1. Continue to push forward work on the first phase of the Kaohsiung Intercontinental Container Terminal.

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1 KHB-A1 KHB to hold 64 th anniversary celebration The 64 th anniversary of Kaohsiung Harbor Bureau (KHB) took place on Dec.1, 2009, chaired by Director-General Hsieh and attended by a great number of representatives from the shipping industry. During the ceremony, certain staff members of KHB as well as shipping operators were presented with awards for their contribution and outstanding performance. In particular, KHB commended the incredible performance of Jin Nan-Cheng, the head of the Harbor Pilot Office who, during Typhoon Morakot, did so much to assist ships in the port Director-General Hsieh noted that 2010 will be the Port of Kaohsiung s Year of Construction. KHB will vigorously pursue the following projects, in the areas of both port construction and reconstruction. 1. Continue to push forward work on the first phase of the Kaohsiung Intercontinental Container Terminal. 2. Expand marketing and promotional activities for the Kaohsiung Free Trade Zone (KFTZ). From 2005 to November of 2009, the number of firms in the Zone has increased steadily to 25. In the near future, it is hoped KFTZ will continue to attract business development and industrial firms. 3. Carry out the development plan for the Chienchen Commerical Port area ie: expand the storage yard of the KFTZ. Land previously owned and occupied by Taiwan Railway and Tangeng Iron Works Co., Ltd has been bulletined and will be acquired by Dec The acquisition of land from Asia Pacific Lon Kang Steel Co., Ltd. will also be completed before the end of Improve the Port s access roads : as one of the I-Taiwan 12 projects, the Kaohsiung Port -City Regeneration program includes KaoPort s Connecting Overpass (connecting Kaohsiung Airport, Kaohsiung Port and the National Freeway), which is scheduled to be completed by The new overpass will ease congestion and link all commercial port areas in Koahsiung Port with the freeway, which will in turn lower shippers delivery costs. 5. Construction of various port facilities 1) The expansion & dredging of the first and second harbor entrances, the extension of Wharf No. 66, reconstruction of Wharf No s 68, 69 and 118, 119 in the third and fourth Container Terminals ; Penghu commercial port construction; and a dedicated area for passenger use in Kaohsiung Port. 2) Construction of Wharf No s 115, 116, 117 in the fourth Terminal, which will be dredged to a depth of 16.5 meters, construction of new tracks for the 100ft-gauge gantry cranes, and new berthing 1

2 facilities ( Fenders and Dolphins ). After its completion by 2014, it is estimated these projects will create an increase of 832,000 TEU in container capacity. 6. Enhanced E-services: Transshipments escorted by technology instead of manpower has been the beneficial end result of the AGC (automatic system for gate control of Kaohsiung Harbor Bureau), as well as the movement of hazardous goods for safety transportation. Further purpose at FTPZ (Free Trade Port Zone) in future, the network will be linked with other ports to add industry-wide supply-chain value. 7. Create a Kaohsiung Port brand name to add recognition to high-quality services: The key to the success of Kaohsiung Port lies in the satisfaction of its customers. KHB will dedicate itself to upholding the KaoPort brand name, which will imply trustworthiness, professionalism, efficiency, creativity, and superior-quality customer service. KHB-A2 Equal emphasis on Container & Passenger business in KaoPort s five-year plan Lwo Shih-Hsiung, the Chief Executive of the Southern Taiwan Joint Service Center under the Executive Yuan, convened a conference entitled Plans for Kaohsiung Intercontinental Container Terminal and passenger-dedicated area on Oct.28, The Kaohsiung Intercontinental Container Terminal (KICT) will contribute to the development of Kaohsiung Harbor as a multi-functional international transshipment hub. Its first phase of construction was undertaken following approval in hectares of land acquired as a result of the relocation of Hong-Mao-Gong is being developed by the Yang Ming Group on a BOT basis. Once dredging of the turning basin is completed, KICT will be capable of berthing much larger vessels (10,000~12,500 TEU). Then, in 2010, two wharves will be completed, and two other wharves as well as the container yard itself will be finished by 2013, thereby raising container capacity by 2.8 million TEU per year. It is estimated the project will generate some NT$39.47 billion on throughput and create 17,000 job opportunities. With respect to the new passenger-dedicated area, KHB will bring passenger facilities up to international standards in an attempt to alter the traditional impression of KaoPort as a harbor that places greater emphasis on container transport than passenger traffic. Passenger and port service facilities will be the top priority in the plan. Wharf No.18~ No.21 will be developed in stages. Director-General Lin Kung-shan of the Kaohsiung Tourism Bureau suggested that during the five years of anticipated development, it may be possible to renovate the existing banana shed to cater to visitors from larger cruise ships. 2

3 KHB A3 KHB introduces Megaports Initiative Under the Megaports Initiative, the U.S. Department of Energy provides partners with radiation portal monitors, related handheld detection devices, optical character recognition (OCR) technology, communications equipment, training and technical support to prevent containerized cargo from being used for nuclear and other radioactive materials smuggling. The opening ceremony for the Megaports Initiatives was held at the Port of Kaohsiung on November 18, 2009, sponsored jointly by the American Institute in Taiwan (AIT), the U.S. Department of Energy (DOE) and the Kaohsiung Customs Office. AIT Director William A. Stanton, Taiwan s Deputy Minister of Finance Chang Sheng-ho, and Elly Melamed, Deputy Director, Office of Second Line of Defense, U.S. Department of Energy National Nuclear Security Administration were invited to deliver speeches at the ceremony. More than one hundred and fifty participants from the Ministry of Foreign Affairs, the Ministry of Transportation and Communications, Transportation Industry, Atomic Energy Council and other related industries attended. The Megaports Initiative originated in May of 2006 with a Memorandum of Understanding (MOU) signed between AIT and the Taipei Economic and Cultural Representative Office (TECRO). The Port of Kaohsiung was the first port in Taiwan to implement the Megaports Initiative due to its strategic location, its role as a key transshipment hub and the port s high volume of container traffic. The goal of the Megaports Initiative is to protect shipping networks from nuclear and other radioactive materials that could potentially be exploited by terrorists in a weapon of mass destruction (WMD) or a radiological dispersal device, by use of radiation detection equipment. The Kaohsiung Customs Office noted that, as part of the first stage of the Megaports Initiative, the DOE will equip the Port of Kaohsiung with 23 radiation portal monitors (RPM) at the second, third, and fifth Container Terminals. KaoPort is to be equipped with wireless communications, which it began to operate in September of In the second stage, the first and fourth Terminals will be equipped with 22 RPM. The RPMs themselves will not release any radiation; nor will they harm people or damage vehicles. The monitor alarms will be triggered once they detect radiation hidden in the containers, and officers at the Central Monitoring Station will respond immediately. Use of the RPMs will have no adverse impact on operations within the container yard. KHB-A4 Adjustments to the boundaries of KaoPort create land use benefits In response to development of the Port-City relationship, and to better meet the needs of local citizens, the Kaohsung Harbor Bureau (KHB) has adjusted the boundaries of its commercial port areas in Chitsin and Gusan. On land not currently in use, in civil housing areas, and on private land, the boundaries of KaoPort were adjusted for more effective land management. The release of land from KaoPort is intended to drive local economic prosperity in several ways: 1. The problem of old and damaged houses in that area will be resolved to improve the city s appearance. 2. Land not required for future development of the Port of Kaohsuing will be excluded in order to cut 3

down on land management costs and thereby raise competitivness. 3. In conjunction with the Kaohsiung City Government s urban planning, the use of land will be modified to accomodate public use. 4.

4 down on land management costs and thereby raise competitivness. 3. In conjunction with the Kaohsiung City Government s urban planning, the use of land will be modified to accomodate public use. 4. Advantage will be taken of the rich natural landscape and ecology of that area as a boost to local eco-tourism. 5. Add to the allure of beach activities with high-quality water-front recreational space. KHB-A5 ISPS, Explosives, Marine Fire and Rescue & Pollution Contingency The Kaohsiung Harbor Bureau (KHB) conducted an exercise for International Ship and Port Facility Security Code (ISPS), Explosives, Marine Fire and Rescue & Pollution Contingency at Wharf No. 59 on November 20, Under instructions from Director General Hsieh of KHB, a contingency committee was set up for the exercise, and drilled on port facilities, the detection and removal of explosives, marine and vessel fire rescue, and marine pollution contingencies. In co-ordination with port security authorities, a total of 10 patrol ships, 20 vehicles, and 210 personnel took part in the exercise. Since the global terrorist threat remains so potent, preparation for terrorist contingencies is a task high on the priority list of all countries. As a result of ISPS measures implemented by KHB since 2004, the port area has been divided into 33 security organizations, and their emergency response times and capabilities have been honed through constant, rigorous exercises. KHB-A6 Chi Mei resumes construction at Wharf No.23 4 In response to the economic rebound, Chi Mei Corporation has applied for the resumption of the fourth phase of its construction at Wharf No.23, a petrochemical wharf, and increased its investment to NT$309,771,000. It is estimated that annual throughput at Anping Harobr will increase by 60,000 tons after completion. In order to shorten delivery times, reduce transportation risks on the national freeway, and improve the flexibility of chemical supply and demand, Chi Mei has invested over $500 million in the construction of two wharves, (each 200 meters in length, and 11 meters in depth) as well as16 storage tanks and other support facilities in Wharf Sikunshen area in Anping Harbor, all of which were completed and began service in Following the shift of acrylonitrile imports to Anping Harbor from Kaohsiung Harbor. in July, 2008, Chi Mei applied for construction of petrochemical Wharf No.23 as part of its phase.4 development, along with three 500-cubic meter storage tanks and related facilities in Anping Harbor. However, in the wake of the global financial crisis, all development work was suspended in December, 2008.

KHB-A7 KHB will take over Longmen-Chienshan Harbor Penghu Longmen-Chienshan harbor, constructed by the Penghu County Government and serving as a cargo harbor, will be handed over to Kaohsiung Harbor

So as to improve the safety of cargo access and harbor operations, the wharves, channels, and office buildings in the five existing general-cargo berths and two bulk-goods berths will be renovated.

5 KHB-A7 KHB will take over Longmen-Chienshan Harbor Penghu Longmen-Chienshan harbor, constructed by the Penghu County Government and serving as a cargo harbor, will be handed over to Kaohsiung Harbor Bureau (KHB) on November 16, So as to improve the safety of cargo access and harbor operations, the wharves, channels, and office buildings in the five existing general-cargo berths and two bulk-goods berths will be renovated. In accordance with Regulations for the Outlet of Penghu Domestic Commercial Harbor, Penghu Harbor will consist of both Magong Harbor and Longmen-Chienshan Harbor. The latter was proclaimed a domestic commercial harbor by the Ministry of Transportation and Communications (MOTC) in According to Magong Port officials, in order to promote the future development of tourism in the islands, and in co-operation with the Penghu County Government, Magong Port endeavored to get its budget approved by the Executive Yuan. KHB will take over Longmen-Chienshan Harbor and carry out all necessary renovations, at an estimated cost of NT$ 790 million over three years from To cope with the handover work, and minimize the impact to port operations in Longmen-Chienshan Harbor, Harbor Master Tsai held a conference to discuss details of the renovation and made a briefing to specially-invited shipping companies. KHB requires all operators to abide by port regulations and ensure environmental protection when carrying out operations in the port. KHB-A8 Mini-Three Links maiden voyage from Magong Harbor Since government regulations state that Taiwanese goods shipped to China can be transited through Penghu, Yu Tai No.1 carrying 30 tons of general goods, out of Putai Harbor, transshipped at Magong Harbor and headed to Dongshan Harbor in Fujian Province. This was the first time that a vessel left for China from Magong Harbor since the opening of the Mini-Three Links. In Penghu the goods were unloaded at Longmen-Chienshan Harbor under the terms of the Mini-Three Links. In coordination with the Coast Guard Administration, Port Police, the Customs Bureau, Immigration Agency, and Inspection Bureau, the Kaohsiung Harbor Bureau and Magong Office has made great strides in expanding the volume of cargo transshipped through Penghu,, In order to smooth the procedures for shipping routes from Magong Harbor to Fujian Province under the Mini-Three Links, KHB has held the CIQS conference five times with the relevant government departments. Yu Tai No.1, a general cargo ship, with a total weight of 1448 tons, a length of 67.1 meters, a width of 11.8 meters, and a depth of 6.8 meters, is capable of carrying 1974 tons. It serves a fixed domestic shipping route between Putai Harbor and Magong Harbor. It is the first ship to apply for an additional shipping route between Donshan Harbor and Magong Harbor under the Mini-Three Links. 5

KHB-A9 The first voyage of International Cruise from Kaohsiung Port reflects optimism about Asian tourism vessel to commence its voyage from Taiwan.

6 KHB-A9 The first voyage of International Cruise from Kaohsiung Port reflects optimism about Asian tourism vessel to commence its voyage from Taiwan. In 2009, a Chinese Amway tour group of employees brought millions of NT dollars into the Taiwan tourism industry. International cruise operators have adopted a very optimistic attitude toward tourism across the Taiwan Strait, and Royal Caribbean Cruise organized first five-day cruise tour out of Kaohsiung Port, via Vietnam s Halong Bay and Hainan Island s Sanya, and berthed at Hong Kong, making it the first cruise According to Mr. Zhao, Head of the International Division of the Taiwan Tourism Bureau, the Taiwan Tourism Bureau has gradually increased its efforts to promote the cruise ship market and has enjoyed some success. The number of cruises and passengers arriving at Taiwan has grown ten times from 11 cruises and 6000 passengers in 2005 to 52 cruises and over 60,000 passengers this year. It is believed that the success of the Chinese Amway tour group will attract even more international tourists to Taiwan. Manager Lu, the Royal Caribbean International & Celebrity Cruise international representative for Taiwan, announced that Royal Caribbean International plans to launch a tour beginning from Kaohsiung Port, via Vietnam, China and Hong Kong in February, KHB-B1 Delegation from North Kyushu 20 delegates from North Kyushu, Japan, led by Itou Kazuo, paid a visit to Kaohsiung Port on October 29, Received by Deputy Director Huang of the Kaohsiung Harbor Bureau, they took a boat tour of the port. The chief of the delegation, Itou Kazuo, noted that their visit will pave the way for a better relationship and the promotion of trade. KHB-B2 Scottish delegation pays a visit to KaoPort A delegation of 9 people from the Scottish Parliament, led by Mr.Iain Smith, paid a visit to Kaohsiung Port on November 14, 2009, in the company of officials from Taiwan s Ministry of Foreign Affairs. They were received by representatives from the Kaohsiung Harbor Bureau and took a tour of the port by boat. The delegation included Legislators: Mr. Ian Mckee, Mrs. Nanette Milne, Mr. Richard Simpson, and Mr. David Stewart. 6

KHB-B3 B3-1 18 The M/V PRAMONI, registered in Singapore, and represented by Taiwan Kawasaki Kaisha (K-Line Taiwan), made her first call to Kaohsiung Port on Oct.20, 2009, berthing at Wharf No.28.

She is scheduled to serve the route: Jiangyin Mailiao Kaohsiung Singapore. B3-2 The M/V XIN TIAN JIN, owned by CHINA SHIPPING CONTAINER LINES CO., LTD and represented by ORIS SHIPPING AGENCY CO.

3 meters in width, and is capable of carrying 5,668 TEU. According to the port agent, China Glory Shipping Agency Co. Ltd., CHINA SHIPPING CONTAINER LINES CO.

7 KHB-B3 B The M/V PRAMONI, registered in Singapore, and represented by Taiwan Kawasaki Kaisha (K-Line Taiwan), made her first call to Kaohsiung Port on Oct.20, 2009, berthing at Wharf No.28. The M/V PRAMONI, a chemical vessel, was built in She has a total weight of 12,105 tons, a length of meters, and a width of 24.2 meters. She is scheduled to serve the route: Jiangyin Mailiao Kaohsiung Singapore. B3-2 The M/V XIN TIAN JIN, owned by CHINA SHIPPING CONTAINER LINES CO., LTD and represented by ORIS SHIPPING AGENCY CO., LTD, made her first call to Kaohsiung Port on Oct.26, 2009, berthing at Wharf No.115. Delivered in May, 2003, she measures 66,433 tons in total weight, meters in length, 40.3 meters in width, and is capable of carrying 5,668 TEU. According to the port agent, China Glory Shipping Agency Co. Ltd., CHINA SHIPPING CONTAINER LINES CO., LTD under the China Shipping Group, is scheduled to join service on the route West Coast America/ Canada together with Evergreen Marine Corporation. Their joint service will include: Ningbo Shanghai Nansha Hong Kong Yantian Pusan Tacoma Seattle Vancouver Tokyo Osaka Ningbo. B3-3 The M/V XIN YAN TAI, owned by CHINA SHIPPING CONTAINER LINES CO., LTD and represented by ORIS SHIPPING AGENCY CO., LTD, made her first call to Kaohsiung Port on Nov.9, 2009, berthing at Wharf No.115. She measures 66,453 tons in total weight, meters in length, 40.3 meters in width, and is capable of carrying 5,668 TEU. Her shipping route is: Shanghai Kaohsiung Nansha Hong Kong Yantian. 7

B3-4 The M/V XIN QING DAO, owned by CHINA SHIPPING CONTAINER LINES CO., LTD and represented by ORIS SHIPPING AGENCY CO., LTD, made her first call to Kaohsiung Port on Nov.

8 B3-4 The M/V XIN QING DAO, owned by CHINA SHIPPING CONTAINER LINES CO., LTD and represented by ORIS SHIPPING AGENCY CO., LTD, made her first call to Kaohsiung Port on Nov.26, 2009, berthing at Wharf No.115. Delivered in May, 2003, she measures 66,433 tons in total weight, meters in length, 40.3 meters in width, and is capable of carrying 5,668 TEU. Her service route is: Ningbo Shanghai Kaohsiung Nansha Hong Kong Yantian Pusan Tacoma Seattle Vancouver Tokyo Osaka - Ningbo B3-5 The M/V ZIM MOSKVA, a Liberia registered container vessel, represented by Kao s Express Warehouse & Stevedoring Co. Ltd, made her maiden voyage to Kaohsiung Port on Nov.6, 2009, berthing at Wharf No With a total weight of 40,741 tons, a length of 259 meters, a width of 32.2 meters and a carrying capacity of 4,352 TEU, she was delivered in 2009 and is scheduled to serve the route: Kaohsiung Shekou Hong Kong Kingston New York Norfolk Savannah. B5-6 The M/V HANJIN MILANO, registered in the Marshall Islands and represented by Taiwan Hanjing, made her maiden voyage to Kaohsiung Port on Nov.8, 2009, berthing at Wharf No.70. Built in October, 2009, she has a total weight of 40,542 tons, a length of meters, a width of meters, and is capable of carrying 4,300TEU. She will serve the route: Kaohsiung Singapore Middle East. 8

KHB 39- A1 Kaohsiung Harbor faces rigorous challenges

KHB 39- A1 Kaohsiung Harbor faces rigorous challenges Due to the global economic and financial crisis, the container handling volume at Kaohsiung Harbor in 2008 totaled 9.67 million TEU, down 5.66% from