In 2008, the Company faithfully and sincerely performed its social responsibilities in contributing to the community. Confronted with the snowstorms in the southern region of China and the Wenchuan earthquake, the Company, with a strong sense of responsibility and mission, made rapid responses and careful arrangements to best ensure unblocked communications and to implement post-disaster reconstruction works. The Company also took up the historic mission of providing services during the Olympic Games. During the year, the Company actively participated in the support of various social community events in areas such as poverty alleviation and education, so as to drive the harmonious development of the PRC telecommunications industry and society as a whole.

Fulfill corporate social responsibility by relieving snowstorm disasters and maintaining communications

The freezing rain and snowstorm disasters which occurred in mid- January 2008 caused severe damage to communication networks in most areas of the southern region of China. During the disaster relief period, the Company sent a total of 166,568 individuals for emergency rescue and disaster relief, and transported a large amount of relief supplies totaling RMB28 million in value to the disasterstricken provincial company in the southern region. At the same time, the Company sent a total of 447 million emergency SMSs to the public nationwide.

For the purpose of resuming operations at the earliest possible time, the Company commenced postdisaster reconstruction works following the disaster in mid-February and formulated post-disaster reconstruction plans and planning proposals to implement post-disaster reconstruction projects so as to ensure the restoration of smooth communications as soon as possible.

Following the Wenchuan earthquake on 12 May, almost all communications in the hardest hit areas of Sichuan were interrupted. The Company urgently mobilized a large number of rescue personnel, vehicles and emergency devices, and undertook the provision of technical training to the VSAT equipment communication and rescue team in which three operators jointly participated and which comprised of 150 members, as well as installing 100 sets of VSAT equipment in the hardest hit areas and the disaster relief command post. The Company also connected on an urgent basis circuits for government disaster relief teams and press media to ensure timely message transmission to frontline disaster relief command and in disaster areas. In addition, the Company immediately set up hotlines "10010" and "10198" for victims in search of relatives, and created an online service zone for search of relatives on its portal in order to provide such services, issuing messages for seeking help, reporting of well being to family members, and inquiry on disaster relief and hospital phone numbers.

To fully restore communications in the disaster areas of Sichuan, the Company invested RMB610 million in construction restoration which comprised the construction restoration of a total of 956 base stations and optical fibres totaling 6,300 km in length. The post-disaster reconstruction efforts commenced in August and lasted till December, with RMB2.2 billion invested in postdisaster reconstruction, which comprised of the reconstruction of optical fibres totaling 70,500 km in length and the reconstruction of 3,200 base stations. Post-reconstruction network coverage increased by almost 15% as compared with network coverage prior to the disaster. Capital used by the Company in relation to restoration and reconstruction amounted to RMB2.8 billion.

Taking up a historic mission, successfully completing the task of providing communication services during the Olympic Games

2008 was China's "Year of the Olympic Games" which attracted the world's attention. Being a partner of the Beijing Olympic Games, the Company focused significant human and material resources to construct the communications service infrastructure and supporting systems for the Olympic Games, and accomplished the task of safeguarding communications during the Olympic Games. In addition, by embracing the philosophy of a "Hitech Olympic Games", the Company strived for technology and business innovation and achieved a number of "firsts" for communication services provision in the Olympic history, displaying advanced level of Chinese telecommunications development.

During the Olympic Games, a total of 23,000 individuals from the Company directly participated in Olympic Games services and security work. The Company also had personnel on duty in international locations such as Hong Kong, Los Angeles, San Francisco, New York, Tokyo, London and Frankfurt, involving a total of approximately 514,000 individuals. At the "Bird's Nest", the Company provided high definition TV signals for 16 broadcasting institutions from around the world to enable more than 4 billion viewers worldwide to simultaneously watch the grand opening ceremony of the Olympic Games, and at the same time, achieved the concurrent broadcast of the fireworks display and the opening ceremony programme through its teleconferencing system, successfully accomplishing the historic mission with which the Company was entrusted.

Undertaking the important task of providing general services in rural areas

Ever since its inception in 2004, the "Extension of Phone Coverage to Every Village" project has been and remains a key project for the Company. Over the past few years, the Company has taken the initiative to undertake obligations relating to village communication projects in more than 20 provinces and districts, and has actively implemented communication construction in rural areas, invested a large amount of capital, constructed large-capacity, highly efficient, technologically advanced, safe and reliable highspeed light transmission networks and mobile networks covering cities and villages. The Company has also simultaneously provided various means of connection such as broadband Internet connection, wireless connection and satellite connection to provide communication network coverage in rural areas. With the rapid development of new technologies, new communication networks such as broadband Internet and mobile Internet have extended progressively to rural areas. At present, the Company has provided various communication services to the rural market such as mobile phone, fixed phone, personal handy phone, broadband Internet, village information service and various valued-added businesses.

In 2008, the task target set by the MIIT for the Company was 3,019 natural villages, involving 17 provinces and cities. The Company overcame the impact of various unfavourable factors such as internal amalgamation and reorganization, network division and natural disasters such as freezing rain and snowstorms and the Wenchuan earthquake, to not only meet but exceed the village communication task target with 3,271 villages.

To contribute to the community with integrity and care

Since 2002, the Company has performed poverty alleviation work in the state key poverty relief development counties in Zhangjiakou, Hebei,and has invested a total of RMB15 million over six years up to present and has successively implemented 32 poverty alleviation projects. In addition, the Company has actively initiated community events and has organized various community donation events to donate office computers, office furniture, clothing and books to certain villages and schools in poverty alleviation counties.

Meanwhile, the Company has also undertaken the task of providing support to Tibet since 2002, and has invested a total of RMB40 million over the past six years and has completed the construction of 14 engineering projects such as the Hope primary school, education training centre, cultural plaza and housing projects in an effort to improve the living conditions of people in Tibet.

In 2008, the Company arranged for medical teams to carry out cataract vision recovery operations for 84 impoverished individuals in Shaju County, Xinjiang, and undertook the opening ceremony and teacher training for a local bilingual kindergarten. The Company also sent its staff to conduct poverty relief investigation and research activities in Heilongjiang, allocated RMB1 million poverty alleviation funds for the construction of the teaching building of the Raohe County Occupational Education Centre, and organized activities of subsidizing impoverished high school students in Raohe County to contribute to education development in poverty-stricken areas.

Facing a future with both opportunities and challenges, the Company will continue to maintain its enthusiasm in social welfare, endeavour to realize the unification of corporate operations and social responsibility and further propel the harmonious development of enterprises and society.

Updated on 15 April, 2009