Q:    How is China Railway Group adapting its strategy to the current global financial crisis?
A:     In view of the present international financial crisis and new trends of the global economies, the Company will conduct in-depth analysis on the latest market and economic development trends and will strengthen the management of its internal operations and optimize its management structure so as to enhance efficiency and protect the interest of its investors.

Q:    How well did China Railway Group perform in the third quarter 2008?
A:     The Company continued to report rapid growth in its core businesses.  During the reporting period, the Company recorded revenue of RMB58.702 billion.  For the first nine months of 2008, revenue of the Company reached RMB153,916 billion, representing 85% of the total reported in the full year of 2007.  Net operating profit for the first nine months was RMB4.029 million, before the net exchange loss in respect of the H share listing proceeds, equivalent to the operating profit level of the full year of 2007.

Q:    Why did China Railway Group record higher exchange loss in 2008?
A:     The Company has recorded higher exchange loss, mainly attributable to a one-off loss from the Australian dollars deposits.  The Company will be able to minimize its exposure to the foreign exchange risks with the implementation of a number of related measures and the easing departmental control on exchange of foreign currencies.

Q:    What is China Railway Group’s overseas development strategy?
A:     The Company adheres to its development strategy of “going out”, and strives to develop its overseas business, increases the proportion of overseas business over the Company’s overall business, and further improves and fine-tunes its business mix.

Q:   How will China Railway Group improve its corporate governance?
A:     The Company has completed a self-investigation project for corporate governance, and has formulated a number of measures to improve its corporate governance, including:
(1)   the launching of the Internal Reporting System for Significant Events, which regulates the procedures for reporting, dissemination, auditing and disclosure of significant events
(2)   the amendment of the System for Administration of Connected Transactions, and the establishment and refinement of the accountability system
(3)   the increase of number of meetings of specialized committees under the board of directors, as full utilization of their consultative functions
(4)   the enhancement of the organizational structure and streamlining the management chain of the Company