1. WORLD TRADE GROUP. LLP. WORLD TRADE GROUP, LLP and Rogers Towers, P.A. China Trade & Business Putting the Pieces Together Present

2. WORLD TRADE GROUP. LLP. WORLD TRADE GROUP, LLP.

3. WORLD TRADE GROUP. LLP. WORLD TRADE GROUP, LLP.

4. 2003 Economic Overview

5. WORLD TRADE GROUP. LLP. China Economic Indicators

6. WORLD TRADE GROUP. LLP. Comparative GDP Growth ( China = 3.9 % of global GDP 15 % of global growth )

7. WORLD TRADE GROUP. LLP. Asia-Pacific Economic Growth

8. WORLD TRADE GROUP. LLP. Year 2003 Comparative Data ChinaIndiaGermanyJapanUS GDP (bil) $5,700GDP$2,660GDP$2,184GDP$3,550GDP$10,400 GDP pp $ 4,400 GDP pp $ 2,540 GDP pp $ 26,600 GDP pp $ 28,000 GDP pp $ 37,600

9. WORLD TRADE GROUP. LLP. Manufacturing – 35% of GDP Manufacturing – 35% of GDP Exports – 26% of GDP Exports – 26% of GDP Infrastructure expansion Infrastructure expansion Foreign investment Foreign investment Domestic consumption Domestic consumption Capital Markets Capital Markets Market sectors driving growth

10. WORLD TRADE GROUP. LLP. New Milestones -- 2003  9% GDP growth – largest globally  16% increase in domestic investment  #1 in foreign investment - $53.5 billion  #1 in cell phone users – 258 million  #2 in Internet users – 60 million  #4 in auto sales – 3.2 million  Foreign investment in stock markets  Allowing investment outside China

11. WORLD TRADE GROUP. LLP. Foreign Corporate Expansions Walmart Walmart Kfc / Pizza Hut Kfc / Pizza Hut Heinz / P&G Heinz / P&G MacDonalds MacDonalds Office 1 Superstore Office 1 Superstore Home Depot Home Depot Honda / Toyota / VW GM / Ford / Mitsubishi Honda / Toyota / VW GM / Ford / Mitsubishi Intel Intel Microsoft Microsoft Dell Dell Motorola Motorola Computer Associates Computer Associates DuPont DuPont Rockwell Rockwell Toshiba Toshiba

12. WORLD TRADE GROUP. LLP. New Expansion into China Multinationals Multinationals Second-tier OEM manufacturers Second-tier OEM manufacturers Mid-sized and small manufacturers Mid-sized and small manufacturers Start-ups Start-ups Service sector Service sector

13. China Foreign Trade

14. WORLD TRADE GROUP. LLP. China’s Trade with the World (Billion USD)

15. WORLD TRADE GROUP. LLP. US Trade with China (Billion USD)

16. WORLD TRADE GROUP. LLP. China’s Major Exports - 2003 Apparel, clothing & footwear Apparel, clothing & footwear Electrical equipment & parts Electrical equipment & parts Machinery & parts Machinery & parts Textiles & yarn Textiles & yarn Chemical industrial products Chemical industrial products Furniture, house wares Furniture, house wares toys, handicrafts toys, handicrafts Food stuffs Food stuffs

17. WORLD TRADE GROUP. LLP. China’s Major Imports - 2003 Electrical equipment & parts Electrical equipment & parts Machinery, parts & transportation equip. Machinery, parts & transportation equip. Crude oil and fuels Crude oil and fuels Iron and steel Iron and steel Airplanes Airplanes Plastics and plastic articles Plastics and plastic articles Services ?? Services ??

18. WORLD TRADE GROUP. LLP. China’s Leading Markets

19. WORLD TRADE GROUP. LLP. Florida Trading Partners (yr.2003 exports)

20. WORLD TRADE GROUP. LLP. Florida Trading Partners: GDP Growth

21. WORLD TRADE GROUP. LLP. China’s Work Force

22. WORLD TRADE GROUP. LLP. 2003 Manufacturing Wages: Hourly Compensation Costs

23. WORLD TRADE GROUP. LLP. 2003 Annual Wages (USD) China Major Cities v. Mexico Guangzhou$ 2,750 Shanghai$ 2,630 Beijing$ 2,313 Tianjin$ 1,728 Chongqing$ 1,150 Mexico$ 7,322

24. WORLD TRADE GROUP. LLP. China’s Work Force Allocation (percentage of work force)

25. WORLD TRADE GROUP. LLP. China’s Labor Supply 19992000200120022003 Labor cost USD / hour 0.420.440.440.50.61 Recorded Unemployment * 5.507.06.0????8.0????10.0???? * Does not include 150 mil. Underemployed in rural areas

26. WORLD TRADE GROUP. LLP. Labor Over-Supply At current GDP growth rate: 8 million new jobs / yr Current annual rate of new workers: 12 million / yr.

27. WORLD TRADE GROUP. LLP. Internal Developments

28. WORLD TRADE GROUP. LLP. New Leadership Hu Jintao Hu Jintao –President & Chairman of Central Committee –Rejuvenation of Party –Continuation of private sector expansion –“Spreading the growth” to inner Provinces –Social security and health care benefits –Fighting corruption –Expanding influence in World politics –Taiwan

29. WORLD TRADE GROUP. LLP. Major Government Initiatives Public Housing Public Housing Private Home ownership Private Home ownership Transportation Transportation Telecom / Internet Telecom / Internet Water / sewer / garbage Water / sewer / garbage Environmental clean-up Environmental clean-up 3-Gorges Dam 3-Gorges Dam Gas Pipeline Gas Pipeline

30. WORLD TRADE GROUP. LLP. Continued WTO – Related Changes Tariffs Tariffs Quotas and other non-tariff barriers Quotas and other non-tariff barriers Anti-dumping / overproduction Anti-dumping / overproduction Enhanced IP protection and enforcement Enhanced IP protection and enforcement Transparency rules and systems Transparency rules and systems Accelerated Clean up of banking and securities markets Accelerated Clean up of banking and securities markets Service industries – continued expansion Service industries – continued expansion

31. WORLD TRADE GROUP. LLP. Expanding Services Sales and distribution Sales and distribution 3 rd party Logistics 3 rd party Logistics Telecom Telecom Banking and finance Banking and finance Insurance Insurance Construction and development Construction and development Project consulting Project consulting Engineering Engineering Architecture Architecture Environmental Environmental Legal services Legal services Education / training Education / training Travel services Travel services Employment agencies Employment agencies Franchising Franchising

32. WORLD TRADE GROUP. LLP. Continuing Challenges Resistance & confusion re WTO changes Resistance & confusion re WTO changes WTO Transition -- economic impact WTO Transition -- economic impact Clean up of Banks and SOE’s Clean up of Banks and SOE’s Enforcement - Open markets / IP Enforcement - Open markets / IP Legal system overload Legal system overload Labor abuses Labor abuses Currency evaluation Currency evaluation Economy overheating Economy overheating

33. Succeeding in China

34. WORLD TRADE GROUP. LLP. Success in China = ………..the PANDA formula Lots of Patience Lots of Patience The Assistance of qualified pros The Assistance of qualified pros A trusted Network of friends and alliances A trusted Network of friends and alliances Attention to Detail Attention to Detail The right Attitude The right Attitude

35. WORLD TRADE GROUP. LLP. WORLD TRADE GROUP, LLP and Rogers Towers, P.A. China Trade & Business Putting the Pieces Together Present

36. WORLD TRADE GROUP. LLP. Conducting Market Analysis Government info – MOFTEC, NBS, etc. Government info – MOFTEC, NBS, etc. US Dept. Commerce - FCS US Dept. Commerce - FCS US Dept. of State – background notes US Dept. of State – background notes US Industry Groups US Industry Groups Private consultants Private consultants –Analytical studies –Surveys and Questionnaires –Investigation & Intelligence –Sampling & Taste Tests

37. WORLD TRADE GROUP. LLP. Legal Representation in China Domestic law firms Domestic law firms Foreign law firms Foreign law firms Law firm networks and affiliates Law firm networks and affiliates Advice: Deal with who you know !!

38. WORLD TRADE GROUP. LLP. Miscellaneous Issues Who am I really dealing with ? Who am I really dealing with ? Referrals to “Friends” Referrals to “Friends” Who is in charge ? Who is in charge ? Public corruption Public corruption Language & document translation Language & document translation “Contract” = a living document “Contract” = a living document Cultural differences Cultural differences

39. WORLD TRADE GROUP. LLP. China’s Big 3 Big Three Trading Centers