Survey Shows More Mainland China Manufacturers Expect to Raise Export Prices in 2007, Express Stronger Outlook for Higher Export Growth

Survey Shows More Mainland China Manufacturers Expect to Raise Export Prices in 2007, Express Stronger Outlook for Higher Export Growth

March 27, 2007

    HONG KONG, March 27 /Xinhua-PRNewswire/ -- Seventy-six
percent of mainland China manufacturers expect to increase
export prices in 2007 according to Global Sources' (Nasdaq:
GSOL) Fourth Bi-Annual China Supplier Survey.  This compares
with 70 percent in Global Sources' previous survey for the
first half of 2006.

    (Logo: http://www.xprn.com.cn/xprn/sa/200703271450.JPG
)

    For this survey, Global Sources conducted in-person and
phone interviews with 509 mainland China exporters.

    The China Supplier Survey aims to give buyers who
source from the region a look at pricing, capacity and
production trends in the next 12 months. The Survey is free
to download at
http://www.globalsources.com/SITE/CSSURVEY.HTM .

    "Price competition is the top concern among
mainland China's exporters," said Global Sources'
general manager of Content Development, Michael Kleist. 

    "Another major challenge is the cost of key raw
materials.  The greatest increase was seen in brass, which
last year tripled from its May 2005 level."

    Among the surveyed suppliers' biggest challenges
ahead:

    -- 35 percent cited price competition;
    -- 34 percent indicated higher material costs;
    -- 16 percent said design copying/piracy;
    -- 11 percent cited labor shortages; and
    -- 5 percent said stricter overseas standards.

    Kleist added: "Despite higher costs and lower
margins, most manufacturers are planning to limit prices
increases to less than 10 percent to compete for buyer
orders."

    "Most manufacturers have indicated that the
appreciation of the yuan is not a major concern.  It only
has a small impact on the cost of finished goods and can
easily be overcome by strengthening competitive advantages
in other areas."

    Positive outlook: 78 Percent Expect Large Sales
Increases vs. 68 Percent in Last Survey

    Kleist said: "Suppliers are more positive about
export growth than in the first-half 2006 survey. 

    "In this survey, 78 percent said they expect sales
will increase by 5 percent or more in the coming 12 months. 
In the previous survey, only 68 percent projected this level
of growth.

    "Additionally, more than 41 percent of respondents
plan to increase production capacity by more than 20
percent.  That compares with just 32 percent planning such
increases in the previous survey.

    "With sales targets and capacity plans up
significantly from the last survey, it would appear Chinese
suppliers feel they can maintain solid growth despite higher
prices," said Kleist. 

    Nearly Half of Manufacturers Targeting Exports to the
EU

    Kleist said: "Because shipments to the EU generate
the highest margins, nearly half of manufacturers are
focusing on exports to the region.

    "Even the higher cost of complying with the EU
Restrictions on Hazardous Substances (RoHS) hasn't deterred
suppliers.  In fact, many medium and large exporters welcome
the restriction as an opportunity to grow exports, as
competitors unable to meet the requirements drop
out."

    Among suppliers' export targets for the next 12
months:

    -- 49 percent plan to target the EU;
    -- 25 percent plan to focus on the US;
    -- 10 percent plan to target Asia; and
    -- 7 percent plan to focus on the Middle East/Africa

    The remaining 9 percent expect to focus on European
(non-EU) and other countries.    

    Manufacturers surveyed produce air conditioners,
automotive lights, ceiling light fixtures, eyewear, leather
garments, massagers, pet products and solar panels.

    Specialized Global Sources trade magazines, websites
and China Sourcing Fairs 

    The China Supplier Survey's data was compiled from 10
of Global Sources' China Sourcing Reports (
http://www.chinasourcingreports.com ), part of the
company's product and sourcing information services which
include Global Sources trade magazines, Global Sources
Online ( http://www.globalsources.com ), Global Sources
Direct ( http://www.globalsourcesdirect.com ) and the China
Sourcing Fairs ( http://www.chinasourcingfair.com ).  For
more information about Global Sources, visit
http://www.corporate.globalsources.com .

    About Global Sources 

    Global Sources is a leading business-to-business (B2B)
media company and a primary facilitator of two-way trade
with Greater China.  The core business is facilitating
trade from Greater China to the world, using a wide range
of English-language media.  The other key business segment
facilitates trade from the world to Greater China using
Chinese-language media. 

    The company provides sourcing information to volume
buyers and integrated marketing services to suppliers.  It
helps a community of over 560,000 active buyers source more
profitably from complex overseas supply markets.  With the
goal of providing the most effective ways possible to
advertise, market and sell, Global Sources enables
suppliers to sell to hard-to-reach buyers in 230
countries.

    The company offers the most extensive range of media
and export marketing services in the industries it serves. 
It delivers information on 1.8 million products and more
than 150,000 suppliers annually through 13 online
marketplaces, 11 monthly magazines, over 100 sourcing
research reports and nine specialized trade shows which run
22 times a year across seven cities. 

    Suppliers receive more than 10 million sales leads
annually from buyers through Global Sources Online (
http://www.globalsources.com ) alone.

    Global Sources has been facilitating global trade for
36 years.  In mainland China it has over 1,600 team members
in 44 locations, and a community of over 1 million
registered online users and magazine readers for
Chinese-language media. 


    For more information, please contact:

    Global Sources Press Contact in Asia:	
     Camellia So	
     Tel:   [phone]	
     Email: [e-mail] 	
	
    Global Sources Investor Contact in Asia:	
     Eddie Heng	
     Tel:   [phone]	
     Email: [e-mail]	

    Global Sources Press Contact in U.S.:
     James W.W. Strachan 
     Tel:   [phone]
     Email: [e-mail] 

    Global Sources Investor Contact in U.S.:
     Moriah Shilton & Cathy Mattison
     Lippert/Heilshorn & Associates, Inc.
     Tel:   [phone]
     Email: [e-mail]