Annual Report 2021

Management Discussion and Analysis 30 CHINA MERCHANTS PORT HOLDINGS COMPANY LIMITED In respect of overseas business, the Group will continue to optimize its overseas presence. Leveraging the regional influence of overseas terminals, the Group will strengthen regional market expansion, and continue to promote port- vicinity industry projects. Through improving overseas management systems to enhance the management efficiency for overseas projects, the Group will strive to strengthen the risk prevention and control, quality and efficiency of overseas terminals, and improve the income stream of overseas business. In terms of comprehensive development, the Group will closely adapt to the changes in the global trade environment, strive to become an important link between domestic and foreign economic cycles, and a cornerstone for the security and stability of the industrial supply chain. The Group will accelerate the building of a mature model of integrated development business of “Port-Park-City” to realize the long-term benefits for “land economy” of the ports. Apart from improving quality of services to existing customers and increasing customer stickiness, the Group will enhance the capability to cultivate and support hinterland industries. Regarding innovative development, the Group will focus on industrial transformation and upgrade driven by innovation and technology empowerment. Leveraging on the “Research Institute of CMPort for Technological Innovation and Development”, the Group will develop the ecosystem for technology and innovation, and generate innovative solutions with technology for ports to build the integrated platform for industry, education and research. Through “CMCore” platform, the Group will develop three major leading products for the industry, including Container Terminal Operation System (CTOS), Bulk Cargo Terminal Operation System (BTOS) and Logistic Park Operation System (LPOS), striving to intelligentise the operation within the terminals. The “CM ePort” platform will innovate the service models by improving the information service system and adopting the “Port + Internet” approach for the port, so as to explore and develop an open platform for intelligent ports. As for capital operation, the Group constantly strives to explore solutions to optimize asset structures in order to reduce the investment risks. In line with the strategies of the Group and promotion of dual-wheel drive model of “asset management + capital operation”, starting from the direction of “asset-heavy to asset-light” and “quantity-oriented to quality-oriented”, the Group will strive to improve capital operation plans, asset allocation and endogenous growth in order to enhance returns of each assets. In respect of operation management, the Group will continuously reach the world’s first-class standards as its benchmarks and enhance overall operation and management. Focusing on the Group’s strategies, the Group will strengthen management and control optimisation for improvement of management efficiency. By continuously deepening the smart operation management platform system to push the construction of management standards for operations, the Group will accelerate the development of an international operation and management system that sustainably creates value, as well as a value-oriented management headquarters. In terms of marketing and commerce, the Group will continue to strengthen the cooperation with major shipping companies and enhance the interaction with end-customers. Simultaneously, the Group will improve the construction of the market commerce system, building up a collaboration platform of integration, platformisation and digitalisation, and expanding the coverage of the logistics supply chain through both internal and external development. In 2022, due to the COVID-19 pandemic and supply chain disruptions, uncertainties in foreign trade and imports and exports still remain, but the gradual recovery of the global economy is expected to continue to drive demand for maritime transport. China has been driving for a higher level of opening up and strengthening momentum in the commodity import and export, and it is expected to energize and provide opportunities for port business development. Meanwhile, the new digitalisation technology will also continue to be a new driver for the Group to build world- class ports. The Group will proactively grasp the opportunities of the times, enhance its core capability and maintain strategic focus. The Group will strive to maximize the interests of shareholders as always, and create more returns for shareholders while generate higher value for all stakeholders.