CITIC welcomes opportunity to meet PM Helen Clark

Media Release

For immediate release 20 April 2001

CITIC welcomes opportunity to meet PM Helen Clark in China

China International Trust and Investment Corporation (CITIC), the investment arm of the Chinese government, is welcoming an opportunity to meet with New Zealand Prime Minister Helen Clark today (20 April) in Beijing at 4.30 pm Beijing time.

The Prime Minister will meet with CITIC Chairman Mr. Wang Jun. Prime Minister Helen Clark is in China leading a New Zealand trade delegation to promote New Zealand’s trade with major Asian markets.

CITIC is looking forward to discussing its intent to review investment opportunities in New Zealand with a view to increased and productive trade links between the two countries.

China, New Zealand’s seventh largest trading partner, is close to becoming the world’s second largest economy.

After Russia, New Zealand is the biggest exporter of softwood forest products to China.

For the year ended June 2000, China was New Zealand’s fifth biggest export destination of forestry products. New Zealand’s wood product exports to China stood at $149,142m, while Hong Kong accounted for another $72,788m (Source: New Zealand Forest Industry ¡V Facts and Figures 2000/2001.)

International forecasts are projecting that China’s future demand for temperate forest products will increase dramatically and that New Zealand will be a major supplier.

With China’s 1999 log imports from New Zealand at 212 000 cubic metres, forecasts predict volumes nearly doubling to 400 000 cubic metres in 2000 and increasing markedly to 1200 000 cubic metres in 2002. (For further information see attached backgrounder.)

For further information, please contact:

Mi Zengxin

Executive Director & Vice President

CITIC

008610 64660088

Rachel Catanach

025 322 784

Sourced from the ECE/FAO Forest Products Annual Market Review, 1999-2000:

- China’s domestic demand for wood products is growing rapidly due to the rising standard of living of its 1.3 billion people.

- Because of extreme lack of forest resources and strong demand, China now ranks as the world’s third-largest importer of forest products, importing nearly one-third of its forest products consumption.

o Although 5 million hectares are planted per year, the forestland cover is only 17%.

o In 1998, China’s export volume of the six major wood categories was only 5.3% of its import volume.

- China’s imports of forest products over the last two decades have expanded dramatically:

o By 1999, the import value of forest products ranked first among all China’s imported commodities.

o China’s import value of forest products increased from $4.5 billion in 1991, seventh in the world, to $12.4 billion in 1997 ranking it third in the world behind US and Japan.

o In 1999, the total import value of the six chief categories of forest products was 26.5% higher than in the preceding year.

o As proportions of China’s forest product imports in 1998, paper and paperboard accounted for 58%, paper pulp and waste paper 17% and roundwood 9%.

o In 1999, import volumes of paper and paperboard (semi-finished products) rose 12.9%.

o Import volumes of round wood, such as radiata pine, and waste paper (raw material commodities) rose sharply in 1999 by 110% and 92.6% respectively.

- A structural shortage is forecast in 2010 when China is expected to import 50% of its forest products demand, of which almost 70% will be from temperate and boreal sources.

o It is estimated that by 2010 China will have to import 64.5 million cubic metres of wood, which will include 43.9 million cubic metres of temperate wood (68.1%) and include 20.6 million cubic metres of tropical wood (31.9%).

o It is projected that temperate wood will be imported mainly in the form pulp, paper and paperboard, and second in the form of roundwood.

- Based on the current situation of forest products trade in China, the distribution of forest products in the world, and the patterns of production and trade of forest products in the world, it is estimated that China will import pulp, paper products, temperate roundwood and temperate sawnwood mainly from Russia, North America, northern Europe and New Zealand.

- For the year ended June 2000, China was our fifth biggest export destination of forestry products. New Zealand’s wood product exports to China stood at $149,142m ,with Hong Kong accounting for another $72,788m.

- After Russia, New Zealand is the biggest exporter of softwood forest products to China.

Import of Logs into China (Volume 1000 cbm’s)

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000* 2001* 2002*

North America 1814 1859 1178 586 444 116 80 121 49 26 60 60 60

Russia 1505 248 100 100 50 100 85 360 1072 3945 5120 6000 6000

New Zealand 196 165 586 370 279 81 81 80 75 212 400 700 1200

South America 20

Other 391 445 329 346 338 280 184 250 350 350

* Forecast volumes

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