Interim Report 2023

5 INTERIM REPORT 2023 GENERAL OVERVIEW In the first half of 2023, as global economic uncertainty increased, economic recovery remained sluggish. Geopolitical frictions persisted while high inflation and high inventories inhibited consumer demand in the developed countries. Interest hikes in European countries and the United States slowed down the growth of investment and expansion in emerging markets. China and the United States entered a new round of tug-of-war in the high-tech field. In accordance with the “World Economic Outlook” report published by the International Monetary Fund (“ IMF ”) in July 2023, the global economy was expected to grow by 3.0% in 2023, representing a decrease of 0.5 percentage point as compared with 2022, of which the developed economies were projected to grow by 1.5%, down 1.2 percentage points year-on-year; and the emerging market and developing economies were projected to grow by 4.0%, representing a flat growth as compared with 2022. With reference to the report of the U.S. Department of Commerce, the gross domestic product (“ GDP ”) of the United States increased by 2.4% in the second quarter of 2023, higher than 2% in the first quarter. According to the data from the Eurostat, the GDP of the Eurozone increased by 0.3% quarter-on-quarter in the second quarter of 2023, of which the GDP of Germany remained flat quarter-on-quarter and France increased by 0.5% quarter-on-quarter. The economic situation in Japan was relatively complicated. Though some indicators such as industrial output value in June 2023 have rebounded beyond expectations, the economic and financial conditions of Japan remained uncertain. South Korea’s economic growth in the second quarter was better than expected with a year-on-year GDP rise of 0.9%, which was the same as the first quarter. In respect of global trade, IMF expected that the global trade growth for 2023 would be 2.0%, down 3.2% year-on-year. Against the backdrop of sluggish commodity consumption, increasing uncertainties in the future geopolitical economic situation, weak productivity growth and more challenging financial environment, enterprises would scale down their investments in production capacity. In the first half of 2023, confronted with the complex and severe external environment, the general tone of seeking progress while maintaining stability has been adhered to in China and its economy rebounded generally with steady improvement of import and export trade, which met expectations. According to the data from the National Bureau of Statistics of China, the GDP of China for the first half of 2023 amounted to RMB59.30 trillion, representing a year-on-year growth of 5.5% at constant prices. However, with the weak recovery of the world economy, the sluggish investment in global trading, and rising risks of unilateralism, protectionism and geopolitics, the impact of dropping external demand on China’s trade was still continuing. According to the statistics of the General Administration of Customs of China, the total value of China’s export and import trade amounted to RMB20.1 trillion in the first half of 2023, representing an increase of 2.1% over the corresponding period last year, of which the exports amounted to RMB11.46 trillion, up by 3.7% year-on-year; and the imports amounted to RMB8.64 trillion, down by 0.1% year-on-year. The trade surplus was RMB2.82 trillion, which expanded by 17.4%. In US dollar terms, China’s total imports and exports amounted to US$2.92 trillion, down by 4.7%.