts receivable      bad debt provision
                                                                (%)
Total balance of the accounts
receivable with the top five         8,508,287.04                        4.44             82,077.26
entities
             Total                   8,508,287.04                        4.44             82,077.26

Other statements
     The Group is mainly engaged in market operation, hotel services and commodity sales, and
the balance of receivables is mainly based on the market operation of commercial rate receivables,
hotel consumption, trade receivables and advertising publishing fees.

(6). Accounts receivable derecognized due to transfer of financial assets
□Applicable √Not Applicable

(7). Amounts of assets and liabilities formed by the transfer of accounts receivable and
     continuing involvement
□Applicable √Not Applicable

Other notes:
□Applicable √Not Applicable

6. Accounts receivable financing
□Applicable √Not Applicable



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                                        2021 Annual Report


7. Prepayments
(1). Presentation of prepayment by account age
√Applicable □Not Applicable
                                                                                         Unit: RMB
                            Closing balance                             Opening balance
Account age
                       Amount           Proportion (%)               Amount         Proportion (%)
Within 1              868,252,359.56              99.21
                                                                  102,657,415.19              97.59
year
1 to 2 years              6,212,572.92                0.71          2,329,113.07                2.22
2 to 3 years                602,777.00                0.07                      -                  -
Over 3 years                100,000.00                0.01            201,000.00                0.19
    Total              875,167,709.48                  100        105,187,528.26                 100
Explanation for failure to settle the prepayments with an account age longer than one year and in
important amounts:
None

(2). Prepayments to the five suppliers with the highest closing balance
√Applicable □Not Applicable
                                                                                   Proportion in total
                       Debtor                                Closing balance       closing balance of
                                                                                   prepayments (%)
PACIFIC SEAFOOD TRADER SA                                      84,334,516.52                       9.64
Sociedad Nacional de Galapagos C.A. SONGA                      40,474,343.32                       4.62
Yiwu Zuqing Commodity Co., Ltd.                                42,928,301.09                       4.91
PROCESADORA DE MARISCOS DE EL ORO
                                                               36,062,941.54                      4.12
PROMARO S.A.
FALCON MARINE EXPORTS LTD.,                                    24,255,029.78                      2.77
                      Total                                   228,055,132.25                     26.06

Other statements
None


Other statements
□Applicable √Not Applicable
  8. Other receivables
Presentation of items
√Applicable □Not Applicable
                                                                                            Unit: RMB
               Item                          Closing balance                    Opening balance
Interest receivable                                   92,249,275.44                    121,401,210.48
Other receivables                                  1,263,675,007.52                  2,579,341,575.87
Total                                              1,355,924,282.96                  2,700,742,786.35

Other notes:
□Applicable √Not Applicable

Interest receivable
(1). Classification of interest receivable
√Applicable □Not Applicable
                                                                                            Unit: RMB
            Item                        Closing balance                        Opening balance
Cash occupation fee for                          92,249,275.44                        121,401,210.48
receivables
            Total                                    92,249,275.44                    121,401,210.48

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(2). Significant overdue interest
□Applicable √Not Applicable
(3). Bad debt provision
□Applicable √Not Applicable

Other notes:
□Applicable √Not Applicable

Dividend receivable
(1). Dividend receivable
□Applicable √Not Applicable
(2). Important dividend receivable with an account age longer than 1 year
□Applicable √Not Applicable
(3). Bad debt provision
□Applicable √Not Applicable


Other notes:
□Applicable √Not Applicable

Other receivables
(1). Disclosure based on account age
√Applicable □Not Applicable
                                                                                             Unit: RMB
                  Account age                                         Closing book balance
Within 1 year                                                                           133,457,994.19
1 to 2 years                                                                          1,113,635,528.49
2 to 3 years                                                                                732,296.38
Over 3 years                                                                             20,204,272.92
Bad debt provision for other receivables                                                 -4,355,084.46
                      Total                                                           1,263,675,007.52


(2). Classification based on the nature of accounts
√Applicable □Not Applicable
                                                                          Unit: RMB
      Nature of receivable             Closing book balance                 Opening book balance
Financial grants receivables                    1,103,178,748.00                    2,480,172,779.00
from joint ventures and
associated enterprises
Withholdings, deposit and                            125,377,518.60                     59,045,233.81
margin
Receivables from export tax                            34,759,474.84                     4,841,801.31
rebate
Reserve                                                      359,266.08                    523,397.65
Receivables from self-operated                                        -                 42,493,714.00
land
              Total                               1,263,675,007.52                   2,587,076,925.77


(3). Bad debt provision
√Applicable □Not Applicable
                                                                                           Unit: RMB
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                                                2021 Annual Report


                                      Phase I                 Phase 2                  Phase 3
                                                          Expected credit          Expected credit
                                Expected credit loss     loss in the entire       loss in the entire
    Bad debt provision                                                                                         Total
                                 in the coming 12         duration (credit         duration (credit
                                      months               has not been               has been
                                                             impaired)                impaired)
Balance as of January 1,
2021
                                     3,768,512.43                                                         3,768,512.43
Balance as of January 1,
2021 in the current period
Provision made      in    the        1,309,763.41                                                         1,309,763.40
current period
Current reversal                       353,464.30                                                           353,464.30
Current write-off                      369,727.08                                                           369,727.07
Balance as at 31                     4,355,084.46                                                         4,355,084.46
December 2021

Significant changes in the book balance of other receivables with changes in loss provisions:
□Applicable √Not Applicable

Basis for the bad debt provision made in the current period and for assessing whether the credit risk
of financial instruments has increased significantly:
□Applicable √Not Applicable

(4). Provisions for bad debts
√Applicable □Not Applicable
                                                                                                              Unit: RMB
                                            Amount of change during the current period
                          Opening                                                                             Closing
    Category                                              Recovery or     Charge-off or
                          balance            Provision                                                        balance
                                                            reversal         write-off
Bad debt
provision for            3,768,512.43      1,309,763.41              353,464.30        369,727.08         4,355,084.46
other receivables
      Total              3,768,512.43      1,309,763.41              353,464.30        369,727.08         4,355,084.46

In which the recovered or reversed amount is important:
□Applicable √Not Applicable
(5). Other receivables actually written off during the current period
□Applicable √Not Applicable

(6). Other receivables from the five debtors with highest closing balance
√Applicable □Not Applicable
                                                                                                              Unit: RMB
                                                                                        Weight in the
                                                                                        total closing          Bad debt
                            Nature of                                   Account          balance of            provision
      Debtor                                 Closing balance
                           receivable                                     age               other               Closing
                                                                                        receivables            balance
                                                                                             (%)
Yiwu Tonghui
                          Financial                                     1-2
Shangbo Real                                    880,728,548.00                                    69.46                 -
                          assistance                                    years
Estate Co., Ltd.
Yiwu Handing
                          Financial                                     1-2
Shangbo Real                                    222,450,200.00                                    17.54                 -
                          assistance                                    years
Estate Co., Ltd.
Yisha Chengdu
International             Temporary                                     Within 1
                                                 40,000,000.00                                         3.15             -
Trade City Co.,           loan                                          year
Ltd.
                                                       149   / 228
                                                     2021 Annual Report


          Yiwu Taxation
          Bureau, State          Export tax                                 Within 1
                                                      34,759,474.84                                     2.74             -
          Administration of      rebate                                     year
          Taxation
          Logistis Quelfor       Guarantee                                  1-2
                                                          4,985,493.99                                  0.39
          s.r.o.                 deposit                                    years
                Total                  /          1,182,923,716.83               /                     93.28             -


          (7). Receivables involving government grants
          √Applicable □Not Applicable
                                                                                                                Unit: RMB
                                     Government                                                          Estimated time,
                 Debtor            subsidy project     Closing balance           Closing Aging          amount and basis
                                        name                                                              for collection
          Yiwu Taxation            Export tax              34,759,474.84        Within one year       April 2022,
          Bureau, State            rebate                                                             34,759,474.84,
          Administration of                                                                           "Interim
          Taxation                                                                                    Regulations of the
                                                                                                      People's Republic
                                                                                                      of China on Value
                                                                                                      Added Tax"
                                                                                                      .
          Other statements
          None


          (8). Other receivables derecognized due to transfer of financial assets
          □Applicable √Not Applicable

          (9). Amounts of assets and liabilities formed by the transfer of accounts receivable and
               continuing involvement
          □Applicable √Not Applicable

          Other notes:
          □Applicable √Not Applicable

          9. Inventory
          (1). Classification of inventory
          √Applicable □Not Applicable
                                                                                                               Unit: RMB

                                    Closing balance                                                    Opening balance
                                     Provision for                                                       Provision for
                                        inventory                                                           inventory
   Item                          depreciation/provision                                              depreciation/provision
              Book balance                                   Book value         Book balance                                     Book value
                                   for impairment of                                                   for impairment of
                                 contract performance                                                contract performance
                                           cost                                                                cost
Raw
                   723,775.34                          -           723,775.34          402,020.27                            -      402,020.27
materials
Finished
                 75,079,555.38                         -      75,079,555.38          75,506,826.35                           -    75,506,826.35
goods
Development
                347,123,927.41             28,303,338.06     318,820,589.35      341,654,440.82                28,303,338.06     313,351,102.76
cost
Development
                928,561,037.31                         -     928,561,037.31      932,153,659.76                              -   932,153,659.76
products



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                                                             2021 Annual Report


Work-in-
progress               4,217,610.61                            -          4,217,610.61         8,054,119.03                                    -       8,054,119.03
materials
    Total           1,355,705,906.05               28,303,338.06     1,327,402,567.99      1,357,771,066.23                   28,303,338.06        1,329,467,728.17




            (2). Provision for inventory depreciation/provision for impairment of contract performance
                  cost
            √Applicable □Not Applicable
                                                                                                 Unit: RMB
                                          Increase in the current     Decrease in the
                              Opening              period              current period
                Item                                                                       Closing balance
                               balance                             Charge-off
                                           Provision     Others                    Others
                                                                   or write-off
            Developm        28,303,338.06           -           -               -        -
                                                                                            28,303,338.06
            ent cost
               Total        28,303,338.06            -          -               -        -  28,303,338.06


            (3). Closing balance of inventory containing capitalized borrowing costs
            √Applicable □Not Applicable
                On December 31, 2021, the inventory with a book value of RMB 35,797,443.87 (December 31,
            2020: RMB 35,797,443.87) was formed by capitalization of borrowing costs.

            (4). Amortization of contract performance cost during the current period
            □Applicable √Not Applicable

            Other statements
            √Applicable □Not Applicable
               Inventory-Development Cost Unit: RMB-yuan Currency: RMB
                      Item             Opening balance        Increase in the            Decrease in the              Closing balance
                                                               current period             current period
            Haicheng Phase I            67,907,950.27                             -                           -        67,907,950.27
            Business Street
            Haicheng Phase II          273,746,490.55              5,469,486.59                               -       279,215,977.14
            Business Street
            Total                      341,654,440.82              5,469,486.59                               -       347,123,927.41

            Inventory-Developed Products Unit: RMB-yuan Currency: RMB
                    Item         Opening balance       Increase in          Delivered          Other transfer-           Closing balance
                                                       the current        during current            out
                                                         period             reporting
                                                                              period
            Haicheng
            Phase           I    918,976,130.79                      -                   -      3,360,000.00            915,616,130.79
            Business Street
            Qiantang
            Yinxiang                   238,807.22                    -      238,807.22                            -                        -
            Shuangchuang
            Building              12,938,721.75           6,184.77                       -                        -       12,944,906.52
            Total                932,153,659.76           6,184.77          238,807.22          3,360,000.00            928,561,037.31


            10. Contract assets
            (1). Overview of contract assets
            □Applicable √Not Applicable
            (2). Amount of and reasons for material changes to book value during the reporting period
            □Applicable √Not Applicable

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                                          2021 Annual Report


 (3). Provision for impairment of contract assets in the current period
 □Applicable √Not Applicable
 If the bad debt provision is made according to the general model of expected credit loss, please
 refer to the disclosure of other receivables:
 □Applicable √Not Applicable

 Other notes:
 □Applicable √Not Applicable

 11. Held-for-sale assets
 □Applicable √Not Applicable


  12. Non-current assets due within one year
 □Applicable √Not Applicable
 Important debt investments and other debt investments at the end of the period:
 □Applicable √Not Applicable
 Other statements
 None

   13. Other current assets
 √Applicable □Not Applicable
                                                                                         Unit: RMB
                  Item                       Closing balance                 Opening balance
To-be-deducted input tax                            234,080,141.55                 162,435,010.24
Prepaid land transfer fees                             7,629,349.00                               -
To-be-certified input tax                              4,357,934.03                  14,195,996.43
Entrusted loans to the market                          2,780,294.82                   3,279,187.50
traders
Less: bad debt provision for                                 -185,500.00                 -185,500.00
entrusted loans
                 Total                                 248,662,219.40                179,724,694.17

 Other statements
 None

 14. Debt investments
 (1). Overview of debt investment
 □Applicable √Not Applicable
 (2). Important debt investment as of the close of the reporting period
 □Applicable √Not Applicable
 (3). Provision for impairment
 □Applicable √Not Applicable

 Amount of impairment provision for the current period and the basis for assessing whether there is
 significant increase in the credit risk of financial instruments
 □Applicable √Not Applicable

 Other statements
 □Applicable √Not Applicable

 15. Other debt investments
 (1). Overview of other debt investment
 □Applicable √Not Applicable

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                                                                    2021 Annual Report


             (2). Important other debt investment as of the close of the reporting period
             □Applicable √Not Applicable
             (3). Provision for impairment
             □Applicable √Not Applicable

             Amount of impairment provision for the current period and the basis for assessing whether there is
             significant increase in the credit risk of financial instruments
             □Applicable √Not Applicable

             Other notes:
             □Applicable √Not Applicable

              16. Long-term receivables
             (1). Overview of long-term receivables
             √Applicable □Not Applicable
                                                                                                                                            Unit: RMB
                                      Closing balance                                                       Opening balance                         Range
                                                                                                                                                      of
           Item                            Bad debt                                                               Bad debt
                       Book balance                          Book value                 Book balance                                Book value     discount
                                           provision                                                              provision
                                                                                                                                                     rate
   Guarantee
                7,555,361.89                                 7,555,361.89                 6,302,088.07                             6,302,088.07
   deposit
   Financial
   assistance
   receivable 214,752,001.51                               214,752,001.51 126,756,573.81                                    - 126,756,573.81
   from joint
   ventures
      Total   222,307,363.40                               222,307,363.40 133,058,661.88                                    - 133,058,661.88             /

             (2). Bad debt provision
             □Applicable √Not Applicable


             Amount of bad debt provision for the current period and the basis for assessing whether there is
             significant increase in the credit risk of financial instruments
             □Applicable √Not Applicable

             (3). Long-term receivables derecognized due to transfer of financial assets
             □Applicable √Not Applicable

             (4). Amounts of assets and liabilities formed by the transfer of long-term receivables and
                  continuing involvement
             □Applicable √Not Applicable

             Other statements
             □Applicable √Not Applicable

               17. Long-term equity investment
             √Applicable □Not Applicable
                                                                                                                                                 Unit: RMB
                                                                           Change in the current period
                                                                                                                                                               Closing
                                                                                 Investment gains or
                                                                                                                                                   Closing     balance
                  Opening amount
Investee
                     Balance       Additional investment
                                                             Decrease in          losses recognized       Change in other   Declared a cash        amount         of
                                                             investment             with the equity          benefits       dividend or profit
                                                                                        method                                                     Balance    impairme
                                                                                                                                                                  nt

                                                                              153   / 228
                                                                2021 Annual Report


                                                                                                                                                         provision
1. Joint ventures
Yiwu Shanglv         365,830,756.91                                              17,837,597.30                                         383,668,354.21
Yiwu
Rongshang
                      22,319,075.64                                             195,068,462.30                                         217,387,537.94
Property Co.,
Ltd.
Yiwu
Chuangcheng
                      11,444,786.74                                              76,618,539.06                                          88,063,325.80
Property Co.,
Ltd.
Others                15,284,720.18      17,850,000.00                           23,678,584.58                                          56,813,304.76     3,327,216.16
Sub-total            414,879,339.47      17,850,000.00                          313,203,183.24                                         745,932,522.71     3,327,216.16
2. Associates
Binjiang
                     154,152,267.42                                              17,523,961.66                     137,200,000.00       34,476,229.08
Shangbo
Huishang
                      71,396,566.07                                              11,428,130.57                                          82,824,696.64
Micro-finance
Yiwu
Huishang
Redbud
                      78,072,569.23                       17,223,611.38          16,057,218.98                       5,909,184.62       70,996,992.21
Equity
Investment
Co., Ltd.
Chouzhou
Financial            371,320,662.02                                              54,700,187.22                                         426,020,849.24
Lease
Yiwu China
Commodities
City
                                   -                                                                                                                 -    9,508,049.22
Investment
Management
Co., Ltd.
Yiwu China
Commodities
City Fuxing
Investment           102,918,559.00                                                                                                    102,918,559.00
Center
(limited
partnership)
Pujiang Lvgu
Property Co.,        379,672,466.65                                              79,608,970.60                                         459,281,437.25
Ltd.
CCCP                1,471,572,953.91   1,225,000,000.00                          60,365,490.42                                        2,756,938,444.33
Yiwu Hongyi
Equity
Investment
Fund                 689,756,805.12     150,000,000.00                           48,115,457.34                                         887,872,262.46
Partnership
(limited
partnership)
Others                 99,155,313.82     103,366,783.24                          -1,822,274.45   4,493,427.31                           205,193,249.92
Sub-total           3,418,018,163.24   1,478,366,783.24   17,223,611.38         285,977,142.34   4,493,427.31      143,109,184.62     5,026,522,720.13    9,508,049.22
      Total         3,832,897,502.71   1,496,216,783.24   17,223,611.38         599,180,325.58   4,493,427.31      143,109,184.62     5,772,455,242.84     12,835,265.38



         Other statements
             Provision for impairment of long-term equity investment:
                                                                 Unit: RMB
Investee                                           Opening        Increase in                                   Decrease            Closing
                                                   balance        the current                                     in the            balance
                                                                     period                                      current
                                                                                                                 period
Yiwu China Commodities City Investment
                                                    9,508,049.22               -              -    9,508,049.22
Management Co., Ltd. (Note 1)
Others                                              3,327,216.16               -              -    3,327,216.16
Total                                              12,835,265.38               -              -   12,835,265.38
            Note 1: In 2017, Yiwu China Commodities City Financial Holdings Co., Ltd. (hereinafter
       referred to as "CCCF"), a wholly-owned subsidiary of the Group, and Shanghai Fuxing Industrial
       Group Co., Ltd. (hereinafter referred to as "Fuxing") jointly established Industrial Fund Yiwu China
       Commodities City Fuxing Investment Center (LLP) (hereinafter referred to as the "Funds of Funds"),
       the Fund of Funds has invested in 12 sub-funds including Yiwu Shangfu Chuangzhi Investment
       Center (LLP) (hereinafter referred to as "Shangfu Chuangzhi Fund"). CCCF, as a limited partner,
       subscribed RMB 998 million in the FOF, accounting for 49.9% of the subscribed capital. The paid-in
       capital was RMB 102.92 million, and there is no deadline for the payment for the unpaid capital
       contribution. The other limited partner of the FOF is Fuxing. CCCF also contributed RMB 9.8 million,
       49% of total shares, to jointly establish Yiwu China Commodity City Investment Management Co.,
       Ltd. (hereinafter referred to as “CCCIM”) with Fuxing as the general partner of the above-mentioned
       FOF and sub-funds. The FoF and CCCIM are both under the control of Fuxing and are associates
       of CCCF. The above paid-in capital contribution made by CCCF to the FoF has been contributed to

                                                                          154   / 228
                                         2021 Annual Report


Shangfu Chuangzhi Fund together with the capital contribution of Fuxing to the FoF through the
FoF as a limited partner. With the capital contribution from the FoF as a limited partner and CCCF’s
capital contribution to Shangfu Chuangzhi Fund as a limited partner, Shangfu Chuangzhi Fund
made capital contribution of RMB820.54million to subscribe for the increase in the registered capital
of Hubei Provincial Asset Management Co., Ltd. to acquire 22.667% equity therein.
     In 2018, CCCF learned during its after-investment follow-up management that Fuxing and its
actual controller ZHU Yidong were suspected of having committed a criminal offense and the
22.667% equity held by Shangfu Chuangzhi Fund in Hubei Provincial Asset Management Co., Ltd.
was frozen by the Public Security Bureau of Shanghai due to Fuxing’s contribution to the sources of
the capital contribution. The Group believes that, on December 31, 2021, the Group’s investment in
the Fund of Funds and Shangfu Chuangzhi Fund was non-related to Fuxing’s investment, and there
was no indication of impairment of the underlying assets. Although they were still frozen, but without
affecting the Group’s equity. Therefore, there was no impairment. However, for the equity
investment managed for the Yiwu CCC, a full impairment provision has been made since 2018. See
Notes VII.81 and Notes XIV. 1 for details.

18. Other equity instruments investment
(1). Overview of other equity instruments investment
√Applicable □Not Applicable
                                                                                           Unit: RMB
              Item                              Closing balance                  Opening balance
Shenwan Hongyuan Group Co., Ltd.                      642,187,968.77                   662,256,342.79
             Total                                    642,187,968.77                   662,256,342.79


(2). Non-trading equity instruments investment
□Applicable √Not Applicable
Other notes:
□Applicable √Not Applicable

  19. Other non-current financial assets
√Applicable □Not Applicable
                                                                                            Unit: RMB
                  Item                          Closing balance                  Opening balance
Unlisted equity investment                            213,607,388.98                   134,582,725.75
PE investment                                       1,263,329,797.13                 1,341,220,243.72
NEEQ equity investment                                 47,882,069.30                    48,122,280.34
                  Total                             1,524,819,255.41                 1,523,925,249.81


Other notes:
□Applicable √Not Applicable

20. Property investment
Measurement models
(1). Property investment measured by cost
                                                                                           Unit: RMB
                                       Buildings and
               Item                                             Land use right            Total
                                        structures
I. Original book value
    1. Opening balance                1,952,906,526.61           428,095,086.44      2,381,001,613.05
    2. Increase in the current        1,109,483,031.70            10,665,898.19      1,120,148,929.89
period
    (1) Outsourcing                                         -     10,665,898.19         10,665,898.19


                                              155   / 228
                                                   2021 Annual Report


            (2) Inventory\fixed
       assets\construction in progress      1,109,483,031.70                                -    1,109,483,031.70
       changed into property investment
             4. Closing balance             3,062,389,558.31                438,760,984.63       3,501,150,542.94
       II. Accumulated depreciation and accumulated amortization
             1. Opening balance               352,149,349.88                 68,425,971.44         420,575,321.32
             2. Increase in the current
                                               93,669,647.35                 12,969,173.81         106,638,821.16
       period
            (1) Provision or amortization      93,669,647.35                 12,969,173.81         106,638,821.16
             4. Closing balance               445,818,997.23                 81,395,145.25         527,214,142.48
       III. Depreciation provision
             1. Opening balance                            -                                -                     -
             4. Closing balance                            -                                -                     -
       IV. Book value
            1. Opening book value           2,616,570,561.08                357,365,839.38       2,973,936,400.46
            2. Closing book value           1,600,757,176.73                359,669,115.00       1,960,426,291.73

       (2). Information of investment real estate without property right certificates
       √Applicable □Not Applicable
                                                                                                          Unit: RMB
                                                                                        Reasons for having not
                       Item                                 Book value                  obtained the ownership
                                                                                               certificate
       Office building of the auxiliary                            103,736,942.74    Completion settlement not
       project in western Yiwu                                                       completed
       Total                                                       103,736,942.74

      Other statements
      √Applicable □Not Applicable
           As of December 31, 2021, the total amount of investment real estate for which the property
      right certificates had not been received due to the final settlement was still in progress was RMB
      103,736,942.74.

         21. Fixed assets
       Presentation of items
       √Applicable □Not Applicable
                                                                                                       Unit: RMB
                       Item                               Closing balance                  Opening balance
       Fixed assets                                            5,078,590,929.75                 5,234,293,786.87
                       Total                                   5,078,590,929.75                 5,234,293,786.87

       Other notes:
       □Applicable √Not Applicable

       Fixed assets
       (1). Overview of fixed assets
       √Applicable □Not Applicable
                                                                                                        Unit: RMB
                                          Buildings and             Machinery         Transportation
               Item                                                                                            Total
                                           structures               equipment           equipment
I. Original book value:
     1. Opening balance               7,419,947,051.90           3,785,579,073.90      17,844,183.85     11,223,370,309.65
     2. Increase in the current
                                          142,043,463.99             95,500,592.38        985,758.82        238,529,815.19
period

                                                           156   / 228
                                                 2021 Annual Report


         (1) Purchase                     1,742,482.55          50,062,006.86       985,758.82         52,790,248.23
         (2) Changeover from
                                       140,300,981.44           45,159,824.47                 -       185,460,805.91
construction in progress
         (4) Other transfer-in                        -             278,761.05                -           278,761.05
      3. Decrease in the current
                                               3,366.44         13,881,195.30     5,504,327.05         19,388,888.79
period
         (1) Disposal or retirement            3,366.44        13,881,195.30      5,504,327.05         19,388,888.79
         (2) Other changeover                                              -                 -                     -
      4. Closing balance              7,561,987,149.45      3,867,198,470.98     13,325,615.62     11,442,511,236.05
II. Accumulated depreciation
      1. Opening balance              2,443,460,695.43      3,061,676,908.45     12,775,451.05      5,517,913,054.93
      2. Increase in the current
                                       286,194,882.11         104,750,015.62        982,547.28        391,927,445.01
period
         (1) Provision                 286,194,882.11         104,750,015.62        982,547.28        391,927,445.01
      3. Decrease in the current
                                                      -         11,793,932.72     5,289,728.77         17,083,661.49
period
         (1) Disposal or retirement                  -         11,793,932.72      5,289,728.77         17,083,661.49
      4. Closing balance              2,729,655,577.54      3,154,632,991.35      8,468,269.56      5,892,756,838.45
III. Depreciation provision
      1. Opening balance               471,163,467.85                        -                -       471,163,467.85
      4. Closing balance               471,163,467.85                        -                -       471,163,467.85
IV. Book value
      1. Closing book value           4,361,168,104.06        712,565,479.63      4,857,346.06      5,078,590,929.75
      2. Opening book value           4,505,322,888.62        723,902,165.45      5,068,732.80      5,234,293,786.87



       (2). Temporarily idle fixed assets
       □Applicable √Not Applicable
       (3). Fixed assets leased in through financial lease
       √Applicable □Not Applicable
                                                                                                  Unit: RMB
                              Original book        Accumulated             Impairment
             Item                                                                            Book value
                                  value            depreciation             provision
       General                  6,084,431.99         5,841,054.71                       -         243,377.28
       equipment


       (4). Fixed assets leased out through operating lease
       □Applicable √Not Applicable
       (5). Fixed assets for which the ownership certificates have not been obtained
       √Applicable □Not Applicable
                                                                                                   Unit: RMB
                                                                                Reasons for having not
                     Item                           Book value                  obtained the ownership
                                                                                       certificate
       Huangyuan Clothing Market                            259,100,829.23   Completion settlement not
                                                                             completed
       CCC Hotel                                             53,939,512.13   Completion settlement not
                                                                             completed
       Liaoning Xiliu Yiwu China                            392,075,717.75   Completion settlement not
       Commodity City                                                        completed
       Underground space of Yixi                            497,104,194.34   Completion settlement not
       supporting project                                                    completed
       Total                                              1,202,220,253.45



                                                      157   / 228
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            Other notes:
            √Applicable □Not Applicable
                The impairment of fixed assets was RMB 471,163,467.85, which was the impairment of fixed
            assets of Haicheng Yiwu China Commodities City.
                As of December 31, 2021, the total amount of property, plant and equipmentfor which the
            property right certificates had not been received due to the final settlement was still in progress was
            RMB 1,202,220,253.45.

            Disposal of fixed assets
            □Applicable √Not Applicable


              22. Construction in progress
            Presentation of items
            √Applicable □Not Applicable
                                                                                                               Unit: RMB
                           Item                             Closing balance                        Opening balance
            Construction in progress                              1,090,577,963.27                        982,891,877.14
                          Total                                   1,090,577,963.27                        982,891,877.14

            Other notes:
            □Applicable √Not Applicable

            Construction in progress
            (1). Overview of construction in progress
            √Applicable □Not Applicable
                                                                                                               Unit: RMB
                                                Closing balance                                           Opening balance
         Item                                     Impairment                                                Impairment
                            Book balance                                Book value           Book balance                 Book value
                                                   provision                                                 provision
West Yiwu International
Means of Production          212,637,292.78                    -         212,637,292.78       166,382,416.70               -   166,382,416.70
Market Auxiliary Project
Liaoning Xiliu Yiwu China
Commodities City
                              32,290,506.33        -4,635,059.96             27,655,446.37     32,290,506.33   -4,635,059.96    27,655,446.37
Commerce Phase I
Project—Hotel Project
The Zhimei Dachen
                              58,285,106.90                    -             58,285,106.90     43,194,369.48               -    43,194,369.48
Tourism Project
The Chian West Sea
                              68,040,671.22                    -             68,040,671.22     54,552,839.23               -    54,552,839.23
Tourism Project
The renovation project of
Yindu Hotel and Office                      -                  -                         -     55,553,736.33               -    55,553,736.33
Building
The Yiwu Comprehensive
                             357,114,238.02                    -         357,114,238.02       505,797,275.02               -   505,797,275.02
Bonded Zone Project
The business station
project of the warehouse                    -                  -                         -     89,894,127.82               -    89,894,127.82
park of the Yiwu CCC
The lighting project in
                                            -                  -                         -     29,724,101.17               -    29,724,101.17
Zone IV
Zone II East Parking Lot
                             276,099,117.75                    -         276,099,117.75         7,346,035.44               -     7,346,035.44
Project
Yiwu Digital Trade
                              60,070,777.68                    -             60,070,777.68                 -               -                -
Industrial Park
Other projects                 30,675,312.55                   -          30,675,312.55         2,791,529.58               -     2,791,529.58
            Total           1,095,213,023.23       -4,635,059.96       1,090,577,963.27       987,526,937.10   -4,635,059.96   982,891,877.14



            (2). Changes to important construction in progress during the current period
            √Applicable □Not Applicable
                                                                                        Unit: RMB10,000
                                                               158   / 228
                                                                              2021 Annual Report

                                                                                                                                                        In which:
                                                                                                             Ratio of                                                   Interest
                                                                                                                                                       capitalized
                                      Opening       Increase in          Amount            Closing        accumulated                   Accumulated                  capitalization
                                                                                                                         Progress of                   interest in
     Item               Budget        amount        the current       changed into         amount          investment                    capitalized                  ratio for the   Source of funds
                                                                                                                           project                         the
                                      Balance         period          fixed assets         Balance          to budget                     interest                      current
                                                                                                                                                         current
                                                                                                               (%)                                                     period (%)
                                                                                                                                                          period
West Yiwu
International
Means of                                                                                                                 Under                                                        Self-
                         133,916.00   16,638.24        4,625.49                      -     21,263.73             83.76                     9,938.28     1,024.58              3.53
Production                                                                                                               construction                                                 owned/financing
Market Auxiliary
Project
Liaoning Xiliu
Yiwu China
Commodities
                                                                                                                                                                                      Self-
City Commerce            180,000.00    3,229.05                   -                  -         3,229.05          96.32   Shutdown            154.61              -
                                                                                                                                                                                      owned/financing
Phase I
Project—Hotel
Project
The Zhimei
Dachen                     6,000.00    4,319.44         1,509.07                     -         5,828.51          97.14                                                                Self-owned
Tourism Project
The Chian West
Sea Tourism                8,000.00    5,455.28        1,348.78                      -         6,804.06          85.05                                                                Self-owned
Project
The renovation
project of Yindu
                          25,000.00    5,555.37       17,577.42            23,132.79                  -          92.53                                                                Self-owned
Hotel and Office
Building
The Yiwu
Comprehensive                                                                                                            Under
                         624,250.00   50,579.73       90,342.12           105,210.43       35,711.42             67.97                                                                Self-owned
Bonded Zone                                                                                                              construction
Project
The business
station project
of the
                          19,000.00    8,989.41        1,378.56           10,367.97                   -          54.57                                                                Self-owned
warehouse park
of the Yiwu
CCC
The lighting
project in Zone            4,000.00    2,972.41            -3.24           2,969.17                   -          74.23                                                                Self-owned
IV
Zone II East
Parking Lot               60,706.00      734.60       26,875.31                      -     27,609.91             46.37                                                                Self-owned
Project
Yiwu Digital
Trade Industrial          39,579.00             -      6,007.08                      -         6,007.08           1.52                                                                Self-owned
Park

Other projects                           279.16         4,426.65            1,638.27           3,067.54                                                                               Self-owned

     Total             1,100,451.00   98,752.69      154,087.24           143,318.63      109,521.30         /               /            10,092.89     1,024.58         /                 /




                   (3). Provision made for the impairment of construction in progress in the current period
                   □Applicable √Not Applicable
                   Other statements
                   √Applicable □Not Applicable
                       The impairment value of the project under construction is RMB 4,635,059.96, which is the
                   provision impairment of Liaoning Xiliu Yiwu China Commodities City Commerce Phase I Project—
                   Hotel Project.

                   Construction materials
                   (1). Engineering materials
                   □Applicable √Not Applicable

                   23. Productive biological asset
                   (1). Productive biological asset measured by cost
                   □Applicable √Not Applicable
                   (2). Productive biological asset measured by fair value
                   □Applicable √Not Applicable
                   Other statements
                   □Applicable √Not Applicable

                   24. Oil and gas assets
                   □Applicable √Not Applicable

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  25. Right-of-use assets
√Applicable □Not Applicable
                                                                                        Unit: RMB
                 Item                     Buildings and structures              Total
I. Original book value
1. Opening balance                                       249,646,048.55           249,646,048.55
     2. Increase in the current                            4,981,462.16             4,981,462.16
period
        (1) Lease in                                       4,981,462.16             4,981,462.16
      4. Closing balance                                 254,627,510.71           254,627,510.71
II. Accumulated depreciation
      1. Opening balance                                              -                        -
      2. Increase in the current                          29,280,433.57            29,280,433.57
period
         (1) Provision                                    29,280,433.57            29,280,433.57
      4. Closing balance                                  29,280,433.57            29,280,433.57
III. Depreciation provision
      1. Opening balance                                              -                          -
      4. Closing balance                                              -                          -
IV. Book value
1. Opening book value                                    225,347,077.14           225,347,077.14
2. Closing book value                                    249,644,048.55           249,646,048.55

Other notes:
None

26. Intangible assets
(1). Overview of intangible assets
√Applicable □Not Applicable
                                                                                      Unit: RMB
            Item                   Land use right               Software           Total
I. Original book value
1. Opening balance                 5,390,387,256.44             19,279,040.17   5,409,666,296.61
     2. Increase in the
                                    230,390,400.00              53,125,410.15     283,515,810.15
current period
        (1) Purchase                230,390,400.00              53,125,410.15     283,515,810.15
3. Decrease in the current
                                                     -             314,178.16           314,178.16
period
        (1) Disposal                                 -             314,178.16           314,178.16
4. Closing balance                 5,620,777,656.44             72,090,272.16   5,692,867,928.60
II. Accumulated amortization
     1. Opening balance            1,504,667,791.47              4,217,523.22   1,508,885,314.69
     2. Increase in the
                                    137,398,312.25               3,124,477.63     140,522,789.88
current period
        (1) Provision               137,398,312.25               3,124,477.63     140,522,789.88
     3. Decrease in the
                                                     -             104,838.32           104,838.32
current period

                                               160   / 228
                                        2021 Annual Report


       (1) Disposal                                   -           104,838.32               104,838.32
    4. Closing balance           1,642,066,103.72               7,237,162.53          1,649,303,266.25
III. Depreciation provision
    1. Opening balance                                -                    -                         -

    4. Closing balance                                -                    -                         -

IV. Book value
1. Opening book value            3,978,711,552.72              64,853,109.63          4,043,564,662.35
2. Closing book value            3,885,719,464.97              15,061,516.95          3,900,780,981.92

At the end of the period, the percentage of the intangible assets formed through the Company's
internal research and development in the balance of intangible assets was 0.71%

(2). Land use right for which the ownership certificate has not been obtained
□Applicable √Not Applicable
Other notes:
□Applicable √Not Applicable

  27. Development expenses
√Applicable □Not Applicable
                                                                                            Unit: RMB
                                                  Increase in the Decrease in the
                                  Opening          current period  current period          Closing
            Item                  amount              Internal     Recognized as           amount
                                  Balance          development       intangible            Balance
                                                    expenditure        assets
The development project
                                22,223,061.09         28,600,354.03   44,463,601.10       6,359,814.02
for platform “chinagoods”
            Total               22,223,061.09         28,600,354.03   44,463,601.10       6,359,814.02

Other statements
None

28. Goodwill
(1). Original book value of goodwill
□Applicable √Not Applicable
(2). Provision for goodwill impairment
□Applicable √Not Applicable
(3).Information on the assets Group or combination of assets Groups to which the goodwill
    belongs
□Applicable √Not Applicable

(4).Goodwill impairment test process, key parameters (e.g. growth rate in the forecast
    period, growth rate in the stable period, profit margin, discount rate, forecast period for
    the estimate of present value of future cash flows, if applicable) and recognition of
    goodwill impairment loss
□Applicable √Not Applicable

(5). Impact of goodwill impairment test
□Applicable √Not Applicable


                                                161   / 228
                                             2021 Annual Report


   Other statements
   □Applicable √Not Applicable

     29. Long-term prepaid expenses
   √Applicable □Not Applicable
                                                                                                      Unit: RMB
          Item           Opening balance      Increase in the            Amortized             Closing balance
                                               current period          amount in the
                                                                       current period
   Decoration       of
   buildings       and    101,767,311.81       133,097,867.38           59,993,339.89           174,871,839.30
   structures
   Advertising
                             3,586,262.55         12,130,450.31          2,404,175.73            13,312,537.13
   facilities
           Total          105,353,574.36       145,228,317.69           62,397,515.62           188,184,376.43

   Other notes:
   None

    30. Deferred income tax assets/deferred income tax liabilities
   (1). Deferred income tax assets having not been offset
   √Applicable □Not Applicable
                                                                                                Unit: RMB
                                          Closing balance                         Opening balance
            Item                   Deductible          Deferred             Deductible        Deferred
                                   temporary          income tax            temporary        income tax
                                   difference           assets              difference         assets
   Provision for impairment
                                   18,766,810.88         4,691,702.72      18,551,468.79          4,637,867.20
of assets
   Unrealized profits of
                                    1,094,793.10           273,698.28        1,094,793.10           273,698.27
internal transactions
   Deductible losses               10,635,059.71         2,658,764.93      19,006,883.14          4,751,720.78
   Recognized but unpaid
                                359,852,941.25        89,963,235.31       268,732,373.15         67,183,093.30
liabilities
   Overspent advertising
                                    8,497,106.53         2,124,276.63        9,689,617.59         2,422,404.41
cost
   Changes in the fair value
of other non-current               87,763,868.16      21,940,967.04        81,582,179.51         20,395,544.88
financial assets
   Right-of-use assets and
                                    3,291,235.93           822,808.98                      -                  -
lease liabilities
   Asset-related government
                                   53,046,300.00      13,261,575.00                        -                  -
grants
              Total             542,948,115.56       135,737,028.89       398,657,315.28         99,664,328.84

   (2). Deferred income tax liabilities having not been offset
   √Applicable □Not Applicable
                                                                                                 Unit: RMB
                                          Closing balance                          Opening balance
              Item                  Taxable            Deferred              Taxable           Deferred
                                   temporary          income tax            temporary         income tax
                                   difference            Debt               difference           Debt
   Asset evaluation
   appreciation for merger
                                     879,727.84           219,931.94        1,068,720.92            267,180.23
   of the enterprises not
   under common control

                                                   162   / 228
                                                2021 Annual Report


Change in fair value of
other equity instruments           88,562,537.79       22,140,634.45       108,630,911.81              27,157,727.95
investment
Changes in fair value of
other non-current                 357,773,989.10       89,443,497.28       343,005,960.28              85,751,490.08
financial assets
Changes in fair value of
                                     373,599.00                93,399.75      1,706,102.10               426,525.53
trading financial assets
           Total                  447,589,853.73      111,897,463.42       454,411,695.11            113,602,923.79

(3). Deferred income tax assets or liabilities presented in net amount after offsetting
□Applicable √Not Applicable
(4). Breakdown of unrecognized deferred income tax assets
√Applicable □Not Applicable
                                                                                                      Unit: RMB
             Item                               Closing balance                          Opening balance
Deductible temporary                                    485,392,932.16
                                                                                                     466,278,633.25
difference
Deductible losses                                      1,090,714,817.48                               908,844,380.05
             Total                                     1,576,107,749.64                             1,375,123,013.30

(5). The deductible loss in unrecognized deferred income tax assets will be due in the
     following years
√Applicable □Not Applicable
                                                                              Unit: RMB
         Year               Closing amount     Opening amount           Remarks
2021                                         -      34,738,115.44
2022                            245,346,275.18    245,346,275.18
2023                            145,652,609.01    145,652,609.01
2024                            219,603,443.50    226,329,502.26
2025                            236,606,485.47    256,777,878.16
2026                            243,506,004.32                  -
         Total                1,090,714,817.48    908,844,380.05            /


Other notes:
√Applicable □Not Applicable
     The Group believes that, the deductible temporary differences including the aforementioned
provision for asset impairment and the deductible losses of some subsidiaries can be deducted in
the foreseeable future, and it is expected that the Group will have sufficient pre-tax profit for
deduction during the reversing period. Therefore, the Group deemed it necessary to recognize the
above deferred income tax assets.

  31. Other non-current assets
√Applicable □Not Applicable
                                                                                                          Unit: RMB
                              Closing balance                                        Opening balance
     Item        Book balance   Impairment                          Book balance       Impairment
                                                  Book value                                             Book value
                                 provision                                              provision
Prepaid land
                 138,253,316.00            -    138,253,316.00      138,253,316.00              -       138,253,316.00
transfer fees
Prepayment
for renovation
works and
                   5,681,334.45            -      5,681,334.45       14,241,880.56              -        14,241,880.56
prepaid
decoration
rent

                                                     163   / 228
                                            2021 Annual Report


Prepaid equity
transfer          67,395,000.00        -     67,395,000.00                  -          -                 -
consideration
    Total        211,329,650.45        -    211,329,650.45     152,495,196.56          -    152,495,196.56


Other notes:
None

32. Short-term borrowings
(1). Classification of short-term borrowings
√Applicable □Not Applicable
                                                                                             Unit: RMB
                 Item                      Closing balance                      Opening balance
Credit loans                                      942,736,046.04                    1,257,179,389.40
              Total                               942,736,046.04                    1,257,179,389.40
Note to the classification of short-term borrowings:
None

(2). Overdue short-term borrowings
□Applicable √Not Applicable

The important overdue and unpaid short-term loans are as follows:
□Applicable √Not Applicable
Other statements
√Applicable □Not Applicable
    As of December 31, 2021, the annual interest rate of the above-mentioned borrowing is 1.20%-
3.915% (December 31, 2020: 1.20%-4.35%).

33. Held-for-trading financial liabilities
□Applicable √Not Applicable


34. Derivative financial liabilities
□Applicable √Not Applicable


35. Notes payable
(1). Presentation of notes payable
□Applicable √Not Applicable


36. Accounts payable
(1). Presentation of accounts payable
√Applicable □Not Applicable
                                                                                              Unit: RMB
             Item                          Closing balance                      Opening balance
Accounts payable for market                       301,995,294.63                         511,789,572.40
and auxiliary works projects
Trade payables                                     72,330,560.78                           14,267,029.02
Accounts payable for                               58,722,226.25                           26,767,337.63
procurement for the hotel
project
Accounts payable for real                          33,317,557.65                           57,763,664.12
estate projects
Others                                             26,994,789.71                           25,876,199.06
                                                 164   / 228
                                         2021 Annual Report


            Total                             493,360,429.02                           636,463,802.23


(2). Important accounts payable with age over 1 year
√Applicable □Not Applicable
                                                                                              Unit: RMB
                                                                       Reasons for not being paid or
             Item                       Closing balance
                                                                               carried forward
Accounts payable for real                           6,484,732.17     Settlement has not been
estate projects                                                      completed or the projects are
                                                                     within the warranty periods
             Total                                  6,484,732.17                       /


Other statements
√Applicable □Not Applicable
     The accounts payable are free of interest and are generally paid within two months after receipt
of the payment notice or based on the project contracts and progress of projects. The balance
payments for the projects are made after completion of settlement.

37. Advances from customers
(1). Presentation of advances from customers
√Applicable □Not Applicable
                                                                                           Unit: RMB
            Item                         Closing balance                      Opening balance
Rental advances                                  142,605,296.83                       105,773,195.96
Others                                            10,961,014.30                         6,979,701.29
           Total                                 153,566,311.13                       112,752,897.25


(2). Important advances with the age over 1 year
□Applicable √Not Applicable
Other statements
√Applicable □Not Applicable
    Since the advances from customers are mainly derived from the advance rentals of auxiliary
housing businesses and investment real estate with small individual amounts, as of December 31,
2021, there were no single large advances from customers with an age of more than 1 year.

38. Contract liabilities
(1). Overview of contract liabilities
√Applicable □Not Applicable
                                                                                           Unit: RMB
              Item                       Closing balance                      Opening balance
Advances from customers for                    2,996,965,006.91                     2,243,528,509.65
use fee of shops
Advances from customers for                         762,448,893.76                     100,786,067.26
goods
Advances from customers for                         178,756,399.38                       3,856,621.50
housing purchase
Advances from customers for                          66,129,057.15                      57,095,601.13
advertising fee
Advances from customers for                          17,997,985.07                       3,270,729.29
loyalty ofbrands
Advances from customers for                          14,150,457.59                      10,534,354.07
use fee of networking cables
Others                                               21,971,424.98                      23,139,905.98

                                              165   / 228
                                       2021 Annual Report


             Total                             4,058,419,224.84                     2,442,211,788.88


(2). Amount of and reasons for material changes to book value during the reporting period
□Applicable √Not Applicable
Other notes:
□Applicable √Not Applicable

39. Payroll payable
(1). Presentation of payroll payable
√Applicable □Not Applicable
                                                                                          Unit: RMB
                            Opening          Increase in the     Decrease in the
         Item                                                                        Closing balance
                            balance           current period      current period
I. Short-term
                          159,703,155.55     613,854,934.39      532,105,325.85      241,452,764.09
compensation
II. Post employment
benefits – defined         1,795,841.98      29,714,756.98       28,998,607.67         2,511,991.29
contribution plan
III. Severance benefits                -       4,592,993.70        4,592,993.70                   -
          Total           161,498,997.53     648,162,685.07      565,696,927.22      243,964,755.38

(2). Presentation of short-term compensation
√Applicable □Not Applicable
                                                                                          Unit: RMB
                            Opening          Increase in the     Decrease in the
         Item                                                                        Closing balance
                            balance           current period      current period
1. Salary, bonus,
                          158,575,947.86     508,355,599.60      426,809,517.47      240,122,029.99
allowance and subsidy
2. Employee benefits                   -      45,147,496.52       45,147,496.52                    -
3. Social security
                             965,231.59       21,411,511.78       21,137,796.52         1,238,946.85
contribution
In which: contribution
to medical insurance         887,294.94       19,546,488.20       19,331,895.41         1,101,887.73
scheme
       Contribution to
work-related injury            48,011.60           770,986.78        790,071.51            28,926.87
insurance scheme
       Contribution to
maternity insurance            29,925.05       1,094,036.80        1,015,829.60          108,132.25
scheme
4. Housing provident
                             110,017.00       28,521,846.04       28,552,103.04            79,760.00
fund
5. Contribution to
trade union fund and
                               51,959.10      10,418,480.45       10,458,412.30            12,027.25
employee education
fund
         Total            159,703,155.55     613,854,934.39      532,105,325.85      241,452,764.09

(3). Presentation of defined contribution plan
√Applicable □Not Applicable
                                                                                           Unit: RMB
                               Opening         Increase in the    Decrease in the         Closing
           Item
                               balance          current period     current period        balance
1. Contribution to the                          28,708,041.18       28,031,295.88       2,342,403.40
                              1,665,658.10
basic endowment

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                                        2021 Annual Report


insurance scheme
2. Contribution to the                                1,006,715.80      967,311.79       169,587.89
unemployment insurance           130,183.88
scheme
           Total                1,795,841.98         29,714,756.98    28,998,607.67     2,511,991.29

Other notes:
□Applicable √Not Applicable

  40. Tax payable
√Applicable □Not Applicable
                                                                                          Unit: RMB
             Item                        Closing balance                     Opening balance
VAT                                              83,766,540.18                        90,094,604.12
Business tax                                       -240,013.55                          -431,783.32
Corporate income tax                            279,485,623.04                      341,382,542.08
Individual income tax                             1,260,803.19                         1,008,552.21
Urban maintenance and                             4,687,093.90
                                                                                        5,176,906.98
construction tax
Land appreciation tax                                  2,780,327.20                   -47,134,688.35
Real estate tax                                      171,138,711.99                    93,881,697.54
Land use tax                                          10,612,069.24                     5,357,865.24
Others                                                 6,005,392.15                     6,064,803.23
              Total                                  559,496,547.34                   495,400,499.73

Other notes:
    As of December 31, 2021, the details of the main taxes prepaid by the Group were as follows:
    Unit: RMB
               Item               Qiantang Impression       Occident Center     Total amount of
                                   Real Estate Project        Real Estate         prepaid tax
                                                                Project
Business tax                                  240,013.55                    -         240,013.55
Urban       maintenance    and                          -         731,793.32          731,793.32
construction tax
Education surcharge and local                           -         522,709.51          522,709.51
education surcharge
               Total                          240,013.55        1,254,502.83        1,494,516.38



  41. Other payables
Presentation of items
√Applicable □Not Applicable
                                                                                         Unit: RMB
              Item                         Closing balance                   Opening balance
Other payables                                  1,908,742,835.15                  1,646,345,561.62
Total                                           1,908,742,835.15                  1,646,345,561.62

Other notes:
□Applicable √Not Applicable

Interest payable
(1). Presentation by category
□Applicable √Not Applicable



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Dividend payable
(1). Presentation by category
□Applicable √Not Applicable


Other payables
(1). Presentation of other payables by nature
√Applicable □Not Applicable
                                                                                       Unit: RMB
             Item                       Closing balance                   Opening balance
Withholdings, deposit and
                                                   598,819,336.72                   584,880,967.08
margin
Operating expenses payable                         268,576,640.89                   234,420,448.09
Bank reserve of Zhejiang
Yiwugou E-commerce Co.,                             25,823,767.03                    23,223,609.46
Ltd.
Restricted equity incentive
                                                   137,440,900.00                   137,298,000.00
plan
Pending investment refunds                      877,464,692.76                      666,512,070.29
Others                                              617,497.75                           10,466.70
             Total                            1,908,742,835.15                    1,646,345,561.62

(2). Important other payables with account age over 1 year
□Applicable √Not Applicable
Other notes:
√Applicable □Not Applicable
    Other payables mainly come from deposits for commercial spaces and bid deposits for
engineering projects, with small individual amounts, so there were no important other payables with
an age of more than 1 year on December 31, 2021.

42. Held-for-sale liabilities
□Applicable √Not Applicable


  43. Non-current liabilities due within one year
√Applicable □Not Applicable
                                                                                       Unit: RMB
               Item                     Closing balance                   Opening balance
Long-term borrowings within                     100,918,614.59
                                                                                    300,634,822.21
one year
Bonds payable due within 1                     3,552,960,829.66
                                                                                  1,014,391,752.22
year
Lease liabilities due within 1                      10,362,478.83                     6,930,542.47
year
               Total                           3,664,241,923.08                   1,321,957,116.90
Other notes:
None
  44. Other current liabilities
Other current liabilities
√Applicable □Not Applicable
                                                                                        Unit: RMB
              Item                         Closing balance                  Opening balance
Short-term financing notes                       3,009,756,921.11                3,004,009,789.85
payable
To-be-reported output tax                             67,323,844.72                  15,466,581.46

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               Dividend announced but not                                                 2,083,112.65                                         2,083,112.65
               collected before listing
               Dividend payable to to-be-                                                 2,220,922.02                                         2,048,557.72
               recognized accounts
                             Total                                                3,081,384,800.50                                        3,023,608,041.68

               Changes in short-term bonds payable:
               √Applicable □Not Applicable
                                                                                                                                                     Unit: RMB
                                                                                                          Interest
       Bond         Face       Issuing    Bond   Issuing         Opening amount       Current period      accrued      Premium/discount     Current period       Closing amount
       Name         value        Date     Term   Amount             Balance              Issuing       based on face     amortization        Repayment              Balance
                                                                                                           value


Super-short-term            October 27,   268
                     100                         1,000,000,000                    -   1,000,000,000     5,388,493.15        180,821.92                       -        1,004,835,068.48
commercial paper            2021          days

Super-short-term            November      279
                     100                         1,000,000,000                    -   1,000,000,000     3,695,616.44        130,555.56                       -        1,003,076,172.00
commercial paper            15, 2021      days

Super-short-term            November      269
                     100                         1,000,000,000                    -   1,000,000,000     2,489,863.01          88,888.89                      -        1,001,845,680.63
commercial paper            30, 2021      days

Super-short-term            November      90
                     100                         1,000,000,000     1,002,227,312.68                -    3,767,123.29        152,777.78     1,006,147,213.75                          -
commercial paper            27, 2020      days

Super-short-term            December 9,   90
                     100                         1,000,000,000     1,000,238,641.55                -    4,497,260.27        279,166.67     1,005,015,068.49                          -
commercial paper            2020          days

Super-short-term            December      28
                     100                         1,000,000,000     1,001,543,835.62                -    1,553,424.66                  -    1,003,097,260.28                          -
commercial paper            25, 2020      days

       Total          /           /         /    6,000,000,000     3,004,009,789.85   3,000,000,000    21,391,780.82        832,210.82     3,014,259,542.52           3,009,756,921.11




               Other notes:
               √Applicable □Not Applicable
                   As of December 31, 2021, the annual interest rate of the above-mentioned short-term financing
               bonds was 2.48%-2.98% (December 31, 2020: 2.45%-2.70%).

               45. Long-term borrowings
               (1). Classification of long-term borrowings
               √Applicable □Not Applicable
                                                                                                                                         Unit: RMB
                                 Item                               Closing balance                                          Opening balance
               Credit loans                                               771,250,000.00                                            282,000,000.00
                                Total                                     771,250,000.00                                            282,000,000.00
               Notes on the classification of long-term borrowings:
               None

               Other notes, including the interest rate range:
               √Applicable □Not Applicable
                        As of December 31, 2021, the annual interest rate of the above borrowing was 2.70%-3.92%
               (December 31, 2020: 2.70%-3.92%).

               46. Bonds payable
               (1). Bonds payable
               √Applicable □Not Applicable
                                                                                                                                         Unit: RMB
                                 Item                               Closing balance                                          Opening balance
               MTN                                                                                           -                    2,024,870,915.16
               Bonds payable                                                                                 -                    1,527,290,794.52
                           Total                                                                             -                    3,552,161,709.68




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(2). Changes in bonds payable: (excluding preferred stocks, perpetual bonds and other
     financial instruments classified as financial liabilities)
√Applicable □Not Applicable
                                                                             Unit: RMB
                                                     Curr                                                        Closi
                                                                Interest                   Curren   Transferre
        Fa             Bo                             ent                    Premium/d                            ng
              Issuin                   Opening                  accrued                      t       d in this
Bond    ce             nd   Issuing                   peri                    iscount                            amo
                 g                     amount                  based on                    period    year and
Name    val            Te   Amount                     od                    amortizatio                          unt
               Date                    Balance                    face                     Repay    due within
        ue             rm                            Issui                       n                               Bala
                                                                 value                      ment     one year
                                                       ng                                                        nce
                July
        10                  1,000,00   1,017,879,                 39,900,0                          1,018,263,
MTN              15,   3Y                                  -                 384,201.20         -                    -
         0                     0,000      350.82                     00.00                             552.02
               2019
              Octob
        10                  1,000,00   1,006,991,                 39,700,0                          1,007,406,
MTN           er 21,   3Y                                  -                 414,918.78         -                    -
         0                     0,000      564.34                     00.00                             483.12
               2019
Corpo          June
        10                  800,000,   819,791,7                  34,400,0                          819,791,7
rate              5,   3Y                                  -                           -        -                    -
         0                       000       80.82                     00.00                              80.82
bonds          2019
              Septe
Corpo
        10     mber         700,000,   707,499,0                  27,930,0                          707,499,0
rate                   3Y                                  -                           -        -                    -
         0       25,             000       13.70                   00.00                                13.70
bonds
               2019
                            3,500,00   3,552,161,                 141,930,                          3,552,960,
Total    /      /      /                                   -                 799,119.98         -                    -
                               0,000      709.68                    000.00                             829.66



(3). Conditions and time for the conversion of convertible corporate bonds
□Applicable √Not Applicable

(4). Notes on other financial instruments classified as financial liabilities
Basic information of other financial instruments such as preferred shares and perpetual bonds
outstanding at the end of the reporting period
□Applicable √Not Applicable

Changes in other financial instruments such as preferred shares and perpetual bonds outstanding
at the end of the reporting period
□Applicable √Not Applicable
The basis for classifying other financial instruments as financial liabilities:
□Applicable √Not Applicable

Other notes:
□Applicable √Not Applicable

  47. Lease liabilities
√Applicable □Not Applicable
                                                                                                       Unit: RMB
                Item                           Closing balance                             Opening balance
Undiscounted amount of finance                        334,659,632.28                              229,574,650.88
lease payables
Unrecognized financing charges                            -118,354,479.52                                        -
Lease liabilities due within 1 year                        -10,362,478.83                                        -
                Total                                      205,942,673.93                           229,574,650.88
Other notes:
    Note: The Group uses the incremental borrowing rate of 2.78%-8.01% as the discount rate to
calculate book value to determine the lease liability and measure right-of-use assets.




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48. Long-term accounts payable
Presentation of items
□Applicable √Not Applicable
Other notes:
□Applicable √Not Applicable

Long-term accounts payable
(1). Long-term payables by nature
□Applicable √Not Applicable


Special accounts payable
(1). Special payables by nature
□Applicable √Not Applicable


49. Long-term payroll payable
□Applicable √Not Applicable


  50. Estimated liabilities
√Applicable □Not Applicable
                                                                                                 Unit: RMB
        Item                Opening balance                  Closing balance           Cause of formation
Pending L/C losses             110,620,306.10                   110,620,306.10
       Total                   110,620,306.10                   110,620,306.10                 /

Other notes, including the notes on related important assumptions and estimates of important
estimated liabilities:
     In 2017, the letters of credit issued by the Group’s subsidiary based on international trade
agency business became overdue successively due to the principals’ failure to make payments as
agreed. Based on the principle of prudence, the Group recognized estimated liabilities for the
estimated potential losses. On Apr 30, 2018, the Group lost control over the subsidiary due to its
disposal of some equity in the subsidiary. As of December 31, 2021, the matter is currently under
processing.

  51. Deferred income
Overview of deferred income
√Applicable □Not Applicable
                                                                                                   Unit: RMB
                                     Increase in        Decrease in
                     Opening                                                 Closing          Cause of
     Item                            the current        the current
                     balance                                                 balance          formation
                                       period             period
Asset-related
government       26,545,277.30    53,046,300.00         1,421,473.68     78,170,103.62
grants
    Total        26,545,277.30    53,046,300.00         1,421,473.68     78,170,103.62               /

Items involving government grants:
√Applicable □Not Applicable
                                                                                                   Unit: RMB
                                        Increase in             Amount                             Asset-related
                      Opening                                                    Closing
Liability item                         grant amount          recognized in                          or income-
                      balance                                                    balance
                                       in the current        other income                             related

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                                                2021 Annual Report


                                                 period             in the current
                                                                        period
   Subsidy for service
   industry cluster         5,510,112.59                      -       266,666.64          5,243,445.95   Asset-related
   project
   Interest subsidy for
   the international
                          21,035,164.71                       -     1,154,807.04         19,880,357.67   Asset-related
   exhibition center
   construction fund
   Subsidy for Yiwu
   Comprehensive
                                         -   53,046,300.00                       -       53,046,300.00   Asset-related
   Bonded Zone
   Project

      Other notes:
      □Applicable √Not Applicable

      52. Other non-current liabilities
      □Applicable √Not Applicable


        53. Capital stock
      √Applicable □Not Applicable
                                                                                                         Unit: RMB
                                       Increase or decrease in the current period (+, -)
                                                         Provident
            Opening balance        Issuing     Bonus       funds                                         Closing balance
                                                                       Others      Sub-total
                                 New shares shares Conversion
                                                        into shares
  Total
 number     5,489,914,176.00     1,360,000.00           -                 -          -    1,360,000.00   5,491,274,176.00
of shares
      Other notes:
           On August 9, 2021, the Group implemented a restricted equity incentive plan, granting
      2,550,000 restricted stocks to incentive objects. On September 6, 2021, the Group received the
      restricted stock subscription payment of RMB 5,592,600.00 from the incentive objects, and the
      actual number of shares subscribed was 2,340,000 shares, which was verified by Zhejiang
      Zhicheng Certified Public Accountants (special general partnership), with a capital verification report
      (Zhe Zhi Kuai Yi Zi [2021] No. 17) issued for that.
           After consideration and approval at the thirty-fifth meeting of the eighth the Board of Directors
      and the ninth meeting of the eighth Board of Supervisors of the Group held on August 9, 2021, in
      view of the fact that among the original incentive objects granted for the first time, 6 incentive
      objects including ZHAO Qitong no longer worked in the Company due to their position adjustments,
      and three incentive objects including HOU Wenbin had resigned due to personal reasons,
      according to the relevant regulations of the "Incentive Plan" and the authorization of the Fifth
      Provisional General Meeting of Shareholders in 2020, the Board of Directors of the Company
      decided to repurchase and canceled a total of 980,000 restricted shares granted to the above nine
      persons but yet to be released. The Company would repurchase and cancel the restricted shares
      held by the above-mentioned 9 persons that had been granted but not yet been released at the
      sum of interest calculated at RMB 2.885 per share and the fixed deposit interest rate announced by
      the People's Bank of China for the same period. The total amount of restricted stock repurchase
      funds this time was RMB 2.852 million. The above-mentioned repurchase funds would all be paid
      with the Company's own funds, and the cancellation would be completed on November 30, 2021.
           After the reserved grant of restricted stocks and the first partial repurchase of restricted stocks,
      the share capital increased by RMB 1,360,000 this year.



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54. Other equity instruments
(1). Basic information of other financial instruments such as preferred shares and perpetual
     bonds outstanding at the end of the reporting period
□Applicable √Not Applicable

(2). Changes in other financial instruments such as preferred shares and perpetual bonds
     outstanding at the end of the reporting period
□Applicable √Not Applicable
Changes in other equity instruments in the current period, the reasons therefor and the basis for
relevant accounting treatment:
□Applicable √Not Applicable

Other notes:
□Applicable √Not Applicable

  55. Capital reserve
√Applicable □Not Applicable
                                                                                           Unit: RMB
                                             Increase in the    Decrease in the
        Item            Opening balance                                              Closing balance
                                              current period     current period
Capital surplus
                        1,558,612,797.11        3,252,600.00        1,901,200.00    1,559,964,197.11
(share premium)
Equity incentive            1,880,981.38      31,533,363.28                    -       33,414,344.66
Others                     34,412,746.18       3,717,827.01                    -       38,130,573.19
         Total          1,594,906,524.67      38,503,790.29         1,901,200.00    1,631,509,114.96

Other notes including those on the changes in the current period and the reasons therefor:
    The increase in capital reserve-other capital reserve during the reporting period was due to the
Company's recognition on the share payment fee for RMB 31,533,363.28 during the waiting period,
which was included in this item accordingly.

  56. Treasury shares
√Applicable □Not Applicable
                                                                                           Unit: RMB
                                Opening       Increase in the    Decrease in the
           Item                                                                      Closing balance
                                balance        current period     current period
Restricted equity
                          137,298,000.00         5,592,600.00        5,395,800.00     137,494,800.00
incentive plan
         Total            137,298,000.00         5,592,600.00        5,395,800.00     137,494,800.00

Other notes including those on the changes in the current period and the reasons therefor:
    On August 9, 2021, the Group implemented the restricted equity incentive plan, granting
2,340,000 restricted shares to the incentive objects and confirming treasury shares of RMB
5,592,600. At the same time, because some incentive objects resigned during the waiting period
and no longer had the incentive qualification, the Company repurchased the restricted shares for
cancellation and offset the corresponding treasury shares. For details, please refer to Note VII. 53
Share capital.

  57. Other comprehensive income
√Applicable □Not Applicable
                                                                                           Unit: RMB
                                                       Amount in the current period
                           Opening         Amount before                                             Closing
                                                                               Amount after tax
    Item                   amount          tax incurred in   Less: income                            amount
                                                                                 attributable to
                           Balance           the current           tax                               Balance
                                                                               parent company
                                                period

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                                                     2021 Annual Report


I. Other comprehensive
income that cannot be               81,473,183.84      -20,068,374.01           -5,017,093.50    -15,051,280.51     66,421,903.33
reclassified into profit or loss
    Change in fair value of
other equity instruments            81,473,183.84      -20,068,374.01           -5,017,093.50    -15,051,280.51     66,421,903.33
investment
II. Other comprehensive
income to be reclassified into      -3,323,522.51       -2,247,645.80                       -     -2,247,645.80     -5,571,168.31
profit or loss
Difference arising from the
translation of foreign              -3,323,522.51       -2,247,645.80                       -     -2,247,645.80     -5,571,168.31
currency financial statements
Total other comprehensive
                                    78,149,661.33      -22,316,019.81           -5,017,093.50    -17,298,926.31     60,850,735.02
income

         Other notes, including those on the adjustment of the initially recognized amount of hedged items
         converted from the effective part of gains or losses from cash flow hedging:
         None

         58. Special reserve
         □Applicable √Not Applicable


           59. Surplus reserve
         √Applicable □Not Applicable
                                                                                                          Unit: RMB
                 Item              Opening balance        Increase in the          Decrease in    Closing balance
                                                           current period          the current
                                                                                     period
         Statutory     surplus                            140,951,986.92                    -    1,453,325,098.91
                                   1,312,373,111.99
         reserve
         Discretionary                                                      -               -
                                     40,195,855.68                                                  40,195,855.68
         surplus reserve
         Others                       11,688,840.91                    -                    -       11,688,840.91
                 Total             1,364,257,808.58       140,951,986.92                    -    1,505,209,795.50
         Notes on surplus reserves, including those on the changes in the current period and the reasons
         therefor:
              According to the “Company Law” and the Company’s articles of association, the Company
         accrued a statutory surplus reserve in terms of 10% of its net profit. If the amount of statutory
         surplus reserve accrued reaches more than 50% of the Company's registered capital, the accrual
         may cease.
              The Company can accrue free surplus reserve after accruing the statutory surplus reserve.
         With the approval, the free surplus reserve can be used to make up for previous losses or to
         increase share capital.

           60. Undistributed profits
         √Applicable □Not Applicable
                                                                                                          Unit: RMB
                              Item                               Current period                  Previous period
         Undistributed profits at the end of the
         previous reporting period before                              5,168,298,206.50            4,750,787,389.17
         adjustment
         Opening undistributed profits after
                                                                       5,168,298,206.50            4,750,787,389.17
         adjustment




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                                        2021 Annual Report


Plus: net profits attributable to
shareholders of the parent company in the                  1,334,095,906.95             926,626,706.42
current period
Less: withdrawal of statutory surplus
                                                            140,951,986.92              128,090,896.77
reserve
     Common share dividend payable                           301,945,279.68             381,024,992.32
Closing undistributed profits                              6,059,496,846.85           5,168,298,206.50
Details of the adjustment of opening undistributed profits:
1. The opening undistributed profits affected by the retroactive adjustment made in accordance with
the Accounting Standards for Enterprises and related new provisions amounted to RMB0.
2.The opening undistributed profits affected by the changes in accounting policies amounted to
RMB0.
3. The opening undistributed profits affected by the correction of major accounting errors amounted
to RMB0.
4. The opening undistributed profits affected by changes in the scope of mergers caused by
common control amounted to RMB0.
5. The opening undistributed profits affected by other adjustments together amounted to RMB0.

61. Operating revenue and operating cost
(1). Overview of operating revenue and operating cost
√Applicable □Not Applicable
                                                                                            Unit: RMB
                      Amount in the current period                  Amount in the previous period
      Item
                     Revenue            Cost of sales              Revenue             Cost of sales
 Main             5,586,058,113.32    3,870,814,652.77          3,059,365,345.58     1,695,958,420.47
 business
 Other              447,784,859.63       156,728,485.79           666,320,754.81        115,178,023.52
 businesses
     Total        6,033,842,972.95     4,027,543,138.56         3,725,686,100.39      1,811,136,443.99

(2). Revenue generated from contracts
√Applicable □Not Applicable
                                                                                             Unit: RMB
             Classified by type of contract                                   Total
Types of goods
    Sales of goods                                                                    2,596,259,373.98
    The use of shops in the Commodity City and its                                    2,429,854,974.22
supporting services
    Hotel accommodation and catering services                                           150,853,037.93
    Revenue from use fees                                                               107,299,598.45
    Other services                                                                      534,842,468.16
Classified by business area
    Chinese mainland                                                                  5,819,109,472.74
Classified by contract period
    Revenue confirmed at certain time point
    Sales of goods                                                                    2,596,259,393.98
    Hotel catering services                                                              99,876,232.85
    Other services                                                                      430,842,121.05
    Revenue confirmed during certain time period
    The use of shops in the Commodity City and its                                    2,429,854,974.22
supporting services
    Hotel accommodation service                                                          50,976,805.08
    Revenue from use fees                                                               107,299,598.45
    Other services                                                                      104,000,347.11
                         Total                                                        5,819,109,472.74


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                                         2021 Annual Report


Description of the income from contracts:
√Applicable □Not Applicable
    The income recognized in the current year and included in the opening book value of
contractual liabilities is as follows:
                                                                                         Unit: RMB
                    Type of contract                                    Current period
Sales of goods                                                                    100,786,067.26
The use of shops in the Commodity City and its                                  2,252,863,622.76
supporting services
Hotel accommodation service                                                         13,367,212.91
Other services                                                                      59,472,570.40
Total                                                                            2,426,489,473.33


(3). Contract performance obligations
√Applicable □Not Applicable
     Sales of goods
     The performance obligation is fulfilled when the goods are delivered to the customer, and the
contract price is collected in advance before the goods are delivered to the customer or received
upon the delivery of the goods.
     The use of shops in the Commodity City and its supporting services
     The contractual performance obligation is fulfilled when providing the use of shops in the
Commodity City and the supporting services for business. For the use of shops in the Commodity
City and the supporting services for business, the progress of contract performance is determined
based on the number of using days of the shops. Customers usually need to pay in advance before
the use of shops in the Commodity City and the supporting services for business are provided.
     Hotel accommodation business
     The performance obligation is fulfilled when providing hotel accommodation services. For the
hotel accommodation business, the progress of contractual performance is determined based on
the number of days of stay. For hotel accommodation services, a partial deposit is collected from
the customer first, and the remaining contract price is usually collected upon the completion of the
hotel accommodation services.
     Hotel catering business
     The performance obligation is fulfilled when the hotel catering services are provided. The
contract price for hotel catering services is usually charged when the hotel catering services are
performed.
     Fixed -time paid funding services
     The performance obligation is fulfilled when the fixed-time paid funding service is provided. For
the fixed-time paid funding service, the progress of contractual performance is determined based on
the number of using days the fund. For the fixed-time paid funding service, the contract price is
usually charged regularly as agreed in the contract.

(4). Amortization to remaining contract performance obligations
√Applicable □Not Applicable
At the end of the reporting period, the amount of income corresponding to the performance
obligations that have been signed but not yet performed or not yet completed was RMB
4,058,419,224.84, of which:
RMB 4,058,419,224.84 is expected to be recognized as an income in 2026
Other notes:
None

  62. Taxes and surcharges
√Applicable □Not Applicable
                                                                                          Unit: RMB
             Item                  Amount in the current period       Amount in the previous period
Real estate tax                                  118,182,369.56                      111,702,852.72
Urban maintenance and                             12,672,573.75                        8,757,433.19

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construction tax
Land use tax                                       11,029,363.42                         9,601,436.31
Stamp duty                                          7,188,521.64                         4,789,431.36
Education surcharge                                 5,476,928.89                         3,759,495.94
Local education surcharge                           3,651,285.86                         2,495,683.67
Land appreciation tax                               3,349,307.04                        10,586,314.21
Business tax                                          206,842.50                        14,077,088.53
Vehicle and vessel use tax                              3,456.16                                32.90
Cultural undertaking                                   -1,440.00                           116,214.00
development fee
             Total                                161,759,208.82                       165,885,982.83

Other notes:
None

  63. Sales expenses
√Applicable □Not Applicable
                                                                                             Unit: RMB
                                                                             Amount in the previous
               Item                  Amount in the current period
                                                                                    period
Marketing expenses                                  115,754,997.02                     104,738,904.24
Advertising expenses                                 45,648,963.60                       94,410,960.56
Security and insurance expenses                      38,306,012.40                       27,115,364.49
Water, electricity and fuel
                                                          1,351,892.26                   3,651,395.20
expenses
Depreciation and amortization                           950,256.30                       1,345,275.41
Employee expenses                                                -                           7,379.32
Others                                                2,733,852.99                      10,619,907.22
                Total                               204,745,974.57                     241,889,186.44

Other notes:
None

  64. Administrative expenses
√Applicable □Not Applicable
                                                                                            Unit: RMB
                   Item                       Amount in the current            Amount in the previous
                                                    period                            period
Employee and uniform expenses                        326,368,947.18                   245,021,737.66
Depreciation and amortization                          37,743,155.62                    37,337,018.02
Intermediary expenses                                  23,480,815.21                    38,529,410.46
Office expenses                                        17,616,097.42                    14,680,708.68
Travel expenses                                         4,761,152.09                     5,353,751.01
Lease and property management                           3,071,515.25                     3,071,515.25
expenses
Promotion and market traders introduction                       728,448.70                 937,941.53
expenses
Others                                                       39,773,296.33              32,584,762.84
                  Total                                     453,543,427.80             377,516,845.45

Other notes:
None

  65. R&D expenses
√Applicable □Not Applicable

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                                                                                            Unit: RMB
                   Item                         Amount in the current          Amount in the previous
                                                      period                          period
Employee expenses                                         6,076,406.11                   6,293,791.55
Technology development fee                                  650,354.19                   7,050,178.63
Depreciation and amortization                               122,541.44                     343,037.80
Others                                                    3,459,500.10                   4,820,619.01
                  Total                                  10,308,801.84                  18,507,626.99

Other notes:
None

  66. Financial expenses
√Applicable □Not Applicable
                                                                                            Unit: RMB
                   Item                         Amount in the current          Amount in the previous
                                                      period                          period
Interest expenses                                      341,313,765.39                 416,095,890.57
Amortization of commercial paper discount                 4,735,876.54                   3,269,879.47
Amortization of discounted bonds payable                              -                  2,060,361.37
Less: interest income                                 -177,964,682.68                -230,212,773.93
Less:capitalized amount of interest                     -10,245,795.84                 -29,273,761.94
Foreign exchange gains or losses                          5,841,186.27                  13,574,395.11
Amortization of unrecognized financing                   12,864,558.43                                -
expenses
Others                                                    3,366,705.59                 6,575,708.68
                   Total                               179,911,613.70               182,089,699.33
Other notes:
     The capitalized amount of borrowing costs has been included in the construction in progress.

  67. Other income
√Applicable □Not Applicable
                                                                                            Unit: RMB
                      Item                             Amount in the current         Amount in the
                                                             period                 previous period
Additional deduction of input tax                               6,244,434.23             1,376,744.49
Subsidies for energy saving and consumption
                                                                4,863,474.00                          -
reduction
Special incentive funds for modern supply chain
                                                                2,682,704.00                          -
system innovation
Industrial Cluster Cross-border E-commerce
                                                                1,879,093.83                          -
Development Pilot Subsidy
Interest subsidy for the international exhibition
                                                                1,154,807.04             1,154,807.04
center construction fund
Reward for "three collections and three rebates"                1,084,878.00                          -
Government subsidy for service industry cluster
                                                                 266,666.64                266,666.64
for 2011
Refund of social security contribution                            14,595.20              4,870,959.47
Grant for the construction and operation of Yiwu
                                                                           -             3,000,000.00
credit data center
R&D investment prize from Yiwu Science and
                                                                           -             2,104,180.00
Technology Bureau
Exhibition and conference subsidies                                       -              1,309,000.00
Employment stabilization subsidy                                          -              1,091,612.71
Others                                                         5,366,295.07              2,812,361.79
                       Total                                  23,556,948.01             17,986,332.14


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Other notes:
None


  68. Investment income
√Applicable □Not Applicable
                                                                                          Unit: RMB
                                                              Amount in the         Amount in the
                         Item
                                                              current period       previous period
Income from long-term equity investment calculated
                                                                599,180,325.58        34,968,640.68
with the equity method
Dividend income from other equity instruments
                                                                 12,542,733.80        10,034,187.04
investment during holding period
Interest income from debt investment during holding
                                                                               -      11,786,857.07
period
Investment income from disposal of held-for-trading
                                                                     67,265.72          377,061.15
financial assets
Income acquired from other non-current financial
                                                                 20,833,465.43        41,242,844.09
assets during the holding period
Gains from re-measurement of the remaining equity at
                                                                               -      30,456,963.96
fair value after the loss of control
Investment income from disposal of subsidiaries and
                                                                               -    394,658,616.42
related claims
Investment income from disposal of wealth
                                                                  1,604,200.49          688,953.43
management products
                            Total                               634,227,991.02      524,214,123.84

Other notes:
None

69. Income from net exposure hedging
□Applicable √Not Applicable


  70. Income from changes in fair value
√Applicable □Not Applicable
                                                                                          Unit: RMB
Sources of income from changes in                                          Amount in the previous
                                       Amount in the current period
              fair value                                                          period
Held-for-trading financial assets                      -1,332,503.10                   1,706,102.10
Other non-current financial assets                      8,563,824.94                 -34,661,963.73
                Total                                   7,231,321.84                 -32,955,861.63
Other notes:
None

  71. Loss of impairment of credit
√Applicable □Not Applicable
                                                                                          Unit: RMB
                                            Amount in the current          Amount in the previous
                 Item
                                                  period                          period
Bad debt loss of accounts receivable                   6,343,395.56                       23,224.87
Loss for bad debts of other                              956,299.11                    2,259,459.03
receivables
                 Total                                     7,299,694.67                2,282,683.90

Other notes:

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None


72. Loss of impairment of assets
□Applicable √Not Applicable


  73. Income from disposal of assets
√Applicable □Not Applicable
                                                                                             Unit: RMB
              Item                    Amount in the current period       Amount in the previous period
Income from disposal of                                  76,006.41                        6,819,021.38
intangible assets
Income from disposal of                                              -                       1,361,570.34
property, plant and equipment
              Total                                          76,006.41                       8,180,591.72
Other notes:
None

  74. Revenue from non-operating activities
Information of non-operating incomes
√Applicable □Not Applicable
                                                                                                  Unit: RMB
                                                                                   Amount recognized in
                                         Amount in the         Amount in the           profit or loss of
               Item
                                         current period       previous period      nonrecurring items for
                                                                                     the current period
Government grants not related to               2,950.00           669,648.00                       2,950.00
the daily activities of the Company
Incomes from liquidated damages            5,552,161.47          1,402,173.09                5,552,161.47
Others                                       211,260.99          2,353,251.88                  211,260.99
                  Total                    5,766,372.46          4,425,072.97                5,766,372.46


Government grants recognized in the profit or loss for the current period
√Applicable □Not Applicable
                                                                                                 Unit: RMB
                                                                                             Asset-related
                                                       Amount in the        Previous
                  Grant items                                                                  or income-
                                                       current period       amount
                                                                                                 related
                                                                                             Income-
Tourism development special award                                    -          50,000.00
                                                                                             related
Relief fund for small and micro enterprises and
                                                                                             Income-
individual business households in Shangcheng                         -          10,000.00
                                                                                             related
District
Subsidy for booth fee of 2020 Shanghai Gifts                                                 Income-
                                                                     -          56,448.00
Exhibition                                                                                   related
Special fund reward for 2019 overseas
                                                                                             Income-
investment from Yiwu Municipal Bureau of                             -      550,000.00
                                                                                             related
Commerce
Subsidy from Yiwu Market Development                                                         Income-
                                                                     -           3,200.00
Committee                                                                                    related
Subsidy for enterprise monitoring from                                                       Income-
                                                              1,200.00                   -
Choucheng Subdistrict                                                                        related
Yiwu Comprehensive Bonded Zone Enterprise                                                    Income-
                                                              1,750.00                   -
Development Support Policy                                                                   related
Total                                                         2,950.00      669,648.00

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Other notes:

□Applicable √Not Applicable


  75. Non-operating expenses
√Applicable □Not Applicable
                                                                                              Unit: RMB
                                                                                   Amount recognized
                                                                                    in profit or loss of
                                     Amount in the             Amount in the
               Item                                                                nonrecurring items
                                     current period           previous period
                                                                                      for the current
                                                                                           period
Total loss for disposal of non-
                                           637,423.30            19,632,275.93              637,423.30
current assets
Including: loss for disposal of
                                           637,423.30            19,632,275.93              637,423.30
property, plant and equipment
        Loss for disposal of
intangible assets
External donation                        1,107,540.00             6,540,313.91           1,107,540.00
Water conservancy construction
                                                   6.76             249,883.92                         -
fund
Others                                   1,150,958.70               214,342.31           1,150,958.70
               Total                     2,895,928.76            26,636,816.07           2,895,922.00

Other notes:
None

76. Income tax expenses
(1). Overview of income tax expenses
√Applicable □Not Applicable
                                                                                          Unit: RMB
              Item                   Amount in the current period      Amount in the previous period
Current income tax expenses                       360,286,304.87                     510,006,312.87
Deferred income tax expenses                       -32,761,066.92                    -10,251,293.65
             Total                                327,525,237.95                     499,755,019.22

(2). Adjustment process of accounting profits and income tax expenses
√Applicable □Not Applicable
                                                                                             Unit: RMB
                                  Item                                          Amount in the current
                                                                                      period
Profits before tax                                                                  1,656,693,823.97
Income tax expenses calculated at the statutory/applicable tax rate                   414,173,455.99
Impact of different tax rates applied by subsidiaries                                   -2,092,001.08
Effect of adjusting income tax of previous period                                        9,258,148.22
Effect of non-taxable income                                                               -567,975.32
Effect of non-deductible costs, expenses and losses                                      5,498,793.94
Effect of using deductible losses of unrecognized deferred income tax                   -5,950,758.23
assets in previous period
Effect of deductible temporary differences or deductible losses of                      64,881,959.24
unrecognized deferred income tax assets in the current period
Profits or losses attributable to joint ventures and associates                       -157,676,384.80
Income tax expenses                                                                    327,525,237.95


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Other notes:
□Applicable √Not Applicable

  77. Other comprehensive income
√Applicable □Not Applicable
For details, please refer to Note 57. Other comprehensive income

78. Items of cash flow statement
(1). Other cash receipts relating to operating activities
√Applicable □Not Applicable
                                                                                            Unit: RMB
                Item                    Amount in the current period         Amount in the previous
                                                                                    period
Deposit and margin received                            212,256,986.10                  164,887,997.67
Government grants received                              63,576,554.04                    3,573,983.14
Bank deposit interest income                                                           230,212,493.06
received                                               177,964,682.68
Liquidated damages received from                                                          1,402,173.09
market traders                                               5,766,372.46
Yiwugo’s Bank Reserve Fund                                                               1,842,251.21
received                                                 2,600,157.57
Received overpaid input tax                             62,799,958.77                                -
Others                                                    443,618.96                      6,870,248.13
               Total                                   525,408,330.58                   408,789,146.30

Notes on other cash receipts relating to operating activities:
None

(2). Other cash payments relating to operating activities
√Applicable □Not Applicable
                                                                                            Unit: RMB
                Item                    Amount in the current period         Amount in the previous
                                                                                    period
Major expenses paid                                    319,328,171.57                  365,010,313.02
Repair costs and expenses paid                         120,690,572.43                  132,298,446.26
Deposit and security paid                              157,057,755.29                   95,090,779.43
Others                                                   1,107,540.00                    1,689,857.57
               Total                                   598,184,039.29                  594,089,396.28
Notes on other cash payments relating to operating activities:
None


(3). Other cash receipts relating to investing activities
√Applicable □Not Applicable
                                                                                             Unit: RMB
                       Item                            Amount in the current     Amount in the previous
                                                             period                     period
Recovered-pending investment refunds                        822,300,000.00               43,027,285.60
Advance subsidy for joint venture’s subsidiaries
                                                                             -        1,608,852,069.00
that was recovered from the joint venture party
Received funding from from the joint ventures
                                                              2,924,599,831.00        2,775,280,817.96
and their subsidiaries
Receipt of redeemed financing products                                       -            6,000,000.00
Cash balance on acquisition date of subsidiary                               -           17,326,086.71

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                     Total                                  3,746,899,831.00            4,450,486,259.27
Notes on other cash receipts relating to investing activities:
None

(4). Other cash payments relating to investing activities
√Applicable □Not Applicable
                                                                                                Unit: RMB
                Item                     Amount in the current period            Amount in the previous
                                                                                        period
Advance for land for proposed joint                                                       281,839,499.86
venture                                                                      -
Financial subsidy paid to Tonghui                                                       1,486,368,548.00
Shangbo                                                      138,160,000.00
Financial subsidy paid to Handing                                                         472,144,400.00
Shangbo                                                          17,845,800.00
Financial subsidy paid to the joint                                                        63,465,484.42
venture in Dubai                                             104,456,205.00
Financial subsidy paid to Gongchen                                                         49,000,000.00
Shangbo                                                                      -
Paid the financial assistance for                                                                       -
Guoshen Shangbo                                           1,372,000,000.00
                Total                                     1,632,462,005.00              2,352,817,932.28
Other cash paid related to investment activities:
None

(5). Other cash receipts relating to financing activities
□Applicable √Not Applicable


(6). Other cash payments relating to financing activities
√Applicable □Not Applicable
                                                                                                Unit: RMB
                Item                     Amount in the current period            Amount in the previous
                                                                                        period
Acquisition of minority                                                                     64,460,000.00
shareholders' equity in subsidiaries                                         -
Restricted stock cancellation                                                                           -
payment                                                           2,827,300.00
Minimum lease payment                                            37,531,483.07                         -
                Total                                            40,358,783.07             64,460,000.00
Other cash paid related to financing activities:
None

79. Supplements to cash flow statement
(1). Supplements to cash flow statement
√Applicable □Not Applicable
                                                                                                Unit: RMB
                                                                                 Amount in the previous
            Supplements                  Amount in the current period
                                                                                        period
1.Adjust net profits to cash flow from operating activities:
Net profits                                     1,329,168,586.02                          921,836,055.21
Plus: provision for impairment of
                                                               -                                        -
assets
Loss of impairment of credit                        7,299,694.67                            2,282,683.90

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Depreciation of fixed assets,
depletion of oil and gas assets and
                                                   391,927,445.01                391,308,329.57
depreciation of bearer biological
assets
Amortization of right-of-use assets                 29,280,433.57                             -
Amortization of intangible assets                  140,522,789.88                129,979,055.25
Depreciation and amortization of
                                                   106,638,821.16                 91,509,152.33
investment real estate
Amortization of long-term prepaid
                                                    62,397,515.62                 64,667,911.54
expenses
Loss from disposal of fixed assets,
intangible assets and other long-                       -76,006.41                11,451,684.21
term assets (gains indicated by “-”)
Loss from fixed assets retirement
                                                       637,423.30                             -
(gains indicated by “-”)
Loss from changes in fair value
                                                    -7,231,321.84                 32,955,861.63
(gains indicated by “-”)
Financial expenses (gains indicated
                                                   336,909,155.82                392,152,088.59
by “-”)
Investment loss (gains indicated by
                                                  -769,582,290.36               -648,958,950.22
“-”)
Decrease in deferred income tax
                                                   -36,072,700.05                 -7,112,433.29
assets (increase indicated by “-”)
Increase in deferred income tax
liabilities (decrease indicated by                  -1,705,460.37                 -3,988,508.40
“-”)
Decrease in inventory (increase
                                                    -8,180,635.66             -1,156,397,502.91
indicated by “-”)
Decrease in operating receivables
                                                  -912,160,213.18               -538,592,969.66
(increase indicated by “-”)
Increase in operating payables
                                                 1,363,309,270.58              1,145,695,804.20
(decrease indicated by “-”)
Net cash flow from operating
                                                 2,033,082,507.76                828,788,261.95
activities
2.Significant investing and financing activities not involving cash receipt and payment:
When the joint venture company
was established based on the equity
of the subsidiary, the original
financial subsidy for subsidiary’s                              -             1,545,759,831.00
prepayment for land was converted
to other receivables from the
subsidiary of the joint venture
3.Net changes in cash and cash equivalents:
Closing balance of cash                          4,006,468,325.47              2,032,642,871.63
Less: opening balance of cash                    2,032,642,871.63              3,426,712,549.26
Add: closing balance of cash
equivalents
Less: opening balance of cash
equivalents
Net increase in cash and cash                    1,973,825,453.84             -1,394,069,677.63
equivalents


(2). Net cash paid for acquisition of subsidiaries in the current period
□Applicable √Not Applicable



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(3). Net cash received from disposal of subsidiaries in the current period
□Applicable √Not Applicable


(4). Composition of cash and cash equivalents
√Applicable □Not Applicable
                                                                                          Unit: RMB
                    Item                                Closing balance          Opening balance
I. Cash                                                    4,006,468,325.47        2,032,642,871.63
In which: cash on hand                                           154,264.94              292,999.29
Bank deposit that can be used for payment
                                                             4,006,258,722.95      2,032,189,759.31
at any time
Other monetary capital that can be used for
                                                                   55,337.58              160,113.03
payment at any time
II. Cash equivalents
Including: bond investments due within three
months
III. Closing balance of cash and cash
                                                             4,006,468,325.47      2,032,642,871.63
equivalents
Including:cash and cash equivalents with
restricted use by the parent company or its                            60.78                   60.58
subsidiaries

Other notes:
√Applicable □Not Applicable
    Monetary funds with a deposit period of more than three months:              Currency: RMB
             Item                      Closing balance                      Opening balance
Negotiated deposits                            825,000,000.00                    3,580,000,000.00


80. Notes to items in statement of changes in owners’ equity
Names of “others” items whose closing balances in the previous year are adjusted and the amounts
of adjustments:
□Applicable √Not Applicable

  81. Assets with restricted title or right of use
√Applicable □Not Applicable
                                                                                           Unit: RMB
              Item                          Closing book value               Reasons for restriction
Monetary capital                                                 60.78    [Note 1]
Long-term equity investment                             102,918,559.00    [Note 2]
Other non-current financial                             636,870,392.09    [Note 2]
assets
              Total                                     739,789,011.87                /
Other notes:
     Note 1. As of December 31, 2021, bank deposits with a book value of RMB 60.78 (December
31, 2020: RMB 60.58) were restricted for ownership or use rights due to being as security deposits
for obtaining commercial housing mortgage loan.
     Note 2: As of December 31, 2021, long-term equity investments with a book value of RMB
102,918,559.00 (December 31, 2020: RMB 102,918,559.00) and other non-current assets of RMB
636,870,392.09 (December 31, 2020: RMB 617,511,352.00) were frozen by Shanghai Municipal
Public Security Bureau. See Note XIV.1 Important commitments for details.



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82. Foreign currency monetary items
(1). Foreign currency monetary items
√Applicable □Not Applicable
                                                                                        Unit: RMB Yuan
                                                                                  Closing amount after
                                Closing balance in
           Item                                              Exchange rate         conversation: RMB
                                 foreign currency
                                                                                        Balance
Monetary capital                                  -                        -
In which: USD                          5,485,690.70                   6.3757             34,975,118.20
EURO                                     285,450.21                   7.2197              2,060,864.88
Rwandan Franc                         10,849,325.00                   0.0063                 68,350.75
Dirham                                   891,319.05                   1.7361              1,547,419.00
Koruna                                 7,967,992.08                   0.2899              2,309,920.90
Accounts receivable                               -                        -
In which: USD                         14,360,439.00                   6.3757             91,557,850.93
EURO                                   1,455,026.65                   7.2197             10,504,855.91
Koruna                                 5,076,307.71                   0.2899              1,471,621.61
Other receivables                                 -                        -                         -
Including: EURO                            5,100.00                   7.2197                 36,820.47
Koruna                                31,936,127.00                   0.2899              9,258,283.22
Accounts payable                                  -                        -                         -
In which: USD                          1,267,239.54                   6.3757              8,079,539.14
Other payables                                    -                        -                         -
In which: USD                          1,793,978.13                   6.3757             11,437,866.36
EURO                                      62,397.91                   7.2197                450,494.19
Koruna                                 3,775,500.35                   0.2899              1,094,517.55

Other notes:
None

(2). Description of overseas operations, for important overseas operations, also includes
     the disclosure of principal overseas place of business, bookkeeping currency and the
     basis for selection, and the reason for the change in bookkeeping currency.
□Applicable √Not Applicable

83. Hedging
□Applicable √Not Applicable


84. Government grants
(1). Overview of government grants
√Applicable □Not Applicable
                                                                                               Unit: RMB
                                                                                  Amount recognized in
                   Type                          Amount          Presentation      profit or loss for the
                                                                                      current period
Yiwu Comprehensive Bonded Zone                        1,750.00   Revenue                         1,750.00
Enterprise Development Support Policy                            from      non-
                                                                 operating
                                                                 activities
Subsidy for enterprise monitoring from                1,200.00   Revenue                       1,200.00
Choucheng Subdistrict                                            from non-
                                                                 operating
                                                                 activities
Additional deduction of input tax              6,244,434.23      Other                     6,244,434.23
                                                                 income
                                              186    / 228
                                       2021 Annual Report


Subsidies for energy saving and              4,863,474.00     Other     4,863,474.00
consumption reduction                                         income
Special incentive funds for modern supply    2,682,704.00     Other     2,682,704.00
chain system innovation                                       income
Industrial   Cluster    Cross-border   E-    1,879,093.83     Other     1,879,093.83
commerce Development Pilot Subsidy                            income
Interest subsidy for the international       1,154,807.04     Other     1,154,807.04
exhibition center construction fund                           income
"3 refunds and 3 rewards"                    1,084,878.00     Other     1,084,878.00
                                                              income
Government subsidy for service industry       266,666.64      Other      266,666.64
cluster for 2011                                              income
Refund of social security contribution            14,595.20   Other       14,595.20
                                                              income
Others                                       5,366,295.07     Other     5,366,295.07
                                                              income
Total                                       23,559,898.01              23,559,898.01

(2). Refund of government grants
□Applicable √Not Applicable
Other notes:
None

85. Others
□Applicable √Not Applicable

VIII. Changes in consolidation scope
1. Mergers of enterprises not under common control
□Applicable √Not Applicable


2. Mergers of the enterprises under common control
□Applicable √Not Applicable

3. Reverse acquisition
□Applicable √Not Applicable




                                            187   / 228
                                        2021 Annual Report



4. Disposal of subsidiaries
Has the Group lost control upon a single disposal of investment in a subsidiary?
□Applicable √Not Applicable
Other notes:
□Applicable √Not Applicable


  5. Changes in consolidation scope for other reasons
Changes in the consolidation scope for other reasons (e.g. new establishment of subsidiaries,
liquidation of subsidiaries, etc.) and the related information:
√Applicable □Not Applicable
     The Company established a subsidiary, Zhejiang China Commodities City Group Commercial
Factoring Co., Ltd. in the current period.


6. Others
□Applicable √Not Applicable




                                             188   / 228
                                                  2021 Annual Report



        IX. Equity in Other Entities
         1. Equity in subsidiaries
        (1).Composition of the enterprise Group
        √Applicable □Not Applicable
                                                                          Shareholding
       Subsidiary           Main place      Place of                         ratio (%)           Acquisition
                                                              Business
         Name               of business   registration                                            Method
                                                                         Direct Indirect
Yiwu China
Commodities City            Yiwu,         Yiwu,
                                                         Service           100             Establishment
Logistics and               Zhejiang      Zhejiang
Warehousing Co., Ltd.
Yiwu Commodities City
                            Yiwu,         Yiwu,
Gonglian Property Co.,                                   Real estate       100             Establishment
                            Zhejiang      Zhejiang
Ltd.
Yiwu China
                            Yiwu,         Yiwu,
Commodities City                                         Service           100             Establishment
                            Zhejiang      Zhejiang
Exhibition Co., Ltd.
Yiwu China
                            Yiwu,         Yiwu,
Commodities City                                         Advertising       100             Establishment
                            Zhejiang      Zhejiang
Advertising Co., Ld.
Yiwu China
Commodities City            Yiwu,         Yiwu,
                                                         IT                100             Establishment
Information Technology      Zhejiang      Zhejiang
Co., Ltd.
Yiwu China Commodity
City RMB and Foreign        Yiwu,         Yiwu,
                                                         Service                    100    Establishment
Currency Exchange           Zhejiang      Zhejiang
Co., Ltd.
Hangzhou Shangbo
                            Hangzhou,     Hangzhou,
Nanxing Property Co.,                                    Real estate       100             Establishment
                            Zhejiang      Zhejiang
Ltd.
Yiwu China
Commodities City            Yiwu,         Yiwu,
                                                         IT                         100    Establishment
Payment Network             Zhejiang      Zhejiang
Technology Co., Ltd.
Yiwu China
Commodities City            Yiwu,         Yiwu,
                                                         Service                     85    Establishment
Credit Investigation Co.,   Zhejiang      Zhejiang
Ltd.
Haicheng Yiwu China
Commodities City            Haicheng,     Haicheng,
                                                         Real estate        95             Establishment
Investment                  Liaoning      Liaoning
Development Co., Ltd.
Zhejiang Yiwugou E-         Yiwu,         Yiwu,
                                                         E-commerce                  51    Establishment
commerce Co., Ltd.          Zhejiang      Zhejiang
Yiwu Shangbo Property       Hangzhou,     Hangzhou,
                                                         Real estate       100             Establishment
Co., Ltd.                   Zhejiang      Zhejiang
Yiwu China
Commodities City            Yiwu,         Yiwu,
                                                         Wholesale         100             Establishment
Import and Export Co.,      Zhejiang      Zhejiang
Ltd.
Yiwu China
Commodities City            Yiwu,         Yiwu,
                                                         Service           100             Establishment
Supply Chain                Zhejiang      Zhejiang
Management Co., Ltd.
Yiwu China                                               Lease and
                            Yiwu,         Yiwu,
Commodities City                                         business          100             Establishment
                            Zhejiang      Zhejiang
Tourism Development                                      service
                                                         189   / 228
                                                   2021 Annual Report


Co., Ltd.
Yiwu China
Commodities City           Yiwu,         Yiwu,
                                                        Service         100         Establishment
Financial Holdings Co.,    Zhejiang      Zhejiang
Ltd.
Yiwu China Commodity
                           Frankfurt,    Frankfurt,
City (Germany) Co.,                                     Service               100   Establishment
                           Germany       Germany
Ltd.
Yiwu International
                           Yiwu,         Yiwu,
Trade Comprehensive                                     Wholesale             60    Establishment
                           Zhejiang      Zhejiang
Service Co., Ltd.
Yiwu Aiximao Supply
                           Yiwu,         Yiwu,
Chain Management                                        Service               100   Establishment
                           Zhejiang      Zhejiang
Co., Ltd.
Yiwu China
Commodities City           Hong          Hong
(Hong Kong)                Kong,         Kong,          Wholesale             100   Establishment
International Trade Co.,   China         China
Ltd.
Ningxia Yiwu China
Commodity City Supply      Shizuishan,   Shizuishan,
                                                        Service               100   Establishment
Chain Management           Ningxia       Ningxia
Co., Ltd.
Yiwu China
Commodities City
                           Yiwu,         Yiwu,
Overseas Investment                                     Wholesale       100         Establishment
                           Zhejiang      Zhejiang
and Development Co.,
Ltd.
Yiwu China
Commodities City
                           Yiwu,         Yiwu,
Commerce and Trade                                      Education       100         Establishment
                           Zhejiang      Zhejiang
Service Training Center
Co., Ltd.
Yiwu China
                                                        Lease and
Commodities City           Yiwu,         Yiwu,
                                                        business        100         Establishment
Assets Operation and       Zhejiang      Zhejiang
                                                        service
Management Co., Ltd.
                                                        Lease and
Zhejiang Yindu Hotel       Yiwu,         Yiwu,
                                                        business        100         Establishment
Management Co., Ltd.       Zhejiang      Zhejiang
                                                        service
                           Hong          Hong
Hong Kong Better Silk
                           Kong,         Kong,          Service               100   Establishment
Road Co., Ltd.
                           China         China
BETTER SILK ROAD           Dubai,        Dubai,
                                                        Service               100   Establishment
FZE                        UAE           UAE
BETTER SILK ROAD           Kigali,       Kigali,
                                                        Service               100   Establishment
RWANDA Ltd                 Rwanda        Rwanda
Yiwu China
Commodities City           Yiwu,         Yiwu,          Business
                                                                        100         Establishment
Research Institute Co.,    Zhejiang      Zhejiang       service
Ltd.
Yiwu Comprehensive
Bonded Zone Operation      Yiwu,         Yiwu,          Business
                                                                        100         Establishment
and Management Co.,        Zhejiang      Zhejiang       service
Ltd.
                                                        Software and
Yiwu China
                           Yiwu,         Yiwu,          Information
Commodities City Big                                                    100         Establishment
                           Zhejiang      Zhejiang       Technology
Data Co., Ltd.
                                                        Service
                                                       190   / 228
                                                    2021 Annual Report


                                                           Industry
                                                           Multimodal
 Yiwu Huanqiuyida           Yiwu,          Yiwu,           transport and
                                                                                               60   Establishment
 Logistics Co., Ltd.        Zhejiang       Zhejiang        transportation
                                                           agency
 Yiwu China
 Commodities City
                            Yiwu,          Yiwu,
 Internet Financial                                        Service                            100   Incorporation+acquisition
                            Zhejiang       Zhejiang
 Information Service
 Co., Ltd.
 Zhejiang Huajie
                            Yiwu,          Yiwu,           Commercial
 Investment and                                                               96.4                  Incorporation+acquisition
                            Zhejiang       Zhejiang        services
 Development Co., Ltd.
 European Huajie            Prague,        Prague,
                                                           Commercial
 Investment                 Czech          Czech                                             96.4   Incorporation+acquisition
                                                           services
 Development Co., Ltd.      Republic       Republic
 Zhejiang China
 Commodities City           Yiwu,          Yiwu,
                                                           Service                 60          40   Establishment
 Group Commercial           Zhejiang       Zhejiang
 Factoring Co., Ltd.

         Explanation for the difference between the shareholding ratio and voting right ratio in a subsidiary:
         None

         Basis for holding half or less voting rights in but still controlling an investee, and holding more than
         half of the voting rights in but not controlling an investee:
         None

         Basis for controlling important structured entities included in the consolidation scope:
         None

         Basis for determining whether a company is an agent or a principal:
         None

         Other notes:
         None

         (2).Important non-wholly-owned subsidiaries
         √Applicable □Not Applicable
                                                                                                                Unit: RMB
                                         Shareholding         Profits or losses         Dividends declared
                                            ratio of           attributable to          to be distributed to     Closing balance
        Name of subsidiary                 minority                minority                   minority              of minority
                                         shareholders         shareholders in             shareholders for           interest
                                                .            the current period          the current period
Zhejiang Yiwugou E-commerce Co.,                   49%            3,231,306.40                              -      44,817,381.94
Ltd.
Haicheng Company                                      5%           -7,342,519.03                            -     -42,993,044.00

         Explanation for the difference between the shareholding ratio and voting right ratio of minority
         shareholders in a subsidiary:
         □Applicable √Not Applicable

         Other notes:
         □Applicable √Not Applicable

         (3).Major financial information of important non-wholly-owned subsidiaries
         √Applicable □Not Applicable
                                                           191   / 228
                                                                              2021 Annual Report


                                                                                                                                              Unit: RMB10,000
                                           Closing balance                                                                       Opening balance
  Name of                                                                 Non-                                                                                  Non-
 subsidiary     Current      Non-current     Total        Current                     Total      Current         Non-current       Total        Current                       Total
                                                                         current                                                                               current
                assets         assets       assets       liabilities               liabilities   assets            assets         assets       liabilities                 liabilities
                                                                       liabilities                                                                           liabilities
Zhejiang
Yiwugou E-
                 11,899.73       900.21     12,799.94     3,653.53            -     3,653.53       10,131.63        1,035.94      11,167.57      2,680.61            -        2,680.61
commerce Co.,
Ltd.

Haicheng
                126,423.87    98,154.04    224,577.91      310,564            -      310,564     124,510.56       105,804.70     230,315.26    301,683.12        0.26       301,683.38
Company




                                   Amount in the current period                                                 Amount in the previous period
                                                      Total       Cash                                                             Total      Cash flow
     Name of                                                                                           Operatin
                          Operating               comprehe flow from                                                           comprehen        from
    subsidiary                       Net profits                                                          g      Net profits
                          revenue                    nsive      operating                                                          sive       operating
                                                                                                       revenue
                                                    income      activities                                                       income       activities
Zhejiang
Yiwugou E-
                             4,747.83            659.45                659.45          -2,891.61           4,620.58               668.86                668.86             6,298.22
commerce Co.,
Ltd.
Haicheng
                               898.01        -14,685.04          -14,685.04            11,694.15               546.63          -13,339.37          -13,339.37              -5,460.25
Company

                Other notes:
                None

                (4).Significant restrictions on the use of enterprise Group’s assets and the settlement of
                    enterprise Group’s debts
                □Applicable √Not Applicable

                (5).Financial or other supports provided to structured entities included in the scope of
                    consolidated financial statements
                □Applicable √Not Applicable

                Other notes:
                □Applicable √Not Applicable

                2. Transactions in which the Group’s share of owners’ equity in a subsidiary changes and
                    the Group still controls the subsidiary
                □Applicable √Not Applicable

                  3. Equity in joint ventures or associated enterprises
                √Applicable □Not Applicable
                (1).Important joint ventures or associated enterprises
                √Applicable □Not Applicable
                                                                                                                                                 Unit: RMB
                                                                                                                                    Shareholding       Accounting
                                                                                                                                       ratio (%)        treatment
                                                                                                                                                        method of
  Name of joint venture or associated                   Main place                  Place of
                                                                                                            Business                                   investment
              enterprise                                of business               registration
                                                                                                                                   Direct Indirect in the joint
                                                                                                                                                        venture or
                                                                                                                                                        associate
  Joint venture

                                                                                      192    / 228
                                                     2021 Annual Report


Yiwu Shanglv Investment               Yiwu,          Yiwu,                                                  Equity
                                                                        Real estate          49
Development Co., Ltd.                 Zhejiang       Zhejiang                                               method
Yiwu Huishang Redbud Capital          Yiwu,          Yiwu,                                                  Equity
                                                                        Service                        20
Management Co., Ltd.                  Zhejiang       Zhejiang                                               method
                                      Yiwu,          Yiwu,                                                  Equity
Yiwu Rongshang Property Co., Ltd.                                       Real estate          49
                                      Zhejiang       Zhejiang                                               method
Yiwu Chuangcheng Property Co.,        Yiwu,          Yiwu,                                                  Equity
                                                                        Real estate          24
Ltd.                                  Zhejiang       Zhejiang                                               method
Yiwu Guoshen Shangbo Property         Yiwu,          Yiwu,                                                  Equity
                                                                        Real estate          49
Co., Ltd.                             Zhejiang       Zhejiang                                               method
Associated enterprise
Hangzhou Binjiang Shangbo             Hangzhou,      Hangzhou,                                              Equity
                                                                        Real estate          49
Property Development Co., Ltd.        Zhejiang       Zhejiang                                               method
Yiwu Huishang Redbud Equity           Yiwu,          Yiwu,              Commercial                          Equity
                                                                                                    10.42
Investment Co., Ltd. (Note 4)         Zhejiang       Zhejiang           services                            method
Zhejiang Chouzhou Financial           Yiwu,          Yiwu,                                                  Equity
                                                                        Service              26
Lease Co., Ltd.                       Zhejiang       Zhejiang                                               method
Yiwu Huishang Redbud Phase II                                           Lease and
                                      Yiwu,          Yiwu,                                                  Equity
Investment Partnership (LLP) (Note                                      business           9.43
                                      Zhejiang       Zhejiang                                               method
5)                                                                      service
Yiwu Hongyi Equity Investment         Yiwu,          Yiwu,                                                  Equity
                                                                        Service                     49.98
Fund Partnership                      Zhejiang       Zhejiang                                               method
                                      Pujiang,       Pujiang,                                               Equity
Pujiang Lvgu Property Co., Ltd.                                         Real estate          49
                                      Zhejiang       Zhejiang                                               method
Yiwu China Commodities City           Yiwu,          Yiwu,                                                  Equity
                                                                        Real estate          49
Property Development Co., Ltd.        Zhejiang       Zhejiang                                               method

           Explanation for the difference between the shareholding ratio and voting right ratio in a joint venture
           or associate:
           None

           Bases for holding less than 20% of the voting rights but having significant influence, or holding 20%
           or more of the voting rights but not having significant influence:
                Note 4: The Company holds 10.42% (2020: 10.42%) of equity of Yiwu Huishang Redbud
           Equity Investment Co., Ltd. (hereinafter referred to as "Redbud Equity Investment"), but regards it
           as a joint venture of the Company. According to Redbud Investment’s articles of association, it is
           engaged in investing and its important financial and operating decision-making activities are to pick
           and manage investment projects, which have been fully entrusted to the Company’s joint venture
           Yiwu Huishang Redbud Capital Management Co., Ltd. (“Redbud Capital”). Redbud Capital picks
           and manages investment projects via its investment decision-making committee. Except for special
           investment matters, which are subject to the resolution of Redbud Investment’s board of directors,
           other important financial and operating decision-making activities are conducted by Redbud Capital
           on the behalf of Redbud Investment. Therefore, the Company was able to exercise significant
           influence on Redbud Investment in which the Company held 10.42% of total equity.
                Note 5: The Company holds 9.43% (9.43% in 2020) equity in Yiwu Huishang Redbud Phase II
           Investment Partnership (limited partnership) (“Redbud Phase II”), but regards it as an associated
           company of the Company. According to Redbud Phase II’s articles of association, it is engaged in
           investing and its important financial and operating decision-making activities are to pick and
           manage investment projects, which have been fully entrusted to the Company’s joint venture
           Redbud Capital. Redbud Capital picks and manages investment projects via its investment
           decision-making committee. Except for special investment matters, which are subject to the
           resolution of Redbud Phase II’s board of directors, other important financial and operating decision-
           making activities are conducted by Redbud Capital on the behalf of Redbud Phase II. Therefore,
           the Company can exert significant influence on Redbud Phase II in which it holds 9.43% equity.

           (2).Main financial information of important joint ventures
           √Applicable □Not Applicable
                                                                                                       Unit: RMB

                                                          193   / 228
                                           2021 Annual Report


                                                Closing balance/amount         Opening balance/amount
                                                  in the current period         in the previous period
                                                      Yiwu Shanglv                   Yiwu Shanglv
Current assets                                             94,995,453.50                 187,602,175.56
    In which: cash and cash equivalents                    17,204,162.54                  24,893,904.53
Non-current assets                                      1,332,618,603.76               1,369,948,370.68
Total assets                                            1,427,614,057.26               1,557,550,546.24

Current liabilities                                           375,275,386.49            420,643,904.92
Non-current liabilities                                       236,957,211.08            356,957,211.08
Total liabilities                                             612,232,597.57            777,601,116.00

Minority interest
Shareholders’ equity attributable to parent                  815,381,459.69            779,949,430.24
company

Share of net assets calculated based                          399,536,915.25            382,175,220.82
shareholding ratio
Adjustments                                                   -15,868,561.04            -16,344,463.91
--Goodwill                                                                 -                         -
--unrealized profits of internal transactions                 -15,868,561.04            -16,344,463.91
--Others                                                                   -                         -
Book value of equity investment in joint                      383,668,354.21            365,830,756.91
ventures

Operating revenue                                             235,111,114.62            209,478,335.98
Financial expenses                                             24,364,607.11             25,646,329.54
Net profits                                                    35,438,822.77             35,139,746.38
Total comprehensive income                                     35,438,822.77             35,139,746.38

Dividends received from joint ventures                                     -                          -
this year

Other statements
None




                                                194   / 228
                                                                                                                          2021 Annual Report




                  (3).Main financial information of important associates
                  √Applicable □Not Applicable
                                                                                                                                                                                                                                 Unit: RMB10,000
                                                          Closing balance/amount in the current period                                                                           Opening balance/amount in the previous period
                      Binjiang          Chouzhou       Hongyi Fund          CCCP             Pujiang Lvgu     Yiwu             Yiwu          Binjiang          Chouzhou       Hongyi Fund         CCCP            Pujiang Lvgu     Yiwu Rongshang      Yiwu
                      Shangbo        Financial Lease                                                        Rongshang       Chuangcheng      Shangbo        Financial Lease                                                            Property     Chuangcheng
                                                                                                             Property         Property                                                                                                                Property
Current assets        11,002.00            77,805.80      21,730.37        1,492,712.71        122,804.10    564,093.80       385,685.30      44,924.53           72,933.41      18,713.03         755,070.00       169,861.53         754,838.27     487,362.79
Non-current
                          69.23         1,356,968.91     155,970.63           42,919.44            459.02      8,395.40         5,324.96         104.99        1,139,961.66     119,447.65          40,293.49         1,300.59          10,377.57       7,101.31
assets
Total assets          11,071.23         1,434,774.71     177,701.00        1,535,632.15        123,263.12    572,489.20       391,010.26      45,029.52        1,212,895.07     138,160.68         795,363.49       171,162.12         765,215.84     494,464.10

Current liabilities    3,263.30         1,020,585.17          37.71          915,862.90         31,456.60    528,124.40       354,317.21      12,787.62         945,311.98          140.31         467,243.03        88,160.96         760,395.30     453,367.00
Non-current
                                 -       250,335.36                -          49,089.63                 -             -                -                -       124,403.19               -          20,902.58         7,441.37                  -      35,900.00
liabilities
Total liabilities      3,263.30         1,270,920.53          37.71          964,952.53         31,456.60    528,124.40       354,317.21      12,787.62        1,069,715.17         140.31         488,145.61        95,602.33         760,395.30     489,267.00

Shareholders’
equity
                       7,807.93          163,854.17      177,663.28          570,679.62         91,806.52     44,364.80        36,693.05      32,241.90         143,179.91      138,020.37         307,217.88        75,559.79           4,820.55       5,197.10
attributable to
parent company

Share of net
assets
calculated based       3,825.88            42,602.08      88,796.11          279,633.01         44,985.19     21,738.75         8,806.33      15,798.53           37,226.78      68,975.68         150,536.76        37,024.30           2,362.07       1,247.31
shareholding
ratio
Adjustments             -378.26                    -           -8.88           -3,939.17           942.95             -                -        -383.31              -94.71              -           -3,379.46          942.95            -130.16        -102.83
--unrealized
profits of internal     -378.26                    -           -8.88           -3,939.17           942.95             -                -        -383.31              -94.71              -           -3,379.46          942.95            -130.16        -102.83
transactions
Book value of
equity
                       3,447.62            42,602.08      88,787.23          275,693.84         45,928.14     21,738.75         8,806.33      15,415.23           37,132.07      68,975.68         147,157.30        37,964.25           2,231.91       1,144.48
investment in
joint ventures

Operating
                       3,673.67            43,115.27         177.83          138,101.44         90,893.54    272,636.85       199,877.07       9,770.28           45,121.82         944.83          19,133.91        19,704.98             384.12         101.10
revenue
Net profits            3,566.03            20,984.32       9,749.03           14,621.40         16,246.73     39,544.26        31,495.95       3,463.97           15,636.61       1,872.25           -1,853.66        3,561.41            -973.50      -2,330.19
Total
comprehensive          3,566.03            20,984.32       9,749.03           14,621.40         16,246.73     39,544.26        31,495.95       3,463.97           15,636.61       1,872.25           -1,853.66        3,561.41            -973.50      -2,330.19
income

Dividend on
associates
                         13,720
received in the
current year


                  Other statements
                  None



                                                                                                                               195   / 228
                                        2021 Annual Report




(4).Summary financial information of unimportant joint ventures and associates
√Applicable □Not Applicable
                                                                                        Unit: RMB
                                 Closing balance/amount in the     Opening balance/amount in the
                                         current period                   previous period
Joint ventures:
Total book value of                                56,813,304.76                     15,284,720.18
investments
Total amounts of the following items calculated based on shareholding ratio
--Net profits                                      23,678,584.58                    -19,726,695.26
--Other comprehensive
income
--Total comprehensive
income

Associates:
Total book value of                               461,933,497.77                    351,543,008.12
investments
Total amounts of the following items calculated based on shareholding ratio
--Net profits                                      25,663,075.10                     -6,084,558.45
--Other comprehensive
income
--Total comprehensive
income
Other statements
None

(5).Restrictions on the ability of joint ventures or associates to transfer money to the
    Company
□Applicable √Not Applicable

(6).Excess losses of joint ventures or associates
□Applicable √Not Applicable


(7).Unrecognized commitments relating to investment in joint ventures
□Applicable √Not Applicable

(8).Contingent liabilities relating to investment in joint ventures or associates
□Applicable √Not Applicable

4. Important joint operations
□Applicable √Not Applicable


5. Equity in structured entities not included in the consolidated financial statements
Notes on structured entities not included in the consolidated financial statements:
□Applicable √Not Applicable

6. Others
□Applicable √Not Applicable



                                             196   / 228
                                                           2021 Annual Report


X. Risks associated with financial instruments
√Applicable □Not Applicable

1. Categorization of financial instruments
       The book values of financial instruments on the balance sheet date are as follows:
       2021
       Financial assets
                                     Financial assets that
                                                                                              measured at fair
                                        are measured by
                                                                                             value and whose
                                         fair value and of
                                                                                                 changes are
                                       which the changes        Measured at amortized
                                                                                                   included in                 Total
                                          in fair value are                      cost
                                                                                                         other
                                        recognized in the
                                                                                               comprehensive
                                      profit or loss for the
                                                                                                       income
                                             current period
                                     Requirements in the                                          Designated
                                                  standard
       Monetary capital                                    -          4,831,468,386.25                      -       4,831,468,386.25
       Held-for-trading
                                           75,375,083.21                             -                       -         75,375,083.21
       financial assets
       Accounts receivable                                 -            185,237,530.89                       -        185,237,530.89
       Other receivables                                   -          1,355,924,282.96                       -      1,355,924,282.96
       Other current assets                                -              2,780,294.82                       -          2,780,294.82
       Long-term receivables                               -            222,307,363.40                       -        222,307,363.40
       Other             equity
                                                           -                         -        642,187,968.77         642,187,968.77
       instruments investment
       Other        non-current
                                        1,524,819,255.41                             -                       -      1,524,819,255.41
       financial assets

                                        1,600,194,338.62              6,597,717,858.32        642,187,968.77        8,840,100,165.70


       Financial liabilities                                                                                     Other financial
                                                                                                                       liabilities
       Short-term borrowings                                                                                          942,736,046.04
       Accounts payable                                                                                               493,360,429.02
       Other payables                                                                                               1,908,742,835.15
       Non-current liabilities due within one                                                                       3,664,241,923.08
       year
       Other current liabilities                                                                                    3,081,384,800.50
       Long-term borrowings                                                                                           771,250,000.00
       Lease liabilities                                                                                              205,942,673.93

                                                                                                                   11,067,658,707.72


       2020
       Financial assets
                                         Financial assets
                                                                                              measured at fair
                                       that are measured
                                                                                             value and whose
                                      by fair value and of
                                                                                                 changes are
                                       which the changes         Measured at amortized
                                                                                                   included in                 Total
                                          in fair value are                       cost
                                                                                                         other
                                        recognized in the
                                                                                               comprehensive
                                      profit or loss for the
                                                                                                       income
                                             current period
                                     Requirements in the                                          Designated
                                                  standard
       Monetary capital
                                                           -                                                 -      5,612,642,932.21
                                                               5,612,642,932.21
       Held-for-trading
                                           51,712,734.31                                 -                   -         51,712,734.31
       financial assets
       Accounts receivable                                 -            153,573,476.86                       -        153,573,476.86
       Other receivables                                   -          2,708,478,136.25                       -      2,708,478,136.25
       Other current assets                                -              3,279,187.50                       -          3,279,187.50
       Long-term receivables                               -            126,756,573.81                       -        126,756,573.81
       Other            equity
                                                           -                             -    662,256,342.79         662,256,342.79
       instruments investment
       Other non-current financial
       assets
                                       1,523,925,249.81                                  -                   -      1,523,925,249.81

                                       1,575,637,984.12               8,604,730,306.63        662,256,342.79       10,842,624,633.54


       Financial liabilities                                                                                     Other financial
                                                                                                                       liabilities
       Short-term borrowings                                                                                        1,257,179,389.40
       Accounts payable                                                                                               636,463,802.23

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      Other payables                                                                 1,908,742,835.15
      Non-current liabilities due within one                                         1,315,026,574.43
      year
      Other current liabilities                                                      3,008,141,460.22
      Long-term borrowings                                                             282,000,000.00
      Bonds payable                                                                  3,552,161,709.68

                                                                                    11,067,658,707.72
2.   Risks associated with financial instruments

       The risks associated with financial instruments faced by the Group in regular activities
       mainly include credit risk, liquidity risk and market risk. The main financial instruments
       of the Group include cash, borrowings from banks, bonds payable and commercial
       papers payable. Those instruments are used mainly to finance the operation of the
       Group. The Group has lots of other financial assets and liabilities directly arising from
       operation, such as accounts receivable, other receivables, accounts payable and other
       payables. The risks associated with those financial instruments and the risk
       management strategy taken by the Group to reduce those risks are stated as follows.

       Credit risk

       The Group only deals with the recognized third parties with good reputation. According
       to its policy, the Group needs to carry out credit review on all clients who require to
       deal with the Group on credit. In addition, the Group keeps monitoring the balance of
       accounts receivable to ensure it will not face any material bad debt risk. For the
       transactions settled other than in the functional currency of related business entities,
       unless with specific approval of the Group’s credit control department, the Group will
       not provide the conditions for dealing on credit. The Group also faces credit risks due
       to the provision of financial guarantees. See Note XIV. 2 for details.

       As the counterparties to the transactions of cash are banks with good reputation and
       high credit ratings, the credit risk of those financial instruments is relatively low.

       The Group’s other financial assets include cash, debt investment, other receivables
       and certain derivatives, the credit risk of which is sourced from default by the
       counterparties, and the maximum risk exposure is equal to the book value of those
       instruments.

       As the clients from which the Group’s accounts receivable are receivable are scattered
       in different sectors and industries, there’s no material credit risk concentrated within
       the Group. The Group does not have any collaterals or other credit enhancements for
       the balance of its accounts receivable.

       See Notes VII. 5 and 8 for quantitative data on the Group's credit risk exposure in
       relation to receivables and other receivables.

       Criteria for significant increase in credit risk
       The Group evaluates, on each balance sheet date, whether the credit risk of related
       financial instruments has increased significantly since the initial recognition thereof. In
       determining whether the credit risk of a financial instrument has increased significantly
       since the initial recognition thereof, the Group takes into account the reasonable and
       well-grounded information that is accessible without unnecessary extra costs or
       efforts, including the qualitative and quantitative analyses based on the Group’s
       historical data, external credit risk rating and forward-looking information. The Group
       compares the risk of financial instruments defaulting on the balance sheet date and
       the risk of them defaulting on the date of initial recognition based on an individual
       financial instrument or a Group of financial instruments with similar credit risk
       characteristics to determine the changes in anticipated default risk of the financial
       instrument(s) within the duration thereof.

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                                2021 Annual Report




If a financial instrument meets one or more of the following quantitative or qualitative
criteria, the Group will determine that its credit risk has increased significantly:

(1)     The main quantitative criterion is that its probability of default within the
          remaining duration on the reporting date rises by a certain margin from that at its
          initial recognition;
(2)     The main qualitative criterion is that the debtor has materially adverse changes in
          business or financial conditions or is on the warning list of clients.

Definition of the assets whose credit has been impaired
In order to determine whether the credit of an asset has been impaired, the Group
adopts the criteria consistent with its internal credit risk management goal for related
financial instruments and also takes into account the quantitative and qualitative
indicators. The Group mainly considers the following factors while assessing whether
the credit of a debtor has been impaired:

(1)    the issuer or debtor suffers material financial difficulty;
(2)    the debtor is in breach of contract, such as breach in interest payment,
         principal repayment or overdue payment;
(3)   the creditor makes a compromise to the debtor which it would in no case make,
         based on the economic or contract considerations in connection with the
         debtor’s financial difficulty;
(4)    the debtor is very likely to go bankrupt or enter into other financial
         reorganizations;
(5)    the financial difficulty of the issuer or debtor results in the disappearance of
         the active market of the financial asset;
(6)    a financial asset is purchased or derived at a large discount and the discount
         points to the fact of credit loss having been incurred.

The credit impairment of financial assets may be caused by multiple events together
and may not necessarily be caused by an individually identifiable event.

Measurement parameters of expected credit loss
Depending on whether credit risk has increased significantly and whether credit has
been impaired, the Group makes impairment provisions for the expected credit losses
of different assets within 12 months or the entire duration. The key parameters of
expected credit loss include the probability of default, loss given default and default
risk exposure. The Group has built the models of probability of default, loss given
default and default risk exposure based on the quantitative analysis of historical data
(e.g. rating of counterparties, form of guarantee and category of collaterals or pledges,
form of repayment) and forward-looking information.

The related definitions are as follows:

  (1) The probability of default refers to the possibility that the debtor will be unable to
        fulfill its payment obligations in the next 12 months or throughout the remaining
        duration. The Group adjusts the probability of default based on the results of the
        expected credit loss model and with forward-looking information included to
        reflect the debtors’ probability of default under the current macro economic
        environment.
  (2) The default loss rate refers to the Group’s expectation on the extent of losses
        incurred due to the default risk exposure. The loss given default varies with the
        type of counterparty, the form and priority of claims and collaterals. The loss
        given default is the percentage of risk exposure loss at the time of default and is
        calculated based on the coming 12 months or the entire remaining duration.
  (3) The default risk exposure refers to the amount that the Group should pay out
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                                                              2021 Annual Report


                                  when a default occurs in the next 12 months or throughout the remaining
                                  duration.

                     The determination of significant increase in credit risk and the calculation of expected
                     credit loss both involve forward-looking information. The Group identifies the key
                     economic indicators that affect the credit risk and expected credit loss of various types
                     of businesses through the analysis of historical data.

                    The influence of those economic indicators on the probability of default and loss given
                    default varies with the type of business. The Group predicts those indicators on a
                    quarterly basis based on experts’ judgments and determines their influence on the
                    probability of default and loss given default through regression analysis.

                    The Group makes impairment provisions for the expected credit loss of accounts
                    receivable and other receivables within the coming 12 months with the simplified
                    method and general method respectively. Please refer to Notes VII. 5 and 8 for details.

                    Liquidity risk

                    The Group manages the cash shortage risk with the cyclical liquidity plan tool. The tool
                    considers not only the maturity dates of financial instruments but also the estimated
                    cash flows arising from the operation of the Group.

                    The Group aims to make use of such financing instruments as bank loans, commercial
                    papers, MTNs, corporate bonds and long-term borrowings to maintain the balance
                    between the continuity and flexibility of financing. As of December 31, 2021, 87.59%
                    (December 31, 2020: 66.99%) of the Group's debts would be due within one year.
                    The following table summarizes the analysis on the due day of financial liabilities based
                    on non-discounted contractual cash flows:
                    2021
                                                                     3 months-1 year (1 year         1 year - 5 years (5 Above
         Item                  At call           1-3 months                                                                                    Total
                                                                           inclusive)                 years inclusive) 5 years

Short-term
                               2,580,651.41     253,953,316.72              702,138,696.23                                  -      -         958,672,664.36
 borrowings
Accounts payable             433,048,081.66      60,312,347.36                                -                       -            -          493,360,429.02
Other payables             1,337,240,761.48                  -                                -          571,310,673.67            -        1,908,934,235.15
Other         current
                               4,304,034.67                      -         3,064,041,095.89                                 -      -        3,068,345,130.56
liabilities
Non-current
liabilities    due               326,666.67      50,424,666.67             3,639,370,038.05                                 -      -        3,690,121,371.39
within one year
Long-term
                               2,178,645.83       4,357,291.67               19,607,812.50               785,678,164.58            -         811,821,914.58
borrowings
Total                      1,779,678,841.72     369,047,622.42             7,425,157,642.67            1,356,988,838.25            -       10,931,064,345.06
                    2020
                                                                                                                                Above
                                                                     3 months-1 year (1           1 year - 5 years (5
        Item                  At call          1-3 months                                                                         5            Total
                                                                       year inclusive)             years inclusive)
                                                                                                                                years
Short-term
                              3,043,884.75     704,443,269.49           559,256,951.23                                  -              -    1,266,744,105.47
borrowings
Accounts payable           538,556,910.03       97,906,892.20                             -                        -                   -      636,463,802.23
Other payables           1,168,708,392.46                   -                             -           477,637,169.16                   -    1,646,345,561.62
Other          current
                              4,131,670.37    1,002,071,232.88         2,012,205,479.45                                 -              -    3,018,408,382.70
liabilities
Non-current
liabilities due within          980,000.00      51,731,333.33          1,285,433,398.48                                 -              -    1,338,144,731.81
one year
Long-term
                                868,333.33       1,736,666.67               7,815,000.00              298,671,166.67                   -     309,091,166.67
borrowings
Bonds payable                           -                    -           141,930,000.00             3,588,613,260.27                   -    3,730,543,260.27
Total                    1,716,289,190.94     1,857,889,394.57         4,006,640,829.16             4,364,921,596.10                   -   11,945,741,010.77


                    Market risks

                    Interest rate risk

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       The risk of changes in market interest rates faced by the Group is mainly related to the
       Group's long-term liabilities at floating interest rates.

       The Group manages interest costs by maintaining an appropriate combination of fixed-
       rate debts and variable-rate debts. In the long-term debts of the Group as of December
       31, 2021, there are long-term loans of RMB 282 million in total. The interest rate is
       adjusted based on the benchmark loan interest rate on that day at the end of each
       year, and will not be adjusted in the middle of the year. Therefore, the management
       believes that the risk of changes in market interest rates is relatively low.

       Foreign exchange rate risk
       The Group faces trading exchange rate risks. Such risks are caused by sales or
       purchases made by certain business units in currencies other than their bookkeeping
       currency. 0.86% (2020: 3%) of the Group's sales in the current period were
       denominated in a currency other than the functional currency of the operating unit
       where the sales occurred, while 99% (2020: 98%) of the costs were denominated in
       the functional currency of the operating unit. Considering the Group’s short time of
       inventory and timely collection of accounts receivable, the management believe that its
       foreign exchange rate risk is relatively low.

       Price risk of equity instrument investments
       The price risk of equity instrument investments refers to the risk of the fair value of
       equity securities decreasing due to the changes in stock indices and value of individual
       securities. As of December 31, 2021, the Group was exposed to the price risk of equity
       instrument investments arising from the individual equity instrument investments
       classified as the financial instruments that are measured by fair value and of which the
       changes in fair value are recognized in income in current period (Note VII. 2) or
       recognized in other comprehensive income (Note VII. 18). The listed equity instruments
       that were invested and held by the Group were listed on the Shanghai Stock Exchange
       and the Shenzhen Stock Exchange, respectively,the determination is made through
       discounting and adjustment using the trading prices of similar circulating stocks of the
       same listed company on the balance sheet date, combined with liquidity.

      The market stock indexes of the following stock exchanges at the closing point of the
      trading day that is closest to the balance sheet date, and their respective highest and
      lowest closing points during the year are as follows:


                        At the end of 2021   2021      At the end of 2020    2020
                                        Highest/lowest                 Highest/lowest
        SZSE-A Share Index       2,648 2,691/2,229         2,438        2,442/1,683
        SSE-A Share Index        3,814 3,912/3,472         3,640        3,640/2,788

      The following table indicates the sensitivity of the Group’s net profit and loss and other
      comprehensive income after tax to the change each 10% of the fair value of equity
      instrument investment (based on the book value on the balance sheet date) under the
      assumption that all other variables remain unchanged.

      2021

                                       Equity
                                                                                         Other
                                  instrument                                                      Total shareholders'
                                                      Net profit or loss       comprehensive
                                 investment                                                                   equity
                                                                           income net after tax
                                 Book value
Equity instrument investment                     increase/(decrease)       increase/(decrease)    increase/(decrease)
  Fair value increase/decrease
by10%

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 Shenzhen - Investment in the
 equity instruments that are
 measured by fair value and of
                                      642,187,968.77                            -         48,164,097.66          48,164,097.66
 which the changes in fair value
 are      recognized   in    other
 comprehensive income
 Shanghai - Equity instrument
 investment at fair value through      50,375,083.20              3,778,131.24                          -         3,778,131.24
 profit or loss

2020

                                                Equity
                                                                                                   Other
                                           instrument                                                       Total shareholders'
                                                               Net profit or loss        comprehensive
                                          investment                                                                    equity
                                                                                     income net after tax
                                          Book value
 Equity instrument investment                             increase/(decrease)        increase/(decrease)    increase/(decrease)
   Fair value increase/decrease
 by10%
 Shenzhen - Investment in the
 equity instruments that are
 measured by fair value and of
                                      662,256,342.79                                      49,669,225.71          49,669,225.71
 which the changes in fair value
 are      recognized    in    other
 comprehensive income
 Shanghai - Equity instrument
 investment at fair value through      51,712,734.31              3,878,455.07                          -         3,878,455.07
 profit or loss

3.        Capital management
         The main objective of the Group in capital management is to ensure the Group’s ability
         to continue operations and maintain a healthy capital ratio to support its business
         development and maximize the values for shareholders.
        The Group manages and adjusts its capital structure based on the changes in the
        economic situation and the risk characteristics of related assets. To maintain or adjust
        the capital structure, the Group may adjust the distribution of profits to shareholders,
        return capital contribution to shareholders or issue new shares. The Group is not subject
        to external mandatory capital requirements. In 2021 and 2020, there was no change in
        capital management objectives, policies or procedures.
XI. Disclosure of fair value
  1. Closing fair value of the assets and liabilities measured by fair value
√Applicable □Not Applicable
                                                                                                                  Unit: RMB
                                                                Closing fair value
         Item                   Level 1 fair             Level 2 fair       Level 3 fair
                                                                                                                Total
                                  value                    value               value
I. Continuous fair
value measurement
(1) Held-for-trading
                               50,375,083.20                                        25,000,000.00            75,375,083.20
financial assets
1. Financial assets
that are measured at
fair value and whose
changes are                    50,375,083.20                                        25,000,000.00            75,375,083.20
included in the
current profit and
loss
(2) Investment in
                               50,375,083.20                                                                 50,375,083.20
equity instruments
(4) Bank wealth
                                                                                    25,000,000.00            25,000,000.00
management

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                                            2021 Annual Report


products

(3) Other equity
instruments              642,187,968.77                                              642,187,968.77
investment
(vi) Other non-
current financial                       -     894,066,000.44     630,753,254.97     1,524,819,255.41
assets
Total assets
continuously
                         692,563,051.97       894,066,000.44     655,753,254.97     2,242,382,307.38
measured by fair
value


2.   Basis for determining the market prices of the items continuously and non-continuously
     measured by Level 1 fair value
√Applicable □Not Applicable
     The Group's continuous first-level fair value measurement items mainly include listed equity
instruments, whose fair value is determined based on the market quotation on the last trading day
of 2021.

3.    Valuation techniques and qualitative and quantitative information of important
      parameters for the items continuously and non-continuously measured by Level 2 fair
      value
√Applicable □Not Applicable
     The Group’s level-2 items continuously measured at fair value mainly include unlisted equity
investments and listed equity instruments with restricted sales conditions. The fair value of unlisted
equity investments is determined based on the information in the financial statements of these
unlisted companies on December 31, 2021, combined with comparable information of listed
companies in the same industry under the comparable company multiplier method. In the listed
equity instruments subject to restricted sales conditions, the valuation model is used to determine
the fair value based on the market quotation, and the important observable input value is the
liquidity discount.

4.   Valuation techniques and qualitative and quantitative information of important
     parameters for the items continuously and non-continuously measured by Level 3 fair
     value
√Applicable □Not Applicable
    The Group’s level-3 items continuously measured at fair value include equity investments and
debt investments in non-listed companies for which the comparable company multiplier method
cannot be used. The fair value of the equity investments and debt investments in non-listed
companies for which the comparable company multiplier method cannot be used are determined
under the asset-based method as of December 31, 2021.

5.   Adjustment information between the opening book value and closing book value, and
     the sensitivity analysis of unobservable parameters for items continuously measured by
     Level 3 fair value
□Applicable √Not Applicable

6.   For items continuously measured by fair value, if there is conversion between different
     levels in the current period, the reasons for the conversion and the policy for
     determining the time of conversion
□Applicable √Not Applicable

7. Changes in valuation techniques in the current period and reasons for changes
□Applicable √Not Applicable

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                                                            2021 Annual Report




  8. Fair value of financial assets and financial liabilities not measured by fair value
√Applicable □Not Applicable

       December 31, 2021
                                                                               Entries used in the fair value measurement
                                         Quotation in an active market    Important observable Important non-observable
                                                                                          Entry                     Entry
                                                              Level 1                   Level 2                   Level 3                  Total

        Bonds payable (current portion included)                             3,552,960,829.66                           3,552,960,829.66




  9. Others
√Applicable □Not Applicable
Estimate of fair value

          Fair value of financial instruments
          The table below shows the differences between book value and fair value of the Group’s
        financial instruments other than the financial instruments with very small differences
        between book value and fair value and the equity instruments that did not have an offering
        price in the active market and whose fair value could not be measured reliably:

                                           Book value                                                             Fair value
                              2021                            2020                                    2021                          2020

Financial
liabilities
Bonds payable
(current
portion
included)           3.552.960.829.66               4,584,565,819.27                         3.549.754.103.37                4,566,553,461.90


        The management have evaluated cash and cash equivalents, accounts receivable,
        notes payable and accounts payable. Their fair values were equivalent to their book
        values as their remaining terms were not long. The fair values of long-term receivables,
        other non-current assets, long and short-term borrowings and long-term accounts
        payable were determined with the discounted future cash flow method, with the market
        yields of other financial instruments with similar contract terms, credit risks and
        remaining terms as the discount rates. Their fair values were equivalent to their book
        values.
        The Group's finance department, headed by the General manager of the Group
        Finance Center, is responsible for developing policies and procedures for the fair value
        measurement of financial instruments. The General Manager of the Group Finance
        Center reports directly to the Group Finance Officer, who reports to the Audit
        Committee. On each balance sheet date, the financial department analyzes the
        changes in the value of financial instruments and determines the main input values
        applicable to the valuation. The valuation shall be reviewed and approved by the
        Group's Financial Director. For the preparation of semi-annual and annual financial
        statements, the valuation process and results are discussed with the audit committee
        twice a year.
        The fair values of financial assets and financial liabilities refer to the amounts
        determined based on the voluntary exchange of assets or repayment of debts by the
        parties to arm’s length transactions who are familiar with the transactions rather than
        forced sale or liquidation. The following methods and assumptions are used to
        estimate fair value.


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                                         2021 Annual Report


        The fair value of bonds payable is determined with the discounted future cash flow
        method, with the market yields of other financial instruments with similar contract
        terms, credit risks and remaining terms as the discount rates, and falls in Level 2. The
        significant unobservable inputs for measurement of the fair value of bonds payable are
        the prepayment rate and loss given default.
        If there are no restrictions on the sale of listed equity instruments, the fair value is
        determined at the quoted market price. In the listed equity instruments subject to
        restricted sales conditions, the valuation model is used to determine the fair value
        based on the market quotation, and the important observable input value is the liquidity
        discount. The Group believes that the fair value estimated by valuation techniques is
        reasonable and is also the most appropriate value on the balance sheet date.
        There was no significant conversion of the Group’s and the Company’s financial
        instruments measured by fair value between different levels in the current year and in
        the previous year.
XII. Related parties and related-party transactions
  1. Parent company of the Company
√Applicable □Not Applicable
                                                                                         Unit: RMB10,000
                                                                         Shareholding       Voting right
   Name of parent          Place of                         Registered
                                         Business                         ratio in the      ratio in the
     company             registration                        capital
                                                                         Company (%)       Company (%)
Yiwu China               Yiwu,          Asset                 100,000           55.33              55.33
Commodities City         Zhejiang       management
Holdings Limited

Notes on the parent company of the Company
None
The ultimate controlling party of this enterprise is the State-owned Assets Supervision and
Administration Office of Yiwu Municipal People's Government.
Other notes:
None
  2. Subsidiaries of the Company
For details of the Company’s subsidiaries, please refer to the Notes
√Applicable □Not Applicable
For details of subsidiaries, please refer to Note IX. 1. Equity in subsidiaries

  3. Joint ventures and associates of the Company
For details of the Company’s important joint ventures or associates, please refer to the Notes
√Applicable □Not Applicable
For details, please refer to Note IX. 3. Interests in joint ventures or associated enterprises

Other joint ventures or associates that have related-party transactions with the Company in the
current period or had related-party transactions with the Company in the prior year which resulted in
an outstanding amount are as follows
√Applicable □Not Applicable
                       Name of joint venture or associate                          Relationship with
                                                                                     the Company
Yiwu Shanglv                                                                            Joint venture
Redbud Capital                                                                          Joint venture
Binjiang Shangbo                                                                           Associate
Huishang Micro-finance                                                                     Associate
Zhejiang Yemai Data Technology Co., Ltd.                                                   Associate
Yiwu Meipinshu Supply Chain Management Co., Ltd.                                           Associate
EBEL ALI FREE ZONE TRADER MARKET DEVELOPMENT AND                                           Associate
OPERATZON FZCO
                                              205   / 228
                                        2021 Annual Report


Yiwu Digital Port Technology Co., Ltd.                                                Associate
Yiwu China Commodities City Property Development Co., Ltd.                            Associate

Other statements
□Applicable √Not Applicable
  4. Other related parties
√Applicable □Not Applicable
                 Name of other related party                    Relationship with the Company
                                                             Parent company of controlling
SCO                                                          shareholder of the Company’s
                                                             largest shareholder
                                                             Controlling shareholder of the
MDG
                                                             Company’s largest shareholder
                                                             Subsidiary of the Company’s
Yiwu China Commodities City Property Service Co., Ltd.
                                                             largest shareholder
                                                             Branch of Controlling shareholder
Yourworld International Conference Center Company of
                                                             of the Company’s largest
Yiwu Market Development Group Co., Ltd.
                                                             shareholder
                                                             Subsidiary of controlling
Yiwu Security Service Co., Ltd.                              shareholder of the Company’s
                                                             largest shareholder
                                                             Subsidiary of controlling
Zhejiang Xingfuhu Sports Development Co., Ltd.               shareholder of the Company’s
                                                             largest shareholder
Huangyuan Shangbo                                            Subsidiaries of joint ventures
Chengzhen Property                                           Subsidiaries of joint ventures
Gongchen Shangbo                                             Subsidiaries of joint ventures
Tonghui Shangbo                                              Subsidiaries of joint ventures
                                                             Subsidiary of the Company’s
Zhejiang Shangbo Property Co., Ltd.
                                                             largest shareholder
Handing Shangbo                                              Subsidiaries of associates

Other statements
None

5.   Related-party transactions
(1).Related-party transactions of purchasing and selling goods and rendering and
     accepting service
Purchasing goods/accepting service
√Applicable □Not Applicable
                                                                                 Unit: RMB
                                                                               Amount in
                                 Contents of related-party    Amount in the
        Related party                                                         the previous
                                        transaction           current period
                                                                                 period
Yiwu Security Service Co.,    Epidemic prevention and
Ltd.                          control and exhibition security  23,279,926.97     69,300.00
                              service fee
Yiwu China Commodities
                              Property service fee and
City Property Service Co.,                                     13,721,576.38              -
                              greening maintenance fee
Ltd.
Yiwu China Commodities
City Creative Design and
                              Design fee                         1,953,465.33             -
Development Services Co.,
Ltd.



                                               206   / 228
                                       2021 Annual Report


Selling goods/rendering service
√Applicable □Not Applicable
                                                                                             Unit: RMB
                                           Contents of related-    Amount in the        Amount in the
             Related party
                                            party transaction      current period      previous period
MDG and its branch Xingfuhu
                                           Laundering fees           1,594,054.55        1,515,186.29
International Conference Center
                                           Procurement
Meipinshu                                                                 231,822.45       310,367.07
                                           agency

Notes on related-party transactions of purchasing and selling goods and rendering and accepting
service
□Applicable √Not Applicable

(2).Entrustment/contracting from and to related parties
Entrustment/contracting to the Company:
√Applicable □Not Applicable
                                                                                             Unit: RMB
                                                Starting      Ending                     Entrustment
                                                date of       date of        Pricing of income/contra
   Name of        Name of          Type of
                                               entrustm      entrustm       entrustment cting income
consignor/empl consignee/contr entrusted/contr
                                                  ent           ent       income/contra recognized in
     oyer           actor        acted assets
                                               /contracti    /contracti    cting income   the current
                                                   ng           ng                           period
                               Entrustment of February       January      Negotiated      1,453,314.18
MDG            The Company
                               other assets    1, 2020       31, 2025     price

Notes on entrustment/contracting from related parties
√Applicable □Not Applicable
     According to the Xingfuhu International Conference Center Management Contract signed by
and between the Company and the Market Development Group, the Company is entrusted to
manage Xingfuhu International Conference Center Hotel located at No. 100, Xingfuhu Road, Yiwu
City. The hotel management fee collected during the reporting period was RMB 1,453,314.18 (2020:
RMB 1,020,591.87)

Entrusted management/contracted by the Company
□Applicable √Not Applicable
Notes on related-party management/contracting
□Applicable √Not Applicable

(3).Related-party lease
The Company as the lessor:
√Applicable □Not Applicable
                                                                                            Unit: RMB
                                                                                       Rental income
                                                   Type of       Rental income
                                                                                       recognized in
              Name of lessee                       leased       recognized in the
                                                                                        the previous
                                                    asset         current period
                                                                                           period
CCCP                                           Office                3,767,104.11                    -
                                               space
Huishang Micro-finance                         Office                     103,301.70       312,233.27
                                               space
MDG                                            Office                              -       836,793.82
                                               space
Redbud Capital                                 Office                              -       246,819.09
                                               space
Zhejiang Yemai Data Technology Co., Ltd.       Office                              -        28,793.86
                                               space
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                                        2021 Annual Report




The Company as the lessee
√Applicable □Not Applicable
                                                                                           Unit: RMB
                                                                  Rental fee          Rental fee
                                            Type of
             lessor name                                       confirmed in the     confirmed in the
                                         leased asset
                                                                current period      previous period
CCCH                                    Warehouses                  3,947,798.16                     -

Notes on related-party lease
√Applicable □Not Applicable
    The Group rent office spaces from above related parties at market prices

(4).Related-party guarantees
The Company as the guarantor
√Applicable □Not Applicable
                                                                                          Unit: RMB
                     Amount of     Starting date of the Expiry date of the    Is the guarantee
The guaranteed
                     guarantee          guarantee           guarantee           fulfilled in full
Yiwu Shanglv        145,287,733.04 July 1, 2015         December 15,       No
                                                        2026
Yiwu Shanglv          8,283,103.03 December 25,         December 24,       No
                                   2020                 2023

The Company as the guaranteed party
√Applicable □Not Applicable
                                                                                          Unit: RMB
                     Amount of     Starting date of the Expiry date of the    Is the guarantee
   Guarantor
                     guarantee          guarantee           guarantee           fulfilled in full
CCCH                  8,283,103.03 December 25,         December 24,       No
                                   2020                 2023

Notes on related-party guarantees
√Applicable □Not Applicable
      1. The Group provided guarantee for the borrowings of Yiwu Shanglv. As of December 31,
2021, Yiwu Shanglv actually borrowed RMB 296,505,600 (RMB 477,659,700 as of Dec 31, 2020)
from banks. According to the guarantee contract, the Group assumed liability for RMB145,287,700
(RMB 234,053,300 as of Dec 31, 2020). The state-owned capital operation center provided counter-
guarantee for the said loan.
      2. The Group provided Yiwu Shanglv with a loan guarantee with the maximum amount not
exceeding RMB 49 million to Yiwu Branch of Bank of Communications Co., Ltd. As of December
31, 2021, Yiwu Shanglv actually borrowed RMB 16,904,300 from the bank (December 31, 2020:
RMB 11.50 million). As agreed in the guarantee contract, the Bank of Communications Co., Ltd.
Yiwu Branch assumed a guarantee liability of RMB 8.2831 million (December 31, 2020: RMB 5.635
million). CCCH provided a counter-guarantee

(5).Related-party lending and borrowing
√Applicable □Not Applicable
                                                                                            Unit: RMB
  Related                          Starting         Maturity
                    Amount                                                    Remarks
    party                           date             date
Borrowings
Huangyuan        539,000,000.00   July 31,                      The Group allocated a total of RMB
Shangbo                           2020                          539,000,000.00 of surplus funds from
                                                                Huangyuan Shangbo in 2020, and a
                                                                total of RMB 171,500,000.00 of surplus
                                                                funds from Huangyuan Shangbo in
                                                                2021. The allocation was based on the
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                                       2021 Annual Report


                                                             share holding rate and the annual
                                                             interest rate was 0%. As of December
                                                             31 2021, RMB 102,900,000.00 has
                                                             been transferred back, and the return
                                                             date of the remaining funds would be
                                                             determined according to the capital
                                                             needs of the Huangyuan Business
                                                             Expo project.
Huangyuan        171,500,000.00   January                    Ditto
Shangbo                           26, 2021
Chengzhen         27,200,000.00   October                    In 2020, theGGroup allocated a total of
Property                          22, 2020                   RMB 27,200,000.00 of surplus funds
                                                             from Chengzhen Real Estate a total of
                                                             RMB 72,000,000.00 of surplus funds
                                                             from Chengzhen Real Estate in 2021.
                                                             The allocation was based on the share
                                                             holding rate and the annual interest
                                                             rate was 0%. The repayment date
                                                             would be determined according to the
                                                             capital needs of the Chengzhen Real
                                                             Estate project.
Chengzhen        172,800,000.00   January                    Ditto
Property                          26, 2021


 Related party          Amount         Starting        Maturity                Remarks
                                        date            date
Lending to
Gongchen             472,659,831.00   February        May    27,   In 2020, the Group provided
Shangbo                               28, 2020        2021         Gongchen Shangbo with financial
                                                                   assistance      totaling     RMB
                                                                   521,659,831.00 at the annual
                                                                   interest rate of 10%. As of
                                                                   December 31, 2021, Gongchen
                                                                   Shangbo       has     repaid  off
                                                                   successively.
Gongchen              49,000,000.00   June 22,        May 27,      Ditto
Shangbo                               2020            2021
Tonghui              743,800,000.00   November        December     In 2020, the Group provided a
Shangbo                               17, 2020        29, 2021     total of RMB1,486,368,548.00 in
                                                                   financial assistance to Tonghui
                                                                   Shangbo, and in 2021, it provided
                                                                   a total of RMB138,160,000.00 in
                                                                   financial assistance to Tonghui
                                                                   Shangbo, with an annual interest
                                                                   rate of 6.5%. Tonghui Shangbo
                                                                   has repaid RMB 743,800,000.00
                                                                   successively in 2021.
Tonghui              742,568,548.00   November                     Ditto
Shangbo                               17, 2020
Tonghui              138,160,000.00   February                     Ditto
Shangbo                               26, 2021
Handing              267,540,000.00   December        December     In 2020, the Group provided
Shangbo                               11, 2020        29, 2021     financial assistance to Handing
                                                                   Shangbo         totaling    RMB
                                                                   472,144,400.00, and in 2021, it
                                                                   provided financial assistance to
                                                                   Handing Shangbo totaling RMB
                                                                   17,845,800.00, with an annual
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                                        2021 Annual Report


                                                                  interest rate of 6%. Handing
                                                                  Shangbo     has  repaid   RMB
                                                                  267,540,000.00 successively in
                                                                  2021.
Handing               204,604,400.00    December                  Ditto.
Shangbo                                 11, 2020
Handing                17,845,800.00    May 11,                   Ditto
Shangbo                                 2021
Guoshen              1,372,000,000.00   April 19,     December    In 2019, the Group provideda total
Shangbo                                 2021          30, 2021    of RMB 451,816,700.00 of
                                                                  financial assistance to Chengzhen
                                                                  Real Estate at an annual interest
                                                                  rate of 0% or 10%. Among them,
                                                                  the annual interest rate of the
                                                                  portion beyond the shareholding
                                                                  ratio is 10%. As of December 31,
                                                                  2020, Chengzhen Real Estate
                                                                  has repaid off successively.
JEBEL    ALI           63,465,484.42    March   9,                The Group provided financial
FREE   ZONE                             2020                      assistance to JEBEL ALI FREE
TRADER                                                            ZONE        TRADER       MARKET
MARKET                                                            DEVELOPMENT                   AND
DEVELOPMENT                                                       OPERATZON         FZCO     totaling
AND                                                               RMB 63,465,484.42 in 2020, and
OPERATZON                                                         provided financial assistance to
FZCO                                                              JEBEL       ALI    FREE      ZONE
                                                                  TRADER                   MARKET
                                                                  DEVELOPMENT                   AND
                                                                  OPERATZON         FZCO     totaling
                                                                  RMB 173,102,001.51 in 2021,
                                                                  with an annual interest rate of 6-
                                                                  month average EIBOR plus 5%,
                                                                  and the financial aid repayment
                                                                  period would be determined
                                                                  according to the progress of the
                                                                  project.
JEBEL    ALI          109,636,517.09    March 31,                 Ditto
FREE   ZONE                             2021
TRADER
MARKET
DEVELOPMENT
AND
OPERATZON
FZCO

(6).Related-party transfer of assets and restructuring of debts
□Applicable √Not Applicable
(7).Remunerations of key officers
√Applicable □Not Applicable
                                                                                         Unit: RMB
                                                                            Amount in the previous
              Item                      Amount in the current period
                                                                                   period
Remunerations of key officers                              23,333,482.40             22,487,812.15

(8).Other related-party transactions
□Applicable √Not Applicable


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                                               2021 Annual Report




          6.   Accounts receivable from and payable to related parties
          (1).Receivables
          √Applicable □Not Applicable
                                                                                             Unit: RMB
                                                 Closing balance                 Opening balance
        Item            Related party                          Bad debt                       Bad debt
                                             Book balance                     Book balance
                                                              provision                       provision
Accounts
                    Tonghui Shangbo            6,200,000.00              -                  -           -
receivable
                    Yourworld
                    International
Accounts            Conference Center
                                                 369,743.93              -                  -           -
receivable          Company of Yiwu
                    Market Development
                    Group Co., Ltd.
                    Yiwu Gongchen
Accounts
                    Shangbo Property              97,351.08              -                  -
receivable
                    Co., Ltd.
Accounts
                    CCCP                           9,000.00              -                  -           -
receivable
Accounts
                    Meipinshu                                 -          -       3,791,271.51           -
receivable
Total                                          6,676,095.01              -       3,791,271.51           -
Other
receivables-
                    Gongchen Shangbo                          -          -    101,380,259.61            -
interest
receivable
Other
receivables-
                    Tonghui Shangbo           92,249,275.44              -     18,391,082.53            -
interest
receivable
Other
receivables-
                    Handing Shangbo                           -          -       1,629,868.34           -
interest
receivable
Other
                    Gongchen Shangbo                          -          -    521,659,831.00            -
receivables
Other
                    Tonghui Shangbo          880,728,548.00              -   1,486,368,548.00           -
receivables
Other
                    Handing Shangbo          222,450,200.00              -    472,144,400.00            -
receivables
Total                                      1,195,428,023.44              -   2,601,573,989.48           -
Long-term
                    Yiwu Shanglv              41,650,000.00              -     61,250,000.00            -
receivables
                    JEBEL ALI FREE
                    ZONE TRADER
Long-term           MARKET
                                             173,102,001.51              -       65,506,573.8           -
receivables         DEVELOPMENT
                    AND OPERATZON
                    FZCO
Total                                        214,752,001.51              -    126,756,573.81            -


          (2).Payables
          √Applicable □Not Applicable
                                                                                                Unit: RMB

                                                    211   / 228
                                      2021 Annual Report


    Item                     Related party                 Closing book     Opening book
                                                             balance          balance
Accounts       Zhejiang Yemai Data Technology                 176,873.43      1,944,907.37
payable
Total                                                         176,873.43      1,944,907.37
Advance from   CCCP                                           612,288.99        612,289.00
customers
Advance from   Huishang Micro-finance                           20,798.09       119,444.13
customers
Advance from   Yiwu Digital Port Technology Co., Ltd.         112,281.94        116,090.04
customers
Advance from   Redbud Capital                                   82,273.06        82,272.97
customers
Advance from   Zhejiang Yemai Data Technology Co.,                      -         7,395.00
customers      Ltd.
Advance from   Yiwu Meipinshu Supply Chain                      31,195.06        29,076.43
customers      Management Co., Ltd.
Advance from   Yiwu China Commodities City Property             32,052.85                -
customers      Service Co., Ltd.
Total                                                         890,889.99        966,567.57
Contract       Huishang Micro-finance                           7,966.42         12,609.59
liabilities
Contract       Yiwu Digital Port Technology Co., Ltd.           22,205.25         2,192.92
liabilities
Contract       Yiwu Security Service Co., Ltd.                   2,004.40                -
liabilities
Contract       Yiwu China Commodities City Property               332.00                 -
liabilities    Service Co., Ltd.
Total                                                           32,508.07        14,802.51
Other          Huangyuan Shangbo
                                                           607,600,000.00   539,000,000.00
payables
Other          Chengzhen Property
                                                           200,000,000.00    27,200,000.00
payables
Other          MDG
                                                                63,334.76       400,421.10
payables
Other          Huishang Micro-finance
                                                                33,000.00        85,000.00
payables
Other          Zhejiang Yemai Data Technology Co.,
                                                                        -        24,000.00
payables       Ltd.
Other          CCCP
                                                              240,000.00        240,000.00
payables
Other          Yiwu Meipinshu Supply Chain
                                                                57,000.00        57,000.00
payables       Management Co., Ltd.
Other          Yiwu Digital Port Technology Co., Ltd.
                                                                26,300.00        26,300.00
payables
Other          Yiwu Shangfu Chuangzhi Investment
                                                            34,000,500.00                -
payables       Center (limited partnership)
Other          Binjiang Shangbo
                                                            14,700,000.00                -
payables
Other          Yiwu Huishang Redbud Equity Investment
                                                             4,500,000.00                -
payables       Co., Ltd.
Other          Yiwu Shanglv Investment Development
                                                                75,000.00                -
payables       Co., Ltd.
Other          Gongchen Shangbo
                                                                 3,000.00                -
payables
Total                                                      861,298,134.76   567,032,721.10



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                                          2021 Annual Report


7. Related-party commitments
□Applicable √Not Applicable

8. Others
□Applicable √Not Applicable

XIII. Share-based payment
  1. Overview of share-based payment
√Applicable □Not Applicable
                                                                        Unit: Share    Currency: RMB
Total amount of equity instruments granted by the                                        2,340,000.00
Company in the current period
The total amount of equity instruments exercised                                                       -
by the Company during the current period
The total amount of the Company's equity                                                    980,000.00
instruments that have lapsed during the current
period
Scope of the exercise price of the stock options        The grant price was RMB 2.94, in 60 months
issued by the Company and the remaining period          from the date of grant registration
of the contract at the end of the period
Scope of the exercise price of other equity
instruments issued by the Company and the
remaining period of the contract at the end of the
period
Other statements
None
  2. Share-based payment settled with equity
√Applicable □Not Applicable
                                                                                             Unit: RMB
Method for determining the fair value of equity         Market price on grant day
instruments on the grant date
Basis for determining the number of exercisable         Determined based on the number of incentive
equity instruments                                      objects that have reached the assessment
                                                        target, through annual assessment on the
                                                        Company’s financial performance indicators
                                                        and personal performance indicators.
Reason for the significant difference between the
estimates in the current period and in the
previous period
Cumulative amount of equity-settled share-based                                            33,415,506.37
payments included in the capital reserve
Total amount of expenses recognized by equity-                                             33,415,506.37
settled share payments in the current period
Other statements
     On December 10, 2020, the 2020 fifth provisional general meeting of shareholders of the
Company reviewed and approved the “Plan on the Company's Restricted Equity incentive Plan
2020 (Draft)” and its summary. A total of 50,480,000 restricted shares were granted, accounting for
about 0.927% of the Company's total share capital of 5,443,214,176 shares, of which 47,920,000
shares were granted for the first time and 2,560,000 shares were reserved. During the subscription
process, 10 incentive objects voluntarily waived the restrictions to be granted to them due to
personal reasons. Therefore, 46,700,000 restricted shares were actually granted this time, and the
number of incentive objects was 395. On January 15, 2021, the Company's board of directors has
completed the registration of the first grant of restricted stocks.
     After consideration and approval at the thirty-fifth meeting of the eighth the Board of Directors
and the ninth meeting of the eighth Board of Supervisors of the Company held on August 9, 2021,
in view of the fact that among the original incentive objects granted for the first time, 6 incentive
objects including ZHAO Qitong no longer worked in the Company due to their position adjustments,

                                               213   / 228
                                          2021 Annual Report


and three incentive objects including HOU Wenbin had resigned due to personal reasons,
according to the relevant regulations of the "Incentive Plan" and the authorization of the Fifth
Provisional General Meeting of Shareholders in 2020, the Board of Directors of the Company
decided to repurchase and canceled a total of 980,000 restricted shares granted to the above nine
persons but yet to be released. The Company would repurchase and cancel the restricted shares
held by the above-mentioned 9 persons that had been granted but not yet been released at the
sum of interest calculated at RMB 2.885 per share and the fixed deposit interest rate announced by
the People's Bank of China for the same period. The total amount of restricted stock repurchase
funds this time was RMB 2.852 million , and the above-mentioned repurchase funds would all be
paid with the Company's own funds.
     On September 6, 2021, Zhejiang Zhicheng Certified Public Accountants (Special General
Partnership) issued the capital verification report (Zhe Zhi Kuai Yi Zi [2021] No. 17): The Company
has received a total of RMB 5,592,600.00 for subscription of restricted shares from 31 restricted
equity incentive objects, including RMB 2,340,000.00 in newly registered capital (share capital), and
RMB 3,252,600.00 in capital reserve. The registered capital and share capital of the Company
before the capital increase were both RMB 5,489,914,176.00, and the registered capital and share
capital after the change were both RMB 5,492,254,176.00. During this grant registration process, in
view of the fact that 3 of the incentive objects to be granted on the reserved grant date are no
longer eligible for incentive objects due to their voluntary abandonment; 31 incentive objects
actually subscribed this time, and 2.34 million shares were subscribed. On November 4, 2021, the
registration procedures for the reserved grant of restricted stocks involved in this incentive plan
were completed, and the Shanghai Branch of China Securities Depository and Clearing Corporation
Limited issued the "Securities Change Registration Certificate".
     The restricted stocks granted for the first time under the restricted equity incentive plan should
be vested in three terms from the first trading day after 24 months after the grant registration is
completed until the last trading day in 60 months after the grant registration is completed. That is,
after the vesting conditions have been satisfied, employees have the right to purchase stocks at the
vesting price. If the vesting conditions of the restricted equity incentive plan have been satisfied
during the vesting period, the incentive objects can apply for the ownership of stocks and being
listed for circulation.

3. Share-based payment settled with cash
□Applicable √Not Applicable


4. Modification and termination of share-based payment
□Applicable √Not Applicable

5. Others
□Applicable √Not Applicable

XIV. Commitments and contingencies
  1. Important commitments
√Applicable □Not Applicable
Important external commitments, nature and amount thereof as of the balance sheet dates
                                                                            Unit: RMB Yuan
     Capital commitments                         2021                              2020
Signed but not provided                           2,165,863,780.60                 1,346,968,354.17
     Investment commitments:
     In 2017, the Group’s wholly-owned subsidiary Yiwu China Commodities City Financial Holdings
Co., Ltd. (“CCCF”) and Shanghai Fuxing Industry Group Co., Ltd. (“Fuxing”) jointly established an
industry fund Yiwu China Commodities City Fuxing Investment Center (limited partnership)
(hereinafter referred to as the “FoF”). The FoF invested in 12 sub-funds including Yiwu Shangfu
Chuangzhi Investment Center (limited partnership) (“Shangfu Chuangzhi Fund”). CCCF subscribed
for capital contribution of RMB998million in the FoF as a limited partner, accounting for 49.9% of
the total capital contribution, and has paid in RMB102.92million. The unpaid portion of its
subscribed capital contribution was promised to be RMB895.08million and was not subject to a term.

                                               214   / 228
                                          2021 Annual Report


CCCF also made capital contribution of RMB9.8million (49% equity) to Yiwu China Commodities
City Investment and Management Co., Ltd. (hereinafter referred to as the “CCCIM”), which was a
general partner of the above FoF and sub-funds. Fuxing made capital contribution of 51% to and
had control over CCCIM.
     Shangfu Chuangzhi Fund raised funds of RMB823.36million in total. The FoF has subscribed
for and paid in capital contribution of RMB205.84million as a limited partner (including the above
RMB102.92million from CCCIM and the rest was contributed by Fuxing, the other limited partner of
the FoF). As the other limited partner of Shangfu Chuangzhi Fund, CCCF has separately
subscribed for and paid in capital contribution of RMB617.51million. In addition, neither the Group
nor CCCF have invested in other sub-funds of the FoF. Subsequently, Shangfu Chuangzhi Fund
made capital contribution of RMB820.54million to subscribe for the increase in the registered capital
of Hubei Provincial Asset Management Co., Ltd. to acquire 22.667% equity therein. By 2019, 9 out
of the above 12 sub-funds had been deregistered.
     In 2018, CCCF learned during its after-investment follow-up management that Fuxing and its
actual controller ZHU Yidong were suspected of having committed a criminal offense and the
22.667% equity held by Shangfu Chuangzhi Fund in Hubei Provincial Asset Management Co., Ltd.
was frozen by the Public Security Bureau of Shanghai for a term from Sep 6, 2018 to Sep 6, 2019
due to Fuxing’s contribution in the sources of the capital contribution. As of the approval date of the
financial statements, the freeze period has been extended until September 2, 2022.
     As of the approval date of the financial statements, the Group had not received any notice of
capital contribution other than the above contributions that had been made or any notice of action
involving the Group, CCCF, FoF and its sub-funds.
     In addition, as of December 31, 2021, the Group had other investment commitments totaling
RMB 1.28078 billion (December 31, 2020: RMB 201.71 million).

2.   Contingencies
(1).Important contingencies on the balance sheet dates
√Applicable □Not Applicable
                                                                              Unit: RMB Yuan
Item                                                    2021                            2020
Contingent liabilities resulting from the                158,634,169.67                973,992,539.81
guarantee provided externally
     According to relevant regulations, before the purchaser of the commercial housing sold by the
Group has obtained the property certificate, the Group shall provide the purchaser with a bank
mortgage guarantee. As of June 30, 2021, the unsettled guarantee amount was RMB 9,928,856.22
(December 31, 2020: RMB 16,170,141.08). Those guarantees would be released after the issuance
of the property ownership certificates and are thus little likely to incur losses. Therefore, the
management believed that it was not necessary to make provision for the guarantees.
     According to the resolution of the 15th meeting of the 7th Board of Directors on Jul 1, 2015, the
Group applied to the Yiwu Branch of ABC for a RMB750million loan for Yiwu Shanglv and provided
guarantee based on its shareholding ratio. The guarantee was a joint and several liability guarantee,
the maximum amount of guarantee was RMB367.5million and the term was 11 years. As of
December 31, 2021, Yiwu Shanglv actually borrowed RMB 296,505,577.63 (December 31, 2020:
RMB 477,659,739.88) from the banks in total. According to the agreement of the guarantee contract,
it assumed the guarantee liability of RMB 145,287,733.04 (December 31, 2020: RMB
234,053,272.54) for the Agricultural Bank of China Yiwu Branch. Yiwu State-owned Capital
Operation Co., Ltd. provided a counter guarantee for this guarantee.
     According to the resolution of the 19th Meeting of the 8th Board of Directors on August 13,
2020, the Group applies for a loan with a total amount of not more than RMB 100 million for Yiwu
Shanglv with the Bank of Communications Co., Ltd. Yiwu Branch and provided a guarantee in
proportion to the shareholding ratio. The guarantee method was under joint liability, the maximum
amount of the guarantee was RMB 49 million, and the guarantee period was two years, from the
date of the expiry of the debt performance period agreed in the independent contract until the date
of the expiration of the debt performance period of all last due main debt under the master contract.
As of December 31, 2021, Yiwu Shanglv actually borrowed RMB 28,404,291.89 (December 31,
2020: RMB 11,500,000.00) from banks in total. According to the agreement of the guarantee
contract, it assumed the guarantee liability of RMB 8,283,103.03 (December 31, 2020: RMB
5,635,000.00) for the Agricultural Bank of China Yiwu Branch. CCCH provided a counter-guarantee

                                               215   / 228
                                         2021 Annual Report


(2).Notes shall also be made even if the Company has no important contingencies to be
    disclosed:
□Applicable √Not Applicable

3. Others
□Applicable √Not Applicable

XV. Post-balance sheet date events
  1. Important non-adjusting events
√Applicable □Not Applicable
                                                                                       Unit: RMB
                                                                                        Issuance
                                                                                         of ultra-
                                                                                       short-term
                                                                           Effect on
                                                                                        financing
                                                                           financial
                                                                                        notes for
          Item                                Content                     status and
                                                                                       which the
                                                                          operating
                                                                                          impact
                                                                            results
                                                                                       cannot be
                                                                                       estimated:
                                                                                        Reasons
                           On February 22, 2022, the Company issued
                           the first issue of medium-term note of RMB 1
Medium Term Note           billion of Zhejiang China Commodities City
Issuance                   Group Co., Ltd. in 2022, with a term of 3
                           years and annual interest payment at an
                           interest rate of 3.29%.


  2. Profit distribution
√Applicable □Not Applicable
                                                                                       Unit: RMB
Profits or dividends to be distributed                                            400,863,014.85
Profits or dividends announced through                                            400,863,014.85
deliberation and approval


3. Sales return
□Applicable √Not Applicable

4. Other post-balance sheet date events
□Applicable √Not Applicable

XVI. Other important events
1. Correction of previous accounting errors
(1).Retrospective restatement
□Applicable √Not Applicable
(2).Prospective application
□Applicable √Not Applicable
 2. Debt restructuring
□Applicable √Not Applicable




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                                            2021 Annual Report


3.   Exchange of assets
(1).Exchange of non-monetary assets
□Applicable √Not Applicable

(2).Exchange of other assets
□Applicable √Not Applicable

4. Annuity plan
□Applicable √Not Applicable

5. Termination of operations
□Applicable √Not Applicable


6.   Information of divisions
(1).Determination basis and accounting policy of reporting divisions
√Applicable □Not Applicable
     Information of divisions is reported based on business divisions of the Group. In the
identification of region-based divisions, revenue is attributable to the divisions in the regions where
the clients are located, and assets are attributable to the divisions in the regions where the assets
are located. As the Group’s main operating activities and operating assets are both concentrated in
mainland China, it is not required to report more detailed information on region-based divisions.
     The Group’s businesses are organized and managed separately based on the nature of
business and the products and services provided. Each business division of the Group is a
business department or a subsidiary and provides the products and services that face the risk
different from that faced by other business divisions and bring the compensations different from
those brought by other business divisions. The detailed information on business divisions are
summarized as follows:
     (a) Market operation segment refers to the business that the Group is engaged in market
operation, including the collection of business space usage fees and the rent of auxiliary buildings
and office buildings;
     (b) The commodities sales division engages in the purchase and sale of goods such as export
trade;
     (c) The hotel service division engages in the operation of hotels including accommodation and
catering services;
     (d) The exhibition advertising division engages in the design, production, placement and
agency of advertisements;
     (e) Other services division covers the provision of market-related auxiliary services.
     The transfer pricing between divisions is made based on the prices offered to third parties and
the then prevailing market prices.


(2).Financial information of reporting divisions
√Applicable □Not Applicable
                                                                                        Unit: RMB million
                                                              Exhibition               Set-offs
                   Market       Sales of        Hotel                        Other
     Item                                                        and                    among     Total
                  operation      goods         service                      services
                                                              advertising              divisions
Revenue from
external               2,756        2,618             138            147        375            -   6,034
transactions
Revenue from
inter-division            15           44                6            12          49        126           -
transactions
Profits before         1,683          -42             -75              6        158          73    1,657

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                                                   2021 Annual Report


tax
Total assets            39,021             1,361             452            622                5,404      15,980       30,880
Total liabilities       23,290             1,269             523            586                1,059      10,234       16,493
Capital
                          1,493                2             190                 11              72               -     1,768
expenditures
Long-term
equity
investment in             4,606                1                -                 -            1,166              -     5,773
joint ventures
and associates


(3).If the Company does not have reporting divisions or is unable to disclose the total
    assets and total liabilities of each division, please explain
□Applicable √Not Applicable

(4).Other statements
□Applicable √Not Applicable

7.   Other important transactions and events that have influence on investors’ decisions
□Applicable √Not Applicable

8. Others
□Applicable √Not Applicable
XVII.     Notes to main items in financial statements of parent company
1. Accounts receivable
(1).Disclosure based on account age
√Applicable □Not Applicable
                                                                                                         Unit: RMB
                      Account age                                                Closing book balance
Within 1 year                                                                                        23,204,362.72
1 to 2 years                                                                                            100,234.00
2 to 3 years                                                                                            352,588.44
                         Total                                                                       23,657,185.16


(2).Categorized disclosure based on the bad debt provision method
√Applicable □Not Applicable
                                                                                                              Unit: RMB
                          Closing balance                                           Opening balance
                                    Bad debt                                                 Bad debt
           Book balance                                               Book balance
Catego                              provision                                                provision
  ry                                       Provisi      Book                                        Provisi            Book
                    Proport Amoun             on        value                  Proport Amoun           on              value
          Amount                                                     Amount
                    ion (%)       t         ratio                              ion (%)     t         ratio
                                             (%)                                                      (%)
Accoun
ts
receiva
ble for
which
bad       23,657,18               27,502               23,629,68     14,686,56                   14,988               14,671,57
                        100.00                0.12                                    100.00               0.10
debt           5.16                  .47                    2.69          5.66                      .19                    7.47
provisi
on is
made
by
Group

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                                                         2021 Annual Report


                         23,657,18        27,502             23,629,68     14,686,56           14,988           14,671,57
              Total                  /               /                                 /                  /
                              5.16           .47                  2.69          5.66              .19                7.47


             Accounts receivable for which bad debt provision is made individually:
             □Applicable √Not Applicable


             Explanation for making bad debt provision for accounts receivable by Group:
             √Applicable □Not Applicable
             Items for which the bad debts are provided for by combination: by combination of credit risk
             characteristics
                                                                                                        Unit: RMB
                                                                             Closing balance
                                Name                           Accounts           Bad debt          Provision ratio
                                                              receivable          provision                (%)
             Provision for bad debt by combination of        23,657,185.16            27,502.47                 0.12
             credit risk characteristics
                                 Total                       23,657,185.16            27,502.47                 0.12
             Standard for recognition of provision for bad debt by combination of credit risk characteristics and
             descriptions:
             □Applicable √Not Applicable


             If the bad debt provision is made according to the general model of expected credit loss, please
             refer to the disclosure of other receivables:
             √Applicable □Not Applicable
                                                                                     Unit: RMB Yuan
                                        2021                                              2020
                 Estimated book Expected            Expected        Estimated    book Expected          Expected
Account age
                 balance        in credit loss credit loss in balance in default credit loss credit loss in
                 default             rate (%)       whole duration                      rate (%)        whole duration
Within 1 year      23,204,362.72             0.01            50.87      14,267,749.52            0.01         1,350.33
1 - 2 years            100,234.00            0.29           286.13         407,254.08            0.51         2,075.80
2 -3 years             352,588.44            7.70        27,165.47                  -          13.76                  -
Over 3 years                     -         100.00                 -         11,562.06         100.00         11,562.06
Total              23,657,185.16                         27,502.47      14,686,565.66                        14,988.19


             (3).Provisions for bad debts
             √Applicable □Not Applicable
                                                                                                              Unit: RMB
                                                           Amount of change during the current
                                                                         period
                      Category       Opening balance                                                    Closing balance
                                                                                Recovery or
                                                             Provision
                                                                                  reversal
             Bad debt provision            14,988.19             50,558.20           38,043.92                27,502.47
             for accounts
             receivable
                    Total                  14,988.19               50,558.20               38,043.92          27,502.47


             In which the recovered or reversed amount is important:
             □Applicable √Not Applicable


             (4).Accounts receivable actually written off during the current period
             □Applicable √Not Applicable
             Information of write-off of important accounts receivable
                                                             219   / 228
                                        2021 Annual Report


□Applicable √Not Applicable


(5).Accounts receivable from the five debtors with the highest closing balance
□Applicable √Not Applicable


(6).Accounts receivable derecognized due to transfer of financial assets
□Applicable √Not Applicable

(7).Amounts of assets and liabilities formed by the transfer of accounts receivable and
    continuing involvement
□Applicable √Not Applicable

Other notes:
□Applicable √Not Applicable

  2. Other receivables
Presentation of items
√Applicable □Not Applicable
                                                                                      Unit: RMB
               Item                          Closing balance              Opening balance
Interest receivable                                   92,249,275.44              121,401,210.48
Other receivables                                  1,114,837,610.55            2,530,219,399.58
               Total                               1,207,086,885.99            2,651,620,610.06


Other notes:
□Applicable √Not Applicable

Interest receivable
(1). Classification of interest receivable
√Applicable □Not Applicable
                                                                                      Unit: RMB
            Item                       Closing balance                   Opening balance
Cash occupation fee for                         92,249,275.44                   121,401,210.48
receivables
            Total                                    92,249,275.44               121,401,210.48


(2). Significant overdue interest
□Applicable √Not Applicable
(3). Bad debt provision
□Applicable √Not Applicable


Other notes:
√Applicable □Not Applicable
     As of December 31, 2021, the receivable capital occupation fee was the capital occupation fee
collectable by the Company for providing financial assistance to joint ventures and associated
enterprises.




                                               220   / 228
                                           2021 Annual Report


Dividend receivable
(1). Dividend receivable
□Applicable √Not Applicable
(2). Important dividend receivable with an account age longer than 1 year
□Applicable √Not Applicable
(3). Bad debt provision
□Applicable √Not Applicable


Other notes:
□Applicable √Not Applicable

Other receivables
(1). Disclosure based on account age
√Applicable □Not Applicable
                                                                                                 Unit: RMB
                     Account age                                      Closing book balance
Within 1 year                                                                                  6,125,410.03
1 to 2 years                                                                               1,103,741,875.92
2 to 3 years                                                                                     200,000.00
Over 3 years                                                                                   5,663,633.70
Bad debt provision for other receivables                                                        -893,309.10
                      Total                                                                1,114,837,610.55


(2). Classification based on the nature of accounts
√Applicable □Not Applicable
                                                                                              Unit: RMB
      Nature of receivable               Closing book balance                  Opening book balance
Financial assistance receivable                   1,103,178,748.00                     2,480,172,779.00
from joint ventures
Receivables from self-operated                                        -                      42,493,714.00
land
Reserve                                                     267,208.49                           430,887.57
Withholdings,     deposit  and                           11,391,654.06                         7,142,019.01
margin
              Total                                 1,114,837,610.55                       2,530,239,399.58


(3). Bad debt provision
√Applicable □Not Applicable
                                                                                                Unit: RMB
                          Phase I              Phase 2                    Phase 3

                       Expected credit   Expected credit loss     Expected credit loss
Bad debt provision       loss in the     in the entire duration   in the entire duration         Total
                         coming 12        (credit has not been       (credit has been
                           months              impaired)                 impaired)

Balance on January
1, 2021
                          285,589.88                                                            285,589.88
Provision made in
the current period
                        1,305,420.60                                                           1,305,420.60
Current reversal          327,974.30                                                            327,974.30
Current write-off         369,727.08                                                            369,727.08
Balance on
December 31, 2021
                          893,309.10                                                            893,309.10
                                                 221   / 228
                                         2021 Annual Report




Significant changes in the book balance of other receivables with changes in loss provisions:
□Applicable √Not Applicable

Basis for the bad debt provision made in the current period and for assessing whether the credit risk
of financial instruments has increased significantly:
□Applicable √Not Applicable

(4). Provisions for bad debts
√Applicable □Not Applicable
                                                                                            Unit: RMB
                                     Amount of change during the current period
                     Opening                                                                Closing
   Category                                        Recovery or     Charge-off or
                     balance         Provision                                              balance
                                                     reversal         write-off
Bad debt
provision for
                     285,589.88     1,305,420.60            327,974.30     369,727.08       893,309.10
other
receivables
      Total          285,589.88     1,305,420.60            327,974.30     369,727.08       893,309.10

In which the recovered or reversed amount is important:
□Applicable √Not Applicable
(5). Other receivables actually written off during the current period
□Applicable √Not Applicable


(6). Other receivables from the five debtors with highest closing balance
√Applicable □Not Applicable
                                                                                            Unit: RMB
                                                                            Weight in the
                                                                            total closing    Bad debt
                      Nature of                                 Account      balance of      provision
     Debtor                           Closing balance
                     receivable                                   age           other         Closing
                                                                            receivables      balance
                                                                                 (%)
Yiwu Tonghui
                    Financial
Shangbo Real                            880,728,548.00         1-2 years            78.94             -
                    assistance
Estate Co., Ltd.
Yiwu Handing
                    Financial
Shangbo Real                            222,450,200.00         1-2 years            19.94             -
                    assistance
Estate Co., Ltd.
Zhejiang
Yuntong             Current                                    Over 3
                                            596,580.00                               0.05             -
Advertising Co.,    payments                                   years
Ltd.
Yiwu Haoyang
                    Current                                    Within 1
Construction                                278,106.18                               0.02             -
                    payments                                   year
Co., Ltd.
Yiwu Chengxi
Sub-district        Margin                  225,000.00         1-2 years             0.02             -
Office
      Total               /           1,104,278,434.18             /                98.97             -

(7). Receivables involving government grants
□Applicable √Not Applicable


                                              222   / 228
                                                               2021 Annual Report


                (8). Other receivables derecognized due to transfer of financial assets
                □Applicable √Not Applicable

                (9). Amounts of assets and liabilities formed by the transfer of other receivables and
                     continuing involvement
                □Applicable √Not Applicable

                Other notes:
                □Applicable √Not Applicable

                3. Long-term equity investment
                √Applicable □Not Applicable
                                                                                                                           Unit: RMB
                                   Closing balance                                                  Opening balance
   Item                             Impairment                                                        Impairment
                Book balance                            Book value           Book balance                                   Book value
                                     provision                                                         provision
Investment
in              4,190,057,937.33    570,000,000.00      3,620,057,937.33         3,727,825,391.43     570,000,000.00       3,157,825,391.43
subsidiaries
Investment
in
associates      4,625,942,083.47                 -      4,625,942,083.47         2,925,310,036.59                  -       2,925,310,036.59
and joint
ventures
   Total        8,816,000,020.80    570,000,000.00      8,246,000,020.80         6,653,135,428.02     570,000,000.00       6,083,135,428.02


                (1). Investment in subsidiaries
                √Applicable □Not Applicable
                                                                                                                           Unit: RMB
                                                                                                            Current             Closing
                                                                 Decrease in
                          Opening          Increase in the                               Closing           provision          balance of
     Investee                                                    the current
                          balance           current period                               balance              for            impairment
                                                                   period
                                                                                                          impairment           provision
Yiwu China
Commodities City
Supply Chain                   55,255.02     100,741,437.51                      -      100,796,692.53                 -                   -
Management Co.,
Ltd.
Yiwu China
Commodities City
                           50,073,398.48      51,358,314.60                      -      101,431,713.08                 -                   -
Import and Export
Co., Ltd.
Yiwu China
Commodities City
Tourism                    70,264,019.49        1,168,355.68                     -        71,432,375.17                -                   -
Development Co.,
Ltd.
Yiwu China
Commodities City
Overseas
                          100,041,073.44         749,590.26                      -      100,790,663.70                 -                   -
Investment and
Development Co.,
Ltd.
Yiwu China
Commodities City
Commerce and
                              100,000.00                   -                     -          100,000.00                 -                   -
Trade Service
Training Center Co.,
Ltd.
Zhejiang Yindu Hotel
Management Co.,             1,570,540.29        4,177,181.55                     -         5,747,721.84                -                   -
Ltd.



                                                                   223   / 228
                                                              2021 Annual Report


Yiwu China
Commodities City           81,534,944.31      19,896,768.77                     -    101,431,713.08            -                 -
Big Data Co., Ltd.
Yiwu
Comprehensive
Bonded Zone
                             6,014,844.64     12,677,291.68                     -     18,692,136.32            -                 -
Operation and
Management Co.,
Ltd.
Yiwu China
Commodities City
                             1,124,741.06      4,670,316.71                     -       5,795,057.77           -                 -
Research Institute
Co., Ltd.
Zhejiang Huajie
Investment and
                           53,121,810.63       8,738,911.49                     -     61,860,722.12            -                 -
Development Co.,
Ltd.
Yiwu China
Commodities City
Assets Operation             5,080,000.00      4,920,000.00                     -     10,000,000.00            -                 -
and Management
Co., Ltd.
Yiwu China
Commodities City           18,044,533.91        812,743.83                      -     18,857,277.74            -                 -
Exhibition Co., Ltd.
Yiwu China
Commodities City           39,221,752.54        761,983.76                      -     39,983,736.30            -                 -
Advertising Co., Ld.
Hangzhou Shangbo
Nanxing Property           50,000,000.00                  -                     -     50,000,000.00            -                 -
Co., Ltd.
Yiwu Commodities
City Gonglian             200,000,000.00                  -                     -    200,000,000.00            -                 -
Property Co., Ltd.
Yiwu Shangbo
                          300,000,000.00                  -                     -    300,000,000.00            -                 -
Property Co., Ltd.
Yiwu China
Commodities City
                          200,594,000.00                  -     150,000,000.00        50,594,000.00            -                 -
Information
Technology Co., Ltd.
Yiwu China
Commodities City
                           23,471,131.52      39,910,658.40                     -     63,381,789.92            -                 -
Logistics and
Distribution Co., Ltd.
Haicheng Yiwu
China Commodities
City Investment                43,709.21        670,688.91                      -        714,398.12            -    570,000,000.00
Development Co.,
Ltd.
Yiwu China
Commodities City
                         1,957,469,636.88    240,978,302.76                     -   2,198,447,939.64           -                 -
Financial Holdings
Co., Ltd.
Zhejiang China
Commodities City
                                        -    120,000,000.00                     -    120,000,000.00            -                 -
Group Commercial
Factoring Co., Ltd.
         Total           3,157,825,391.42    612,232,545.91     150,000,000.00      3,620,057,937.33           -    570,000,000.00



                 (2). Investment in associates and joint ventures
                 √Applicable □Not Applicable
                                                                                                                  Unit: RMB
                                                      Change in the current period                                         Closi
                                                                                                                            ng
                                                                  Investment
                                                                                                                          balan
 Investment          Opening amount                             gains or losses                          Closing amount
                                             Additional                             Declared a cash                        ce of
    Unit                Balance                                   recognized                                Balance
                                            investment                              dividend or profit                    impai
                                                                with the equity
                                                                                                                           rmen
                                                                    method
                                                                                                                             t
                                                                  224   / 228
                                                                    2021 Annual Report


                                                                                                                                provi
                                                                                                                                sion
1. Joint ventures
Yiwu Shanglv             365,830,756.91                         -        17,837,597.30                   -    383,668,354.21        -
Yiwu
Rongshang                 22,319,075.64                         -       195,068,462.30                   -    217,387,537.94        -
Property
Yiwu
Chuangcheng               11,444,786.74                         -        76,618,539.06                   -     88,063,325.80        -
Property
Others                     8,713,045.29             17,850,000.00        23,602,002.68                   -     50,165,047.97        -
Sub-total                408,307,664.58             17,850,000.00       313,126,601.34                   -    739,284,265.92        -
2. Associates
Binjiang
                         154,152,267.42                         -        17,523,961.66      137,200,000.00     34,476,229.08        -
Shangbo
Huishang Micro-
                          71,396,566.07                         -        11,428,130.57                   -     82,824,696.64        -
finance
Chouzhou
                         371,320,662.02                         -        54,700,187.22                   -    426,020,849.24        -
Financial Lease
Pujiang Lvgu
Property Co.,            370,318,840.76                         -        79,608,970.60                   -    449,927,811.36        -
Ltd.
CCCP                    1,500,517,785.02         1,225,000,000.00        60,365,490.42                   -   2,785,883,275.44       -
Others                     49,296,250.72            50,000,000.00         8,228,705.07                   -     107,524,955.79       -
Sub-total               2,517,002,372.01         1,275,000,000.00       231,855,445.54      137,200,000.00   3,886,657,817.55       -
      Total             2,925,310,036.59         1,292,850,000.00       544,982,046.88      137,200,000.00   4,625,942,083.47       -




                Other notes:
                None

                    4. Operating revenue and operating cost
                (1). Overview of operating revenue and operating cost
                √Applicable □Not Applicable
                                                                                                                     Unit: RMB
                                         Amount in the current period                        Amount in the previous period
                       Item
                                        Revenue            Cost of sales                    Revenue             Cost of sales
                Main                2,538,880,872.96        944,011,791.40               2,323,724,833.35       979,994,093.76
                business
                Other                 383,244,529.97                118,870,105.91        680,736,868.13        77,147,542.46
                businesses
                    Total           2,922,125,402.93           1,062,881,897.31          3,004,461,701.48    1,057,141,636.22

                (2). Revenue generated from contracts
                √Applicable □Not Applicable
                                                                                                                      Unit: RMB
                                           Classified by type of contract                                     Total
                Types of goods
                     The use of shops in the Commodity City and its supporting                               2,442,029,375.27
                services
                     Hotel accommodation and catering services                                                 151,717,051.19
                     Revenue from use fees                                                                     100,190,909.74
                     Other services                                                                              8,074,777.37
                Classified by business area
                     Chinamainland                                                                           2,702,012,113.57
                Classified by contract period
                     Revenue confirmed at certain time point
                     Hotel catering services                                                                   100,740,246.11
                     Other services                                                                              7,806,164.06
                     Revenue confirmed during certain time period
                     The use of shops in the Commodity City and its supporting                               2,442,029,375.27
                                                                        225   / 228
                                         2021 Annual Report


services
     Hotel accommodation service                                                       50,976,805.08
     Revenue from use fees                                                            100,190,909.74
     Other services                                                                       268,613.31
                              Total                                                 2,702,012,113.57

Description of the income from contracts:
√Applicable □Not Applicable
     The income recognized in the current year and included in the opening book value of
        contractual liabilities is as follows:
                                                                                       Unit: RMB
                   Type of contract                                 Current period
The use of shops in the Commodity City and its                                 2,252,809,691.96
supporting services
Hotel accommodation service                                                       13,367,212.91
Other services                                                                     9,059,873.51
Total                                                                          2,275,236,778.38


(3). Contract performance obligations
√Applicable □Not Applicable
     The information related to the performance obligations of the Group is as follows:
     The use of shops in the Commodity City and its supporting services
     The contractual performance obligation is fulfilled when providing the use of shops in the
Commodity City and the supporting services for business. For the use of shops in the Commodity
City and the supporting services for business, the progress of contract performance is determined
based on the number of using days of the shops. Customers usually need to pay in advance before
the use of shops in the Commodity City and the supporting services for business are provided.
     Hotel accommodation business
     The performance obligation is fulfilled when providing hotel accommodation services. For the
hotel accommodation business, the progress of contractual performance is determined based on
the number of days of stay. For hotel accommodation services, a partial deposit is collected from
the customer first, and the remaining contract price is usually collected upon the completion of the
hotel accommodation services.
     Hotel catering business
     The performance obligation is fulfilled when the hotel catering services are provided. The
contract price for hotel catering services is usually charged when the hotel catering services are
performed.
     Fixed -time paid funding services
     The performance obligation is fulfilled when the fixed-time paid funding service is provided. For
the fixed-time paid funding service, the progress of contractual performance is determined based on
the number of using days of the fund. For the fixed-time paid funding service, the contract price is
usually charged regularly as agreed in the contract.

(4). Amortization to remaining contract performance obligations
□Applicable √Not Applicable

Other notes:
     As of December 31, 2021, the transaction price allocated to the remaining performance
obligations was RMB 3,029,673,931.75. The Group expects that this amount will be recognized as
an income in the coming 5 years with the progress of relevant service provision.


5. Investment income
√Applicable □Not Applicable
                                                                                         Unit: RMB
                        Item                                Amount in the current   Amount in the
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                                              2021 Annual Report


                                                                      period                previous period
Income from long-term equity investment with the                      40,000,000.00                              -
cost method
Income from long-term equity investment                               544,982,046.87            64,824,176.63
calculated with the equity method
Investment income from disposal of long-term                                          -       551,295,000.00
equity investment
Dividend income from other equity instruments                             12,542,733.80         10,034,187.04
investment during holding period
Investment income from disposal of held-for-trading                          67,265.74             377,061.16
financial assets
Investment income from disposal of wealth                                             -            461,232.89
management products
Income acquired from other non-current financial                            728,950.32          31,738,134.32
assets during the holding period
                        Total                                         598,320,996.73          658,729,792.04
Other notes:


None


6. Others
□Applicable √Not Applicable

XVIII.    Supplements
  1. Detailed statement of current non-recurring items
√Applicable □Not Applicable
                                                                                                 Unit: RMB
                      Item                                       Amount                     Remarks
Gain or loss from the disposal of non-
                                                                    -561,416.89
current assets
Government grants that are recognized in
                                                                                    Please refer to details of
the current profit or loss, excluding
                                                                                    other income and
government grants that are closely related
                                                                  23,559,898.01     government grants
to the businesses of the Company and are
                                                                                    accounted for profit or
provided in a fixed amount or quantity
                                                                                    loss for the current period
according to the unified national standards
                                                                                    Fees paid for using fund
Cash occupation fees charged from non-                                              collected from joint
financial enterprises that are recognized in                     107,299,598.45     ventures including
the current profit or loss                                                          Tonghui Shangbo and
                                                                                    Handing Shangbo
Gain or loss from changes in fair value of
held-for-trading financial assets, derivative
financial assets, financial liabilities held for                                    Mainly due to gains or
trading and derivative financial liabilities,                                       losses from the changes
and investment income from the disposal                                             in fair value arising from
of held-for-trading financial assets,                              7,298,587.58     the holding of held-for-
derivative financial assets, financial                                              trading financial assets
liabilities held for trading, derivative                                            and other non-current
financial liabilities and other debt                                                financial assets
instruments, except for effective hedging
during the ordinary course of business
Net income from other non-operating
                                                                   3,504,923.76
activities
Other profit and loss items that meet the                          1,604,200.49

                                                   227   / 228
                                              2021 Annual Report


definition of non-recurring profit and loss
Less: effect of income tax                                       28,698,936.71
Effect of minority interest                                       1,718,948.89
                     Total                                      112,287,905.80



Explanations shall be made for the non-recurring items identified by the Company according the
Explanatory Announcement No. 1 on Information Disclosure by Companies Publicly Offering
Securities – Non-recurring Items, and for the Company identifying the non-recurring items
enumerated in the Explanatory Announcement No. 1 on Information Disclosure by Companies
Publicly Offering Securities – Non-recurring Items as recurring items.
□Applicable √Not Applicable
  2. ROE and EPS
√Applicable □Not Applicable
                                  Weighted average                         EPS
  Profits in the reporting period
                                       ROE (%)                Basic EPS             Diluted EPS
Net profits attributable to
common shareholders of the                          9.38                     0.25                 0.25
Company
Net profits attributable to
common shareholders of the
                                                    8.59                     0.22                 0.22
Company after deducting non-
recurring gains and losses

3. Differences in accounting data between foreign and Chinese accounting standards
□Applicable √Not Applicable


4. Others
□Applicable √Not Applicable



                                                            Chairman of Board of Directors: ZHAO Wenge
                             Date of approving by the Board of Directors for release: March 22, 2022


Amendment
□Applicable √Not Applicable




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