1. 1 Primary strategic responses to current global economic crisis Only 20% of the respondents said cost cutting is their primary strategic responses to the current global economic crisis. More suppliers are hoping to shift to the high-end market by building brands (21%) and increasing efficiency and product quality (22%) Reliance on China domestic market is low (10%) Source ： A survey conducted by Chief Executive China during January 21, 2009 – February 18, 2009 with over 8,900 responses from China manufacturers engaged in domestic and export trade.

2. 2 Chief Executive China survey A survey of C-level users within the Chief Executive China community in late January 2009 Breakout of 784 responses from manufacturers and traders 59% of the respondents are exporters Domestic trade only Export more than 80% Export between 50-80% Export less than 50% Survey: 2009 Outlook for manufacturers

3. 3 Expected total 2009 revenue Negative expectation: 29% surveyed manufacturers expect their total 2009 revenue to fall –Up 12% from a survey conducted in October 2008 However, 47% expect growth of 10% or more in 2009 or more

4. 4 Expected total 2009 revenue by export enterprises Among 202 export enterprises 39% see overall sales decline for 2009 36% expect growth of 10% or more in 2009

5. 5 5 Expected domestic sales change in 2009 by exporters 30% expect flat or declining domestic sales for 2009

6. 6 6 2009 Biggest growth markets expected by exporters

7. 7 Expected total 2009 revenue by domestic enterprises 191 responded suppliers are from manufacturers and traders engaged primarily in domestic sales, among them 27% see overall sales decline for 2009 57% expect growth of 10% or more in 2009

8. 8 Product quality Raw material cost Production efficiency Currency appreciation Pricing pressures Wage inflation Labor issues R&D costs Product quality Raw material cost Production efficiency Currency appreciation Pricing pressures Shipping cost Capacity utilization Environmental regulations Direct material cost Wage inflation Labor issues Product standards R&D costs Primary issues affecting competitive strength