In 2022, the global economy will face myriads of downside risks, including the resurgence of the pandemic caused by the rapid spread of the mutated COVID strain, Omicron, soaring inflation expectations, financial pressure from high debt levels, etc. Meanwhile, China's economic development is facing shrinking demand, supply shock, and weakening expectations. Under the global COVID-19 pandemic and the downward economic pressure, the PRC government executed comprehensive pandemic control measures and adhered to the principle of focusing on stability while seeking progress. The macro policies need to be stable and effective; the micro policies need to continue to stimulate the market; the structural policies need to focus on smoothing the national circular economy and keep the economy going in a reasonable manner. The World Bank predicts that China's economy will grow by 5% in 2022. In the face of a complex and trying economic environment, China's long-run fundamentals remain positive. The favourable conditions for building a new development landscape remain unchanged, with new economic growth points continuing to emerge.
At the Central Economic Work Conference of the PRC government held in December 2021, the position that “housing is for living in, not for speculation” was reiterated. The PRC government will strengthen the guidance of expectations, explore new development models, facilitate both property rental and purchase, and accelerate the development of the long-term rental market. Moreover, it will promote the construction of affordable housing, support the commodity housing market to better meet the reasonable housing demands, and implement city-specific policies to foster a virtuous circle and healthy development of the real estate industry. The real estate industry will still play a stabilising role in China's economic development. Going forward, it is expected that the PRC government will continue to maintain the consistency and stability of its overall policies on the real estate market. Generally, the sound fundamentals of China's economy in the long run coupled with steady property development and investment will continue to facilitate the steady and healthy development of China's residential and commercial property sectors. The real estate industry will no longer rely on the quantity-driven development that focuses on “high leverage and high turnover”; instead, it will continue to innovate business models and put more emphasis on product quality, so as to better meet the buyers' reasonable demands.
With the full implementation of the development strategies in the Greater Bay Area, it has maintained a good momentum in economic growth and becomes the most attractive city cluster in China. The 14th Five-Year Plan strengthens the linkage between Guangzhou and Shenzhen and facilitates the integrated development of industries and transportation on the east and west sides of the Pearl River Estuary, with the aim of building the Greater Bay Area into a world-class bay area, which will offer a solid foundation for the development of the real estate industry. The development of the land market in 2022 is expected to remain stable, with the overall market popularity continuing to be at a low level. The land auction rules may continue to be optimised, and the city differentiations will be further highlighted. With the loosening of credit and the policies of maintaining stability, the demand in the Greater Bay Area remains resilient. The market is expected to recover in 2022, with the transaction volume rising slightly, which is conducive to the healthy development of the real estate industry in the Greater Bay Area.
The Group's projects such as the Shenzhen GDH City, Guangzhou Yungang City, Guangzhou Laurel House, Zhuhai Jinwan, Jiangmen Chenyuan Road, Jiangmen Ganhua, Huizhou Dayawan, Foshan Laurel House and Zhongshan GDH City are all located in the core cities of the Greater Bay Area and will benefit from the strong development momentum of the area.
The Group will continue to seek progress while maintaining stability, make every effort to complete the construction, sales and operation of the existing projects, and leverage its status as a provincial stateowned enterprise and the resource advantages of its shareholders to seize business opportunities and innovate project development models. Through high-quality project mergers and acquisitions, cultivation of redevelopment projects, and strategic cooperation projects, the Group will continue to seek exceptional development opportunities in the Greater Bay Area. It will also continue to promote lean management, position itself strategically as “the influential, comprehensive development expert in the Greater Bay Area”, adhere to the spirit of ingenuity, and continuously create mid-to-high-end products that meet the needs of the markets and customers, so as to further strengthen the Company's management in real estate development and operation, boost the brand awareness and reputation, and enhance the Company's competitiveness in the industry under the management-driven era.
Under the leadership of the Board, the Group is confident in the prospect of its business development and will actively promote the development of its property business in order to create greater returns for its shareholders as we did in the past.