1. Government statistics 2. Government report, dated Q4 2023. 3. China Daily Online article, dated 12 December 2023. 4. Ministry of Tourism and Culture of PRC article, dated 25 December 2023. 5. People’s Bank of China article, dated June 2023. 6. China Economics Online article, dated 28 September 2023. 7. Xinhua News Online article, dated 21 May 2023. MARKET OUTLOOK In 2023, China, the world’s secondlargest economy, achieved 5.2% year-on-year (“YoY”) GDP growth, higher than the 3.0% growth in 20221, due to consumer’s release of pent-up demand during the pandemic. China is expected to become the world’s largest economy due to its steady economic performance. Despite stellar performance in overall GDP growth, China's depressed property sector has yet to improve. Property investments fell 9.6%2 YoY and property sales by floor area also dropped 8.5%2 in 2023. However, the property sector is expected to stabilise when real estate policies such as lower downpayment ratio and mortgage interest rates, all aimed at boosting the real estate sector, take effect. China also firmly continued the construction plan of its extensive HSR network. At the end of 2023, the length of China’s operational railways exceeded 155,500 kilometres (“km”), including 43,700 km of HSR. The investment in the railway network of RMB 640.7 billion grew 7.4% YoY3. The growing connectivity enables Perennial Holdings’ developments to serve a wider catchment from neighbouring cities. Additionally, the tourism sector steadily recovered from the pandemic with a 93.3% increase in tourists, reaching a total of 4,891 million last year4. During the eight days of the Mid-Autumn Festival and National Day holidays, the number of tourists reached 826 million, a 4.1% increase compared with preCOVID levels in 2019. As a post-pandemic measure to boost the economy, China’s government lowered the market-based benchmark lending rate in 20235, which is expected to reduce financing costs, stimulate credit demand and strengthen the growth momentum of consumption and investments. These measures could lower the financial costs of Perennial Holdings’ projects and enable the Company to grow from the potential boost in tourism and healthcare amid a low-interest rate environment. As for the healthcare sector, the government rolled out various initiatives to support social, medical, and eldercare services on top of basic insurance coverage for the elderly and people with disabilities. These measures will assist China’s growing silver population, of which those aged 60 or older numbered more than 297 million in 20236. One such initiative was “Recommendations on Improving Basic Elderly Care Service”7, which was rolled out in 2023 to improve the basic elderly care service system and better guarantee the wellbeing of seniors. With growing interest in eldercare services, Perennial Holdings will closely monitor the developments and look forward to bolstering the strength of its healthcare portfolio. MARKET REVIEW In 2023, Perennial Holdings made good headway across its real estate, healthcare and hospitality businesses. Integrated Approach Drives Synergy in Ecosystems Across China During the year, Perennial International Healthcare and Medical Hub Chengdu (“PIHMH Chengdu”), part of the Chengdu HSR TOD that is connected to Chengdu East HSR Station, celebrated its fifth anniversary. PIHMH Chengdu is Perennial Holdings’ first-generation healthcare-centric HSR TOD, which is comprised predominantly of medical and healthcare-related tenants. The fifth anniversary celebration was graced by Guest-of-Honour Dr Tan See Leng, Singapore’s Minister for Manpower and Second Minister for Trade and Industry, as well as various government officials and business partners from China and Singapore. Over time, PIHMH Chengdu has gained recognition as one of the top healthcare hubs in Chengdu. As at Perennial International Healthcare and Medical Hub Chengdu OVERVIEW PERFORMANCE SUSTAINABILITY FINANCIALS APPENDIX 55 ANNUAL REPORT 2023
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