UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 20-F

(Mark One)

[  ] Registration Statement Pursuant To Section 12(b) or (g) of the Securities
     Exchange Act of 1934

                                       OR

[X]  Annual Report Pursuant To Section 13 or 15 (d) of the Securities Exchange
     Act of 1934

For the fiscal year ended December 31, 2001.

                                       OR

[  ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
     Exchange Act of 1934

For the transition period from ...............to................................
Commission file number 000-30678

                               GLOBAL SOURCES LTD.
             (Exact Name of Registrant as Specified in its Charter)

                               Global Sources Ltd.
                 (Translation of Registrant's Name into English)

                                     Bermuda
                 (Jurisdiction of incorporation or organization)

                                   Cedar House
                                 41 Cedar Avenue
                             Hamilton, HM 12 Bermuda
                    (Address of principal executive offices)

Securities registered or to be registered pursuant to Section 12(b) of the Act:

     Title of Each Class              Name of Each Exchange on which registered

Common Shares, $0.01 Par Value        NASDAQ National Market

Securities registered or to be registered pursuant to Section 12(g) of the Act:
NONE

Securities for which there is a reporting obligation pursuant to Section 15(d)
of the Act: NONE

Indicate the number of outstanding shares of each of the issuer's classes of
capital or common stock as of the close of the period covered by the annual
report:

26,308,949 common shares, $0.01 par value, outstanding as of February 28, 2002.

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

                  Yes  X                        No
                      ---                         -----

Indicate by check mark which financial statement item the registrant has elected
to follow.

                  Item 17                        Item 18 X
                         -----                          ---



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<PAGE>

                                TABLE OF CONTENTS

                               GENERAL INFORMATION

                                     PART I


Page
--------------------------------------------------------------------------------

Item  1.   Identity of Directors, Senior Management and Advisers............ 3
Item  2.   Offer Statistics and Expected Timetable.......................... 3
Item  3.   Key Information.................................................. 3
Item  4.   Information on the Company....................................... 14
Item  5.   Operating and Financial Review and Prospects..................... 24
Item  6.   Directors, Senior Management and Employees....................... 33
Item  7.   Major Shareholders and Related Party Transactions................ 39
Item  8.   Financial Information............................................ 43
Item  9.   The Offer and Listing............................................ 69
Item  10.  Additional Information........................................... 69
Item  11.  Quantitative and Qualitative Discussion About Market Risk........ 79
Item  12.  Description of Securities other than Equity Securities........... 79


                                     PART II

Item  13.  Defaults, Dividends Arrearages and Delinquencies................. 80
Item  14.  Material Modifications to the Rights of Security Holders
             and Use of Proceeds ........................................... 80
Item  15.  (Reserved)....................................................... 80
Item  16.  (Reserved)....................................................... 80


                                    PART III

Item  17.  Financial Statements............................................  80
Item  18.  Financial Statements............................................  80
Item  19.  Exhibits.....................................................81 - 88


                                       2
<PAGE>

                         FORWARD - LOOKING STATEMENTS


Except for any historical information contained herein, the matters discussed in
this Annual Report on Form 20-F contain certain "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995 with
respect to our financial condition, results of operations and business. These
statements relate to analyses and other information which are based on forecasts
of future results and estimates of amounts not yet determinable. These
statements also relate to our future prospects, developments and business
strategies. These forward-looking statements are identified by their use of
terms and phrases such as "anticipate," "believe," "could," "estimate,"
"expect," "intend," "may," "plan," "predicts," "will" and similar terms and
phrases, including references to assumptions. These forward-looking statements
involve risks and uncertainties, including current trend information,
projections for deliveries, backlog and other trend projections, that may cause
our actual future activities and results of operations to be materially
different from those suggested or described in this Annual Report on Form 20-F.
These risks include: product demand; customer satisfaction and quality issues;
labor disputes; competition, including recent intense price competition; our
ability to achieve and execute internal business plans; worldwide political
instability and economic growth; and the impact of any economic downturns and
inflation, including any weakness in the currency, banking and equity markets of
countries in the Asia/Pacific region.

If one or more of these risks or uncertainties materializes, or if underlying
assumptions prove incorrect, our actual results may vary materially from those
expected, estimated or projected. Given these uncertainties, users of the
information included in this Annual Report on Form 20-F, including investors and
prospective investors are cautioned not to place undue reliance on such
forward-looking statements. We do not intend to update the forward-looking
statements included in this Annual Report.

All references in this Annual Report on Form 20-F to the terms "we," "our,"
"us," the "Company," "Trade Media" and "Global Sources" refer to Global Sources
Ltd. and its subsidiaries. All references to "fiscal" in connection with a year
shall mean the year ended December 31.

All financial information contained in this document is expressed in United
States dollars, unless otherwise stated.

                                     PART I


ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS - (Not applicable)

ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE - (Not applicable)

ITEM 3. KEY INFORMATION

Selected Financial Data

The following historical financial information should be read in conjunction
with our audited consolidated financial statements and related notes, all of
which are included elsewhere in this document and in "Operating and Financial
Review and Prospects." The consolidated statements of income data for each of
the three years ended December 31, 1999, 2000, and 2001 and selected
consolidated balance sheet data as of December 31, 2000 and 2001 are derived
from, and qualified by reference to, our audited consolidated financial
statements included elsewhere in this document. The consolidated statements of
income data for each of the years ended December 31, 1997 and 1998 and selected
consolidated balance sheet data as of December 31, 1997, 1998 and 1999 are
derived from our audited financial statements not included in this document.


                                       3
<PAGE>
<TABLE>
<CAPTION>

                                                                      Year Ended December 31,
                                                     -------------------------------------------------------------
                                                              1997        1998      1999         2000        2001
                                                              ----        ----      ----         ----        ----
   Income Statement Data:
   Revenue:
<S>                                                          <C>       <C>        <C>          <C>         <C>
      Online marketplace services.....................       $5,099    $14,450    $25,463      $55,121     $55,468
      Transaction software and services...............        1,076      1,228        584          733         305
      Complementary media services....................       94,779     75,439     60,846       42,602      34,964
      Other...........................................        3,532      3,226      3,379        4,597       4,548
                                                        -----------------------------------------------------------
   Total revenue......................................      104,486     94,343     90,272      103,053      95,285
   Operating expenses:
      Sales...........................................       28,642     27,498     29,481       34,436      32,047
      Circulation.....................................       20,090     15,413     13,069       13,337      11,757
      General and administrative......................       39,460     35,294     32,134       36,197      33,726
      Online services development.....................        1,366      3,182      3,461        6,665       8,393
      Non-cash compensation expense(1)................           --         --         --       65,689       2,501
      Other(2)........................................          372        379        371        2,371       3,476
                                                        -----------------------------------------------------------
   Total operating expenses...........................       89,930     81,766     78,516      158,695      91,900
                                                        -----------------------------------------------------------
   Income/(loss) from operations......................       14,556     12,577     11,756      (55,642)      3,385
   Interest expense...................................         (264)      (336)      (337)        (649)       (172)
   Interest income....................................          646        732        558        1,135         357
   Foreign exchange (losses)/gains, net...............       (4,110)       160        427           50        (470)

   Write-down of investments .........................           --         --         --      (11,750)     (1,150)
                                                        -----------------------------------------------------------
   Income/(loss) before income taxes..................       10,828     13,133     12,404      (66,856)      1,950
   Income tax provision...............................       (1,338)    (1,552)    (1,435)      (1,277)     (1,143)
                                                        -----------------------------------------------------------
   Income/(Loss) before minority interest ............       $9,490   $ 11,581   $ 10,969    $ (68,133)       $807
                                                        ===========================================================
   Equity in (loss)/income of affiliate..............             -          -          -          (51)         51
   Minority interest.................................             -          -          -          (37)        (83)
                                                        -----------------------------------------------------------
   Net income/(loss)..................................       $9,490    $11,581    $10,969    $(68,221)        $775
                                                        ===========================================================

   Basic and diluted net income/(loss) per share......        $0.38      $0.46      $0.44      $(2.63)       $0.03
                                                        ===========================================================

   Cash dividends declared per share..................         0.54       0.80       0.60           --          --
   Weighted average shares outstanding(3).............       25,051     25,051     25,051       25,948      26,304



                                                                               December 31,
                                                        ------------------------------------------------------------
                                                           1997        1998       1999        2000        2001
                                                           ----        ----       ----        ----        ----
Balance Sheet Data:
   Cash and cash equivalents..................           $15,943    $15,713     $15,433    $12,727     $20,236
   Total assets...............................            49,291     46,960      46,645     55,706      53,602
     Long-term debt, less current portion.......           7,333      5,366       3,540     16,084      15,963
     Total Shareholders' equity.................          18,105      9,686       5,710      8,161      11,601
</TABLE>

-------------------

(1) Reflects the non-cash compensation expenses associated with the transfer of
     shares from the parent company to the chairman and chief executive officer
     of the Company and grants under the employee equity compensation plans.
     Approximately $381 (2000: $291) represents sales expenses, $87 (2000: $168)
     represents circulation, $1,546 (2000: $65,044) represents general and
     administrative and $487 (2000: $186) represents online services development
     expenses.

(2) Includes amortization of intangibles/software development cost and for the
     year ended December 31, 2000 also includes non-cash listing expenses of
     approximately $1.4 million.

(3) On April 14, 2000, in conjunction with our share exchange, we effectively
     consummated a 2,505 for 1 stock split. All share and per share amounts have
     been restated for all periods presented. For a further discussion of our
     recent share exchange, please see Note 21 of our consolidated financial
     statements appearing elsewhere in this document.




                                       4
<PAGE>

Risk Factors

In addition to other information in this Report, the following risk factors
should be carefully considered in evaluating Global Sources and its business
because such factors may have a significant impact on Global Sources' business,
operating results and financial condition. As a result of the risk factors set
forth below and elsewhere in this Report, and the risks discussed in Global
Sources' other Securities and Exchange Commission filings, actual results could
differ materially from those projected in any forward-looking statements.

General economic uncertainty may reduce our revenues and affect our business.

The revenue growth and profitability of our business depends significantly on
the overall demand for Internet-based, business-to-business e-commerce
solutions. We believe that the market for these solutions may be negatively
impacted by a number of factors including reductions in marketing expenditures
by customers and the overall weakening of global economies. These factors may
give rise to a number of market trends that may slow our revenue growth. These
trends include the lengthening of sales cycles, the deferral or delay of
e-commerce projects and the reduction of expenditures for e-commerce solutions
and related services, and increased price competition. If the current economic
slowdown continues, the effects of the slowdown could adversely affect our
business, results of operations or financial condition.

We have a limited history in the online marketplace business and may be unable
to expand our online marketplace services revenues.

We have a limited operating history in the online marketplace services business.
We have a limited e-commerce operating history upon which you may evaluate us.
We expect to generate a significant portion of our revenue in the future from
our online marketplace and related services. Our online marketplace revenue
model is evolving and may change significantly in the future. Currently, we
derive most of our online marketplace revenue from monthly fees paid by
suppliers for Marketing Websites. All other online marketplace services, such as
banner advertising, Private Buyer Catalogs and Private Supplier Catalogs, have
not yet generated, and may never generate, significant revenue. If revenue from
our online marketplace services does not continue to increase, our business,
financial condition or operating results may be harmed.

If our current and potential customers are not willing to adopt and renew our
e-commerce services, we may not attract and retain a critical mass of customers.

Our services will be attractive to suppliers only if buyers use our services to
identify suppliers and purchase their products. The content, products and
suppliers currently available on our websites or made available by suppliers may
not be sufficient to attract and retain buyers. Furthermore, because the
business-to-business e-commerce market is new, potential customers may be
confused or uncertain about the merits of e-commerce services or which
e-commerce services to adopt, if any. If buyers and suppliers do not accept our
online services, or if we are unable to attract and retain a critical mass of
buyers and suppliers for our e-commerce services, our business will suffer and
our revenue will not increase.

None of the buyers or suppliers that currently use our services are under any
long-term contractual obligation to continue using our services. As a result,
our current customers may not be customers in the future.

We may not be successful in pursuing acquisitions, joint ventures and alliances
to expand our business.

In order to remain competitive and to grow our business, we may conclude
selective acquisitions and enter into joint ventures and alliances. We may not
be able to negotiate the terms successfully, finance the acquisition or
arrangement, or integrate any new business, products or technologies into our
existing



                                       5
<PAGE>

business and operations. Even if we are successful in integrating any new
businesses, products or technologies into our existing business, we may not
achieve expected results, or we may not realize other expected benefits. If we
are unable to make acquisitions and enter into joint ventures and alliance
arrangements successfully, our growth and revenue may be harmed.

If we are unable to compete effectively, we will lose current customers and fail
to attract new customers.

The e-commerce industry is intensely competitive, evolving and subject to rapid
technological change. We expect the intensity of competition to increase.
Barriers to entry are minimal, and competitors are able to launch new websites
at a low cost. Competition is likely to result in price reductions, reduced
margins and loss of market share, any one of which may harm our business. We
compete for a share of a customer's marketing and advertising budgets with other
established and emerging online services and traditional offline media.
Competitors vary in size, scope and breadth of the products and services
offered. We may encounter competition from companies who offer more
comprehensive content, services and/or functionality.

Many of our current and potential competitors may have greater financial,
technical, marketing and/or other resources and greater name recognition than we
have. In addition, many of our competitors may have established relationships
with one another and with our current and potential suppliers and buyers and may
have extensive knowledge of our industry. Current and potential competitors have
established or may establish cooperative relationships with third parties to
increase the ability of their products to address customer needs. Accordingly,
our competitors may develop and rapidly acquire significant market share.

Our quarterly operating results fluctuate, and we may fail to meet analyst,
investor and shareholder expectations, causing our share price to fall.

The operating results of companies in the e-commerce industry, including us,
have experienced quarter-to-quarter fluctuations. Our buyer activity on Global
Sources Online is often relatively slower during the summer and year-end
vacation and holiday periods. Additionally, our online marketplace services
revenue and print advertising revenue is seasonal and tends to be highest in the
fourth quarter of each calendar year as a result of increased advertising and
media buying in that quarter. As with other companies in our industry, our
expenses are based upon expectations of revenue, and significant costs may be
incurred before revenue is generated. If revenue in a quarter falls below the
expectations of public market analysts, investors and shareholders, the price of
our shares may fall.

The international markets in which we do business are subject to political and
economic instability, which may interfere with our ability to do business,
increase our costs or decrease our revenue.

The international markets in which we operate are subject to risks, including:

     o    fluctuations in regional economic conditions;

     o    political instability;

     o    conflicting and changing legal and regulatory requirements;

     o    restrictions placed on our operations due to our foreign status;

     o    significant changes in tax rates and reporting requirements;

     o    the loss of revenue, property and equipment from expropriation,
          nationalization, war, insurrection, terrorism and other political
          risks;



                                       6
<PAGE>

     o    adverse governmental actions, such as restrictions on transfers of
          funds and trade protection measures, including tariffs and export
          quotas; and

     o    fluctuations in currency exchange rates.

Geographic, time zone, language and cultural differences may also prevent us
from effectively selling our products and services, which may inhibit growth and
reduce revenue.

Our dependence on key Asian markets for current and future revenue growth is
significant, and economic or political instability in those markets could reduce
our revenue and seriously harm our business.

Our customers in China provide more than 30% of our total revenues, and the size
of our market in China is forecasted to continue growing for the next several
years. The dependence we have on the China market and its revenues is
significant, and adverse political and/or economic changes in China may cause
our business to be harmed and our revenues to decline.

Any future economic or political instability in the Asia-Pacific region, from
which we derive most of our revenue, could adversely affect our business and
decrease our revenue.

In 2001, we derived more than 90% of our revenue from customers in the
Asia-Pacific region. We expect that a majority of our future revenues will
continue to be generated from customers in this region. At the time of the Asian
economic crisis of 1997 and 1998, certain of our contracts were denominated and
priced in foreign currencies. The conversion of these contract proceeds into
U.S. dollars resulted in losses and is indicative of the foreign exchange risk
assumed by us. During the Asian economic crisis, both our sales and revenues
declined. If there is future political or economic instability in the
Asia-Pacific region, our business may be harmed and our revenues may decrease.

Fluctuations in currency exchange rates may harm our results of operations.

We operate internationally and foreign exchange rate fluctuations may have a
material impact on our results of operations. To the extent significant currency
fluctuations occur in the New Taiwan dollar or other Asian currencies or if the
Hong Kong dollar were no longer pegged to the U.S. dollar, our revenue and
profits would be affected. Currently, we do not hedge our exposure to foreign
currency fluctuations.

Current weakness of the telecommunications and Internet infrastructure in the
Asia-Pacific region could harm our business.

We are likely to continue to derive the majority of our e-commerce revenue in
the future from the Asia-Pacific region. The quality of the telecommunications
and Internet infrastructure, and telephone line availability in some
Asian-Pacific countries is poor. This may contribute to lower than expected
adoption of many of our services and may cause usage growth and revenue to fall
below expectations. In addition, access fees are high in many Asia-Pacific
countries, which also contributes to low usage and may adversely affect our
growth and revenue potential.

Customer concerns regarding security may deter use of our products and services.

Widely publicized security breaches involving the Internet or in e-commerce
generally, or our failure to prevent security breaches, may cause our current
and potential customers not to use our products and services. We may be required
to incur additional costs to protect against security breaches or to alleviate
problems caused by such breaches. Our potential for growth as an e-commerce
provider depends on our customers' confidence in the security of our products
and services.




                                       7
<PAGE>

The failure of third parties to meet our expectations and the requirements of
our customers may make our services less attractive to customers.

We rely on third parties for catalog information, licenses, product delivery and
technology products and services. We have no control over the accuracy,
timeliness or effectiveness of the information, products and services of these
third parties. As a result of third-party actions, we may fail to provide
accurate, complete and current information about them and their products in a
timely manner and to deliver products to buyers in a satisfactory manner.

We rely on technology relationships with software developers and providers,
systems integrators and other technology firms to support, enhance and develop
our products and services. We have contracts with technology providers to
enhance, expand, manage and maintain our computer and communications equipment
and software. Services provided by third parties include managing our Global
Sources Online network Web server, maintaining our communications lines and
managing our network data centers and software development. These relationships
may not continue or we may not be able to develop additional third-party
relationships on acceptable commercial terms, which could cause customer
dissatisfaction and/or a delay in the launch of new software or services.

We license some components of our technology from third parties. These licenses
may not be available to us on commercially reasonable terms in the future. The
loss of these licenses could delay release or enhancement of our services until
equivalent technology could be licensed, developed or otherwise obtained. Any
such delay could have a material adverse effect on our business. These factors
may deter customers from using our services, damage our business reputation,
cause us to lose current customers, and harm our ability to attract new
customers.

We rely on our independent sales force, and the loss of any significant members
of our sales force would harm our business and revenue.

We rely on the services of our independent sales force for the sales and
marketing of our products and services. We have service agreements with various
sales representative outsourcing firms that employ such sales personnel.
Generally, either we or the outsourcing firm may terminate the service agreement
between us upon short notice. We may not retain some of our outsourcing firms,
or they may not retain some of their sales personnel or be able to replace them
with equally qualified personnel. Furthermore, if an outsourcing firm terminates
its agreement with us, some of our customers with a direct relationship with
that outsourcing firm or its personnel, may terminate their relationship with
us.

The loss of strategic relationships could make our services less appealing and
useful to our customers.

We have license and partnership agreements with third parties that provide us
with a wider geographic presence and product range with buyers. These third
parties expose our products and services to potential customers to which we
would not otherwise have access. The loss of such agreements could reduce our
presence in the market and make our services less appealing to our customers. In
addition, we may discover that these arrangements do not generate the expected
number of new customers or products. We cannot be sure that these parties will
be able to implement our products and services effectively or that buyers and
suppliers will participate in their online marketplaces. In addition, we may not
be able to renew these agreements and their termination may reduce the number of
suppliers and their products that we are able to offer to buyers, and the number
of buyers to which suppliers have access.

The loss of one or more of our executive officers or key employees, either to a
competitor or otherwise, could harm our business.

Our executive officers and key employees are critical to our business. Our
executive officers and key personnel may not remain with us and their loss may
restrict our development of technology, and may reduce our revenues and cash
flows. In particular, the services of our CEO, CFO, COO, and CIO are



                                       8
<PAGE>

important to our operations. If competitors hire our key personnel, it could
allow them to compete more effectively by diverting customers from us and
facilitating more rapid development of their competitive offerings.

We may not be able to hire and retain sufficient technical personnel, which may
adversely affect implementation of our growth strategy and limit our revenues.

If we fail to hire and retain sufficient technical personnel, we may be unable
to develop, implement and maintain our products and services. Competition for
qualified technical personnel is intense in all regions where we have
operations. Our competitors have attempted to hire our employees and we expect
that they will continue to do so.

If the Internet and related services do not grow as anticipated, our revenue
will not increase and our business will be harmed.

Our business depends on increasing acceptance and use of the Internet as a
medium of business-to-business e-commerce. Growth in the use of the Internet is
a recent phenomenon. As a result, acceptance and use may not continue to develop
at historical or anticipated rates. In addition, a sufficiently broad base of
business customers may not adopt or continue to use the Internet as a medium of
e-commerce. Demand and market acceptance for recently introduced services and
products over the Internet are subject to uncertainty and there exist few proven
services and products.

As we grow, we may have difficulty maintaining our database, which may cause our
customers to discontinue their use of our products and services.

A failure to update and maintain our database or to maintain our performance
will negatively affect our growth and revenue. We update and maintain an
extensive database of technical and descriptive information on products and
suppliers. This information is used to support our services, software
applications and websites. Our inability to provide current, accurate and
comprehensive information may reduce our ability to attract and retain a
critical mass of buyers and suppliers, which is essential for our success.
Furthermore, our computer systems and databases may not be able to process large
amounts of complex product specification and configuration data without a
significant decrease in performance.

Our inability to acquire or maintain effective Web domain names could create
confusion and direct traffic away from our online marketplace.

If we are not able to prevent third parties from acquiring Web addresses that
are similar to the various Internet Web addresses that we own, third parties
could create confusion that diverts traffic to other websites away from our
online marketplace, thereby adversely affecting our business. The acquisition
and maintenance of Web addresses generally is regulated by governmental
agencies. The regulation of Web addresses in the United States and in foreign
countries is subject to change. As a result, we may not be able to acquire or
maintain relevant Web addresses in all countries where we conduct business.
Furthermore, the relationship between regulations governing such addresses and
laws protecting proprietary rights is unclear.

If we release new services, catalog tools or software containing defects, we may
need to halt further sales and/or services until we fix the defects, and our
reputation could be harmed.

Our services depend on software that is complex and which may contain unknown
and undetected defects, errors or performance problems. We may not discover
defects, errors or performance problems that affect our new or current services
or enhancements until after they are deployed. These defects, errors or
performance problems could cause service interruptions, which could damage our
reputation or increase our service costs, cause us to lose revenue, delay market
acceptance or divert our development resources, any of which could severely harm
our business.



                                       9
<PAGE>

Risk of failure of our computer and communications hardware systems increases
without redundant facilities.

Our business depends on the efficient and uninterrupted operation of our
computer and communications hardware systems. Any system interruptions that
cause Global Sources Online to be unavailable to Web browsers may reduce the
attractiveness of Global Sources Online to advertisers and could materially
adversely affect our business, financial condition and operating results. We
maintain most of our computer systems in one Web-hosting and internal support
facility in Singapore. We do not have redundant facilities or disaster recovery
systems for our computer systems. Interruptions could result from natural
disasters as well as catastrophic hardware failures, software problems, extended
power loss, telecommunications failure and similar events.

We may be subject to legal liability for publishing or distributing content over
the Internet.

We may be subject to legal claims relating to the content on Global Sources
Online or our other websites, or the downloading and distribution of such
content. Claims could involve matters such as libel and defamation, patent,
trademark, copyright and design infringement, allegations of passing off, and
invasion of privacy. Providers of Internet products and services have been sued
in the past, sometimes successfully, based on the content published or made
available on their websites. In addition, some of the content provided on Global
Sources Online is manually entered from data compiled by other parties,
including governmental and commercial sources, and this data may have errors, or
we may introduce errors when entering such data. If our content is improperly
used or if we supply incorrect information, third parties may take legal action
against us. In addition, we may violate usage restrictions placed on text or
data that is supplied to us by third parties. Our insurance may not cover claims
of this type, or may not provide sufficient coverage, which could harm our
business, financial condition or operating results.

Our intellectual property protection is limited, and others may infringe upon
it, which may reduce our ability to compete and may divert our resources.

Our success depends upon proprietary technology, content and other intellectual
property rights. We have relied on a combination of copyright, trade secret and
trademark laws and nondisclosure and other contractual restrictions to protect
ourselves. Our efforts to protect our intellectual property rights may not be
adequate. Our competitors may independently develop similar technology or
duplicate our software and services. If others are able to develop or use
technology and/or content we have developed, our competitive position may be
negatively affected.

We cannot determine whether future patent, service mark or trademark
applications, if any, will be granted. No certainty exists as to whether our
current intellectual property or any future intellectual property that we may
develop will be challenged, invalidated or circumvented or will provide us with
any competitive advantage.

Litigation may be necessary to enforce our intellectual property rights, protect
trade secrets, determine the validity and scope of the proprietary rights of
others, or defend against claims of infringement or invalidity. Intellectual
property laws provide limited protection. Moreover, the laws of some foreign
countries do not offer the same level of protection for intellectual property as
the laws of the United States. In addition, we may be unable to detect
unauthorized use of our intellectual property. Litigation may result in
substantial costs and diversion of resources, which may limit our ability to
develop new services and compete for customers.

If third parties claim that we infringe upon their intellectual property rights,
our ability to use technologies and products may be limited, and we may incur
costs to resolve these claims.

We have in the past, and may in the future, co-develop some of our intellectual
property with independent third parties. In these instances, we take all action
that we believe is necessary and advisable to protect



                                       10
<PAGE>

and to gain ownership of all co-developed intellectual property. However, if
such third parties were to introduce similar or competing e-commerce products
and services that achieve market acceptance, the success of our e-commerce
products and our business, financial condition, prospects and operating results
may be harmed.

Litigation regarding intellectual property rights is common in the Internet and
software industries. Defending against these claims could be expensive and
divert our attention from operating our business. We expect third-party
infringement claims involving Internet technologies and software products and
services to increase. If we become liable to third parties for infringing their
intellectual property rights, we could be required to pay substantial damage
awards and be forced to develop non-infringing technology, obtain a license or
cease using the applications that contain the infringing technology or content.
We may be unable to develop non-infringing technology or content or to obtain a
license on commercially reasonable terms, or at all.

In the past, we have received notices alleging intellectual property
infringements. However, to date there have been no successful litigation
directed against us with respect to the infringement and/or improper use of the
intellectual property rights of third parties. We do not believe any current
allegations will be sustained, or if sustained, will adversely affect our
business.

We may also be named as a defendant in litigation alleging infringement of
intellectual property rights by our customers. We may be required to defend
ourselves and our customers against infringement claims. In the event of a claim
of infringement, we and our customers may be required to obtain one or more
licenses from third parties, and we may be unable to obtain necessary licenses
at a reasonable cost or at all. Inability to obtain licenses may prevent us or
our customers from offering products and services to our other customers, which
may limit our revenue.

Our lengthy sales and implementation cycle could cause delays in revenue growth.

The period between our initial contact with a potential customer and the
purchase by it of our products and services is often long and may have delays
associated with the lengthy budgeting and approval processes of our customers.

New government regulations may increase our costs of doing business.

The laws governing Internet transactions remain largely unsettled. The adoption
or modification of laws or regulations relating to the Internet may harm our
business by increasing our costs and administrative burdens. It may take years
to determine whether and how existing laws apply to the Internet.

Laws and regulations directly applicable to the Internet are becoming more
prevalent. We may have to comply with new regulations in countries where we do
business. The growth and development of e-commerce may prompt more stringent
laws. Compliance with these laws may prove difficult and may harm our business.

You will not know the identity of the beneficiaries or settlor of the Trust,
which is our controlling shareholder.

The Quan Gung 1986 Trust, through Hung Lay Si Co. Ltd., its wholly owned
subsidiary, beneficially owns approximately 61% of our common shares. Hill
Street Trustees Limited, an Island of Jersey limited liability company, is the
trustee of the Trust. The shares of Hill Street Trustees Limited are owned by
partners of the Mourant Group, which is a firm based in the Island of Jersey
that provides trust administration services. Counsel to the trustee has informed
us that, by virtue of the terms of the Trust and the laws of the Island of
Jersey, the trustee cannot make disclosure of the names of the beneficiaries and
settlor of the Trust in accordance with the obligations placed on it and in
accordance with its duties of confidentiality. Accordingly, you may never know
the identity of the beneficiaries or settlor of the Quan Gung 1986 Trust.



                                       11
<PAGE>

There is a limited public market for our shares and the trading volume for our
shares is low, which may limit your ability to sell your shares or purchase more
shares.

Our common shares have been traded in the public market for a limited time and
this market may not be sustained. As a result of the April 2000 share exchange,
1,189,949 of our common shares were listed on the NASDAQ National Market. We
currently have as of March 31, 2002 approximately 2,591 shareholders, and
approximately 1,233,983 shares that are tradable on the NASDAQ National Market.

However, because of the small number of shareholders and the small number of
tradable shares, we cannot be sure that an active trading market will develop or
be sustained or that you will be able to sell common shares when you want to. As
a result, it may be difficult to make purchases or sales of our common shares in
the market at any particular time or in any significant quantity. If our
shareholders sell substantial amounts of our common shares in the public market,
the market price of our common shares may fall. In addition, such sales may
create the perception by the public of difficulties or problems with our
products and services. As a result, these sales may make it more difficult for
us to sell equity or equity related securities in the future at a time or price
that is appropriate.

Internet-related share prices are volatile, and this volatility may depress our
share price, which would reduce the value of our shares and our ability to raise
additional capital by selling more shares.

Share prices of Internet-related companies have been volatile. This volatility
is often not related to the operating performance of the companies. This
industry volatility may reduce the price of our common shares, without regard to
our operating performance. Due to this volatility, the market price of our
common shares may decrease. This may make it more difficult for us to sell
equity securities at a time and price that is appropriate. The market price of
our common shares may fluctuate in response to the following factors, some of
which are beyond our control:

     o    variations in our quarterly financial and other operating results;

     o    changes in public market analysts' estimates of our financial
          performance;

     o    changes in market valuations of similar companies;

     o    announcements by us or our competitors of significant contracts,
          acquisitions, strategic partnerships, joint ventures or capital
          commitments;

     o    additions or departures of key personnel; and

     o    fluctuations in trading volume.

Because we are governed by Bermuda law rather than the laws of the United
States, our shareholders may have more difficulty protecting their rights
because of differences in the laws of the jurisdictions.

We are organized pursuant to the laws of Bermuda. In addition, certain of our
directors and officers reside outside the United States and a substantial
portion of our assets are located outside the United States. As a result, it may
be difficult for investors to effect service of process within the United States
upon such persons or to realize against them judgments of courts of the United
States predicated upon civil liabilities under the United States federal
securities laws. We have been advised by our legal counsel in Bermuda, Appleby,
Spurling & Kempe, that there is doubt as to the enforcement in Bermuda, in
original actions or in actions for enforcement of judgments of United States
courts, of liabilities predicated upon U.S. federal securities laws, although
Bermuda courts will enforce foreign judgments for liquidated amounts in civil
matters subject to certain conditions and exceptions.



                                       12
<PAGE>

It may be difficult for a third party to acquire us, and this may depress our
share price.

Our bye-laws contain provisions that may have the effect of delaying, deferring
or preventing a change in control or the displacement of our management. These
provisions may discourage proxy contests and make it more difficult for the
shareholders to elect directors and take other corporate actions. These
provisions may also limit the price that investors might be willing to pay in
the future for our common shares. These provisions include:

o    providing for a staggered board of directors, so that it would take three
     successive annual general meetings to replace all directors;

o    requiring the approval of 100% of shareholders for shareholder action by
     written consent;

o    establishing advance notice requirements for submitting nominations for
     election to the board of directors and for proposing matters that may be
     acted upon by shareholders at a general meeting; and

o    restricting business combinations with interested shareholders that have
     not been approved by at least two-thirds of the holders of our voting
     shares (other than the interested shareholder) or by a majority of the
     continuing directors or if certain prescribed conditions are met assuming
     that we will receive fair market value in exchange for such business
     combination. In this context, a "business combination" includes mergers,
     asset sales and other material transactions resulting in a benefit to the
     interested shareholder or the adoption of a plan for our liquidation or
     dissolution; a "continuing director" is a member of our board of directors
     that is not an affiliate or associate of an interested shareholder and was
     a member of our board prior to such person becoming an interested
     shareholder; and an "interested shareholder" is any person (other than us
     or any of our subsidiaries, any employee benefit or other similar plan or
     any of our shareholders that received our shares in connection with our
     recent share exchange prior to the listing of our shares on NASDAQ) that
     owns or has announced its intention to own, or with respect to any of our
     affiliates or associates, within the prior two years did own, at least 15%
     of our voting shares.

This document contains forward-looking statements which may differ from actual
events.

The words "believes," "should be," "anticipates," "plans," "expects," "intends"
and "estimates," and similar expressions, identify forward-looking statements.
These forward-looking statements are contained principally under the headings
"Key Information," "Information on the Company," and "Operating and Financial
Review and Prospects". Although we believe these forward-looking statements are
based on reasonable assumptions, these may not prove to be correct. Because
these forward-looking statements are also subject to risks and uncertainties,
actual results may differ materially from the expectations expressed by such
forward-looking statements. Important factors that may cause actual results to
differ materially from the expectations reflected in the forward-looking
statements include those set forth above, as well as:

o    general economic, business and market conditions;

o    customer acceptance of new products; and

o    the occurrence or non-occurrence of circumstances beyond our control.



                                       13
<PAGE>

ITEM 4.  INFORMATION ON THE COMPANY

History and Development of the Company

We are a leading facilitator of global merchandise trade. Our business began in
1971 in Hong Kong when we launched Asian Sources, a magazine to serve global
buyers importing products in volume from Asia. Since then, we have expanded our
group of sourcing magazines to cover multiple vertical markets, and have become
one of Asia's leading providers of trade information.

While our core business facilitates imports from Asia, we also facilitate trade
in the opposite direction. In 1985, we launched Electronics News for China and
today we have several publications and their associated websites providing
information to high-tech manufacturers in Asia.

Realizing the importance of e-commerce, we commercially released the first
version of Global Sources Transact software in 1991. We then became one of the
first business-to-business online marketplaces by launching Asian Sources Online
in 1995. In 1999, we expanded our scope and changed the name of our online
marketplace to Global Sources Online.

We were originally incorporated under the laws of Hong Kong in 1970. In April
2000, we completed a share exchange with a publicly traded company based in
Bermuda, and our shareholders became the majority shareholders of the Bermuda
corporation. As a result of the share exchange, we became incorporated under the
laws of Bermuda and changed our name to Global Sources Ltd.

Our capital expenditures during the year ended December 31, 2001 amounted to $
4.9 million and were incurred mainly for computers, software and furniture and
fixtures. Capital expenditures during the three months period ended March 31,
2002 amounted to $ 1.1 million and were incurred mainly for computers, software
and renovation of leasehold premises. Our capital expenditures were financed
using cash generated from our operations. The capital assets disposals during
the year ended December 31, 2001 and three months ended March 31, 2002 amounted
to $0.5 million and $0.02 million respectively.

Our primary operating offices are located in Hong Kong, Singapore and the
Philippines. Our registered offices are located at Cedar House, 41 Cedar Avenue,
Hamilton HM 12, Bermuda, and our telephone number at that address is (441)
295-2244. Our website address is www.globalsources.com. Information contained on
our website is not incorporated by reference into this document and should not
be considered a part of this document.

Business Overview

Global Sources facilitates global trade between buyers and suppliers, by
providing the right information, at the right time, in the right format. We
enable more effective buying and selling by providing valuable,
industry-specific information and integrated marketing solutions through our
leading online marketplace, trade magazines, CD-ROMs, and conferences and
exhibitions. In addition, we help companies create, manage and distribute their
own product information by providing an end-to-end content management solution.

We serve an independently certified community of more than 306,000 active buyers
in over 230 countries and territories. These buyers purchase direct goods in
volume for resale. As of December 31, 2001, over 135,000 suppliers were listed
in our marketplace. During the year ended December 31, 2001, buyers sent more
than 2.9 million Requests For Information (RFIs) to suppliers through Global
Sources Online, our online marketplace. Our online marketplace is comprised of
27 vertical and 14 geographic portals and we believe that it hosts more
marketing and sourcing activity than any other global merchandise trade
marketplace. Revenue from our online marketplace services grew from 4.9% of our
total revenue for the year ended December 31,1997 to 58.2% of our total revenue
for the year ended December 31, 2001. Online marketplace services revenue
equaled $55.5 million for the year ended December 31, 2001.



                                       14
<PAGE>

The following table sets forth our revenue category for the last three fiscal
years:

                                               Year Ended December 31,
                               -------------------------------------------------
                                     1999             2000             2001
                               ----------------  ---------------  --------------

Revenues:
  Online marketplace services..       $ 25,463       $  55,121        $  55,468
  Transaction software and
services.......................            584             733              305
  Complementary media services.         60,846          42,602           34,964
  Other........................          3,379           4,597            4,548
                               ----------------  ---------------  --------------
                                      $ 90,272       $ 103,053        $  95,285
                               ----------------  ---------------  --------------


The following table represents our revenue by geographical areas for the last
three fiscal years:

                                                Year Ended December 31,
                                      ------------------------------------------
                                          1999          2000         2001
                                      -----------  -----------  ---------------
 Revenues:

 Asia...............................  $   83,755   $   95,388   $  88,427
 United States......................       4,613        5,235       5,255
 Europe.............................       1,159        1,083         908
 Other..............................         745        1,347         695
                                      -----------  -----------  ---------------
 Consolidated.......................  $   90,272   $  103,053   $  95,285
                                      ===========  ===========  ===============

We currently generate the majority of our revenue from suppliers in Asia, with
China being our largest market at 30% of total revenue. Our revenue is derived
from two primary sources:

o    Online Marketplace Services - Our primary service is creating and hosting
     Marketing Websites that present suppliers' product and company information
     in a consistent and easily searchable manner on Global Sources Online. We
     also derive revenue from banner advertising fees.

o    Complementary Media Services - We publish trade magazines, which consist
     primarily of advertisements and our independent editorial reports and
     product surveys. We publish our core trade magazines monthly, and a host of
     specialized magazines seasonally. Suppliers pay for advertising in our
     trade magazines to promote their products and companies. We also derive
     revenue from buyers that subscribe to our trade publications. We also offer
     CD-ROM versions of our various vertical marketplaces on Global Sources
     Online.

We have been a facilitator of international trade for 31 years, have been
involved in the development of e-commerce software for ten years and have
operated our online marketplace for six years. We launched Asian Sources
magazine in 1971 to serve global buyers importing products in volume from Asia.
Since then, we have expanded our group of sourcing magazines to cover multiple
vertical markets, and have become one of Asia's leading providers of trade
information. Since 1985, we have also facilitated trade in the opposite
direction and now publish several magazines with associated web sites that serve
the information needs of high tech manufacturers in Asia. In 1991, we initiated
our transition to e-commerce by developing our order management software that is
now known as Transact. We became one of the first business-to-business online
marketplaces by launching Asian Sources Online in 1995. In 1999, we expanded our
scope and changed our name to Global Sources.



                                       15
<PAGE>

Industry background

The International Trade Market Opportunity

According to the World Trade Organization, global exports of merchandise
exceeded $6.1 trillion in 2000. They also reported that the ratio of world trade
in goods and services to world GDP reached 29%, an increase of 10 percentage
points since 1990.

The growth in global trade is supported by several factors, including increased
recognition of the benefits of free trade, the proliferation of free trade
agreements, more efficient global communications and logistics, and more
widespread use of electronic commerce technology. Due to its inherent
fragmentation and complexity, global merchandise trade is particularly suited to
benefit from e-commerce and online marketplaces.

International Trade Challenges

International commerce is highly complex, fragmented and expensive, which has
prevented many companies from participating.  International trade participants
face two primary sets of challenges:

Sourcing and Marketing Challenges

The large scale and fragmented nature of international trade can make it
difficult for buyers and suppliers to identify each other. Accordingly, buyers'
search and evaluation costs and suppliers' advertising and marketing expenses
can be far greater than in a domestic environment.

Transacting and Communicating Challenges

Large distances between trading partners, multiple transportation factors and
associated documentation and costs are a significant source of supply chain
inefficiency. Participants can span multiple time zones, speak different
languages, and observe diverse cultural norms. The documents and processes
required are complex, labor intensive and error-prone. Fluctuations in currency
exchange rates increase the financial risks, and governmental actions, including
tariffs and export quotas, increase the costs of international trade. In
addition, regulatory requirements such as the failure to account for duties and
quotas can result in delays or the seizure of goods and the assessment of fines
or penalties.

Our solution

We have developed solutions that streamline the communications and processes
associated with international trade and enable more effective buying and
selling. The key elements of our solutions are as follows:

Neutral platform that benefits both buyers and suppliers

The common interface of the Marketing Websites on Global Sources Online allows
buyers to efficiently search, either by product, supplier or by geographic area,
without having to navigate differently formatted sites of multiple suppliers.
Global suppliers have a forum to promote and display their product offerings and
thereby generate RFIs from buyers.



                                       16
<PAGE>

Global coverage and breadth of products that perpetuates a growing
buyer/supplier network

Buyers from 230 countries and territories made inquiries on our online
marketplace during the year ended December 31, 2001. As our base of active
buyers increases, we believe that our online marketplace services will become
increasingly attractive to suppliers and that the growth will become
self-perpetuating. As the number of buyers and sellers using our services grows,
our site becomes incrementally more attractive to additional buyers and sellers.

Complementary media that serve different market segments and satisfy different
needs

We publish monthly and seasonal trade magazines that serve our verticals; and we
produce CD-ROM versions of our online content from of our vertical markets. We
also offer conferences and exhibitions.

Catalog tools that support buying and selling

My Catalog enables buyers to maintain customized information from current and
potential suppliers, and to receive private offers from suppliers. Private
Supplier Catalogs are password-protected online environments where suppliers can
develop and maintain their own product and company data, and send information to
online marketplaces or buyer catalogs.

Our growth strategy

Our goal is to be the leading creator and facilitator of global merchandise
trade. Our strategy to achieve and maintain this goal has four primary
components:

Increase penetration of our online marketplace services

We intend to increase the penetration of our online marketplace services in our
existing 27 vertical and 14 geographic markets. We have a team of over 700
dedicated sales representatives who focus on introducing our full line of
services to the 135,000 suppliers listed on Global Sources Online.

We believe that this sales force plays a vital role in educating, attracting,
retaining and supporting these customers. We believe that as Global Sources
Online grows in content and usage, more buyers will be attracted, and thus, more
suppliers will seek to maintain Marketing Websites and use our associated
services.

Leverage China representatives and market position

We will continue to use our China representatives and dominant market position
to facilitate two-way trade. We have 20 years experience in this vast and
rapidly expanding market. We currently have 800 team members in more than 36
locations in China, the majority of whom are sales and sales support staff.

Launch new services

Our strategy is to leverage our combination of traditional and electronic media,
content and supplier enablement capabilities, Asian experience and
representation, and the growing community of buyers and suppliers, to create new
services.

Pursue strategic partnership and acquisition opportunities

We may pursue strategic acquisitions of complementary businesses, technologies
or products that we believe will accelerate one or more of the elements of our
strategy. We currently have no understandings, arrangements or agreements with
respect to any potential acquisitions. We also intend to develop and utilize
strategic partnerships to gain access to a larger number of potential users,
cooperatively market products and services, cross-sell additional services
and/or gain entry to new markets.



                                       17
<PAGE>

Our services

Global Sources' products and services allow international buyers to identify
suppliers and products, and enable suppliers to market their products to a large
number of buyers. Our mission is to create and facilitate global trade between
buyers and suppliers by providing the right information, at the right time, in
the right format.

Buyers purchase goods from suppliers who market themselves through our online
marketplaces, trade magazines, CD-ROMs, as well as our conferences and
exhibitions. We provide information that helps buyers evaluate numerous sourcing
options so they can place orders with suppliers that offer them the best terms,
conditions and capabilities.

We help suppliers market their products and their capabilities to our community
of buyers worldwide. By receiving inquiries from a wide selection of buyers,
suppliers have more opportunity to achieve the best possible terms, and to learn
which markets have the highest demand. To support their export marketing needs,
we provide suppliers with a content cleansing, normalizing, rationalizing and
segmenting service.

Online Marketplace Services

Through Global Sources Online we offer online marketplace services that assist
buyers in identifying suppliers and products, and that allow suppliers to market
their products to a wide variety of buyers. A key measure of the performance of
our services is the quantity and quality of marketing and sourcing activity.
During the year ended December 31, 2001, buyers made more than 2.9 million RFIs
to suppliers through Global Sources Online, an increase of 38% over the same
period in 2000.

Our primary service to suppliers is our Marketing Websites. Each Marketing
Website is comprised of a home page, a company profile and an electronic,
virtual showroom containing product profile pages on the supplier's products.
Each product profile page contains detailed product information and
specifications and a full color image. Our sales representatives collect the
data for the Marketing Websites, or suppliers can input the data directly if
they have our Private Supplier Catalog service. Our production units then verify
the data structure and perform a quality control check before posting the new
content on Global Sources Online.

Suppliers pay us a monthly fee for their Marketing Website that varies depending
on the number of product profiles they choose to feature. For an additional flat
fee, suppliers may upgrade to a Gold Website. This enables them to feature
additional company information on their site.

Many suppliers choose to supplement their Marketing Websites with additional
online marketing services. For example, suppliers can sponsor a particular
product or other search category on Global Sources Online. When a buyer searches
that category, the supplier's banner is displayed promoting its products or
services, with a link to that supplier's Marketing Website.

Buyers may search Global Sources Online by product, by supplier or by country. A
key feature of Global Sources Online is the common interface to suppliers'
information, making it unnecessary for buyers to leave our website to visit
numerous individual supplier websites, each with a different data structure and
design. Another important feature of Global Sources Online is "Product Alert."
Buyers set their profiles by registering for product categories about which they
would like to receive information. They are then notified by e-mail whenever
there is new advertising or editorial content in the product categories they
specified.

Private Catalogs

We offer My Catalog for buyers to make their sourcing and purchasing activities
more efficient. The catalogs enable buyers to maintain personalized product and
supplier information for current and/or potential suppliers, and to receive
private offers from suppliers. We launched this service in 1998, and


                                       18
<PAGE>

approximately 100 large buying organizations currently use the service,
including The Home Depot, PREL (buying agent for Wal-Mart, Dell, Compaq), and
Gemex (buying agent for Metro, Europe's largest general merchandise retailer).

Our Private Supplier Catalogs enable suppliers to enter, manage, update and
distribute their product and company data for a variety of online marketing and
cataloging applications. Each Private Supplier Catalog is a private,
password-protected online environment where the supplier has the sole right of
access and data entry. We provide tools within the catalog to assist suppliers
with creating, updating and posting content.

Transaction Software and Services

Global Sources Transact is our order management software that was developed in
1991. More than 350 major trading organizations, including Liz Claiborne, Reebok
and Warnaco, have installed versions of this software. Transact provides a
comprehensive trade management system that integrates sourcing and order
processing capabilities for each step in the supply chain and minimizes manual
and paper-based transactions. Transact supports multiple currencies and
languages, automated document generation and management tracking for greater
control of the order process.

Complementary Media Services

<TABLE>
<CAPTION>
We publish the following industry-specific trade magazines monthly:

<S>                                                   <C>
Asian Sources Computer Products                       Asian Sources Electronics
Asian Sources Electronic Components                   Asian Sources Fashion Accessories & Supplies
Asian Sources Gifts & Home Products                   Asian Sources Hardwares
Asian Sources Telecom Products

We also publish the following specialized magazines and CD-ROMs seasonally
and/or for special trade events:

Global Sources Audio & Video                          Global Sources Lighting & Electricals
Global Sources Auto Parts & Accessories               Global Sources Security & Safety
Global Sources Bags & Footwear                        Global Sources Sporting Goods & Outdoor Equipment
Global Sources Computers & Networking                 Global Sources Stationery & Office Equipment
Global Sources DIY & Home Center                      Global Sources Telephones & Mobile Accessories
Global Sources Furniture & Housewares                 Global Sources Timepieces
Global Sources Garments & Accessories                 Global Sources Electronic Components
Global Sources Gifts & Toys                           -        Cables & Connectors
Global Sources IA & Wireless Communications           -        Manufacturing & Assembly Services
                                                      -        Optoelectronics
                                                      -        Portable Devices
                                                      -        Power Sources
</TABLE>

Our trade magazines contain advertisements from suppliers, as well as our
independent editorial features, which includes market reports and product
surveys. Our CD-ROMs provide buyers with an offline, electronic means of
accessing content found within the vertical marketplaces on Global Sources
Online. In addition to our paid subscription base, we distribute samples of our
trade magazines and CD-ROMs free of charge to prospective customers at a variety
of trade shows and events.

Asia and China-focused Services

In addition to our primary services, our 31-year history and local market
expertise in Asia have enabled us to become a leading provider of information to
electronics engineers, exporters and executives throughout the Asian region. We
have created three websites and publish three magazines covering this segment of


                                       19
<PAGE>

our business. In addition, we host several conferences and events each year for
a variety of participants in the Asian electronics markets.

Websites

Website                                 Description

Chief Executive China Online            - A business management resource for
  www.cec.globalsources.com               Mainland China entrepreneurs.

Electronic Engineering Times Online     - Provides news about electronic pro-
 English - www.eetasia.com                ducts and their applications.  The
 Simplified Chinese - www.eetchina.com    website is available in English, and
 Tradtional Chines - www.eettaiwan.com    Korean as well as traditional and
 Korean - www.eetkorea.com                simplied Chinese.

Eletronic Buyers' news China Online     - Provides global and local industry
 www.ebnchina.com                         news summaries and product updates
                                          that impact Mainland China's local
                                          electronics manufacturers.

Magazines

 Magazine                               Description

 Global Sources Chief Executive China   - Publsihed monthly in simplified
                                          Chinese; serves senior mainland China
                                          management with features on manage-
                                          ment techniques, strategies and case
                                          studies.

 Electronic Engineering Times           - Published bieweekly in five editions;
                                          delivers the latest high-tech compon-
                                          ents and techniques to Asia's engine-
                                          ering community in Chinese, Korean
                                          and English.

 Electronic Buyers' News China          - Published monthly in simplified
                                          Chinese; serves electronics enterprise
                                          managers who are responsible for com-
                                          ponent, material and equipment pur-
                                          chasing decisions.

Customers

We provide services to a broad range of international buyers and suppliers in
various vertical trading communities.

Suppliers

Suppliers from more than 170 countries and territories, approximately 90% of
which are currently Asian manufacturers and trading companies, are currently
listed and categorized on our websites. None of our supplier customers
represented more than 1% of our revenue during the year ended December 31, 2001.

Buyers

Across the vertical markets we currently cover, we serve over 306,000 unique,
active buyers who have made an RFI using Global Sources Online, or received a
magazine or CD-ROM within the last



                                       20
<PAGE>

12 months. Specific procedures used to determine the reliability of the number
of unique buyers were performed by an internationally-recognized accounting
firm.

We emphasize serving large buying organizations as these companies are more
technologically advanced and account for a disproportionately large volume of
trade. For example, we believe that the companies that have established private
catalogs on Global Sources Online have combined annual sales in excess of $760
billion.

We have developed our services primarily for retailers, distributors and
manufacturers who import in volume for resale. We serve a specialized group of
senior executives with large import buying power. We believe over 50% of these
executives are owners, partners or presidents and another 20% are vice
presidents, general managers or directors of their respective companies. We
believe the median volume of annual import purchases for which these executives
are responsible exceeds $2.0 million.

Sales and marketing

Our global sales organization consists of approximately 700 full-time
independent representatives in more than 60 content management locations. These
representatives focus on developing and maintaining relationships with suppliers
that are current customers and seek to increase the number of suppliers using
our services. Online marketplace services and print advertising revenue is
seasonal and tends to be highest in the fourth quarter of each calendar year.
Representatives collectively make an average of 40,000 supplier visits per
month. The largest representative sales offices are located in Hong Kong,
Beijing, Guangzhou, Shanghai, Shenzhen, Seoul and Taipei.

Our marketing strategy leverages our database of 135,000 supplier profiles
currently listed on Global Sources Online. Sophisticated analyses of buyer and
supplier profile data enable us to target our marketing programs to areas
ranging from specific product categories within verticals to entire geographic
markets.

Our Community Development Group is responsible for marketing our solutions to
the global buyer community through online advertisements and promotions, trade
show exhibitions and direct mail campaigns. Teams of analysts within this group
research buyer and supplier use of our online and print media and track buyer
and supplier trends in the global markets.

Content development

Our Content Development Group is responsible for compiling, editing, integrating
and processing the content that appears in our online marketplaces, print media
and CD-ROMs. Within Content Development, the Ad Operations and Editorial groups
compile materials from client suppliers and freelance writers, respectively, and
transform these materials into the advertising and editorial content in our
online and print media. Research teams analyze customer content usage to direct
content development and work with sales representatives and marketing staff to
develop appropriate content for new vertical communities. Our Site Team is
responsible for evaluating and integrating content into our online marketplaces,
as well as maintaining the overall integrity of our marketplaces. In addition,
members of the Content Development Group manage the pre-press production work
and print production processes associated with the creation of our trade
magazines and maintain the back-end supplier database, which is the foundation
for our online supplier and product information.

Customer service

We have established customer service centers employing approximately 25 people
that handle more than 100,000 customer queries per year. We provide customer
service 24 hours a day, five days a week with limited operations on weekends and
holidays. We use two geographic locations in order to implement our coverage,
including Singapore, our servicing headquarters and Shenzhen, China, our Chinese
language support center.



                                       21
<PAGE>
Strategic relationships

We have formed license-based partnerships with third parties to operate regional
online marketing services such as South African Sources, Turkish Sources,
Indonesian Sources and Mexican Sources. These enable suppliers within the
relevant geographic regions to promote their products and services to buyers
located primarily outside of such regions.

We own 60.1% of a joint venture with CMP Media Inc. through United Business
Media B.V., a subsidiary of United News & Media plc. We entered into the joint
venture in September 2000, to provide new technology content, media and
e-commerce services for the Asian electronics market, focusing on new
opportunities in the Greater China market. During 2001, we increased the
frequency of the joint ventures' publications.

During 2001, we formed a strategic alliance with the WorldWide Retail Exchange
(WWRE), to offer a supplier sourcing program for WWRE members and Asian
suppliers.

Technology and systems

We use a combination of commercial software and internally developed systems to
operate our websites and services. We have invested more than $25.8 million
since 1995 in online services development. Currently, we have approximately 150
full-time employees engaged in technology development, maintenance, software
customization and customer service positions.

Our online marketplace services are run on the Oracle DBMS release 8. The
catalog application that supports Global Sources Online's core functions uses a
Java Application Platform.

Our servers are hosted by Singapore Telecom. We have a dedicated 10Mbps link to
SingTel's IX backbone, while Singapore Telecom maintains a 777 Mbps link to the
United States and direct links to most countries in Asia. We use Storage Tech
Enterprise tape back-up systems as well as servers located at our Singapore
facility for back-up. For the year ended December 31, 2001 our computer systems
had approximately 56 hours of service outages.

Our platform applications use standard industry database protocols. We can,
therefore, integrate our systems with products from other vendors written in
traditional program languages or more innovative systems. Our Internet offerings
are based on industry standard Web technologies. We may deploy our Web offerings
on any modern Internet browser platform, which means that our Web clients do not
need to load the software onto their personal computers.

All of our systems use secure socket layer, known as SSL, to encrypt sensitive
communications between browsers and Web servers. SSL enables secure
communication by encoding information transmitted over the Internet. We use
Extensible Markup Language, referred to in the industry as XML, as an open
communication protocol for information delivery.

Competition

For both our online and traditional trade magazine services, potential
competition and competitors vary by country and vertical markets served. Across
the range of our services, we do not believe that there is a dominant direct
competitor.

Online global trade marketplaces are relatively new, rapidly growing and
intensely competitive. We may compete with a variety of businesses that have
announced their intention to launch, or have already launched, solutions that
compete to some degree with ours. These businesses include "brick and mortar"
consortium exchanges, domestic retail marketplaces, international trade
marketplaces, transaction software and services providers, auction and reverse
auction service providers and distributor, sell-side marketplaces. We may be at
a competitive disadvantage to companies that have greater financial



                                       22
<PAGE>

resources, more advanced technology or that offer lower cost solutions than
ours. In addition, some buyers and suppliers may have developed in-house
solutions for the online sourcing and marketing of goods and may be unwilling to
use ours.

Intellectual property

Our primary product and supplier content, in addition to our in-house produced
editorial content, is held under common law copyright. We actively protect this
intellectual property by several means, including the use of digital watermark
technology on the images on our website, which enables us to identify
unauthorized use on other websites.

We have also developed several proprietary technology applications. In the
future we may apply for patents for these technology applications, where
appropriate. However, we may not be successful in obtaining the patents for
which we applied. Even if we are issued a patent, it is possible that others may
be able to challenge such a patent or that no competitive advantage will be
gained from such patent.

Our intellectual property is very important to our business. We rely on a
combination of contractual provisions, employee and third-party nondisclosure
agreements, and copyright, trademark, service mark, trade secret and patent laws
to establish and protect the proprietary rights of our software and services.

We have registered trademarks in the United States, China, the European Union,
Germany, Hong Kong, Japan, Singapore, South Korea, Taiwan and Thailand for
"Asian Sources" and we have many other registered trademarks and trademarks
pending registration in various countries, including trademark registrations for
"Global Sources" in Australia, China, Hong Kong and Switzerland.

We have in the past, and may in the future, co-develop some of our intellectual
property with independent third parties. In these instances, we take all action
that we believe is necessary or advisable to protect and to gain ownership of
all co-developed intellectual property. However, if such third parties were to
introduce similar or competing e-commerce products and services that achieve
market acceptance, the success of our e-commerce products and our business,
financial condition, prospects and operating results may be harmed.

Government regulation

Our services are, to the best of our knowledge, fully compliant with government
regulations in each country and territory in which we do business. Additionally,
we maintain strict internal policies regarding the legality of data that is
publicly available on our websites.

Internet Regulation

There are an increasing number of laws and regulations pertaining to the
Internet. In addition, a number of legislative and regulatory proposals are
under consideration by federal, state and local and foreign governments and
agencies. Laws or regulations may be adopted with respect to the Internet
relating to the liability for information retrieved from or transmitted over the
Internet, online content regulation, user privacy, taxation and the quality of
products and services. Moreover, it may take years to determine whether and how
existing laws such as those governing issues relating to intellectual property
ownership and infringement, privacy, libel, copyright, trademark, trade secret,
taxation and the regulation of, or any unanticipated application or
interpretation of existing laws, may decrease the use of the Internet, which
could in turn decrease the demand for our services, increase our cost of doing
business or otherwise have a material adverse effect on our business, financial
condition, prospects and operating results.

Regulation of Communications Facilities

To some extent, the rapid growth of the Internet in the United States has been
due to the relative lack of government intervention in the marketplace for
Internet access. For example, several telecommunications



                                       23
<PAGE>

carriers are seeking to have telecommunications over the Internet regulated by
the Federal Trade Commission in the same manner as are certain other
telecommunications services. Additionally, local telephone carriers have
petitioned the Federal Communications Commission to regulate Internet service
providers in a manner similar to long distance telephone carriers and to impose
access fees on such providers. Some Internet service providers are seeking to
have broadband Internet access over cable systems regulated in much the same
manner as telephone services, which could slow the deployment of broadband
Internet access services. Because of these proceedings or others, new laws or
regulations could be enacted, which could burden the companies that provide the
infrastructure on which the Internet is based, thereby slowing the rapid
expansion of the medium and its availability to new users.

Legal proceedings

We are a party to litigation from time to time in the ordinary course of our
business. We do not expect any of this litigation to have a material adverse
effect on our business.

Organizational Structure

We own, directly or indirectly, 100% of the following significant subsidiaries:
Trade Media Holdings Limited (Cayman Islands), Trade Media Limited (Cayman
Islands), ASM Business Services Limited (Cayman Islands), World Executive's
Digest Limited (Cayman Islands), Trade Management Software Limited (Cayman
Islands), Lazenby Services Limited (British Virgin Islands), Media Data Systems
Pte Ltd (Singapore), Publishers Representatives Limited (Hong Kong), Equitable
Accounting Services Limited (Hong Kong), Floro Company Limited (Hong Kong),
Trade Magazine Productions Limited (Hong Kong), Trade Management Software (HK)
Limited (Hong Kong), Pine Grove B.V. (Netherlands) and Global Sources USA, Inc.
(Delaware); and 60.1% of eMedia Asia Ltd. (Barbados).

Properties

We do not own any of our offices. Generally, we lease our office space under
cancelable and non-cancelable arrangements with terms of two to five years. We
also service and soon will service our customers through independent sales
representative offices located in Australia, Hong Kong, India, Israel, Japan,
Malaysia, the Netherlands, the Philippines, Singapore, Taiwan, Thailand, the
United Kingdom, the United States and approximately 30 locations in China. We
lease in the aggregate approximately 138,773 square feet of executive and
administrative offices in Hong Kong, Singapore, the Philippines, China, Taiwan
and the United States. Our aggregate base rental and building management fees
payments in 2001 were approximately $1.9 million.


ITEM 5.  OPERATING AND FINANCIAL REVIEW AND PROSPECTS

The following discussion of our financial condition and results of operations
should be read in conjunction with the "Selected Financial Data" and the
accompanying financial statements and the notes to those statements appearing
elsewhere in this document. The following discussion contains forward-looking
statements that reflect our plans, estimates and beliefs. Our actual results
could differ materially from those discussed in these forward-looking
statements. Factors that could cause or contribute to such differences include,
but are not limited to, those discussed below and elsewhere in this document,
particularly under the caption "Risk Factors."

Overview

We derive revenue from two principal activities.

Online Marketplace Services -- Our primary service is creating and hosting
Marketing Websites that present suppliers' product and company information in a
consistent and easily searchable manner on Global Sources Online. We also derive
revenue from banner advertising fees. We ratably recognize the



                                       24
<PAGE>

fees we receive to display a supplier's goods or company data over the
contractual term, which is generally six to 12 months.

Complementary Media Services -- We publish trade magazines, which consist
primarily of product advertisements from suppliers and our independent editorial
reports and product surveys. We publish our core trade magazines monthly, and a
host of specialized magazines seasonally. Suppliers pay for advertising in our
trade magazines to promote their products and companies. We also derive revenue
from buyers that subscribe to our trade publications. We also offer CD-ROM
versions of our various vertical marketplaces on Global Sources Online. We
recognize revenue ratably over the period in which the advertisement is
displayed, generally not exceeding one year.

Revenue from other sources primarily relates to organizing business seminars and
exhibitions. We recognize revenue at the conclusion of these events.

Our sales costs consist of the commissions we pay to our independent sales
representatives, as well as support fees for processing sales contracts and
incentive payments. These representatives sell online marketplace services and
advertisements in our trade magazines and receive a commission as a percentage
of the revenue generated.

Critical Accounting Policies

Our significant accounting policies are described in Note 2 to the consolidated
financial statements included in Item 8 of this document. We believe the
following represent our critical accounting policies:

Revenue Recognition

We derive our revenue primarily from advertising fees in our published trade
magazines and websites, sale of trade magazines, fees from licensing our trade
and service marks, service fees from provision of software maintenance service,
and organizing business seminars.

Revenues from advertising in trade magazines and Web sites are recognized
ratably in the period in which the advertisement is displayed. Advertising
contracts do not exceed one year. Revenue from sales of trade magazines is
recognized upon delivery of the magazine. Magazine subscriptions received in
advance are deferred and recognized as revenue upon delivery of the magazine.
Revenue from the provision of maintenance service is deferred and recognized
ratably over the maintenance service period. Revenue from organizing business
seminars is recognized at the conclusion of the seminar.

The Company receives license fees and royalties from licensing its trade and
service marks. Revenue from license fees is recognized ratably over the term of
the license, currently four to five years. Royalties from license arrangements
are earned ratably in the period in which the advertisement is displayed by the
licensee.

The correct measurement of timing and the duration of the contracts with our
clients are essential to the recognition of our revenue. Any delays in
recognizing the revenue could cause our operating results to vary significantly
from period to period. In addition our revenue recognition determines the timing
of certain expenses such as commissions and circulation expenses. We believe
that we have adequate controls and processes in place to ensure the accuracy of
the revenue recording.

Capitalization of development costs of software for internal use

We adopted Statement of Position 98-1, "Accounting for the Costs of Computer
Software Developed or Obtained for Internal Use." Costs incurred in the
preliminary project stage with respect to the development of software for
internal use are expensed as incurred; costs incurred during the application
development stage are capitalized and are amortized over the estimated useful
life of three years upon the commissioning of service of the software. Training
and maintenance costs are expensed as incurred.


                                       25
<PAGE>

Our policy on capitalized software development costs determines the timing and
our recognition of certain development costs. In addition, this policy
determines whether the costs are capitalized or recorded as expenses.

Estimation of allowance for doubtful debts

The preparation of financial statements requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities in
the financial statements.

Management estimates the collectibility of our accounts receivable based on the
analysis of the accounts receivable, historical bad debts, customer
credit-worthiness and current economic trends. We continuously monitor
collections from our customers and maintain adequate allowance for doubtful
accounts. While credit losses have historically been within our expectations and
the allowances we established, if the bad debts significantly exceed our
provisions, our operating results and liquidity would be adversely affected.

Impairment of long-lived assets

Property and equipment and intangible assets are amortized over their estimated
useful lives. Useful lives are based on management's estimates of the period
that the assets will generate revenue and can be productively employed.

We periodically review the carrying values of our long-lived assets based on the
anticipated gross cash flows and will provide for impairment whenever events or
changes in circumstances indicate that the carrying amount of the assets may not
be fully recoverable. The impairment loss is measured based on the difference
between the carrying amount of the asset and its fair value.

While we believe our estimation of the useful lives and future cash flows are
reasonable, different assumptions regarding such useful lives and cash flows
could materially affect our valuations.

Results of operations

The following table sets forth our results of operations as a percentage of
total revenue.

<TABLE>
<CAPTION>
                                                                   Year Ended December 31,
                                                            -------------------------------------------
                                                                 1999          2000          2001
                                                                 ----          ----          ----
Income statement data:
Revenue:
<S>                                                                <C>            <C>           <C>
   Online marketplace services..........................           28%            54%           58%
   Transaction software and services....................            1              1             0
   Complementary media services.........................           67             41            37
   Other................................................            4              4             5
                                                            -------------------------------------------
      Total revenue.....................................          100            100           100
Operating expenses:
   Sales ...............................................           33             33            34
   Circulation..........................................           14             13            12
   General and administrative...........................           36             35            35
   Online services development..........................            4              7             9
   Non-cash compensation................................           --             64             3
   Other................................................           --              2             3
                                                            -------------------------------------------
     Total operating expenses...........................           87            154            96
                                                            -------------------------------------------
Income/(loss) from operations...........................           13            (54)            4
                                                            -------------------------------------------
Net income/(loss)                                                  12%           (66)%           1%
                                                            ===========================================
</TABLE>


                                       26
<PAGE>

The following table represents our revenue by geographical areas as a percentage
of total revenue:

                                      Year Ended December 31,
                            ---------------------------------------------
                                 1999           2000           2001
                                 ----           ----           ----
Asia.....................         93%           93%            93%
United States............         5              5              5
Europe...................         1              1              1
Other....................         1              1              1
                            ---------------------------------------------
Total revenue............       100%            100%           100%
                            ---------------------------------------------


Fiscal Year 2001 Compared to Fiscal Year 2000

Revenue

During the year ended December 31, 2001, our online marketplace services
revenues increased despite the effects of the slow down in the US economy by
$0.4 million or 1% to $55.5 million as compared with $55.1 million in last year,
as a result of our increased sales efforts and the continuing acceptance by our
clients of Global Sources online marketplace services as a way of conducting
export trade. Revenues in our complementary media services declined by $7.6
million or 18% to $35.0 million during the year ended December 31, 2001 as
compared with $42.6 million during the corresponding period last year, as a
result of our on-going emphasis on online marketplace services. Total revenues
for the year ended December 31, 2001 were $95.3 million compared with $103.1
million for the year ended December 31, 2000, a decline of $7.8 million or 8%
mainly due to the effect of the slow down in the global economy.

Our goal is to be the leading creator and facilitator of global merchandise
trade. Our strategy to achieve and maintain this goal has four primary
components:

We intend to increase the penetration of our online marketplace services in our
existing 27 verticals and 14 geographic markets. We believe that the sales
representatives play a vital role in educating, attracting, retaining and
supporting these customers. We believe that as Global Sources Online grows in
content and usage, more buyers will be attracted, and thus, more suppliers will
seek to maintain Marketing Websites and use our associated services.

We will continue to use our Asian representatives and dominant market position
to facilitate global trade.

Our strategy is to leverage our combination of traditional and electronic media,
our content and supplier enablement capabilities, our Asian experience and
representation, and our growing community of buyers and suppliers, to create new
services.

We may pursue strategic acquisitions of complementary businesses, technologies
or products that we believe will accelerate one or more of the elements of our
strategy. We currently have no understandings, arrangements or agreements with
respect to any potential acquisitions. We also intend to develop and utilize
strategic partnerships to gain access to a larger number of potential users,
cooperatively market products and services, cross-sell additional services
and/or gain entry to new markets.

Operating expenses

Sales

The Company utilizes sales representatives in various territories to promote the
Company's products and services. Under these arrangements, the sales
representatives are entitled to commissions as well as marketing fees.
Commissions expense is recorded when owed to the sales representative and is
included in sales expenses.



                                       27
<PAGE>

The Company's sales representatives, which are mainly corporate entities, handle
collections from clients on behalf of the Company. Included in receivables from
sales representatives are amounts collected on behalf of the Company as well as
cash advances made to the sales representatives. The Company nominated a
director to the Board of Directors of eight of these sales representative
companies to monitor the receivables collected from our clients by these related
party sales representatives, and to monitor any changes to the authorized
signatories of the depository bank accounts. The nominated directors are
employees of the Company. The Company and the nominated directors do not have
any interest in the share capital of the sales representatives companies.

 Sales costs consist of the commissions paid and incentives provided to our
sales representatives and sales support costs. Sales costs declined from $34.4
million during the year ended December 31, 2000 to $32.0 million during the year
ended December 31, 2001, a decline of 7% due mainly to lower sales commissions
as a result of the decline in revenue.

Circulation

Circulation costs consist of the costs relating to our trade magazine publishing
business, specifically printing, paper, bulk circulation, subscription
promotions and customer services costs.

Circulation costs declined from $13.3 million during the year ended December 31,
2000 to $11.8 million during the year ended December 31, 2001, a decline of 11%
due mainly to reductions in subscription promotions costs, printing costs, paper
costs and magazine mailing costs.

General and Administrative

General and administrative costs consist mainly of corporate staff compensation,
information and technology support services, content management services,
marketing costs, office rental, depreciation, communication and travel costs.
General and administrative costs declined from $36.2 million during the year
ended December 31, 2000 to $33.7 million during the year ended December 31,
2001, a decline of 7% mainly due to reduction in content management services
costs, marketing expenses, travel costs and fees paid for professional services.

Development Costs

Development costs consist mainly of payroll costs, and office rental and
depreciation relating to the development of Global Sources Online, Private Buyer
Catalogs and Private Supplier Catalogs. Development costs to fund the expansion
of our online marketplace services increased from $6.7 million during the year
ended December 31, 2000 to $8.4 million during the year ended December 31, 2001,
an increase of 25%. This increase resulted from our continuing efforts to
enhance our online marketplace services.

Non-Cash Compensation Expenses

The Company has issued share awards under a variety of equity compensation
plans (ECP) to both employees and team members. The total non-cash compensation
expense, resulting from the ECP plans recorded by the company during the year
ended December 31, 2001, was $2.5 million.

Other non-cash expenses

Other non-cash expenses consist of amortization of intangibles, software
development costs and, for the year ended December 31, 2000, include the listing
expenses incurred in connection with our share exchange.

Other non-cash expenses during the year ended December 31, 2001 were $3.5
million consisting of $3.1 million amortization of software development cost and
$0.4 million for amortization of intangibles



                                       28
<PAGE>

compared to $2.4 million for the year ended December 31, 2000 consisting of $1.4
million for listing expenses, $0.6 million for amortization of software
development costs and $0.4 million for amortization of intangibles.

Income from operations

Income from operations for online marketplace services grew to $12.3 million
during the year ended December 31, 2001 from a loss of $23.3 million during the
year ended December 31, 2000, an improvement of 153%. The improvement is mainly
attributable to the reduction in non-cash compensation expenses, sales costs and
general and administrative expenses compared to year 2000, off-set partially by
an increase in online services development costs. The total income from
operations during the year ended December 31, 2001 was $3.4 million compared to
a loss of $55.6 million during the year ended December 31, 2000. The improvement
was mainly due to reductions in non-cash compensation expenses, sales costs,
circulation expenses and general and administrative expenses, off-set partially
by reductions in total revenue, increases in online services development costs
and amortization of software development cost.

Write-down of Investment

During the year ended December 31, 2000 we invested $11.0 million in equity
instruments of two privately held unaffiliated electronic commerce companies and
provided an unsecured cash advance of $2.0 million to one of these companies,
with an option to convert this unsecured advance into equity shares. These two
investments were accounted for under cost method since the ownership was less
than 20% and we do not have the ability to exercise significant influence over
the investees. We recorded these investments under long term investments in the
consolidated balance sheets.

It is our policy to review regularly the carrying values of the non-quoted
investments and to identify and provide for impairment when circumstances
indicate impairment other than temporary decline in the carrying values of such
assets.

During the fourth quarter of year 2000, based on the then available financial
positions of the investee companies, we wrote down 100% of one of the
investments that includes the loan. Subsequently, during the year ended December
31, 2001, this company went into liquidation. We estimated the value of the
second investment at $1.2 million based on the financial position and the
business model of the investee and we recorded an $8.8 million impairment loss.

During the year ended December 31, 2001, the above investee company raised
additional capital, which was fully subscribed. Based on the new pricing per
share for the new offering, we estimated the impairment loss to be at $1.1
million and wrote down the investment to $0.1 million in year ended December 31,
2001.

Income Taxes

The company and certain of its subsidiaries operate in the Cayman Islands and
other jurisdictions where no taxes are imposed on certain categories of company
revenues. Certain of the Company's subsidiaries operate in Hong Kong and
Singapore and are subject to income taxes in their respective jurisdictions.
Also, the Company is subject to withholding taxes for revenues earned in certain
other countries.

We reported a tax provision of $1.1 million during the year ended December 31,
2001 compared to $1.3 million during the year ended December 31, 2000.

Net Income

Net income was $0.8 million during the year ended December 31, 2001, compared
to a net loss of $68.2 million during the year ended December 31, 2000. The
improvement was due mainly to reductions in



                                       29
<PAGE>

non-cash compensation expenses, and write-downs of investments, sales costs,
circulation expenses and general and administrative expenses, off-set partially
by a reduction in revenue, an increase in online services development costs and
amortization of software development costs.

Fiscal Year 2000 Compared to Fiscal Year 1999

Our online marketplace services revenue grew from $25.5 million in the year
ended December 31, 1999 to $55.1 million in the year ended December 31, 2000, an
increase of 116%. This increase was attributable to our increased sales efforts
and the continuing acceptance by our clients of our online marketplace services
as a way of conducting export trade. Our complementary media services revenue
declined from $60.8 million in the year ended December 31, 1999 to $42.6 million
in the year ended December 31, 2000, a decrease of 30%. This decrease was
attributable to our ongoing emphasis on online marketplace services. Total
revenue grew from $90.3 million in the year 1999 to $103.1 million in the year
ended December 31, 2000, an increase of 14%.

Sales

Sales costs consists of the commissions paid and incentives provided to our
independent sales representatives and sales support costs. Sales costs increased
from $29.5 million in the year ended December 31, 1999 to $34.4 million in the
year ended December 31, 2000, an increase of 17% arising mainly from the growth
in revenue and sales support costs incurred for development of new markets.

Circulation

Circulation costs consist of the costs relating to our trade magazine publishing
business, specifically printing, paper, bulk circulation, subscription
promotions and customer services costs. Circulation costs increased from $13.1
million in the year 1999 to $13.3 million in the year ended December 31, 2000,
an increase of 2%, due mainly to increases in printing charges and paper costs
for increases in print runs.

General and Administrative

General and administrative costs consist mainly of corporate staff compensation,
information and technology support services, content management services,
marketing costs, office rental, depreciation, communication and travel costs.
General and administrative costs increased from $32.1 million in the year ended
December 31, 1999 to $36.2 million in the year ended December 31, 2000, an
increase of 13%, due mainly to cash expenses incurred in connection with our
recent share exchange, and increases in marketing expenses and fees paid for
professional services.

Development Costs

Development costs consist mainly of payroll costs, office rental and
depreciation relating to the development of Global Sources Online, Private Buyer
Catalogs, Private Supplier Catalogs and online Transaction Services. Development
costs to fund the expansion of our online marketplace services and transaction
services increased from $3.5 million in the year ended December 31, 1999 to $6.7
million in the year ended December 31, 2000, an increase of 91%. This increase
resulted from our efforts to continue to enhance our online marketplace services
and transaction services.

Non-cash Compensation Expense

On February 4, 2000, the Company established a restricted share award plan for
the benefit of our chairman and chief executive officer in recognition of
services to the Company. In conjunction with the restricted share award plan,
the principal shareholder assigned 4,008,221 ordinary shares of the company
representing 15.2% equity interest in the Company, to the company. The Company
then awarded these shares to our chairman and chief executive officer.



                                       30
<PAGE>

Effective August 30, 2000, the Company's equity compensation plan committee
approved the accelerated vesting of all the restricted shares granted to our
chairman and chief executive officer. The non-cash compensation expense
associated with this award amounted to $64 million. An amount of $10.3 million
was charged up to second quarter and $53.7 million was charged in the third
quarter. The $64 million non-cash compensation charge was correspondingly
credited to additional paid in capital, resulting in no dilution to
shareholders' equity.

In the third quarter 2000, the Company's equity compensation plan committee
granted awards under Equity Compensation Plan (ECP) II and ECP III to staff and
team members.

The total non-cash compensation expense, resulting from the one-time grant of
shares to the chairman and chief executive officer and the two ECP plans,
recorded by the Company during the year ended December 31, 2000 was $65.7
million.

Other non-cash expenses

Other non-cash expenses consist of listing expenses in connection with our
recent share exchange and amortization of intangibles and software development
costs.

Other non-cash expenses for the year ended December 31, 2000 was $2.4 million,
consisting mainly of $1.4 million incurred in connection with our recent share
exchange and $0.6 million amortization of software development cost, compared to
$0.4 million for the year ended December 31, 1999 for amortization of
intangibles.

Income/Loss from operations

Loss from operations for online marketplace services for the year 2000 was $23.3
million as compared to the income from operations of $3.6 million in 1999. Total
loss from operations during year ended December 31, 2000 was $55.6 million as
compared to an income from operations of $11.8 million during 1999. The loss
during year ended December 31, 2000 was mainly due to the non-cash compensation
expense of $65.7 million, non-cash listing expenses of $1.4 million and the
increase in online services development costs.

Write-down of investments

During the fourth quarter of year ended December 31, 2000, we wrote down $11.8
million on investments in and cash advances to unaffiliated electronic commerce
companies, based on the current financial position of the investee companies and
other information, which became available in quarter four and developments in
the technology and internet sectors in quarter four.

Income Taxes

The company and certain of its subsidiaries operate in the Cayman Islands and
other jurisdictions where there are no taxes imposed on companies. Certain of
the Company's subsidiaries operate in Hong Kong and Singapore and are subject to
income taxes in their respective jurisdictions. Also, the Company is subject to
withholding taxes for revenues earned in certain other countries. We reported a
tax provision of $1.3 million in the year ended December 31, 2000 and $1.4
million in the year ended December 31, 1999.

Net Income/Loss

Net loss was $68.2 million for the year ended December 31, 2000, as compared to
net income of $11.0 million for last year. This net loss was due mainly to the
non-cash compensation expense of $65.7 million, non-cash listing expenses of
$1.4 million and the write-down on investments in unaffiliated electronic
commerce companies of $11.8 million and an increase in online services
development costs.


                                       31
<PAGE>

Liquidity and Capital Resources

We financed our year ended December 31, 2001 activities using cash generated
from our operations.

Net cash generated from operating activities was $15.5 million during the year
ended December 31, 2001 and $16.9 million during the year ended December 31,
2000. The primary source of cash from operating activities was net income/(loss)
as adjusted by non-cash expenses and changes in working capital.

Net cash used for investing activities was $4.1 million during the year ended
December 31, 2001 which was used principally for capital expenditures for
computers, software and furniture and fixtures. Net cash used for investing
activities in year ended December 31, 2000 was $23.6 million, consisting of
$17.1 million capital expenditures on computers and software and $13.0 million
in investments in unaffiliated electronic commerce companies, off-set partially
by a $6.0 million capital introduced by a minority shareholder in the
corporation set-up pursuant to an agreement entered into with CMP Media Inc.,
through United Business Media B.V.

Net cash used for financing activities was $3.8 million during the year ended
December 31, 2001, which resulted from $4.0 million repayment of short-term
loan, off-set partially by share application money received from a director. Net
cash generated from financing activities was $4.0 million in the year ended
December 31, 2000, resulting from the short term borrowings net of repayments.

On March 13, 2001, we renewed the credit facility with Bank of Bermuda (Isle of
Man) Limited for a further twelve month period under the same terms and
conditions. The credit facility has a term of one year and provides a borrowing
facility of up to $25.0 million, which may be drawn in tranches of a minimum of
US$1.0 million. The lender may request that we secure our borrowings under the
credit facility. The credit facility bears interest, payable quarterly in
arrears, at the London Inter-Bank Market Rate plus 0.5%. The credit facility can
be used for investments, working capital and general corporate purposes. Our
principal shareholder, Hung Lay Si Co. Ltd., has guaranteed all of the
obligations under the credit facility. As of December 31, 2001, we had fully
repaid the borrowings as compared to $4.0 million drawn as of December 31, 2000.
On March 20, 2002, the credit facility was renewed for $10.0 million for one
year subject to the same terms and conditions as applicable to the original
facility.

Advance payments received from customers were $17.1 million as of December 31,
2001 and $15.9 million as of December 31, 2000, improving our liquidity. We
anticipate that cash on hand, and cash generated from operations will be
adequate to satisfy our working capital, capital expenditure requirements and
cash commitments based on our current levels of operation. We can also draw from
the credit facility mentioned above as and when required.

The Company's material commitments for capital expenditures included commitments
as of December 31, 2001 for the renovation work to be carried out on the
leasehold office facilities amounting to $0.09 million. The material commitments
as of March 31, 2002 included $0.2 million for the software development and
$0.06 million for renovation work to be carried out on the leasehold office
facilities.

The estimated future minimum lease payments for office facilities under
non-cancelable operating leases as of December 31, 2001 were as follows:

      Year Ending December 31,                          Operating Leases

               2002                                           $    471
               2003                                                471
               2004                                                414
                                                     ------------------------
                                                             $   1,356
                                                     ========================



                                       32
<PAGE>

We adopted Statement of Position 98-1, "Accounting for the Costs of Computer
Software Developed or Obtained for Internal Use". Costs incurred in the
preliminary project stage with respect to the development of software for
internal use are expensed as incurred; costs incurred during the application
development stage are capitalized and are amortized over the estimated useful
life of three years upon the commissioning of service of the software. Training
and maintenance costs will be expensed as incurred. During the last three
financial years we did not expense material amounts of research & development
costs.

Recent Accounting Pronouncements

As of December 31, 2001, the Company adopted the Emerging Issues Task Force
Issue No. 00-14, "Accounting for Certain Sales Incentives" (EITF 00-14). EITF
00-14 stipulates that the reduction in the selling price of the product or
service resulting from any cash sales incentive should be classified as a
reduction of revenue. The adoption of this EITF resulted in the Company
reclassifying certain sales incentives from a sales expense to a reduction of
revenue for all periods presented. This reclassification represented less than
3% of revenues for each period presented and did not impact net income.

In June 1998, the Financial Accounting Standards Board (FASB) issued Statements
of Accounting Standards (SFAS) No. 133, "Accounting for Derivative Instruments
and Hedging Activities" as amended by SFAS No. 137 and SFAS No. 138. This
statement, as amended, was effective January 1, 2001, and established accounting
and reporting standards for derivative instruments, including certain derivative
instruments imbedded in other contracts, and for hedging activities. The
adoption of SFAS No. 133, as amended, did not impact the Company's financial
position or results of operations.

In June, 2001, FASB issued SFAS No. 141, "Business Combinations," and SFAS No.
142, "Goodwill and Other Intangible Assets." SFAS No. 141 requires all business
combinations initiated after June 30, 2001 to be accounted for using the
purchase method. Under SFAS No. 142, goodwill and intangible assets with
indefinite lives are no longer amortized but are reviewed annually (or more
frequently if impairment indicators arise) for impairment. Separable intangible
assets that are not deemed to have indefinite lives will continue to be
amortized over their useful lives (but with no maximum life). The amortization
provisions of SFAS No. 142 apply immediately to goodwill and intangible assets
acquired after June 30, 2001. With respect to goodwill and intangible assets
acquired prior to July 1, 2001, we are required to adopt SFAS No. 142 effective
January 1, 2002. As goodwill was fully amortized and no acquisitions occurred
during 2001, management believes that the adoption of these standards will not
have a material impact on the Company's financial statement of position, results
of operations, or cash flows.

In June 2001, FASB issued SFAS No. 143, "Accounting for Asset Retirement
Obligations." This statement addresses financial accounting and reporting for
obligations associated with the retirement of tangible long-lived assets and the
associated asset retirement costs. The purpose of this statement is to develop
consistent accounting for asset retirement obligations and related costs in the
financial statements and provide more information about future cash outflows,
leverage and liquidity regarding retirement obligations and the gross investment
in long-lived assets. We will be required to implement SFAS No. 143 on January
1, 2003 and believe that the adoption of this standard will not have a material
impact on the Company's financial statement of position, results of operations,
or cash flows.

In August 2001, FASB issued SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets." This statement addresses financial accounting
and reporting for the impairment or disposal of long-lived assets, superseding
SFAS No. 121, "Accounting for the Impairment of Long-Lived Assets and for
Long-Lived Assets to Be Disposed Of." The statement also supersedes the
accounting and reporting provisions of APB Opinion No. 30, Reporting the Results
of Operations -- Reporting the Effects of Disposal of a Segment of a Business,
and Extraordinary, Unusual and Infrequently Occurring Events and Transactions,
for segments of a business to be disposed. The Company is required to adopt this
statement on January 1, 2002 and believes that the adoption of this standard
will not have a material impact on the Company's financial statement of
position, results of operations, or cash flows.




                                       33
<PAGE>

Qualitative and quantitative disclosures about market risk

We operate internationally and foreign exchange rate fluctuations may have a
material impact on our results of operations. Historically, currency
fluctuations have been minimal on a year to year basis in the currencies of the
countries where we have operations. As a result, foreign exchange gain or losses
in revenues and accounts receivable have been offset by corresponding foreign
exchange losses or gains arising from expenses. However, during the Asian
economic crisis of 1997 to 1998, both advertising sales and the value of Asian
currencies declined, which caused a significant decline in revenues that was not
fully offset by lower expense levels in Asian operations.

This decline in revenues occurred due to contracts being denominated and priced
in foreign currencies prior to devaluations in Asian currencies. The conversion
of these contract proceeds to U.S. dollars resulted in losses and reflects the
foreign exchange risk assumed by us between contract signing and the conversion
of cash into U.S. dollars. We believe this risk is mitigated because
historically a majority (ranging between 55% to 65%) of our revenues are
denominated in U.S. dollars or are received in the Hong Kong currency which is
currently pegged to the U.S. dollar. To the extent significant currency
fluctuations occur in the New Taiwan dollar or other Asian currencies, or if the
Hong Kong dollar is no longer pegged to the U.S. dollar, our profits would be
affected.

As of December 31, 2001, we have not engaged in foreign currency hedging
activities.

In 2001, the Company derived more than 90% of our revenue from customers in the
Asia-Pacific region. The Company expects that a majority of our future revenue
will continue to be generated from customers in this region. Future political or
economic instability in the Asia-Pacific region could negatively impact the
business.


ITEM 6.  DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

Directors and Senior Management

The following table sets forth information regarding the persons who are our
executive officers and directors.

<TABLE>
<CAPTION>

Name                                         Age      Position
----                                         ---      --------

<S>                                          <C>      <C>
Merle A. Hinrichs.....................       60       Director, Chairman and Chief Executive Officer
Eddie Heng Teng Hua...................       51       Director and Chief Financial Officer
J. Craig Pepples......................       41       Chief Operating Officer
Bill Georgiou.........................       57       Chief Information Officer
Sarah Benecke.........................       45       Director
David F. Jones........................       37       Director
Jeffrey J. Steiner....................       65       Director
Roderick Chalmers.....................       54       Director
Dr. H. Lynn Hazlett...................       65       Director
</TABLE>

Merle Hinrichs is one of our founders and served as principal executive officer
of Trade Media (our predecessor) from 1971 through 1993 and resumed that
position in September 1999. From 1994 to August 1999, Mr. Hinrichs was chairman
of the ASM Group which included Trade Media. Mr. Hinrichs is a co-founder and
former chairman of the Society of Hong Kong Publishers. He is a member of the
board of trustees of the American Graduate School of International Management
(Thunderbird) and is a board member of the Economic Strategy Institute. His term
as director expires in 2003.



                                       34
<PAGE>

Eddie Heng has been our chief financial officer (previously entitled vice
president of finance) since April 1994. He joined us in August 1993 as deputy to
the vice president of finance. He is a member of The Institute of Certified
Public Accountants, Singapore and a Fellow Member of The Association of
Chartered Certified Accountants in the United Kingdom. Prior to joining us, he
was the regional financial controller of Hitachi Data Systems, a joint venture
between Hitachi and General Motors. His term as director expires in 2004.

Craig Pepples has been our chief operating officer since June 1999 and is
responsible for our worldwide operations, including interactive media, corporate
marketing, community development, information services, human resources and
finance. Mr. Pepples joined us in October 1986 in an editorial capacity, managed
our sales in China from 1989 to 1992, and served as country manager for China
from 1992 to June 1999.

Bill Georgiou was appointed chief information officer (previously chief
technology officer) in January, 2001. Mr. Georgiou has had over 20 years
experience in information technology, most recently as a consultant with 3Com
Technologies during 2000 and as Chief Information Officer with Park N'Shop (HK)
Ltd. from 1999 to 2000. He received his B.Ec. (Honours degree) and M.B.A. from
the University of Adelaide.

Sarah Benecke has been one of our directors since July 1993. She was our
principal executive officer from January 1994 through August 1999. She joined us
in May of 1980 and served in numerous positions, including publisher from 1988
to December 1992 and chief operating officer in 1993. Her term as director
expires in 2004.

David Jones has been one of our directors since July 1999. He was an executive
at MacQuarie Direct Investment, a venture capital firm in Sydney, Australia from
1994 to August 1999, where he was responsible for investment and strategic
analysis of potential and existing portfolio companies. He joined UBS Capital in
July 1999 and is currently a director of Miller's Retail Ltd., which is one of
our customers. His term as director expires in 2002.

Jeffrey Steiner has been one of our directors since April 2000. He has also been
a director of The Fairchild Corporation since 1985. He has been the chairman of
the board and chief executive officer of Fairchild from December 1985 to the
present. Mr. Steiner was president of Fairchild from July 1991 to November 1998.
He is president of Cedco Holdings Ltd., a Bermuda corporation, and a director of
The Copley Fund. His term as director expires in 2003.

Roderick Chalmers has been one of our directors since October 2000. He was
chairman, Asia-Pacific, of PricewaterhouseCoopers ('PwC') and a member of PwC's
Global Management Board between 1998 and until his retirement in July 2000. He
has been a 30 year veteran with PwC merger partner Coopers & Lybrand with
specialist experience in the securities industry. He has at various times been a
non-executive director of the Hong Kong Securities and Futures Commission, a
member of the Takeovers and Mergers Panel, and chairman of the Working Group on
Financial Disclosure. His term as director expires in 2003.

Dr. H. Lynn Hazlett has been one of our directors since October 2000. He was a
former chief executive officer and president of QRS Corporation, a leading
US-based provider of supply chain management solutions to the retail industry,
until his retirement in 2000. He previously managed Supply Chain Associates, an
international consulting firm until 1997. Prior to that he was corporate vice
president at VF Corporation, the US apparel company, from 1989 to 1994. Dr.
Hazlett has a doctorate in Economics and Automated Systems from George
Washington University. His term as director expires in 2002.

Compensation



                                       35
<PAGE>

For the year ended December 31, 2001, we and our subsidiaries provided our nine
directors and executive officers as a group aggregate remuneration, pension
contributions, allowances and other benefits of approximately $2,541,592
including the non-cash compensation of $522,981 associated with the share award
and ECP plans. Of that amount, $195,000 was paid under a performance based,
long-term discretionary bonus plan which we implemented in 1989 for members of
our senior management. Under the plan, members of senior management may, at our
discretion, receive a long-term discretionary bonus payment. The awards, which
are payable in either five or ten years time, are paid to a member of senior
management if his or her performance is satisfactory to us. There are seven
current members of senior management and three former members of senior
management who may receive payments on maturity.

In 2001, we and our subsidiaries incurred $29,677 in costs to provide pension,
retirement or similar benefits to our respective officers and directors pursuant
to our retirement plan and pension plan.

Employment Agreements

We have employment agreements with Merle A. Hinrichs under which he serves as
our and one of our subsidiaries' chairman and chief executive officer. The
agreements contain covenants restricting Mr. Hinrichs' ability to compete with
us during his term of employment and preventing him from disclosing any
confidential information during the term of his employment agreement and for a
period of three years after the termination of his employment agreement. In
addition, we retain the rights to all trademarks and copyrights acquired and any
inventions or discoveries made or discovered by Mr. Hinrichs in the course of
his employment. Upon a change of control, if Mr. Hinrichs is placed in a
position of lesser stature than that of a senior executive officer, a
significant change in the nature or scope of his duties is effected, Mr.
Hinrichs ceases to be a member of the board or there is a breach of those
sections of his employment agreements relating to compensation, reimbursement,
title and duties or termination, each of us and such subsidiary shall pay Mr.
Hinrichs a lump sum cash payment equal to five times the sum of his base salary
prior to the change of control and the bonus paid to him in the year preceding
the change of control. The agreements may be terminated by either party by
giving six months notice.

We have employment agreements with each of our executive officers. Each
employment agreement contains a non-competition provision, preventing the
employee from undertaking or becoming involved in any business activity or
venture during the term of employment without notice to us and our approval. The
employee must keep all of our proprietary and private information confidential
during the term of employment and for a period of three years after the
termination of the agreement. We can assign the employee to work for another
company if the employee's duties remain similar. In addition, we retain the
rights to all trademarks and copyrights acquired and any inventions or
discoveries made or discovered by the employee during the employee's term of
employment. Each employment agreement contains a six month's notice provision
for termination, and does not have a set term of employment. Bonus provisions
are determined on an individual basis.

Board Practices

Our board of directors consists of seven members divided into three classes, the
terms of which expire at the general meeting of shareholders to be held in each
year indicated above. Each director will hold office until his or her term
expires and his or her successor has been elected and qualified. Beginning in
2000, at each general meeting of shareholders, directors nominated to a class
with a term that expires in that year will be elected for a three-year term.
Executive officers serve at the discretion of the board of directors. Officers
are elected at the annual meeting of the directors held immediately after the
annual general meeting of shareholders. Our executive officers have, on average,
14 years of service with us.

Committees of the board of directors

We have established an audit committee and an executive committee. The audit
committee recommends the appointment of auditors, oversees accounting and audit
functions and other key financial matters of



                                       36
<PAGE>

our company. David Jones, Roderick Chalmers and Lynn Hazlett are the members of
the audit committee. The executive committee acts for the entire board of
directors between board meetings. Merle Hinrichs and Eddie Heng are the members
of the executive committee.



Employees

As of December 31, 2001, we had 526 employees worldwide, the majority of whom
work in management, technical or administrative positions. We consider our
employee relationships to be satisfactory. Our employees are not represented by
labor unions and we are not aware of any attempts to organize our employees.

The following summarizes the approximate number of employees and independent
contractors by function:

<TABLE>
<CAPTION>
                                                                                     Independent
Function                                                           Employees         Contractors         Total
--------                                                           ---------         -----------         -----
<S>                                                                       <C>              <C>            <C>
Content Development.............................................          59               166            225
Corporate Human Resources & Administration......................          42                27             69
Corporate Marketing.............................................           9                29             38
Community Development...........................................          81                30            111
Sales...........................................................          74               813            887
Publishing......................................................          63                47            110
Electronic Commerce Services....................................          21                 4             25
Information System Department...................................          92                91            183
Corporate Accounts..............................................          70                49            119
New Markets.....................................................           2                 7              9
Office of the CEO, COO, CTO.....................................           8                 3             11
Legal and Group Secretarial.....................................           4                 9             13
Conference & Exhibition Services.................................          1                 7              8
                                                                   -------------------------------------------------
        Total Staff.............................................         526              1282           1808
                                                                   -------------------------------------------------
</TABLE>

Share Ownership

Equity compensation plans

We established The Global Sources Employee Equity Compensation Trust on December
30, 1999. The Trust is administered by Harrington Trust Limited, as trustee. The
purpose of the Trust is to administer monies and other assets contributed to the
trustee for the establishment of equity compensation and other benefit plans,
including the equity compensation plans described below. The number of shares
that may be sold pursuant to these plans is limited to the number of our shares
held by the Trust. On February 4, 2000 Hung Lay Si Co. Ltd. made a capital
contribution to us of 1,000 Class A Ordinary Shares of Trade Media, representing
a 10% equity interest, and subsequently contributed these shares to the Trust.
These Trade Media shares currently represent our common shares. As of March 25,
2002, the Trust holds 2,492,224 of our common shares. The Trust does not intend
to acquire any additional shares. In exercising its powers, including the voting
of securities held in the Trust, the trustee may be directed by a plan
committee, selected by the board of directors of one of our wholly owned
subsidiaries.

Global Sources Equity Compensation Plans Numbers I, II and III

In March 2000, we adopted the Global Sources Equity Compensation Plans (ECP)
Numbers I, II and III. Employees, directors, consultants, advisors and
independent contractors of ours, our subsidiaries or affiliates are eligible to
receive option grants under ECP I. Employees and directors of ours, our
subsidiaries or affiliates are eligible to receive grants under ECP II and III.
Options granted under ECP I



                                       37
<PAGE>

and II will be exercisable, and coupons granted under ECP III will be
redeemable, for our shares held by the trust.

ECPs I, II and III are administered by the trustee subject to the directions of
the plan committee of one of our wholly-owned subsidiaries. The plan committee
determines who will receive, and the terms of, the options under ECP I and II.
The exercise price of these options may be below the fair market value of our
shares. Under ECP I, payment for shares being purchased upon exercise of an
option may be made in the manner determined by us at the time of grant. Under
ECP II optionees may pay for common shares purchased upon exercise of options by
check to the trust. Under ECP II, the number of common shares that optionees may
purchase is based on the number of years they have been employed by, or have
been working with us, our subsidiaries or affiliates.

Under ECP III, outstanding coupons are redeemable for a defined amount of
compensation payable in our common shares, which will be transferred from the
trust to the coupon holders. The number of shares will be determined by dividing
the amount of compensation awarded by an amount determined by the plan
committee. Under each of ECPs I and III, the maximum number of shares that may
be issued to any individual in any calendar year may not exceed 25% of the total
shares available under such plan.

On each of the first three annual anniversaries of the listing of our common
shares on a securities exchange, including NASDAQ, the trustee will release
one-third of the common shares purchased by an optionee, under ECP II, and
one-third of the shares granted to each coupon holder, under ECP III, if such
optionee or holder, as the case may be, is still employed with us on these
dates. Under ECP II, the consideration paid for any common shares purchased by
an optionee fired for cause or who becomes an employee of one of our
competitors, but not yet released by the trustee, will be returned to the
optionee by the trust and the right to receive these shares will be forfeited
and revert back to the trustee. Under ECP III, common shares allotted by, but
not yet released by the trustee, to an employee who is subsequently fired for
cause or who becomes an employee of one of our competitors, are forfeited and
revert back to the trustee for future use. Options are not transferable under
ECPs I and II and coupons are not transferable under ECP III.

Under ECPs I and II, all options held by an optionee terminate on the date of
that optionee's termination for cause or resignation. Death, disability or
retirement does not affect an optionee's right to exercise an option.

All outstanding options are adjusted to preserve the optionee's benefits under
ECPs I and II and all outstanding common shares are adjusted to preserve the
interests of the holders of these common shares under ECP III if there is a
change in the number of our outstanding common shares or an exchange for
securities of a successor entity as a result of our: (i) reorganization; (ii)
recapitalization; (iii) stock dividend; or (iv) stock split.

If a person or group of persons acting together becomes the beneficial owner of
at least 50% of our issued and outstanding common shares, by tender offer or
otherwise, all unexercised options under ECPs I and II become immediately
exercisable and all optionees will be entitled to sell to the trustee all
unexercised options at a price equal to the greater of fair market value or the
tender offer price.

ECPs I, II and III terminate and all optionees will be entitled to sell to the
trustee all unexercised options at a price equal to the difference between the
fair market value of the common shares and the aggregate exercise price of the
options under ECPs I and II and securities and any cash held by the trustee
shall be distributed in equal shares to people who received coupons under ECP
III, upon our: (i) dissolution or liquidation; (ii) reorganization, merger or
consolidation; or (iii) sale of our business. If none of these events occurs,
ECPs I, II and III terminate in February 2010.



                                       38
<PAGE>

Global Sources Equity Compensation Plans Numbers IV and V

Eligible employees, directors and consultants under ECP IV are awarded a defined
amount of compensation payable in Global Sources Ltd. common shares, the number
of which are determined by the plan committee periodically.

Entitlement of the employees, directors and consultants to these common shares
is subject to employment and vesting terms.

Eligible employees, directors and consultants under ECP V were awarded a
one-time grant of shares, the number of which was determined by the plan
committee.

Entitlement of the employees to these common shares is subject to employment and
vesting terms.

The Equity Compensation Plan committee approved the awards under ECP IV and ECP
V on January 23, 2001 and approved additional awards under ECP IV on April 1,
2001 and July 1, 2002.

The non-cash compensation expenses associated with the above awards under ECP IV
and ECP V of approximately $3,337,095 and $1,983,118 respectively, are
recognized over the five year vesting term from the respective award date.

The Equity Compensation Plan committee approved further awards under ECP IV and
ECP V in January 2002. The non-cash compensation expenses associated with the
above awards under ECP IV and ECP V of approximately $537,000 and $120,000 will
be recognized over the five year vesting term.

Global Sources Equity Compensation Plan VI

Eligible employees, directors and consultants under ECP VI are awarded a one
time grant of Global Sources Ltd. common shares, the number of which is
determined by the plan committee.

Entitlement of the employees, directors and consultants to these common shares
is subject to non-compete and vesting terms.

The plan committee approved the ECP VI on March 13, 2001 and made awards under
the plan on various dates during the year 2001.

The non-cash compensation expenses associated with the awards under ECP VI
totaling to approximately $313,200 are recognized over the five year vesting
term from the respective award date.

Directors Stock Option Plan

A Non-executive Director Option Plan was approved on October 26, 2000 by the
shareholders of the Company. Each eligible director on the date of the first
board meeting of each calendar year, commencing in 2001, receives the grant of
an option to purchase 20,000 common shares on that date. The options granted are
subject to such terms and conditions as determined by the board of directors at
the time of the grant.

The option price per share, payable before the end of each February, is fifteen
percent less than the average closing price of the shares for the last five
trading days of the previous calendar year. The non-executive directors may
decline all or part of the award, which is non-transferable.

The board granted the first awards under the above plan in 2001. The award vests
over four years with one quarter of the shares vesting each year. Full payment
must be made when exercising the option. Upon resignation of an eligible
director, all unvested shares are forfeited and the option price received for
the forfeited unvested shares is refunded.



                                       39
<PAGE>

Only one director accepted the offer for the 20,000 shares granted under the
option on February 10, 2001. The $164,400 received as proceeds of this plan was
included as additional paid-in capital as at December 31, 2001.

As per the terms of the plan, the board granted options to all eligible
directors again in February 2002. These awards will vest after four years.
Optionees must pay 15% of the option price, which is the average closing price
of the shares for the last five trading days of year 2001, at the time of
exercising the option. The remaining 85% must be paid on or before the vesting
date. The resignation of a director following his or her exercise of the grant
of options and payment of the option price shall not cause a forfeiture of the
unvested shares. All the eligible non-executive directors accepted the offer
before February 28, 2002.


ITEM 7.  MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

Major Shareholders

The following table sets forth information about those persons who hold more
than 5% of our common shares and the share ownership of our directors and
officers as a group. The information is based upon our knowledge of the share
ownership of such persons on February 28, 2002.

Hung Lay Si Co. Ltd. is a company organized under the laws of the Cayman
Islands. It is wholly owned by the Quan Gung 1986 Trust, a trust formed under
the laws of the Island of Jersey. The trustee of the trust is Hill Street
Trustees Limited, an Island of Jersey limited liability company whose shares are
wholly owned by the partners of the Mourant Group, which is a firm based in the
Island of Jersey that provides trust administration services. Hill Street
Trustees Limited is the sole beneficial owner of the Hung Lay Si Co. Ltd. shares
under applicable Securities and Exchange Commission regulations.

The Quan Gung 1986 Trust (through Hung Lay Si Co. Ltd., its wholly owned
subsidiary) beneficially owns approximately 61% of our common shares. The Quan
Gung 1986 Trust was formed under the laws of the Island of Jersey. Counsel to
the trustee has informed us that, by virtue of the terms of the Trust and the
laws of the Island of Jersey, the trustee cannot make disclosure of the names of
the beneficiaries and settlor of the Trust in breach of the obligations placed
on it and in accordance with its duties of confidentiality. Accordingly, you may
never know the identity of the beneficiaries or settlor of the Quan Gung 1986
Trust.

<TABLE>
<CAPTION>
                                                                   Common Shares Beneficially Owned
 Name of Beneficial Owner                                            Shares               Percentage
                                                                     ------               ----------
<S>                                                                <C>                    <C>
Hung Lay Si Co. Ltd.......................................         16,035,388             61.0%
Merle A. Hinrichs.........................................          4,008,221             15.2
Jeffrey J. Steiner(1).....................................            313,131              1.2
Eddie Heng Teng Hua.......................................             *                    *


                                       40
<PAGE>

J. Craig Pepples..........................................             *                    *
Bill Georgiou.............................................             *                    *
Sarah Benecke.............................................             *                    *
David F. Jones............................................             *                    *
Roderick Chalmers.........................................             *                    *
Dr. Lynn Hazlett..........................................             *                    *
All officers and directors as a group (9 persons).........          4,368,516(1)          16.6%

</TABLE>

* Indicates beneficial ownership of less than 1%.

(1) Mr. Jeffrey J. Steiner is the sole manager of The Steiner Group LLC, and as
such may be deemed to beneficially own the same common shares owned directly or
beneficially by The Steiner Group LLC. Mr. Steiner disclaims beneficial
ownership of shares owned by The Steiner Group LLC, the Jeffrey Steiner Family
Trust and shares owned by him as custodian for his children. The Steiner Group
LLC is a Delaware limited liability company. Jeffrey J. Steiner is its sole
manager. The members are Jeffrey J. Steiner (with a 20% membership interest) and
The Jeffrey Steiner Family Trust (with an 80% membership interest). The Jeffrey
Steiner Family Trust is a trust created for the benefit of the issue of Jeffrey
J. Steiner.

At March 29, 2002, 828,153 of our shares, or 3.1%, were beneficially owned by
U.S. holders and there were 2,591 shareholders of record in the U.S.

The Quan Gung 1986 Trust, through Hung Lay Si Co. Ltd., its wholly owned
subsidiary, beneficially owns approximately 61% of our common shares and is
deemed our controlling shareholder.

Our major shareholders do not have different voting rights. We do not know of
any arrangement which may at a subsequent date result in a change in control of
our company.

Related Party Transactions

On December 31, 2001, we had $11,404,000 in net intercompany obligations due to
our controlling shareholder.

These obligations arose from:

     o    the transfer of intangibles, including copyrights for magazines, from
          Hung Lay Si Co. Ltd. to us after our re-incorporation in the Cayman
          Islands in 1983; and

     o    allocations of operating expenses from Hung Lay Si Co. Ltd. and its
          affiliates to us, as described in the last paragraph of Note 10 to our
          audited consolidated financial statements included elsewhere in this
          document.

Effective January 1, 2000, we executed an unsecured promissory note in the
principal amount of $11,404,000 to establish the repayment terms of these
intercompany obligations owed to Hung Lay Si Co. Ltd. On January 1, 2005, we
will begin repayment of this promissory note by making quarterly payments of
principal and interest over the following ten years. Interest will accrue
beginning on January 1, 2005 at the U.S. Federal Funds rate on the following
business day and will be adjusted quarterly. For each subsequent interest
period, the interest rate will be the U.S. Federal Funds rate on the first
business day of the applicable calendar quarter. If we fail to make a timely
payment, the interest rate on that payment will be adjusted quarterly to equal
2% over the U.S. Federal Funds rate on the first business day of each calendar
quarter that payment and the accrued but unpaid interest are outstanding until
that payment is made. The interest that accrues on the unpaid amount will be
payable quarterly unless Hung Lay Si Co. Ltd. demands immediate payment. If we
fail to make a payment, Hung Lay Si Co. Ltd. may also accelerate the promissory
note and demand full payment.



                                       41
<PAGE>

We have extended loans to certain members of our senior management who are
living abroad, for the sole purpose of financing the purchase or lease of a
residence. The loans for the purchase of a residence are secured by that
residence, bear interest at a rate of LIBOR plus 2 to 3%, generally have a term
of ten years and become due and payable immediately upon the termination of the
employee's employment. The loans for the lease of a residence are unsecured,
interest free and are repayable in equal monthly installments over the period of
the lease, which is typically less than or equal to 12 months. The maximum loan
amounts are limited to the lower of the aggregate of two years' gross
compensation of the borrower or $500,000. The loans were made upon terms and
subject to conditions that are more favorable to the borrowers than those that
would customarily be applied by commercial lending institutions in the
borrower's country of employment. Since the beginning of 1998, the largest
aggregate amount of indebtedness of Mr. Pepples and Ms. Benecke to us,
outstanding at any time during such period, was approximately $40,733 and
$350,011, respectively. As of December 31, 2001, the indebtedness of Mr. Pepples
to us was approximately $14,486. Ms. Benecke has repaid her loan in full in July
1999. Ms. Benecke's loan was secured and bore interest at a rate of LIBOR plus
2%. Mr. Pepples' loan was interest free and unsecured.

We lease approximately 97,940 square feet of our office facilities from
affiliated companies under cancelable and non-cancelable operating leases and
incur building maintenance services fees to those affiliated companies. We
incurred rental and building services expenses of $1,044,284 during the year
ended December 31, 2001. We also receive legal and secretarial services from our
affiliate companies. The expenses incurred for these services during the year
ended December 31, 2001 was $464,182.

On March 17, 2000 we entered into a revolving credit facility with Bank of
Bermuda (Isle of Man) Limited. The credit facility has a term of one year and
provides for borrowings of up to $25.0 million, with minimum borrowings of $1.0
million. The lender may request security from time to time to secure borrowings
under the credit facility. The credit facility bears interest, payable quarterly
in arrears, at the London Inter-Bank Market Rate plus 0.5%. The credit facility
may be used for investments, working capital and general corporate purposes. If
any payment is not made when due, the interest rate will increase by 2% on the
aggregate amount outstanding and will be payable in arrears and, if not paid
when due, will be compounded. The loan may not be prepaid prior to the end of
any quarter, but if the bank notifies us of its intention to charge a
maintenance fee to cover its costs for the facility, we may prepay without
penalty the amount outstanding within seven days of the bank's notice. When we
entered into the credit facility, we paid the bank an arrangement fee of
approximately $16,000. Hung Lay Si Co. Ltd. has guaranteed all of our
obligations under the credit facility. We repaid the loan by December 31, 2001.

On March 20, 2002, the credit facility was renewed for $10.0 million for one
year subject to the same terms and conditions as applicable to the original
facility.

We utilize sales representatives in various territories to promote our products
and services. Under these arrangements, the sales representatives are entitled
to commissions and marketing fees. The sales representatives, which are mainly
corporate entities, handle collections from clients on our behalf. We nominated
a director to the board of directors of eight of these sales representative
companies. The nominated directors are our employees. We and the nominated
directors do not have any interest in these eight related party sales
representative companies. We incurred approximately $20,171,614 of commissions
and marketing fees expenses associated with these related party sales
representative companies during the year ended December 31, 2001.

We also provided technical services to these related party sales representatives
and to a subsidiary of our parent company, for a fee. During the year ended
December 31, 2001, we received such services fee of $258,784.

For further information on these transactions, see notes to our audited
consolidated financial statements included elsewhere in this document.



                                       42
<PAGE>

Our management believes these transactions are commercially reasonable in the
jurisdictions where we operate and for our employees where they reside or work.




ITEM 8.  FINANCIAL INFORMATION

Consolidated statements and other financial information


                      GLOBAL SOURCES LTD. AND SUBSIDIARIES

                   Index to Consolidated Financial Statements
                                December 31, 2001



                                                                     Page



Reports of Independent Public Accountants ........................     44



Consolidated Balance Sheets.......................................     45



Consolidated Statements of Income.................................     46



Consolidated Statements of Cash Flows.............................     47



Consolidated Statement of Shareholders' Equity....................     48



Notes to Consolidated Financial Statements........................   49 - 68



                                       43
<PAGE>



REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS


To the Board of Directors and Shareholders of
Global Sources Ltd.

We have audited the accompanying consolidated balance sheets of Global Sources
Ltd. (a company incorporated under the laws of Bermuda) and its subsidiaries as
of December 31, 2001 and 2000, and the related consolidated statements of
income, shareholders' equity and cash flows for each of the three years in the
period ended December 31, 2001. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated financial position of Global
Sources Ltd. and its subsidiaries as of December 31, 2001 and 2000, and the
results of their operations and cash flows for each of the three years in the
period ended December 31, 2001, in conformity with accounting principles
generally accepted in the United States of America.


/s/ ARTHUR ANDERSEN


Singapore
February 28, 2002




                                       44
<PAGE>



                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS

     (In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)


<TABLE>
<CAPTION>
                                                                                             At                   At
                                                                                        December 31           December 31
                                                                                      -----------------    ------------------
                                                                                            2000                 2001
                                                                                      -----------------    ------------------

                                     ASSETS
Current Assets:
<S>                                                                                       <C>                  <C>
   Cash and cash equivalents .............................................                $   12,727           $    20,236
   Accounts receivable, net ..............................................                     7,803                 5,710
   Receivables from sales representatives ................................                       556                   709
   Receivables from related party sales representatives ..................                     3,438                 2,900
   Inventory of paper ....................................................                     1,213                   856
   Prepaid expenses and other current assets .............................                     1,768                 1,122
                                                                                      -----------------    ------------------
         Total Current Assets ............................................                    27,505                31,533
                                                                                      -----------------    ------------------

   Property and equipment, net ..............................................                 23,205                19,058
   Intangible assets, net ...................................................                    373                     3
   Long term investments ....................................................                  1,250                   100
   Bonds held to maturity, at amortized cost ................................                  2,027                 1,709
   Other assets .............................................................                  1,346                 1,199
                                                                                      -----------------    ------------------
         Total Assets ....................................................                $   55,706           $    53,602
                                                                                      =================    ==================
                      LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
   Accounts payable ......................................................                $    5,536              $  3,625
   Deferred income and customer prepayments ..............................                    15,888                17,122
   Accrued liabilities ...................................................                     5,879                 5,127
   Short-term loan .......................................................                     4,000                     -
   Income taxes payable ..................................................                       158                   164
                                                                                      -----------------    ------------------
         Total Current Liabilities .......................................                    31,461                26,038
                                                                                      -----------------    ------------------
   Liabilities for incentive and bonus plans .............................                     1,794                 1,434
   Amount due to parent company ..........................................                    11,404                11,404
   Minority interest .....................................................                     2,432                 2,515
   Deferred tax liability ................................................                       454                   610
                                                                                      -----------------    ------------------
         Total Liabilities ...............................................                    47,545                42,001
                                                                                      -----------------    ------------------


                                       45
<PAGE>


Shareholders' equity:
    Ordinary shares, US$0.01 par value; 50,000,000 shares authorized;
         26,303,949 (2000: 26,303,949) shares issued and outstanding                             263                   263
   Additional paid in capital                                                                 75,726                80,196
   Retained earnings/(deficit)                                                               (62,762)              (61,987)
   Less : Unearned compensation                                                               (5,066)               (6,871)
                                                                                      -----------------    ------------------
         Total shareholders' equity                                                            8,161                11,601
                                                                                      -----------------    ------------------
         Total liabilities and shareholders' equity                                       $   55,706            $   53,602
                                                                                      =================    ==================
</TABLE>


   The accompanying notes are an integral part of these financial statements.



                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                        CONSOLIDATED STATEMENTS OF INCOME

     (In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)


<TABLE>
<CAPTION>
                                                                                       Year Ended December 31,
                                                                     ------------------------------------------------------------
                                                                           1999                  2000                 2001
                                                                     ------------------    -----------------    -----------------

Revenues:
<S>                                                                         <C>                 <C>                  <C>
  Online marketplace services ...................................           $  25,463           $   55,121           $   55,468
  Transaction software and services .............................                 584                  733                  305
  Complementary media services ..................................              60,846               42,602               34,964
  Other .........................................................               3,379                4,597                4,548
                                                                     ------------------    -----------------     ----------------
                                                                               90,272              103,053               95,285
Operating Expenses:
  Sales .........................................................              29,481               34,436               32,047
  Circulation ...................................................              13,069               13,337               11,757
  General and administrative ....................................              32,134               36,197               33,726
  Online services development ...................................               3,461                6,665                8,393
  Non-cash compensation expense (Note a) ........................                   -               65,689                2,501
  Non-cash listing expenses .....................................                   -                1,353                    -
  Amortization of intangibles/Software development cost .........                 371                1,018                3,476
                                                                     ------------------    -----------------    -----------------
Total Operating Expenses ........................................              78,516              158,695               91,900
                                                                     ------------------    -----------------    -----------------
Income/(Loss) from Operations ...................................              11,756              (55,642)               3,385
                                                                     ------------------    -----------------    -----------------
  Interest expense ..............................................                (337)                (649)                (172)
  Interest income ...............................................                 558                1,135                  357
  Foreign exchange gains (losses), net ..........................                 427                   50                  (470)
  Write-down of investments .....................................                   -              (11,750)               (1,150)
                                                                     ------------------    -----------------    -----------------
Income/(Loss) before Income Taxes ...............................              12,404              (66,856)               1,950
Income Tax Provision ............................................              (1,435)              (1,277)               (1,143)
                                                                     ------------------    -----------------    -----------------
Income/(Loss) before minority interest ..........................         $    10,969          $   (68,133)           $     807
                                                                     ------------------    -----------------    -----------------
Equity in (loss)/income of affiliate ............................                   -                  (51)                  51
Minority interest ...............................................                   -                  (37)                 (83)
                                                                     ------------------    -----------------    -----------------
Net Income/(Loss) ...............................................         $    10,969          $   (68,221)           $     775
                                                                     ==================    =================    =================

Basic and diluted net income/(loss) per share ...................          $     0.44           $    (2.63)           $    0.03
                                                                     ==================    =================    =================
Shares used in basic and diluted net income /(loss) per share
  calculations (Note 14) ........................................          25,051,380           25,948,028           26,303,949
                                                                     ==================    =================    =================
</TABLE>


Note : a. Reflects the non-cash compensation expenses associated with the
     transfer of shares from the parent company to the chairman and chief
     executive officer of the Company and the employee equity



                                       46
<PAGE>

     compensation plans. Approximately $381 (2000: $291) represents sales
     expenses, $87 (2000: $168) represents circulation, $1,546 (2000: $65,044)
     represents general and administrative and $487 (2000: $186) represents
     online services development expenses.

   The accompanying notes are an integral part of these financial statements.





                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                           (In U.S. Dollars Thousands)

<TABLE>
<CAPTION>
                                                                                         Year Ended December 31,
                                                                            -----------------------------------------------------
                                                                                  1999                2000              2001
                                                                            -----------------    ---------------     ------------
Cash flows from operating activities:
<S>                                                                              <C>               <C>                  <C>
    Net income/(Loss) ..................................................         $   10,969        $   (68,221)         $   775
Adjustments to reconcile net income to net cash provided by
 (used for) operating activities:
    Depreciation and amortization ......................................              2,441              4,069            8,934
    Loss/(Profit) on sale of property and equipment ....................                 19                (23)              34
    Accretion of U.S. Treasury strips zero % coupons ...................               (170)              (139)            (122)
    Bad debt expense ...................................................              1,123              1,188              765
    Expenses allocated by Parent Company ...............................                640                  -                -
    Non-cash compensation expense ......................................                  -             65,689            2,501
    Non-cash listing expenses ..........................................                  -              1,353                -
    Income attributable to minority shareholder ........................                  -                 37               83
    Write-down of investments ..........................................                  -             11,750            1,150
    Equity in loss/(income) of affiliate ...............................                  -                 51              (51)
    Property and equipment written off .................................                  -                 12              108
                                                                            -----------------    ---------------     ------------
                                                                                     15,022             15,766           14,177
    Changes in assets and liabilities:
    Accounts receivables ...............................................               (407)            (1,865)           1,328
    Receivables from sales representatives .............................                (11)             1,527             (153)
    Receivables from related party sales representatives ...............              2,090                651              538
    Inventory of paper .................................................                200               (630)             357
    Prepaid expenses and other current assets ..........................              1,611              1,459              646
    Loan to chief executive officer ....................................                  -              (5,350)              -
    Repayment of loan from chief executive officer .....................                  -              5,350                -
    Long term assets ...................................................                308               (123)             147
    Accounts payable ...................................................             (1,157)             2,067           (1,911)
    Accrued liabilities and liabilities for incentive and bonus plans ..                 77             (2,987)          (1,061)
    Deferred income and customer prepayments ...........................              3,447                750            1,234
    Amount due to Parent Company .......................................             (6,268)                 -                -
    Tax liability ......................................................                227                298              162
                                                                            -----------------    ---------------     ------------
         Net cash provided by operating activities .....................             15,139             16,913           15,464
                                                                            -----------------    ---------------     ------------

Cash flows from investing activities:
    Purchase of bonds ..................................................                (93)                 -                -
    Purchase of long term investments ..................................                  -            (13,000)               -
    Purchase of property and equipment .................................             (8,318)           (17,128)          (4,874)
    Proceeds from sales of property and equipment ......................                 39                 25              315
    Proceeds from matured bonds ........................................                460                460              440
    Capital contributed by minority shareholder in a joint venture .....                  -              6,000                -
                                                                            -----------------    ---------------     ------------
         Net cash used for investing activities ........................             (7,912)           (23,643)          (4,119)
                                                                            -----------------    ---------------     ------------

Cash flows from financing activities:
    Short-term borrowings ..............................................                  -             13,260                -
    Repayment of short-term borrowings .................................                  -             (9,260)          (4,000)


                                       47
<PAGE>

    Dividends paid .....................................................            (14,945)                 -                -
    Advances from shareholders .........................................              7,438                  -                -
    Amount received towards directors stock option plan ................                  -                  -              164
    Additional capital contributed                                                        -                 24                -
                                                                            -----------------    ---------------     ------------
         Net cash (used for) generated from financing activities .......             (7,507)             4,024           (3,836)
                                                                            -----------------    ---------------     ------------
Net (decrease)/increase in cash and cash equivalents ...................               (280)            (2,706)           7,509
Cash and cash equivalents, beginning of the year .......................             15,713             15,433           12,727
                                                                            -----------------    ---------------     ------------
Cash and cash equivalents, end of the year .............................         $   15,433         $   12,727         $ 20,236
                                                                            =================    ===============     ============

Supplemental cash flow disclosures:
    Income tax paid ....................................................         $    1,208          $     979          $   981
    Interest paid ......................................................                337                639              172
                                                                            =================    ===============     ============
</TABLE>


   The accompanying notes are an integral part of these financial statements.


                                       48
<PAGE>



                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                 CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY

              (In U.S. Dollars Thousands, Except Number of Shares)


<TABLE>
<CAPTION>
                                                     Ordinary Shares
                                          -------------------------------------

                                                                           Additional                                 Total
                                           Number of                        paid in     Retained      Unearned     Shareholders'
                                           Shares              Amounts      Capital     Earnings    Compensation     Equity
                                          --------------------------------------------------------------------------------------
<S>                                           <C>          <C>                   <C>    <C>                   <C>  <C>
Balance at December 31, 1998 ...........      25,051,380   $      251               -   $    9,435             -   $     9,686
Net income .............................               -            -               -       10,969             -   $    10,969
Dividends ..............................               -            -               -      (14,945)            -   $   (14,945)
                                          ---------------- ---------------  ------------------------ ------------- -------------

Balance at December 31, 1999............      25,051,380   $      251               -   $     5,459             -  $     5,710
Net income .............................               -            -               -       (68,221)            -      (68,221)
Issuance of shares upon share exchange .       1,252,569   $       12       $      12             -             -  $        24
Non-cash compensation expenses .........               -            -          70,755             -             -  $    70,755
Unearned compensation ..................               -            -               -             -        (5,066) $    (5,066)
Non-cash listing expenses ..............               -            -           1,353             -             -  $     1,353
Interest in Joint Venture ..............               -            -       $   3,606             -             -  $     3,606
                                          ---------------- -------------  ------------- -------------- ----------- -------------

Balance at December 31, 2000............      26,303,949   $      263       $  75,726    $  (62,762)    $  (5,066) $     8,161
Net income .............................               -            -               -           775             -  $       775
Non-cash compensation expenses .........               -            -           4,306             -             -  $     4,306
Unearned compensation ..................               -            -               -             -        (1,805) $    (1,805)
Amount received towards directors
  stock-option plan ....................               -            -             164             -            -   $      164
                                          ---------------- -------------  ------------- ------------- ------------ -------------
Balance at December 31, 2001 ...........   $  26,303,949   $      263       $  80,196   $   (61,987)    $  (6,871) $    11,601
                                          ================ =============  ============= ============= ============ =============

</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.





                                       49
<PAGE>


                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     (In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)


1.   The Company

     Global Sources Ltd. (the "Company") was incorporated in November 1999 under
     the laws of Bermuda. The Company is majority owned by Hung Lay Si Co Ltd.
     (the "Parent Company"). The Parent Company is a company organized under the
     laws of the Cayman Islands. It is wholly owned by the Quan Gung 1986 Trust,
     a trust formed under the laws of the Island of Jersey. Hill Street Trustees
     Ltd. is the trustee of the trust (the "Trustee") and the Trustee has sole
     and exclusive voting investment and dispositive power over the shares of
     capital stock of the Parent Company owned by the Trust.

     The Company's principal business is to provide services that allow global
     buyers to identify suppliers and products, and enable suppliers to market
     their products to a large number of buyers. The Company's primary online
     service is creating and hosting Marketing Websites that present suppliers'
     product and company information in a consistent, easily searchable manner
     on Global Sources Online. The Company also offers electronic cataloguing
     services for buyers and suppliers. Private Buyer Catalogs enable buyers to
     maintain customized information on suppliers. Private Supplier Catalogs are
     password-protected online environments where suppliers can develop and
     maintain their own product and company data. Complementing these services
     are various trade magazines and CD-ROMs. The Company's businesses are
     conducted primarily through Trade Media Ltd., its wholly owned subsidiary,
     which was incorporated in October 1984 under the laws of the Cayman
     Islands. Through certain other wholly owned subsidiaries, the Company also
     organizes conferences and exhibitions on technology related issues and
     licenses Asian Sources / Global Sources Online and catalog services.


2.   Summary of Significant Accounting Policies

(a)  Basis of Consolidation and Presentation

     (i)  The accompanying consolidated financial statements are prepared in
          accordance with accounting principles generally accepted in the United
          States of America and comprise the accounts of the Company, its
          majority owned subsidiaries and those owned through nominee
          shareholders. All significant intercompany transactions and balances
          have been eliminated on consolidation.

     (ii) The results of subsidiaries acquired or disposed of during the year
          are included in the consolidated statement of income from the
          effective dates of acquisition or up to the effective dates of
          disposal.

     (iii)The functional currency of the Company and certain subsidiaries is the
          United States dollar. The functional currencies of other subsidiaries
          are their respective local currencies. United States dollars are used
          as the reporting currency as the Company's operations are global.

(b)  Use of Estimates

     The preparation of financial statements in conformity with accounting
     principles generally accepted in the United States of America ("U.S. GAAP")
     requires management to make estimates and assumptions that affect the
     amounts reported in the consolidated financial statements and accompanying
     notes. Actual results could differ from those estimates.


                                       50
<PAGE>

                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     (In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)

(c)  Cash Equivalents

     The Company considers all highly liquid investments purchased with an
     original maturity of three months or less to be cash equivalents.

(d)  Inventory of Paper

     Inventory of paper is stated at the lower of cost or net realizable value.
     Cost is determined on the first-in, first-out basis.

(e)  Property and Equipment

     (i)  Property and equipment are stated at cost less accumulated
          depreciation. Cost represents the purchase price of the asset and
          other costs incurred to bring the asset into its existing use.

     (ii) Depreciation on property and equipment is calculated to amortize their
          cost on a straight line basis over their estimated useful lives as
          follows:

                  Fixtures, fittings and office equipment .............5 years
                  Leasehold improvements ..............................5 years
                  Motor vehicles    ...................................5 years
                  Computer equipment and software .....................3 years

     (iii)  Effective January 1, 1999, the Company adopted Statement of Position
          98-1, "Accounting for the Costs of Computer Software Developed or
          Obtained for Internal Use". Costs incurred in the preliminary project
          stage with respect to the development of software for internal use are
          expensed as incurred; costs incurred during the application
          development stage are capitalized and are amortized over the estimated
          useful life of three years upon the commissioning of service of the
          software. Training and maintenance costs will be expensed as incurred.

(f)  Intangible Assets

     Copyrights are carried at cost less accumulated amortization. Copyrights
     are amortized on a straight line basis over a period of ten years.

     Goodwill, which represents the excess of the cost of purchased businesses
     over the fair value of their net assets at dates of acquisition, is
     amortized on a straight line basis over twenty years.

(g)  Investments

     Long term investments for business and strategic purposes in privately-held
     companies where such investments are less than 20% of the equity capital of
     the investees, with no significant influence over the investees, are stated
     at cost.

     Long term investments in companies where such investments are in the range
     of 20% to 50% of the equity capital of the investees and over whom the
     Company exercises significant influence, are accounted under the equity
     method.



                                       51
<PAGE>



                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     (In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)


     Interests in subsidiaries with more than 50% ownership are consolidated and
     the ownership interests of minority investors are recorded as minority
     interest.

     Long term investments in U.S. Treasury strips zero % coupons, held to
     maturity are stated at amortized cost.

(h)  Impairment of Long-lived Assets

     The Company reviews the carrying value of its long-lived assets based upon
     a gross cash flow basis and will reserve for impairment whenever events or
     changes in circumstances indicate the carrying amount of the assets may not
     be fully recoverable. The impairment loss is measured based on the
     difference between the carrying amount of the asset and its fair value.
     There was no impairment of the Company's property and equipment or
     intangibles as of December 31, 2001.

(i)  Revenue Recognition

     The Company derives its revenues from advertising fees in its published
     trade magazines and Web sites, sales of trade magazines, fees from
     licensing its trade and service marks, service fees from the provision of
     software maintenance service, and organizing business seminars.

     Revenues from advertising in trade magazines and Web sites are recognized
     ratably in the period in which the advertisement is displayed. Advertising
     contracts do not exceed one year. Revenue from sales of trade magazines is
     recognized upon delivery of the magazine. Magazine subscriptions received
     in advance are deferred and recognized as revenue upon delivery of the
     magazine. Revenue from the provision of maintenance service is deferred and
     recognized ratably over the maintenance service period. Revenue from
     organizing business seminars is recognized at the conclusion of the
     seminar.

     The Company receives license fees and royalties from licensing its trade
     and service marks. Revenue from license fees is recognized ratably over the
     term of the license, currently four to five years. Royalties from license
     arrangements are earned ratably in the period in which the advertisement is
     displayed by the licensee.

     The interest income from investments in U.S. Treasury strips zero % coupons
     is recognized as it accrues, taking into account the effective yield on the
     asset.

(j)  Transactions with Sales Representatives and Related Party Sales
     Representatives

     The Company utilizes sales representatives and related party sales
     representatives in various territories to promote the Company's products
     and services. Under these arrangements, these sales representatives are
     entitled to commissions as well as marketing fees. Commissions expense is
     recorded when owed to these sales representative and is included in sales
     expenses.

     These sales representatives, which are mainly corporate entities, handle
     collections from clients on behalf of the Company. Included in receivables
     from these sales representatives are amounts collected on behalf of the
     Company as well as cash advances made to these sales representatives.

     The Company nominated a director to the Board of Directors of eight of
     these sales representative companies. The nominated directors are employees
     of the Company. The Company and the nominated directors do not have any
     interest in the share capital of these related party sales representative
     companies. Approximately $16,056, $20,315, and $20,172 of commissions and


                                       52
<PAGE>
                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     (In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)


     marketing fees expense was associated with these related party sales
     representative companies for 1999, 2000, and 2001, respectively.

(k)  Advertising Expenses

     Advertising expenses are expensed as incurred.

(l)  Operating Leases

     The Company leases certain office facilities under cancelable operating
     leases that expire in two to five years. Rentals under operating leases are
     expensed on a straight line basis over the life of the leases.

(m)  Liabilities for Bonus Plan

     Before the commencement of the Equity Compensation Plans as described in
     note 23, the Company rewarded its senior management staff based on their
     performance through long term discretionary bonus awards. These awards were
     payable in cash generally at the end of five or ten years from the date of
     the award, even in the event of termination of employment unless certain
     non-compete provisions had been violated. These awards were expensed in the
     period to which the performance bonus relates.

(n)  Retirement Benefits

     The Company operates a number of defined contribution retirement benefit
     plans. Contributions are based on a percentage of each eligible employee's
     salary and are expensed as the related salaries are incurred.

(o)  Income Taxes

     The Company accounts for deferred income taxes using the liability method,
     under which the expected future tax consequences of temporary differences
     between the financial reporting and tax basis of its assets and liabilities
     are recognized as deferred tax assets and liabilities. A valuation
     allowance is established for any deferred tax asset when it is more likely
     than not that the deferred tax asset will not be recovered.

(p)  Minority Interest

     In 2000 the Company entered into an agreement with CMP Media Inc., through
     United Business Media B.V., a subsidiary of United News and Media plc.
     (CMP) to set-up a corporation (eMedia Asia Ltd.) to provide new technology
     content, media and e-commerce services to the electronics technology market
     in Asia. The Company holds a 60.1% controlling equity interest in the
     eMedia Asia Ltd. and consolidates the results of operations. As part of
     obtaining its 39.9% interest, CMP has committed to pay $6,000 and interest
     thereon to the Company upon the payment of specified future dividends of
     eMedia Asia Ltd. Due to the contingent nature of the payment, the Company
     did not record in its balance sheet the promissory note receivable of
     $6,000 due from CMP and no interest income was accrued as at December 31,
     2001. The minority interest liability of $2,515 at December 31, 2001
     reflects CMP's proportionate interest of the net book value in the eMedia
     Asia Ltd.




                                       53
<PAGE>
                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     (In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)


(q)  Foreign Currencies

     Transactions in currencies other than the functional currency are measured
     and recorded in the functional currency using the exchange rate in effect
     on the date of the transaction. As of the balance sheet date, monetary
     assets and liabilities that are denominated in currencies other than the
     functional currency are remeasured using the exchange rate at the balance
     sheet date. All gains and losses arising from foreign currency transactions
     and remeasurement of foreign currency denominated accounts are included in
     the determination of net income in the year in which they occur.

     The financial statements of the subsidiaries reporting in their respective
     local currencies are translated into U.S. dollars for consolidation as
     follows: assets and liabilities at the exchange rate as of the balance
     sheet date, shareholders' equity at the historical rates of exchange, and
     income and expenses amounts at the average monthly exchange rate for the
     year. The cumulative translation differences were not material as of
     December 31, 2000 and 2001.

(r)  Segment Reporting

     Statement of Financial Accounting Standard ("SFAS") No. 131, "Disclosures
     about Segments of an Enterprise and Related Information" ("SFAS 131")
     requires that companies report separately, in the financial statements,
     certain financial and descriptive information about operating segment
     profit or loss, certain specific revenue and expense items, and segment
     assets. Additionally, companies are required to report information about
     the revenues derived from their products and services groups, about
     geographic areas in which the Company earns revenues and holds assets, and
     about major customers.

     The Company identifies its operating segments based on business activities,
     management responsibility and geographic location. The Company has three
     reportable segments: online marketplace services, transaction software and
     services, and complementary media services.

(s)  Comprehensive Income

     SFAS No. 130, "Reporting Comprehensive Income," establishes standards for
     reporting comprehensive income and its components in financial statements.
     Comprehensive income is defined as the change in equity of a company during
     a period from transactions and other events and circumstances excluding
     transactions resulting from investment by owners and distribution to
     owners. For each of the years ended December 31, 1999, 2000 and 2001, the
     Company had no material comprehensive income items.

(t)  Basic and Diluted Net Income Per Share

     Basic net income per share is computed by dividing net income by the
     weighted average number of shares of ordinary shares outstanding during the
     period, as restated as discussed in note 14. Diluted net income per share
     is calculated using the weighted average number of outstanding ordinary
     shares, as restated as discussed in note 14, plus other dilutive potential
     ordinary shares. For all periods presented, the Company did not have any
     dilutive securities; therefore, both the basic and diluted net income per
     share computations resulted in the same amounts.

(u)  Stock Based Compensation

     The Company has adopted the disclosure only provisions of SFAS No. 123,
     "Accounting for Stock-Based Compensation." The Company accounts for


                                       54
<PAGE>
                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     (In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)


     stock-based compensation using the intrinsic value method prescribed in
     Accounting Principles Board Opinion No. 25 (APB 25), "Accounting for Stock
     Issued to Employees" and related interpretations. Accordingly, compensation
     cost of stock options is measured as the excess, if any, of the fair value
     of the Company's stock at the date of the grant over the option exercise
     price and is charged to operations over the vesting period.

     The Company accounts for equity instruments issued to non-employees in
     accordance with the provisions of SFAS No.123 and Emerging Issues Task
     Force (EITF) Issue No. 96-18, "Accounting for Equity Instruments that are
     Issued to Other Than Employees for Acquiring, or in Conjunction with
     Selling Goods and Services." All transactions in which services are
     received for the issuance of equity instruments are accounted for based on
     the fair value of the consideration received or the fair value of the
     equity instrument issued, whichever is more reliably measurable. The
     measurement date of the fair value of the equity instrument issued is the
     earlier of the date on which the counterparty's performance is complete or
     the date on which it is probable that performance will occur.

(v)  Recent Accounting Pronouncements

     As of December 31, 2001, the Company adopted the Emerging Issues Task Force
     Issue No. 00-14, "Accounting for Certain Sales Incentives" (EITF 00-14).
     EITF 00-14 stipulates that the reduction in the selling price of the
     product or service resulting from any cash sales incentive should be
     classified as a reduction of revenue. The adoption of this EITF resulted in
     the Company reclassifying certain sales incentives from a sales expense to
     a reduction of revenue for all periods presented. This reclassification
     represented less than 3% of revenues for each period presented and did not
     impact net income.

     In June 1998, the Financial Accounting Standards Board (FASB) issued
     Statements of Accounting Standards (SFAS) No. 133, "Accounting for
     Derivative Instruments and Hedging Activities" as amended by SFAS No. 137
     and SFAS No. 138. This statement, as amended, was effective January 1,
     2001, and established accounting and reporting standards for derivative
     instruments, including certain derivative instruments imbedded in other
     contracts, and for hedging activities. The adoption of SFAS No. 133, as
     amended, did not impact the Company's financial position or results of
     operations.

     In June, 2001, FASB issued SFAS No. 141, "Business Combinations," and SFAS
     No. 142, "Goodwill and Other Intangible Assets." SFAS No. 141 requires all
     business combinations initiated after June 30, 2001 to be accounted for
     using the purchase method. Under SFAS No. 142, goodwill and intangible
     assets with indefinite lives are no longer amortized but are reviewed
     annually (or more frequently if impairment indicators arise) for
     impairment. Separable intangible assets that are not deemed to have
     indefinite lives will continue to be amortized over their useful lives (but
     with no maximum life). The amortization provisions of SFAS No. 142 apply
     immediately to goodwill and intangible assets acquired after June 30, 2001.
     With respect to goodwill and intangible assets acquired prior to July 1,
     2001, the Company is required to adopt SFAS No. 142 effective January 1,
     2002. As goodwill was fully amortized and no acquisitions occurred during
     2001, management believes that the adoption of these standards will not
     have a material impact on the Company's financial statement of position,
     results of operations, or cash flows.

     In June 2001, FASB issued SFAS No. 143, "Accounting for Asset Retirement
     Obligations." This statement addresses financial accounting and reporting
     for obligations associated with the



                                       55
<PAGE>
                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     (In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)


     retirement of tangible long-lived assets and the associated asset
     retirement costs. The purpose of this statement is to develop consistent
     accounting for asset retirement obligations and related costs in the
     financial statements and provide more information about future cash
     outflows, leverage and liquidity regarding retirement obligations and the
     gross investment in long-lived assets. The Company will be required to
     implement SFAS No. 143 on January 1, 2003 and believes that the adoption of
     this standard will not have a material impact on the Company's financial
     statement of position, results of operations, or cash flows.

     In August 2001, FASB issued SFAS No. 144, "Accounting for the Impairment or
     Disposal of Long-Lived Assets." This statement addresses financial
     accounting and reporting for the impairment or disposal of long-lived
     assets, superseding SFAS No. 121, "Accounting for the Impairment of
     Long-Lived Assets and for Long-Lived Assets to Be Disposed Of." The
     statement also supersedes the accounting and reporting provisions of APB
     Opinion No. 30, Reporting the Results of Operations -- Reporting the
     Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual
     and Infrequently Occurring Events and Transactions , for segments of a
     business to be disposed. The Company is required to adopt this statement on
     January 1, 2002 and believes that the adoption of this standard will not
     have a material impact on the Company's financial statement of position,
     results of operations, or cash flows.


3.   Current Assets:

<TABLE>
<CAPTION>
                                                                                          At December 31,
                                                                              -----------------------------------------
                                                                                     2000                  2001
                                                                              -------------------    ------------------

         Accounts receivable:
<S>                                                                                 <C>                   <C>
         Gross trade receivables                                                    $    10,203           $     7,842
         Less: Allowance for doubtful debts                                              (2,400)               (2,132)
                                                                              -------------------    ------------------
                                                                                    $     7,803            $    5,710
                                                                              ===================    ==================

         Movements in Allowance for Doubtful Accounts:
                                                                            Year Ended December 31,
                                                          ------------------ -- ----------------- -- ------------------
                                                                1999                  2000                 2001
                                                          ------------------    -----------------    ------------------

         Balance at beginning of year..................      $   2,376             $    1,854            $    2,400
         Charged to bad debt expenses..................          1,123                  1,188                   765
         Write-off of bad debts.......................          (1,645)                  (642)               (1,033)
                                                          ------------------    -----------------    ------------------
         Balance at end of year...........................   $   1,854             $    2,400            $    2,132
                                                          ==================    =================    ==================
</TABLE>

<TABLE>
<CAPTION>
                                                                                          At December 31,
                                                                              -----------------------------------------
                                                                                     2000                  2001
                                                                              -------------------    ------------------

         Prepaid expenses and other current assets:
<S>                                                                              <C>                   <C>
         Unsecured employee loans and other debtors .................            $      318            $      117
         Prepaid expenses ...........................................                   313                   399
         Other current assets .......................................                 1,137                   606
                                                                              -------------------    ------------------
                                                                                $     1,768            $    1,122
                                                                              ===================    ==================
</TABLE>


                                       56
<PAGE>
                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     (In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)


4.   Property and Equipment, net:

<TABLE>
<CAPTION>
                                                                                          At December 31,
                                                                              -----------------------------------------
                                                                                     2000                  2001
                                                                              -------------------    ------------------

<S>                                                                              <C>                    <C>
       Capital work-in progress ...................................              $       89             $      33
       Leasehold improvements .....................................                   6,398                 6,635
       Motor vehicles .............................................                      73                    72
       Computers, fixtures, fittings and office equipment .........                  20,114                21,781
       Software development costs..................................                   9,316                11,821
                                                                              -------------------    ------------------
       Property and equipment, at cost ............................                  35,990                40,342
       Less: Accumulated depreciation .............................                 (12,785)              (21,284)
                                                                              -------------------    ------------------
                                                                                $    23,205           $    19,058
                                                                              ===================    ==================
</TABLE>

         Depreciation expense for the years ended December 31, 1999, 2000 and
         2001 were $2,070, $3,051 and $5,458, respectively and the amortization
         of Software development cost for the years ended December 31, 1999,
         2000 and 2001 were $ NIL, $647 and $3,106, respectively.


5.   Intangible Assets, net:

<TABLE>
<CAPTION>
                                                                                           At December 31,
                                                                             ---------------------------------------------
                                                                                     2000                    2001
                                                                             ---------------------    --------------------

<S>                                                                                   <C>                      <C>
         Goodwill                                                                     $      654               $     654
         Copyrights                                                                        3,706                   3,706
                                                                             --------------------     ---------------------
                                                                                           4,360                   4,360
         Less: Accumulated amortization                                                   (3,987)                 (4,357)
                                                                             ---------------------    --------------------
                                                                                      $      373               $       3
                                                                             =====================    ====================
</TABLE>


6.   Long-term Investments and Bonds held to maturity:

     (i)  As at December 31, 2001, the Company holds equity instruments carried
          at $100 in a privately held unaffiliated electronic commerce company
          for business and strategic purposes. The investment is accounted for
          under the cost method since the ownership is less than 20% and the
          Company does not have the ability to exercise significant influence
          over the investee. The investment is shown under long term investments
          in consolidated balance sheets.

          The Company's policy is to regularly review the carrying values of the
          non-quoted investments and to identify and provide for impairment when
          circumstances indicate impairment other than temporary decline in the
          carrying values of such assets.

          During the fourth quarter of year 2000, the Company recorded $11,750
          impairment loss for other than temporary decline in the carrying value
          of the investments based on the financial position of the investees
          and other information, which became available in the fourth quarter of
          year 2000 and developments in the technology and internet sectors in
          fourth quarter of year 2000. During the year 2001, the Company
          recorded a further $1,150 impairment loss for other than temporary
          decline in the carrying value of the investment based on current
          economic events and other factors. The net carrying value of the long
          term investment as at December 31, 2001 was $100. The Company will
          continue to evaluate this investment.



                                       57
<PAGE>
                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     (In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)


     (ii) U.S. Treasury strips zero % coupons

<TABLE>
<CAPTION>
                                                                                           At December 31,
                                                                             --------------------------------------------
                                                                                    2000                    2001
                                                                             --------------------    --------------------
         The amortized cost classified by date of contractual maturity is as
         follows:
<S>                                                                                   <C>                     <C>
         Due within one year ..........................................               $      420              $      430
         Due after one year through five years ........................                    1,260                   1,059
         Due after five years through ten years .......................                      347                     220
                                                                             --------------------    --------------------
                                                                                     $     2,027             $     1,709
                                                                             ====================    ====================

         The fair value classified by date of contractual maturity is as
         follows:

         Due within one year ..........................................              $       424              $      444
         Due after one year through five years ........................                    1,306                   1,137
         Due after five years through ten years .......................                      362                     230
                                                                             --------------------    --------------------
                                                                                    $      2,092             $     1,811
                                                                             ====================    ====================

                                                                                           At December 31,
                                                                             --------------------------------------------
                                                                                    2000                    2001
                                                                             --------------------    --------------------

         Gross unrealized holding gains ...............................             $       65              $      102
                                                                             ====================    ====================


7.   Other Assets:

                                                                                         At December 31,
                                                                           ---------------------------------------------
                                                                                   2000                    2001
                                                                           ---------------------    --------------------

         Employee housing loans .......................................            $        786              $      378
         Rental and utility deposits ..................................                     560                     821
                                                                           ---------------------    --------------------
                                                                                  $       1,346            $      1,199
                                                                           =====================    ====================


8.   Current Liabilities:

                                                                                           At December 31,
                                                                             ---------------------------------------------
                                                                                     2000                    2001
                                                                             ---------------------    --------------------

         Deferred income and customer prepayments:
         Advertising ..................................................             $      12,229             $    13,963
         Subscription and others ......................................                     3,659                   3,159
                                                                             ---------------------    --------------------
                                                                                    $      15,888             $    17,122
                                                                             =====================    ====================
</TABLE>


                                       58
<PAGE>
                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     (In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)


<TABLE>
<CAPTION>
                                                                                           At December 31,
                                                                             ---------------------------------------------
                                                                                     2000                    2001
                                                                             ---------------------    --------------------

<S>                                                                                  <C>                     <C>
           Accrued liabilities:
           Salaries, wages and commissions ..............................            $      1,251            $      1,442
           Retirement benefit plans .....................................                     493                     435
           Current portion of liabilities for incentive and bonus plans .                   2,848                   1,168
           Others .......................................................                   1,236                   2,082
           Equity in loss of affiliate ..................................                      51                       -
                                                                             ---------------------    --------------------
                                                                                     $      5,879            $      5,127
                                                                             =====================    ====================


9.   Liabilities for Incentive and Bonus Plans:

                                                                                           At December 31,
                                                                             ---------------------------------------------
                                                                                     2000                    2001
                                                                             ---------------------    --------------------

         Liability for long term discretionary bonus program ............           $      1,794            $      1,434
                                                                             =====================    ====================
</TABLE>


10.  Related Party Transactions

     The Company has extended loans to certain members of its senior management
     to finance their purchase or lease of residences. The loans for the
     purchase of a residence are secured by the subject residence, bear interest
     at a rate of LIBOR plus 2 to 3%, generally have a term of ten years and
     become due and payable immediately under certain circumstances, including
     their termination of employment with the Company. The loans for the lease
     of a residence are unsecured, interest free and are repayable in equal
     monthly installments over the period of the lease, typically less than or
     equal to twelve months. Loans due from employees for purchase of residences
     were $786 and $378 as of December 31, 2000 and 2001 respectively. Loans due
     from employees for lease of residences were $219 and $114 as of December
     31, 2000 and 2001, respectively.

     The Company leases certain office facilities from subsidiaries of the
     Parent Company under cancelable and non-cancelable operating leases that
     include both rental and building maintenance services. During the years
     ended December 31, 1999, 2000 and 2001, the Company incurred rental and
     building management services expenses of $1,406, $950 and $1,044,
     respectively, with respect to these office facilities.

     The Company also receives legal and secretarial services from subsidiaries
     of the Parent Company. During the year ended December 31, 1999, 2000 and
     2001, the Company incurred such legal and secretarial services expenses of
     $64, $455 and $464, respectively.

     The Company had $11,404 and $11,404 amounts due to the Parent Company as of
     December 31, 2000 and 2001, respectively. The amount due to the Parent
     Company is unsecured and has no fixed repayment terms prior to January 1,
     2000. Interest was charged in the range of 2 to 3%. During the year ended
     December 31, 1999, the Company incurred interest expense of $337, with
     respect to amounts due to the Parent Company. During the years 2000 and
     2001, the Company did not incur any such interest expenses with respect to
     amounts due to the Parent Company.



                                       59
<PAGE>
                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     (In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)

     Effective January 1, 2000, the Company executed an unsecured promissory
     note in the principal amount of $11,404 to establish the repayment terms of
     amounts owed to the Parent Company. On January 1, 2005, the Company will
     begin repayment of this promissory note. The Company will make quarterly
     payments of principal and interest over the following ten years. Interest
     will accrue beginning January 1, 2005 at the applicable U.S. Federal Funds
     rate.

     During the year ended December 31, 1999, the Company incurred operating
     expenses of $640, allocated from the Parent Company. The Company believes
     that the methods used in the allocation of expenses were reasonable and
     that the consolidated statements of income include all costs directly and
     indirectly attributable to the Company. The amounts related to the Company
     have been determined by segregating amounts related to the operations of
     the Company from those related to the Parent Company. The determination of
     such amounts was made by reference to individual records for costs
     specifically relating to the Company or by allocation based on number of
     personnel, time spent by personnel, usage of facilities or similar
     references. During the years 2000 and 2001 there were no such allocated
     expenses from the Parent Company.

     Effective May 1, 2000, the Company engaged The Fairchild Corporation to
     provide financial, legal and certain other services to the Company for a
     fee of $42 per month. The Company terminated this arrangement effective
     December 31, 2000. The Company incurred $333 expenses for these services
     during the year ended December 31, 2000.

     In addition to the transactions with related party sales representatives
     discussed in Note 2 (j), the Company provided technical services to these
     sales representatives and to a subsidiary of the Parent Company, for a fee.
     During the year ended December 31, 1999, 2000 and 2001, the Company
     received such services fee of $242, $167 and $259, respectively.


11.  Liabilities for Incentive and Bonus Plans

     Before the commencement of the Equity Compensation Plans the Company
     rewarded its senior management staff based on their current performance
     through long term discretionary bonus awards. These awards are payable
     approximately at the end of five or ten years from the date of the award,
     even in the event of termination of employment unless certain non-compete
     provisions have been violated. Amounts expensed related to these awards for
     the years ended December 31, 1999, 2000 and 2001, were $143, $NIL and $NIL,
     respectively. The required funds are set aside for payment of the
     discretionary bonuses by purchasing U.S. Treasury strips zero % coupons
     maturing in either five or ten years. These investments are held until
     maturity and the proceeds are used for payment of the discretionary
     bonuses.

     Certain sales representatives of the Company are eligible for incentive
     awards under plans administered by the Company. Amounts expensed related to
     incentive awards under plans administered by the Company for the years
     ended December 31, 1999, 2000 and 2001 were $45, $116 and $78,
     respectively. Amounts under liabilities for incentive plans include amounts
     owed under plans previously administered by the Company.


                                       60
<PAGE>
                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     (In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)


12.  Retirement Benefit Plans

     The Company operates a number of defined contribution retirement benefit
     plans. Employees working in a jurisdiction where there is no statutory
     provision for retirement benefits are covered by the Company's plans.

     The two principal defined contribution plans are plans where employees are
     not required to make contributions. One of these two plans is separately
     administered by an independent trustee and the plan assets are held
     independent of the Company. The other one is not independently administered
     and is currently unfunded. The Company's liabilities under this unfunded
     plan as of December 31, 2000 and 2001 were $381 and $376, respectively.

     The Company incurred costs of $823, $1,039 and $1,085 with respect to the
     retirement plans in the years ended December 31, 1999, 2000 and 2001,
     respectively.


13.  Income Taxes

     The Company and certain of its subsidiaries operate in the Cayman Islands
     and other jurisdictions where there are no taxes imposed on companies.
     Certain of the Company's subsidiaries operate in Hong Kong and Singapore
     and are subject to income taxes in their respective jurisdictions. Also,
     the Company is subject to withholding taxes for revenues earned in certain
     other countries.

     Income / (loss) before income taxes consists of:

<TABLE>
<CAPTION>
                                                                              Year Ended December 31,
                                                              --------------------------------------------------------
                                                                   1999                 2000               2001
                                                              ----------------     ---------------    ----------------

<S>                                                               <C>                  <C>                   <C>
         Cayman Islands .................................          $   11,470           $  (3,593)            $   401
         Foreign ........................................                934              (63,263)              1,549
                                                              ----------------     ---------------    ----------------
                                                                  $   12,404           $ (66,856)           $  1,950
                                                              ================     ===============    ================

         The provision for income taxes consists of:

                                                                              Year Ended December 31,
                                                              --------------------------------------------------------
                                                                   1999                 2000               2001
                                                              ----------------     ---------------    ----------------

         Current tax expense:
         Cayman Islands .................................           $       -            $      -            $     -
         Foreign ........................................               1,435               1,277              1,143
                                                              ----------------     ---------------    ----------------
         Total provision ................................          $    1,435           $   1,277           $  1,143
                                                              ================     ===============    ================

</TABLE>
     The provision for income taxes for the years ended December 31, 1999, 2000
     and 2001 differed from the amount computed by applying the statutory income
     tax rate of 0% as follows:

<TABLE>
<CAPTION>
                                                                              Year Ended December 31,
                                                              --------------------------------------------------------
                                                                   1999                 2000               2001
                                                              ----------------     ---------------    ----------------

<S>                                                                 <C>                  <C>                  <C>
        Income taxes at statutory rate ....................         $       -            $      -             $     -
        Foreign income and revenues taxed at higher rates .             1,435               1,277               1,143
                                                              ----------------     ---------------    ----------------
        Total .............................................         $    1,435          $    1,277           $   1,143
                                                              ================     ===============    ================
        Effective tax rate                                              11.57%             (1.91)%              58.62%
                                                              ================    ================    ================
</TABLE>

                                       61
<PAGE>
                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     (In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)

     Deferred tax assets consist of the following:

<TABLE>
<CAPTION>
                                                                                          At December 31,
                                                                              ----------------------------------------
                                                                                    2000                  2001
                                                                              ------------------    ------------------

<S>                                                                                 <C>                   <C>
        Net operating loss carry forwards                                           $    7,525            $    7,434
        Less: valuation allowance                                                       (7,525)               (7,434)
                                                                              ------------------    ------------------
        Deferred tax assets                                                          $       -             $       -
                                                                              ==================    ==================

</TABLE>
     The Company recorded a full valuation allowance for the deferred tax assets
     due to the uncertainty as to their ultimate realization.

     As of December 31, 2001, a United States subsidiary has net operating loss
     carry forwards of approximately $17.3 million. These losses can be utilized
     to reduce future taxable income of the subsidiary subject to compliance
     with the taxation legislation and regulations in the relevant jurisdiction.


14.  Share Capital

     On April 14, 2000, in conjunction with the Share Exchange Agreement
     discussed in Note 21, Fairchild (Bermuda) Ltd. issued 25,051,380 ordinary
     shares to the shareholders of Trade Media Holdings Ltd., predecessor to
     Global Sources Ltd., in exchange for all of its 10,000 ordinary shares
     outstanding at that date. All share and per share amounts in these
     consolidated financial statements have been restated for the year ended
     December 31, 1999 in a manner similar to a 2,505 to 1 stock split. In
     addition, Fairchild (Bermuda) Ltd. issued 62,628 ordinary shares and
     1,189,941 ordinary shares to The Fairchild Corporation and the shareholders
     of the Fairchild Corporation respectively. After the share exchange
     Fairchild (Bermuda) Ltd. was renamed Global Sources Ltd. The authorized
     share capital of the Company as at December 31, 2000 and 2001 is 50,000,000
     ordinary shares of $0.01 par value. As at December 31, 2000 and at December
     31, 2001, the Company has 26,303,949 ordinary shares issued and
     outstanding.


15.  Fair Value of Financial Instruments

     The carrying amounts of the Company's cash equivalents, accounts
     receivable, related party receivables, accounts payable and accrued
     liabilities approximate fair value due to their short maturities. The fair
     value of related party payables cannot be determined due to the related
     party nature. The information with respect to long term related party
     payables is disclosed in Note 10. The carrying amount and market value of
     long term investments are discussed in Note 6.


16.  Concentration of Credit Risk and Other Risks

     Financial instruments, which potentially subject the Company to
     concentration of credit risk, consist primarily of investment in checking
     and money market accounts, investment in U.S. Treasury strips zero %
     coupons, trade accounts receivable and receivables from sales
     representatives. The Company maintains checking and money market accounts
     with high quality institutions. The Company has a number of customers,
     operates in different geographic areas and generally does not require
     collateral on accounts receivable or receivables from sales
     representatives. In addition, the Company is continuously monitoring the
     credit transactions and



                                       62
<PAGE>
                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     (In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)

     maintains reserves for credit losses where necessary. No customer accounted
     for more than 10% of the Company's revenues for each of the years ended
     December 31, 1999, 2000 and 2001. No customer accounted for more than 10%
     of the accounts receivable as of December 31, 2000 and 2001.

     In 2001, the Company derived approximately 93% of its revenue from
     customers in the Asia-Pacific region. The Company expects that a majority
     of its future revenue will continue to be generated from customers in this
     region. Future political or economic instability in the Asia-Pacific region
     could negatively impact the business.


17.  Operating Leases

     The Company leases office facilities under cancelable and non-cancelable
     operating leases that expire in two to five years. During the years ended
     December 31, 1999, 2000 and 2001, the Company's operating lease rental
     expenses were $1,898, $1,502 and $1,897, respectively. The estimated future
     minimum lease payments under non-cancelable operating leases as of December
     31, 2001 are as follows:

                  Year Ending December 31,          Operating Leases

                         2002                          $   471
                         2003                              471
                         2004                              414
                                                       --------
                                                       $ 1,356
                                                       ========

18.  Segment and Geographic Information

     The Company has three reportable segments: online marketplace services,
     transaction software and services and complementary media services.
     Revenues by geographic location are based on the location of the customer.

(a)  Segment Information

<TABLE>
<CAPTION>
                                                                             Year Ended December 31,
                                                             --------------------------------------------------------
                                                                  1999                 2000               2001
                                                             ----------------     ---------------    ----------------

        Revenues:
<S>                                                              <C>                   <C>                 <C>
        Online marketplace services ......................       $     25,463          $   55,121           $  55,468
        Transaction software and services ................                584                 733                 305
        Complementary media services .....................             60,846              42,602              34,964
        Other ............................................              3,379               4,597               4,548
                                                             ----------------     ---------------    ----------------
        Consolidated .....................................       $     90,272          $  103,053           $  95,285
                                                             ================     ===============    ================
</TABLE>

                                       63
<PAGE>
                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     (In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)



<TABLE>
<CAPTION>
                                                                             Year Ended December 31,
                                                             --------------------------------------------------------
                                                                  1999                 2000               2001
                                                             ----------------     ---------------    ----------------

        Income/(loss) from Operations:
<S>                                                              <C>                 <C>                  <C>
        Online marketplace services .....................        $    3,607          $  (23,276)          $  12,308
        Transaction software and services ...............            (1,562)             (3,469)             (8,288)
        Complementary media services ....................             9,392             (27,106)             (1,360)
        Other ...........................................               319              (1,791)                725
                                                             ----------------     ---------------    ----------------
        Consolidated ....................................        $   11,756           $  (55,642)         $   3,385
                                                             ================     ===============    ================
</TABLE>

<TABLE>
<CAPTION>

                                                                                          At December 31,
                                                                               --------------------------------------
                                                                                     2000                 2001
                                                                               -----------------    -----------------

        Identifiable Assets:
<S>                                                                                   <C>                 <C>
        Online marketplace services ..................................                $   24,376          $   26,413
        Transaction software and services ............................                    10,564               8,368
        Complementary media services .................................                    18,780              16,655
        Other ........................................................                     1,986               2,166
                                                                               -----------------    -----------------
        Consolidated .................................................                $   55,706          $   53,602
                                                                               =================    =================
</TABLE>


(b)  Foreign Operations
<TABLE>
<CAPTION>

                                                                             Year Ended December 31,
                                                             --------------------------------------------------------
                                                                  1999                 2000               2001
                                                             ----------------     ---------------    ----------------

        Revenues:
<S>                                                               <C>                 <C>                 <C>
        Asia .........................................            $   83,755          $   95,388          $  88,427
        United States ................................                 4,613               5,235              5,255
        Europe .......................................                 1,159               1,083                908
        Other ........................................                   745               1,347                695
                                                             ----------------     ---------------    ----------------
        Consolidated..................................            $   90,272          $  103,053          $  95,285
                                                             ================     ===============    ================
</TABLE>


<TABLE>
<CAPTION>
                                                                                          At December 31,
                                                                               --------------------------------------
                                                                                     2000                 2001
                                                                               -----------------    -----------------

<S>                                                                             <C>                  <C>
        Long-Lived Assets:
        Asia ...........................................................             $   26,060           $   20,247
        United States ..................................................                    114                  113
                                                                               -----------------    -----------------
        Consolidated ...................................................             $   26,174           $   20,360
                                                                               =================    =================
</TABLE>


19.  Contingencies

     From time to time the Company is involved in litigation in the normal
     course of business. While the results of such litigation and claims cannot
     be predicted with certainty, the Company believes that it is remote that
     the outcome of the outstanding litigation and claims as of the current date
     will have a material adverse effect on the Company's consolidated financial
     position and results of operations.




                                       64
<PAGE>
                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     (In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)

20.  Capital commitments

     The commitments as at December 31, 2001 for the renovation work to be
     carried out on the leasehold office facilities amount to $91.

21.  Share Exchange Agreement

     On December 6, 1999, a Share Exchange Agreement was executed by The
     Fairchild Corporation, Fairchild (Bermuda), Ltd., Trade Media Holdings Ltd.
     and the shareholders of Trade Media Holdings Ltd. (the "Share Exchange").
     Under the Share Exchange, Fairchild (Bermuda), Ltd. issued additional
     common shares in exchange for all of the issued and outstanding shares of
     the Company.

     After the Share Exchange, The Fairchild Corporation and shareholders of The
     Fairchild Corporation held less than 5% and the shareholders of Trade Media
     Holdings Ltd. held the remainder of the combined companies. After the Share
     Exchange, Fairchild (Bermuda), Ltd. was renamed Global Sources Ltd., Global
     Sources Ltd. recorded the Share Exchange as a recapitalization. This
     reflected a private operating company, Trade Media Holdings Ltd., as the
     acquirer combining into Fairchild (Bermuda), Ltd., a non-operating public
     shell corporation with nominal net assets. As of, and subsequent to, the
     Share Exchange, the historical consolidated financial statements of Trade
     Media Holdings Ltd. are being presented as the continuing accounting
     entity, similar to a reverse acquisition. Thereafter, all of the historical
     consolidated financial statements presented represent that of Trade Media
     Holdings Ltd.

     In the Share Exchange, the Company issued 25,051,380 ordinary shares to the
     shareholders of Trade Media Holdings Ltd. in exchange for all of its 10,000
     ordinary shares outstanding at that date. The shareholders' equity of Trade
     Media Holdings Ltd. has been restated to reflect the effect of the 2,505 to
     1 exchange ratio. The authorized share capital of the Company following the
     Share Exchange is 50,000,000 ordinary shares. In addition, the Company
     issued 62,628 ordinary shares and 1,189,941 ordinary shares to The
     Fairchild Corporation and The Fairchild Corporation's shareholders,
     respectively.

     On April 3, 2000, the Form F-1 was declared effective, and on April 14,
     2000, the above Share Exchange Agreement was consummated. As of April 14,
     2000, the Company was publicly listed on NASDAQ.

     The transaction costs associated with the Share Exchange Agreement,
     amounting to $750, $609 and $NIL have been expensed during the year ended
     December 31, 1999, 2000 and 2001, respectively. This expense is included
     under general and administrative cost for the year ended December 31, 1999
     and 2000 in the Consolidated Statements of Income.


22.  Restricted Share Award Plan

     On February 4, 2000, the Company established a restricted share award plan
     for the benefit of its chairman and chief executive officer in recognition
     of services to the Company. In conjunction with the restricted share award
     plan, the Parent Company assigned 4,008,221 ordinary shares of the Company,
     representing a 16% equity interest in the Company, to the Company. The
     Company then awarded these shares to its chairman and chief executive
     officer. The chairman and chief executive officer's entitlement to 501,028
     of these shares is subject to an employment agreement with one of the
     Company's United States subsidiaries and entitlement to such shares



                                       65
<PAGE>
                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     (In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)

     vested immediately. The chairman and chief executive officer's entitlement
     to 3,507,193 of these shares is subject to employment, non-compete and
     vesting terms under an employment agreement with one of the Company's
     United States subsidiaries. The 3,507,193 shares were to vest ratably over
     10 years, 10% each year. However, effective August 30, 2000, the Company's
     Board of Directors approved the accelerated vesting of all the restricted
     shares granted to the chairman and chief executive officer resulting in
     immediate vesting of all the shares. The Company recorded total $64,000 and
     $NIL non-cash compensation expense associated with these awards in the year
     ending December 31, 2000 and 2001, respectively.


23.  Equity Compensation Plans

     On December 30, 1999, the Company established the Global Sources Employee
     Equity Compensation Trust (the "Trust") for the purpose of administering
     monies and other assets to be contributed by the Company to the Trust for
     the establishment of equity compensation and other benefit plans. The Trust
     is administered by Harrington Trust Limited (the "Bermuda Trustee"). The
     Bermuda Trustee in the exercise of its power under the Declaration of Trust
     may be directed by the plan committee, including the voting of securities
     held in the Trust. The Board of Directors of a subsidiary of the Company
     will select the members of the plan committee.

     On February 4, 2000, in conjunction with the establishment of the Trust and
     the Share Exchange, the Parent Company assigned 2,505,138 ordinary shares
     of the Company, representing a 10% equity interest in the Company, to the
     Company for the establishment of share option plans and/or share award
     plans, known as ECP I, ECP II and ECP III. Subsequently, share option plans
     and/or share award plans, known as ECP IV, ECP V and ECP VI were
     established.

     Eligible employees, directors and consultants under ECP I are entitled to
     purchase common shares of Global Sources Ltd. at a price determined by the
     plan committee at the time of the grant. The exercise price of these
     options may be below the fair market value of the Company's ordinary
     shares. The plan committee determines who will receive, and the terms of,
     the options.

     Optionees may pay for ordinary shares purchased upon exercise of options by
     check or by the delivery of other securities of the Company. Payment shall
     made to the Trust.

     Eligible employees, directors and consultants under ECP II were entitled to
     purchase common shares of Global Sources Ltd. at an exercise price
     determined by the plan committee at the time of the grant. There are two
     types of options under this plan. The exercise prices of both of these
     options were below the fair market value of the Company's ordinary shares
     at that time. The plan committee determines who will receive, and the terms
     of, the options. Employees could decide whether to take up the options for
     a period of 95 days ending June 29, 2000. All the options granted were
     exercised. Optionees were able to pay for ordinary shares purchased upon
     exercise of options by check or by the delivery of other securities of the
     Company. Payment has been made to the Trust. Entitlement of the employees,
     directors and consultants to these common shares is subject to employment
     and vesting terms.

     Eligible employees and directors under ECP III were awarded a defined
     amount of compensation payable in Global Sources Ltd. common shares the
     number of which was determined by dividing the amount of compensation
     awarded by an amount determined by the plan committee prior to the Share
     Exchange.



                                       66
<PAGE>
                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     (In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)

     Entitlement of the employees to these common shares is subject to
     employment and vesting terms.

     The non-cash compensation expense associated with awards in accordance with
     APB 25 and SFAS 123, under ECP II and ECP III of approximately $2,907 and
     $2,521, respectively, are recognized ratably over the three year vesting
     term.

     Eligible employees directors and consultants under ECP IV are awarded a
     defined amount of compensation payable in Global Sources Ltd. common shares
     the number of which are determined by the plan committee periodically.

     Entitlement of the employees, directors and consultants to these common
     shares is subject to employment and vesting terms.

     Eligible employees, directors and consultants under ECP V were awarded a
     one-time grant of shares the number of which was determined by the plan
     committee.

     Entitlement of the employees to these common shares is subject to
     employment and vesting terms.

     The Equity Compensation Plan committee approved the awards of common shares
     under ECP IV and ECP V on January 23, 2001 and approved additional awards
     of common shares under ECP IV on April 1, 2001 and July 1, 2001.

     The non-cash compensation expenses associated with the above awards in
     accordance with APB 25 and SFAS 123, under ECP IV and ECP V of
     approximately $3,337 and $1,983, respectively, are recognized over the five
     year vesting term from the respective award date.

     The Equity Compensation Plan committee approved further awards of common
     shares under ECP IV and ECP V in January 2002. The non-cash compensation
     expenses associated with the above awards in accordance with APB 25 and
     SFAS 123, under ECP IV and ECP V of approximately $537 and $120 will be
     recognized over the five year vesting term.

     Eligible employees, directors and consultants under ECP VI are awarded a
     one time grant of Global Sources Ltd. common shares the number of which is
     determined by the plan committee.

     Entitlement of the employees, directors and consultants to these common
     shares is subject to non-compete and vesting terms.

     The Equity Compensation Plan committee approved the ECP VI on March 13,
     2001 and made awards of common shares under the plan on various dates
     during the year 2001.

     The non-cash compensation expenses associated with the awards in accordance
     with APB 25 and SFAS 123, under ECP VI totaling to approximately $313, are
     recognized over the five year vesting term from the respective award date.

     The Company expensed $1,689 and $2,501 non-cash compensation costs
     associated with the awards under the above ECP plans in the years ended
     December 31, 2000 and 2001 respectively.



                                       67
<PAGE>

                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     (In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)


<TABLE>
<CAPTION>
                                                                 ECP II             ECP III      ECP IV        ECP V      ECP VI
                                                                 ------             -------      ------        -----      ------

                                                          Purchase        Gift       Grant        Grant        Grant       Grant
                                                            Plan          Plan       Plan         Plan         Plan        Plan

                                                            March,       March,      March,      January,    January,      March,
 Plan Inception.........................................    2000          2000        2000         2001        2001         2001
                                                        ============ ============= ============ ============ =========== =========
<S>                                                        <C>         <C>              <C>        <C>         <C>          <C>

 Number of Shares:

 At December 31, 1999...................................         -             -              -          -           -           -

   Original restricted shares granted in year 2000......    80,887       212,526        104,184          -           -           -
   Shares forfeited to beneficial trustee...............         -       (11,442)        (1,334)         -           -           -
                                                        ----------   -----------   ------------- ----------- ----------  ---------
 Balance at December 31, 2000...........................    80,887       201,084        102,850          -           -           -

   Original restricted shares granted in year 2001 .....         -             -              -    522,354     303,000      78,300
   Shares forfeited to beneficial trustee...............         -       (24,468)       (19,839)   (87,837)    (91,500)          -
                                                        ----------   -----------   ------------- ----------- ----------  ---------
 Balance at December 31, 2001...........................    80,887       176,616         83,011    434,517     211,500      78,300
                                                        ==========   ===========   ============= =========== ==========  =========
 Grant Price Per Share..................................   $ 24.00        $  NIL        $   NIL    $   NIL     $   NIL      $  NIL
                                                        ==========   ===========   ============= =========== ==========  =========

 Weighted average fair value of the shares granted.....    $  2.50     $   26.50        $ 26.50    $  8.67     $  9.22      $ 4.14
                                                        ==========   ===========   ============= =========== ==========  =========


</TABLE>


     Weighted average fair value of the shares granted is estimated to be the
average market value of the shares at the time of the grant.



                                       68
<PAGE>

                      GLOBAL SOURCES LTD. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


     (In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)


24.  Directors Stock Option Plan

     A Non-executive Director Option Plan was approved on October 26, 2000 by
     the shareholders of the Company. Each eligible Director on the date of the
     first board meeting of each calendar year, commencing in 2001, receives the
     grant of an option to purchase 20,000 common shares on that date. The
     Options granted are subject to such terms and conditions as determined by
     the Board of Directors at the grant.

     The option price, per share, payable before the end of each February, is
     fifteen percent less than the average closing price of the shares for the
     last five trading days of the previous calendar year. The non-executive
     Directors may decline all or part of the award, which is non-transferable.

     The Board granted the first awards under the above plan in 2001. The award
     vests over four years with one quarter of the shares vesting each year.
     Full payment must be made while exercising the option. Upon resignation of
     an eligible Director, all unvested shares are forfeited and the option
     price received for the forfeited unvested shares is refunded.

     Only one director accepted on February 10, 2001 the offer for the 20,000
     shares granted under option. The $164 received as proceeds of this plan was
     included in additional paid-in capital.

     As per the terms of the plan, the Board granted options to all eligible
     directors again in February 2002. These awards will vest after four years.
     Optionees must pay 15% of the option price, which is the average closing
     price of the shares for the last five trading days of year 2001, at the
     time of exercising the option. The balance 85% must be paid on or before
     the vesting date. The resignation of a Director following his or her
     exercise of the Grant of Options and payment of the Option Price shall not
     cause a forfeiture of the unvested shares. All the eligible non-executive
     Directors accepted the offer before February 28, 2002.


25.   Credit Facility

     On March 17, 2000, the Company entered into a credit facility with the Bank
     of Bermuda (Isle of Man) Limited. The credit facility has a term of one
     year and provides for borrowings of up to $25,000, with minimum borrowings
     of $1,000. The lender may request security from time to time to secure
     borrowings under the credit facility. The credit facility bears interest,
     payable quarterly in arrears, at the London Inter-Bank Market Rate plus
     0.5%. The Parent Company has guaranteed all of the Company's obligations
     under the credit facility.

     As of December 31, 2000 and 2001, $4,000 and $NIL, respectively of
     principal was outstanding under this credit facility.

     On March 13, 2002, the credit facility will be renewed for $10,000 for one
     year subject to the same terms and conditions as applicable to the original
     facility.




                                       69
<PAGE>


ITEM 9.  THE OFFER AND LISTING

Price history of stock

Global Sources Ltd. Shares Prices in Year 2001

              Period                   High                     Low
 --------------------------    ---------------------    ---------------------

   Year 2000                   $       99.8750           $       8.7500
   Year 2001                           11.2500                   3.0000

   Second Quarter 2000                 99.8750                   21.0000
   Third Quarter 2000                  37.0000                   25.0000
   Fourth Quarter 2000                 33.3125                   8.7500

   First Quarter 2001                  11.2500                   8.0000
   Second Quarter 2001                  8.6500                   6.0000
   Third Quarter 2001                   6.5400                   3.0000
   Fourth Quarter 2001                  4.8200                   3.1000

   First Quarter 2002                   5.5700                   4.0000


   October 2001                         3.7000                   3.1000
   November 2001                        4.8200                   3.7200
   December 2001                        4.7500                   4.0000

   January 2002                         4.5500                   3.6500
   February 2002                        4.9900                   4.1000
   March 2002                           5.5700                   4.0000


Markets

Our shares are listed and traded on NASDAQ national market.


ITEM 10.  ADDITIONAL INFORMATION

Memorandum and Articles of Association

Description of shareholder rights attaching to our common shares

Fairchild (Bermuda) was incorporated in Bermuda on November 9, 1999 under the
Companies Act 1981 of Bermuda. After a share exchange with Trade Media,
Fairchild (Bermuda) changed its name to Global



                                       70
<PAGE>

Sources Ltd. The rights of our shareholders are governed by Bermuda law and our
memorandum of association and bye-laws. The following discussion of our common
shares, and the laws governing the rights of our shareholders, is based upon the
advice of Appleby, Spurling & Kempe, our Bermuda counsel.

Our authorized share capital consists of 50,000,000 common shares, par value
$0.01 per share, of which 26,308,949 common shares are issued and outstanding.

     o    Holders of the common shares have no preemptive, redemption,
          conversion or sinking fund rights.

     o    Holders of the common shares are entitled to one vote per share on all
          matters submitted to a vote of holders of common shares and do not
          have any cumulative voting rights.

     o    In the event of our liquidation, dissolution or winding-up, the
          holders of common shares are entitled to share ratably in our assets,
          if any, remaining after the payment of all our debts and liabilities.

     o    Our outstanding common shares are fully paid and non-assessable.

     o    Additional authorized but unissued common shares may be issued by the
          board of directors without the approval of the shareholders.

The holders of common shares will receive such dividends, if any, as may be
declared by the board of directors out of funds legally available for such
purposes. We may not declare or pay a dividend, or make a distribution out of
contributed surplus, if there are reasonable grounds for believing that:

     o    we are, or after the payment would be, unable to pay our liabilities
          as they become due; or

     o    the realizable value of our assets after such payment or distribution
          would be less than the aggregate amount of our liabilities and our
          issued share capital and share premium accounts.

The following is a summary of provisions of Bermuda law and our organizational
documents, including the bye-laws. We refer you to our memorandum of association
and bye-laws, copies of which have been filed with the SEC. You are urged to
read these documents for a complete understanding of the terms of the memorandum
of association and bye-laws.

Share capital

Our authorized capital consists of one class of common shares. Under our
bye-laws, our board of directors has the power to issue any authorized and
unissued shares on such terms and conditions as it may determine. Any shares or
class of shares may be issued with such preferred, deferred, qualified or other
special rights or such restrictions, whether in regard to dividend, voting,
return of capital or otherwise, as we may from time to time by resolution of the
shareholders prescribe.

Voting rights

Generally, under Bermuda law and our bye-laws, questions brought before a
general meeting are decided by a simple majority vote of shareholders present or
represented by proxy. Each shareholder is entitled to one vote for each share
held. Matters will be decided, by way of votes cast by way of show of hands
unless a poll is demanded.



                                       71
<PAGE>

If a poll is demanded, each shareholder who is entitled to vote and who is
present in person or by proxy has one vote for each common share entitled to
vote on such question. A poll may only be demanded under the bye-laws by:

     o    the chairman of the meeting;

     o    at least three shareholders present in person or by proxy;

     o    any shareholder or shareholders present in person or by proxy and
          holding between them not less than one-tenth of the total voting
          rights of all shareholders having the right to vote at such meeting;
          or

     o    a shareholder or shareholders present in person or represented by
          proxy holding shares conferring the right to vote at such meeting,
          being common shares on which an aggregate sum has been paid up equal
          to not less than one-tenth of the total sum paid up on all such common
          shares conferring such right.

No shareholder shall, unless the board of directors otherwise determines, be
entitled to vote at any general meeting unless all calls or other sums presently
payable by that shareholder in respect of all shares held by such shareholder
have been paid.

Dividend rights

Under Bermuda law, a company may declare and pay dividends unless there are
reasonable grounds for believing that the company is, or would, after the
payment, be unable to pay its liabilities as they become due or that the
realizable value of the company's assets would thereby be less than the
aggregate of its liabilities and issued share capital and share premium
accounts.

Under our bye-laws, each share is entitled to a dividend if, as and when
dividends are declared by the board of directors. The board of directors may
determine that any dividend may be paid in cash or will be satisfied in paying
up in full common shares in Global Sources to be issued to the shareholders
credited as fully paid or partly paid. The board of directors may also pay any
fixed cash dividend which is payable on any of our common shares half-yearly or
on other dates, whenever our position, in the opinion of the board of directors,
justifies such payment.

Dividends, if any, on our common shares will be at the discretion of our board
of directors and will depend on our future operations and earnings, capital
requirements, surplus and general financial conditions as our board of directors
may deem relevant.

We have not paid any cash dividends on our common shares since October 1999.
Previously, we paid dividends as a private company as a means to distribute
earnings to shareholders. Beginning in October 1999, we have focused on the
implementation of our growth plans, and we have retained earnings in furtherance
of such plans. Currently, we do not intend to pay dividends for the foreseeable
future in order to focus on our growth plans.

Purchase by a company of its own common shares

We may purchase our own common shares out of the capital paid up on the common
shares in question or out of funds that would otherwise be available for
dividend or distribution or out of the proceeds of a fresh issue of common
shares made for the purposes of the purchase. We may not purchase our shares if,
as a result, our issued share capital would be reduced below the minimum capital
specified in our memorandum of association.

However, to the extent that any premium is payable on the purchase, the premium
must be provided out of the funds of the company that would otherwise be
available for dividend or distribution or out of a company's share premium
account. Any common shares purchased by a company are treated as cancelled and
the amount of the company's issued capital is diminished by the nominal value of
the shares accordingly but shall not be taken as reducing the amount of the
company's authorized share capital.



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<PAGE>

Preemptive rights

Our bye-laws do not provide the holders of our common shares preemptive rights
in relation to any issues of common shares by us or any transfer of our shares.

Variation of rights

We may issue more than one class of shares and more than one series of shares in
each class. If we have more than one class of shares, the rights attached to any
class of shares may be altered or abrogated either:

     o    with the consent in writing of the holders of not less than
          seventy-five percent of the issued common shares of that class; or

     o    with the sanction of a resolution passed at a separate general meeting
          of the holders of such common shares, voting in proxy or present, at
          which a quorum is present.

The bye-laws provide that a quorum for such a meeting shall be two persons
present in person or by proxy representing a majority of the shares of the
relevant class. The bye-laws specify that the creation or issue of shares
ranking on parity with existing shares will not, subject to any statement to the
contrary in the terms of issue of those shares or rights attached to those
shares, vary the special rights attached to existing shares.

Transfer of common shares

Subject to the "Transfer Restrictions" section below, a shareholder may transfer
title to all or any of his shares by completing an instrument of transfer in the
usual common form or in such other form as the board of directors may approve.
The form of transfer is required to be signed by or on behalf of the transferor.

Transfer Restrictions

The board of directors may in its absolute discretion and without assigning any
reason refuse to register the transfer of any share that is not fully paid.

The board of directors may refuse to register an instrument of transfer of a
share unless it:

     o    is duly stamped, if required by law, and lodged with us;

     o    is accompanied by the relevant share certificate and such other
          evidence of the transferor's right to make the transfer as the board
          of directors shall reasonably require;

     o    has obtained, where applicable, permission of the Bermuda Monetary
          Authority; and

     o    is in respect of one class of shares.

A "blanket" authorization has been obtained from the Bermuda Monetary Authority
for all transfers of our common shares between persons who are not resident in
Bermuda for exchange control purposes, provided our common shares remain listed
on an "appointed stock exchange" (which includes listings on the Nasdaq National
Market).



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<PAGE>

Transmission of Shares

In the event of the death of a shareholder, the survivor or survivors, where the
deceased shareholder was a joint holder, or the legal personal representative of
such shareholder, including executors and administrators, shall be the only
persons recognized by us as having any title to the shareholder shares.

Disclosure of Interests

Our bye-laws provide that a director who has at least a five percent interest,
directly or indirectly, in an entity that is interested in a contract or
proposed contract or arrangement with us, shall declare the nature of such
interest at the first opportunity at a meeting of the board of directors, or by
writing to the board of directors. If the director has complied with the
relevant sections of the Companies Act and the bye-laws with regard to the
disclosure of his interest, the director may vote at a meeting of the board of
directors or a committee thereof on a contract, transaction or arrangement in
which that director is interested and he will be taken into account in
ascertaining whether a quorum is present.

Under Bermuda law, directors individually do not have exerciseable borrowing
rights, unless the bye-laws provide otherwise. Our bye-laws do not provide for
borrowing rights or credit limits for individual directors. The board of
directors may approve borrowings at their meetings, and between meetings the
executive committee of the board may approve borrowings.

Rights in Liquidation

Under Bermuda law, in the event of liquidation, dissolution or winding-up of a
company, after satisfaction in full of all claims of creditors and subject to
the preferential rights accorded to any series of preferred stock, the proceeds
of such liquidation, dissolution or winding-up are distributed among the holders
of shares in accordance with a company's bye-laws.

Under our bye-laws, if we are wound up, the liquidator may, with the sanction of
a resolution from us and any sanction required by the Companies Act, divide
amongst the shareholders in specie or kind the whole or part of our assets,
whether they shall consist of property of the same kind or not and may for such
purposes set such values as he deems fair upon any property to be divided as set
out above and may determine how such division shall be carried out as between
the shareholders.

Meetings of Shareholders

Under Bermuda law, a company is required to convene at least one general meeting
per calendar year. The directors of a company, notwithstanding anything in its
bye-laws, shall, on the requisition of the shareholders holding at the date of
the deposit of the requisition not less than one-tenth of the paid-up capital of
the company carrying the right of vote, duly convene a special general meeting.

The bye-laws provide that the board of directors may convene a special general
meeting whenever in their judgment such a meeting is necessary. Unless the
bye-laws of a company specify otherwise, Bermuda law requires that shareholders
be given at least five days' notice of a meeting of the company. Our bye-laws
extend this period to provide that at least 21 days' written notice of a general
meeting must be given to those shareholders entitled to receive such notice. The
accidental omission to give notice to or non-receipt of a notice of a meeting by
any person does not invalidate the proceedings of a meeting.

Under Bermuda law the number of shareholders constituting a quorum at any
general meeting of shareholders may not be less than two individuals. Our
bye-laws add to this quorum requirement to provide that no business can be
transacted at a general meeting unless a quorum of at least two shareholders
representing a majority of the issued shares of the company are present in
person or by proxy and entitled to vote. A shareholder present at a general
meeting or a meeting of a class of shareholders in person or by proxy shall be
deemed to have received appropriate notice of the meeting.

Under our bye-laws, notice to any shareholders may be delivered either
personally or by sending it through the post, by airmail where applicable, in a
pre-paid letter addressed to the shareholder at his



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<PAGE>

address as appearing in the share register or by delivering it to, or leaving it
at such registered address. A notice of a general meeting is deemed to be duly
given to the shareholder if it is sent to him by cable, telex or telecopier.

Access to Books and Records and Dissemination of Information

Under Bermuda law, members of the general public have the right to inspect the
public documents of a company available at the office of the Bermuda Registrar
of Companies. These documents include the memorandum of association and any
alteration to the memorandum of association.

Our shareholders and directors have the additional right to inspect our minute
books and our audited financial statements, which must be presented at an annual
general meeting.

Our bye-laws provide that the register of shareholders of a company is required
to be open for inspection during normal business hours by shareholders without
charge and to members of the general public on the payment of a fee. A company
is required to maintain its share register in Bermuda but may, subject to the
provisions of the Companies Act, establish a branch register outside of Bermuda.
We have established a branch register with our transfer agent ChaseMellon
Shareholder Services, LLC at 44 Wall Street, 6th Floor, New York, New York
10005.

Under Bermuda law, a company is required to keep at its registered office a
register of its directors and officers that is open for inspection for not less
than two hours in each day by members of the public without charge. Our bye-laws
extend this obligation to provide that the register of directors and officers be
available for inspection by the public during normal business hours. Bermuda law
does not, however, provide a general right for shareholders to inspect or obtain
copies of any other corporate records.

Election or Removal of Directors

The bye-laws provide that the number of directors will be such number not less
than two, as our shareholders by resolution may from time to time determine. A
director will serve until his successor is appointed or his prior removal in the
manner provided by the Companies Act or the bye-laws. Our bye-laws provide that
at each annual general meeting one-third of the directors will retire from
office on a rotational basis based on length of time served. A director is not
required to hold shares in a company to qualify to join the board, and once
appointed may sit on the board regardless of age, unless the bye-laws provide
otherwise. Our bye-laws do not require qualifying shares to join the board and
do not set age limits for directors who serve on the board. All directors must
provide written acceptance of their appointment within thirty days of their
appointment.

The board shall have the power at any time and from time to time to appoint any
individual to be a director so as to fill a casual vacancy. The board may
approve the appointment of alternate directors.

We may, in a special general meeting called for this purpose, remove a director,
provided notice of such meeting is served upon the director concerned not less
than fourteen days before the meeting and he shall be entitled to be heard at
that meeting.

The office of a director will be vacated in the event of any of the following:

     o    if he resigns his office by notice in writing to be delivered to our
          registered office or tendered at a meeting of the board of directors;

     o    if he becomes of unsound mind or a patient for any purpose of any
          statute or applicable law relating to mental health;

     o    if he becomes bankrupt under the law of any country or compounds with
          his creditors;

     o    if he is prohibited by law from being a director; or



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<PAGE>

     o    if he ceases to be a director by virtue of the Companies Act or is
          removed from office pursuant to the bye-laws.

Amendment of Memorandum of Association and Bye-Laws

Bermuda law provides that the memorandum of association of a company may be
amended by resolution of the board subject to approval by a resolution passed at
a general meeting of which due notice has been given. An amendment to a
memorandum of association does not require the consent of the Minister of
Finance save for specific circumstances, for example, the adopting of any
special objects.

Under Bermuda law, the holders of:

     o    an aggregate of not less than twenty percent in par value of a
          company's issued share capital or any class thereof, or

     o    not less in the aggregate than twenty percent of the company's
          debentures entitled to object to alterations to its memorandum of
          association,

have the right to apply to the Supreme Court of Bermuda for an annulment of any
amendment of the memorandum of association. Where such an application is made,
the amendment becomes effective only to the extent that it is confirmed by the
Bermuda Supreme Court. An application for an annulment of an amendment of the
memorandum of association must be made within twenty-one days after the date on
which the resolution altering the memorandum of association is passed and may be
made on behalf of the persons entitled to make the application by one or more of
their number as they may appoint in writing for the purpose. No such application
may be made by persons voting in favor of the amendment or any persons who have
given to the company a statement in writing duly signed that he, having had
notice, consents to the alteration.

Our bye-laws provide that such bye-laws may be amended in the manner provided
for in the Companies Act. The Companies Act provides that the directors may
amend the bye-laws, provided that any such amendment shall be operative only to
the extent approved by the shareholders.

Transactions with Interested Shareholders

Our bye-laws prohibit us from engaging in a business combination with any
interested shareholder unless the business combination is approved by two-thirds
of the holders of our voting shares (other than shares held by such interested
shareholder), or by a majority of continuing directors, or if certain prescribed
conditions are met assuring that we will receive fair market value in exchange
for such business combination. In this context, a "business combination"
includes mergers, asset sales and other material transactions resulting in a
benefit to the interested shareholder or the adoption of a plan for our
liquidation or dissolution; a "continuing director" is a member of our board of
directors that is not an affiliate or associate of an interested shareholder and
was a member of our board prior to such person becoming an interested
shareholder; and an "interested shareholder" is any person (other than us or any
of our subsidiaries, any employee benefit or other similar plan or any of our
shareholders that received our shares in connection with our recent share
exchange prior to the listing of our shares on Nasdaq) that owns or has
announced its intention to own, or with respect to any of our affiliates or
associates, within the prior two years did own, at least 15% of our voting
shares.

Appraisal Rights and Shareholder Suits

Amalgamation

The Companies Act provides that, subject to the terms of a company's bye-laws,
the amalgamation of a Bermuda company with another company requires the
amalgamation agreement to be approved by the



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<PAGE>

board of directors and at a meeting of the shareholders by seventy-five percent
of the members present and entitled to vote at such meeting in respect of which
the quorum shall be two persons holding or representing at least one-third of
the issued shares of the company or class, as the case may be.

Our bye-laws alter the majority vote required and provide that any resolution
submitted for the consideration of shareholders at any general meeting to
approve a proposed amalgamation with another company requires the approval of
two-thirds of the votes of disinterested shareholders cast at such meeting.

Under Bermuda law, in the event of an amalgamation of a Bermuda company, a
shareholder who did not vote in favor of the amalgamation and who is not
satisfied that fair value has been offered for such shareholder's shares, may
apply to a Bermuda court within one month of notice of the meeting of
shareholders to appraise the fair value of those shares.

Class Actions and Derivative Actions

Class actions and derivative actions are generally not available to shareholders
under Bermuda law. Under Bermuda law, a shareholder may commence an action in
the name of a company to remedy a wrong done to the company where the act
complained of is alleged to be beyond the corporate power of the company, or is
illegal or would result in the violation of the company's memorandum of
association or bye-laws. Furthermore, consideration would be given by a Bermuda
court to acts that are alleged to constitute a fraud against the minority
shareholders or, for instance, where an act requires the approval of a greater
percentage of the company's shareholders than those who actually approved it.

When the affairs of a company are being conducted in a manner which is
oppressive or prejudicial to the interests of some part of the shareholders, one
or more shareholders may apply to a Bermuda court, which may make such order as
it sees fit, including an order regulating the conduct of the company's affairs
in the future or ordering the purchase of the shares of any shareholders, by
other shareholders or by the company.

Capitalization of Profits and Reserves

Under our bye-laws, the board of directors may resolve to capitalize all or any
part of any amount for the time being standing to the credit of any reserve or
fund which is available for distribution or to the credit of our share premium
account; and accordingly make such amount available for distribution among the
shareholders who would be entitled to it if distributed by way of a dividend in
the same proportions and on the footing that the same may be paid not in cash
but be applied either in or towards:

     o    paying up amounts unpaid on any of our shares held by the
          shareholders; or

     o    payment up in full of our unissued shares, debentures, or other
          obligations to be allotted and credited as fully paid amongst such
          shareholders.

As a proviso to the foregoing, the share premium account may be applied only in
paying up unissued shares to be issued to shareholders credited as fully paid,
and provided, further, that any sum standing to the credit of a share premium
account may only be applied in crediting as fully paid shares of the same class
as that from which the relevant share premium was derived.

Registrar or Transfer Agent

Our transfer agent and registrar is ChaseMellon Shareholder Services, L.L.C. In
addition to a register held by ChaseMellon, a register of holders of the shares
is maintained by Appleby, Spurling & Kempe in Bermuda located at Cedar House, 41
Cedar Avenue, Hamilton HM12, Bermuda.



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Untraced Shareholders

We are entitled to sell the common shares of a person entitled to such common
shares provided such person goes untraced for a period of 12 years. We shall be
held to account to the rightful holder of such common shares for an amount equal
to the proceeds of sale. Any dividend or distribution out of contributed surplus
unclaimed for a period of six years from the date of declaration of such
dividend or distribution shall be forfeited and shall revert to us and the
payment by the board of directors of any unclaimed dividend, distribution,
interest or other sum payable on or in respect of the common share into a
separate account shall not constitute us a trustee in respect thereof.

Personal Liability of Directors and Indemnity

The Companies Act requires every officer, including directors, of a company in
exercising powers and discharging duties, to act honestly in good faith with a
view to the best interests of the company, and to exercise the care, diligence
and skill that a reasonably prudent person would exercise in comparable
circumstances. The Companies Act further provides that any provision whether in
the bye-laws of a company or in any contract between the company and any officer
or any person employed by the company as auditor exempting such officer or
person from, or indemnifying him against, any liability which by virtue of any
rule of law would otherwise attach to him, in respect of any wilful negligence,
wilful default, fraud or dishonesty of which he may be guilty in relation to the
company, shall be void.

Every director, officer, resident representative and committee member shall be
indemnified out of our funds against all liabilities, loss, damage or expense,
including liabilities under contract, tort and statute or any applicable foreign
law or regulation and all reasonable legal and other costs and expenses properly
payable, incurred or suffered by him as director, officer, resident
representative or committee member; provided that the indemnity contained in the
bye-laws will not extend to any matter which would render it void under the
Companies Act as discussed above.

Material Contracts

We do not believe any of our contracts to be material to the operation of our
company, taken as a whole.

Exchange Controls

Bermuda Law

We have been designated as a nonresident under the Exchange Control Act of 1972
by the Bermuda Monetary Authority. This designation will allow us to engage in
transactions in currencies other than the Bermuda dollar.

The Registrar of Companies (Bermuda) has neither approved nor disapproved of the
securities to which this document relates, nor passed on the accuracy or
adequacy of this document and accepts no responsibility for the financial
soundness of any proposals or the correctness of any statements made or opinions
expressed with regard to such securities. Approvals or permissions received from
the Bermuda Monetary Authority do not constitute a guarantee by the Bermuda
Monetary Authority as to our performance or our creditworthiness. Accordingly,
in giving such approvals or permissions, the Bermuda Monetary Authority will not
be liable for our performance or default or for the correctness of any opinions
or statements expressed in this document.

The transfer of common shares between persons regarded as resident outside
Bermuda for exchange control purposes and the issue of common shares to such
persons may be effected without specific consent under the Control Act and
regulations thereunder. Issues and transfers of common shares to any person
regarded as resident in Bermuda for exchange control purposes require specific
prior approval from the Bermuda Monetary Authority under the Control Act.




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<PAGE>

There are no limitations on the rights of persons regarded as non-resident of
Bermuda for foreign exchange control purposes owning our shares. Because we have
been designated as a non-resident for Bermuda exchange control purposes, there
are no restrictions on our ability to transfer funds, other than funds
denominated in Bermuda dollars, in and out of Bermuda or to pay dividends to
non-Bermuda residents who are holders of our shares, other than in respect of
local Bermuda currency.

Under Bermuda law, share certificates are only issued in the names of
corporations, partnerships or individuals. In the case of an applicant acting in
a special capacity, for example an executor or a trustee, certificates may, at
the request of the applicant, record the capacity in which the applicant is
acting.

Notwithstanding the recording of any such special capacity, we are not bound to
investigate or incur any responsibility in respect of the proper administration
of any such estate or trust.

We will take no notice of any trust applicable to any of our common shares
whether or not we had notice of such trust.

As an "exempted company", we are exempt from Bermuda laws which restrict the
percentage of share capital that may be held by non-Bermudians. However, as an
exempted company we may not participate in designated business transactions,
including:

     o    the acquisition or holding of land in Bermuda (except that required
          for our business and held by way of lease or tenancy agreement for a
          term not exceeding fifty years or, with the consent of the Minister
          granted in his discretion, land held by way of lease or tenancy for a
          term of not more than 21 years in order to provide accommodation or
          recreational facilities for our officers and employees);

     o    the taking of mortgages on land in Bermuda to secure an amount in
          excess of $50,000 without the consent of the Minister of Finance of
          Bermuda;

     o    the acquisition of bonds or debentures secured on land in Bermuda,
          unless they are issued by the Bermuda Government or a public
          authority; or

     o    the carrying on of business of any kind in Bermuda, except in
          furtherance of our business carried on outside Bermuda or under a
          license granted by the Minister of Finance of Bermuda.

Taxation

Bermuda Taxation

We have received from the Minister of Finance a written undertaking under the
Exempted Undertakings Tax Protection Act, 1996 (as amended) of Bermuda, to the
effect that in the event of there being enacted in Bermuda any legislation
imposing tax computed on profits or income, or computed on any capital asset,
gain or appreciation, or any tax in the nature of estate duty or inheritance
tax, then the imposition of any such tax shall not be applicable to us or to any
of our operations or to our shares, debentures or other obligations until March
28, 2016. These assurances are subject to the proviso that they are not
construed so as to prevent the application of any tax or duty to such persons as
are ordinarily resident in Bermuda or to prevent the imposition of property
taxes on any company owning real property or leasehold interests in Bermuda.

Currently there is no Bermuda withholding tax on dividends that may be payable
by us in respect to the holders of our common shares. No income, withholding or
other taxes or stamp duty or other duties are imposed upon the issue, transfer
or sale of the shares or on any payment thereunder. There is no income tax
treaty between Bermuda and the United States.




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Documents On Display

Where You May Find More Information

We are required to comply with the reporting requirements of the Securities
Exchange Act of 1934, as amended, applicable to a foreign private issuer. We
will file annually a Form 20-F no later than six months after the close of our
fiscal year, which is December 31. As a foreign private issuer, we are exempt
from the rules under the Exchange Act prescribing the furnishing and content of
proxy statements, and our officers, directors and principal shareholders are
exempt from the reporting and short-swing profit recovery provisions contained
in Section 16 of the Exchange Act. We will furnish our shareholders with annual
reports, which will include a review of operations and annual audited
consolidated financial statements prepared in conformity with U.S. GAAP. We
intend, although we are not obligated to do so, to furnish our shareholders with
quarterly reports by mail with the assistance of a corporate services provider,
which will include unaudited interim financial information prepared in
conformity with U.S. GAAP for each of the three quarters of each fiscal year
following the end of each such quarter. We may discontinue providing quarterly
reports at any time without prior notice to our shareholders.

Our reports and other information, when so filed, may be inspected and copied at
the public reference facilities maintained by the Securities and Exchange
Commission at Judiciary Plaza, 450 Fifth Street, N.W., Room 1024, Washington,
D.C. 20549; and at Citicorp Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661. Copies of such material may be obtained from the Public
Reference Section of the Securities and Exchange Commission, 450 Fifth Street,
N.W., Washington, D.C. 20549 at prescribed rates.

These reports and other information may also be inspected at the offices of the
NASDAQ National Market, 1735 K Street, N.W., Washington, D.C. 20006.


ITEM 11.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We operate internationally and foreign exchange rate fluctuations may have a
material impact on our results of operations. Historically, currency
fluctuations have been minimal on a year to year basis in the currencies of the
countries where we have operations. As a result, foreign exchange gain or losses
in revenues and accounts receivable have been offset by corresponding foreign
exchange losses or gains arising from expenses. However, during the Asian
economic crisis of 1997 to 1998, both advertising sales and the value of Asian
currencies declined, which caused a significant decline in revenues that was not
fully offset by lower expense levels in Asian operations.

This decline in revenues occurred due to contracts being denominated and priced
in foreign currencies prior to devaluations in Asian currencies. The conversion
of these contract proceeds in U.S. dollars resulted in losses and reflects the
foreign exchange risk assumed by us between contract signing and the conversion
of cash into U.S. dollars. We believe this risk is mitigated because
historically a majority (ranging between 55% to 65%) of our revenues are
denominated in U.S. dollars or are received in the Hong Kong currency which is
currently pegged to the U.S. dollar. To the extent significant currency
fluctuations occur in the New Taiwan dollar or other Asian currencies, or if the
Hong Kong dollar is no longer pegged to the U.S. dollar, our profits would be
affected.

As of December 31, 2001, we have not engaged in foreign currency hedging
activities.


ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES - (Not
         applicable)




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                                     PART II

All financial information contained in this document is expressed in United
States dollars, unless otherwise stated.

ITEM 13.  DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES - (Not applicable)


ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF
         PROCEEDS - (Not applicable)


ITEM 15.  [RESERVED]


ITEM 16.  [RESERVED]


                                    PART III

All financial information contained in this document is expressed in United
States dollars, unless otherwise stated.

ITEM 17.  FINANCIAL STATEMENTS - (Not applicable)


ITEM 18.  FINANCIAL STATEMENTS

As provided in Item 8, the Company has presented financial statements in
accordance with U.S. accounting standards in lieu of Item 18.



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ITEM 19.  EXHIBITS
                                                       EXHIBIT INDEX

Exhibit No.       Description

1.1  Memorandum of Association of the Company*

1.2  Bye-laws of the Company*

2.1  Specimen Certificate*

4.1  Promissory Note, dated April 14, 2000, of Fairchild Technologies (Bermuda),
     Ltd. to Fairchild Technologies USA, Inc.*

4.2  Form of executive officer employment agreement*

4.3  Employment Agreement dated November 1, 1999, by and between Trade Media
     Holdings Limited and Merle Hinrichs*

4.4  Amendment to Employment Agreement dated January 19, 2000, between Trade
     Media Holdings Limited and Merle Hinrichs*

4.5  Employment Agreement dated as of January 29, 2000, by and between LER
     Corporation and Merle Hinrichs*

4.6  Form of Restricted Stock Award and Agreement, dated as of January 29, 2000,
     by and between LER Corporation and Merle Hinrichs*

4.7  Amendment No.1 to Restricted Stock Award and Agreement dated as of February
     29, 2000, by and between LER Corporation and Merle Hinrichs*

4.8  Form of The Global Sources Employee Equity Compensation Plan No. I*

4.9  Form of The Global Sources Employee Equity Compensation Plan No. II*

4.10 Form of The Global Sources Employee Equity Compensation Plan No. III*

4.11 Loan Agreement, dated March 7, 2000 of Trade Media Holdings Ltd. to Hung
     Lay Si Co. Ltd.*

4.12 Facility Agreement, dated March 17, 2000, between Bank of Bermuda (Isle of
     Man) Limited and Trade Media Holdings Ltd.*

4.13 Guarantee and Indemnity, dated March 17, 2000, between Hung Lay Si Co. Ltd.
     and Bank of Bermuda (Isle of Man) Limited*

4.14 Unsecured Promissory Note, dated March 9, 2000, of Merle A. Hinrichs to LER
     Corporation*

4.15 Extension of the Facility terms and conditions letter dated March 9, 2001,
     between Bank of Bermuda (Isle of Man) Limited and Trade Media Holdings
     Ltd.**

4.16 Acceptance of the terms and conditions relating to extension of the
     facility dated March 13, 2001, by Trade Media Holdings Ltd.**

4.17 Extension of the guarantee and indemnity, dated March 13, 2001, between
     Hung Lay Si Co. Ltd. and Bank of Bermuda (Isle of Man) Limited.**

4.18 Form of The Global Sources Employee Equity Compensation Plan No. IV**

4.19 Form of The Global Sources Employee Equity Compensation Plan No. V**

4.20 Form of The Global Sources Employee Equity Compensation Plan No. VI***

4.21 Extension of the Facility terms and conditions letter dated March 20, 2002,
     between Bank of Bermuda (Isle of Man) Limited and Trade Media Holdings
     Ltd., and Acceptance of the terms and conditions relating to extension of
     the facility by Trade Media Holdings Ltd.

4.22 Extension of the guarantee and indemnity, dated March 20, 2002, between
     Hung Lay Si Co. Ltd. and Bank of Bermuda (Isle of Man) Limited.

8.1  Subsidiaries of the Company

10.1 Share Exchange Agreement, dated as of December 6, 1999, by and among The
     Fairchild Corporation, the Company, Trade Media Holdings Ltd. and the
     Shareholders of Trade Media Holdings Ltd. (as amended by Amendment No. 1
     thereto dated March 21, 2000)*

10.2 Consent of Independent Accountants for incorporation of their report filed
     with Form 6-K into the Company's previously filed Registration Statements
     File no. 333-59098 and 333-62132****

99.1 Letter to the SEC from the Company pursuant to SEC Release No. 33-8070,
     dated April 9, 2002****



                                       82
<PAGE>

--------------------

*    Incorporated by reference to Form 20-F Annual Report of Global Sources Ltd.
     filed with the Securities and Exchange Commission on June 30, 2000.

**   Incorporated by reference to Form 20-F Annual Report of Global Sources Ltd.
     filed with the Securities and Exchange Commission on April 5, 2001.

***  Incorporated by reference to form S-8 Registration Statement filed with the
     Securities and Exchange Commission on June 1, 2001.

**** Incorporated by reference to Form 6-K filed with the Securities and
     Exchange Commission on April 25, 2002.








                                       83
<PAGE>


SIGNATURE

The registrant hereby certifies that it meets all of the requirements for filing
on Form 20-F and that it has duly caused and authorized the undersigned to sign
this annual report on its behalf.

GLOBAL SOURCES LTD.


By: /s/  EDDIE HENG
         -------------------
         Eddie Heng, Director and Chief Financial Officer

Date:  April 30, 2002






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<PAGE>



                                                                    EXHIBIT 4.21

                                                 BANK of BERMUDA

                                                 Bank of Bermuda
                                                 (Isle of Man) Limited

                                                 P.O. Box 34
                                                 12/13/ Hill Street,
                                                 Douglas,
                                                 Isle of Man, IM99 1BW
                                                 British Isles
                                                 Telephone (44) 1624 637777
                                                 Fax (44) 1624 63777879

20th March, 2002

The Directors,
Trade Media Holdings Limited,
24/F Block B, Vita Tower
29 Wong Chuk Hang Road
Hong Kong


Dear Sirs,

This letter confirms that the Bank of Bermuda (Isle of Man) Limited ("the Bank")
is prepared to extend the loan facility at a reduced level to Trade Media
Holdings Limited ("the Borrower"). Subject to the amendment outlined below, the
terms and conditions originally set forth in the Bank's facility letter of 13th
March 2000, continue to apply.

The amendment is as follows;

Amount: The paragraph that follows this heading in the Facility Letter is to be
amended to read as follows;

" A maximum amount of US$10,000,000 (ten million US dollars) ("the Loan") will
be available which may be drawn in tranches of a minimum of US$1,000,000 (one
million US dollars)"

The loan and all unpaid interest, fees and other sums payable under this
facility shall be repaid in full not later than the 20th March 2003, pending a
full review and possible renewal of the facility for a further twelve month
term.

The Bank will incur no obligations under this letter until it has received all
of the following:-

a)   return of the enclosed copy of this letter duly signed by the Borrower as
     acceptance of the terms and conditions of this letter.

b)   a copy (certified as true by a Director or the Secretary of the Borrower)
     of a Resolution of the Board of Directors of the Borrower authorising such
     acceptance and designating the person(s) authorised to sign the acceptance
     and confirming that all corporate action necessary to accept the terms of
     this letter have been taken.

c)   Payment of an Annual Fee of $1,000 in respect of this extension.



                                       85
<PAGE>

d)   Board Resolution and Letter from the Guarantor, Hung Lay Si Co Ltd. whose
     registered office is situate at PO Box 309, Grand Cayman, Cayman Islands,
     confirming agreement to extension of the Guarantee and Charge document.

If the terms and conditions of this letter are acceptable, please sign and date
the form of acceptance on the enclosed copy of this letter and return it to the
Bank together with the items mentioned above.




Yours faithfully,

/s/  Nigel Cashin

Nigel Cashin
Credit Manager







TO:  BANK OF BERMUDA (ISLE OF MAN) LIMITED



The Borrower hereby agrees to accept the terms and conditions as set out in the
Bank's letter to the Borrower dated the 20th March 2002 of which the foregoing
is a true copy.




For and on behalf of Trade Media Holdings Limited
(as Borrower)



/s/  Eddie Heng Teng Hua                    /s/  Tang Yang Ping
------------------------------------        ---------------------------------
Director                                    Secretary


Date:



                                       86
<PAGE>



                                                                    EXHIBIT 4.22

--------------------------------------------------------------------------------
                              HUNG LAY SI CO. LTD.


                         Hong Kong Representative Office
                  Mailing address: G.P.O. Box 10999, Hong Kong

--------------------------------------------------------------------------------

20 March, 2002


Bank of Bermuda (Isle of Man) Limited
P.O. Box 34,
12/13 Hill Street, Douglas,
Isle of Man, IM99 1BW,
British Isles



Dear Sirs:

In consideration of your extending a Loan Facility of up to a maximum amount of
US$10,000,000 (ten million US Dollars) ("the Loan Facility") pursuant to the
terms of a Facility letter dated 20 March 2002, copy attached, to Trade Media
Holdings Limited ("the Borrower") we hereby irrevocably undertake, in your
favor:

1.   to acknowledge that the Guarantee and Charge Agreement (both dated 17th
     March 2000) that you hold in respect of the initial Loan Facility may be
     regarded as applying in all respects to the extended 12 months period of
     the Loan Facility as though each had been entered into by ourselves afresh
     in respect of the extended period;

2.   to continue to deposit with you a deposit on the terms set out in our
     previous letter dated 17th March 2000 as amended in facility letter dated
     20 March 2002; and

3.   to deliver to you a copy (certified by either a Director or the Company
     Secretary) of the Resolution of the Board of Directors of this Company
     authorizing the signature of this letter on its behalf.



For and on behalf of
HUNG LAY SI CO. LIMITED



/s/  William R. Seitz                          /s/  Richard F.V. Jeune
------------------------------------           ---------------------------------
William R. Seitz                               Richard F.V. Jeune
Director                                       Director



                                       87
<PAGE>



                                                                     Exhibit 8.1

<TABLE>
<CAPTION>
                       SUBSIDIARIES OF GLOBAL SOURCES LTD.


Name                                                                   Jurisdiction of Organization
----                                                                   ----------------------------

<S>                                                                    <C>
Global Sources Technologies Ltd.                                       Bermuda

Trade Media Holdings Limited                                           Cayman Islands

ASM Business Services Limited                                          Cayman Islands

A.S. Mediaconsult Limited                                              Republic of Cyprus

China Media Advertising, Inc.                                          Liberia

E-Commerce International Ltd.                                          Bermuda

Earldom Limited                                                        British Virgin Islands

eMedia Asia Limited                                                    Barbados

Earldom Computer Software (Shenzhen) Co., Ltd.                         Peoples Republic of China

Equitable Accounting Services Limited                                  Hong Kong SAR

Export Media Ltd.                                                      British Virgin Islands

Fertile Valley Pte Ltd                                                 Singapore

Floro Company Limited                                                  Hong Kong SAR

Fortune Valley Ltd                                                     Mauritius

Global Capital Group Holdings Limited                                  British Virgin Islands

Global e-Learning Services (H.K.) Limited                              Hong Kong

Global Sources Auctions Ltd.                                           Cayman Islands

Global Sources Auctions Limited                                        Hong Kong

Global Sources Research Foundation Limited                             British Virgin Islands

Hillcrest Services Limited                                             British Virgin Islands

Japan Publishing Limited                                               Japan



                                       88
<PAGE>
Name                                                                   Jurisdiction of Organization
----                                                                   ----------------------------

Lazenby Services Limited                                               British Virgin Islands

Global Sources USA, Inc.                                               USA - Delaware

Media Data Systems Pte Ltd                                             Singapore

Media Productions Ltd.                                                 Cayman Islands

Pine Grove B.V.                                                        Netherlands

Publishers Representatives Limited                                     Hong Kong SAR

Steady Access Resources Limited                                        British Virgin Islands

Targeted Marketing Promotions Corp.                                    Liberia

Trade Mag Europe S.A.                                                  Belgium

Trade Management Software Limited                                      Cayman Islands

Trade Management Software (HK) Limited                                 Hong Kong SAR

Trade Magazine Productions Limited                                     Hong Kong SAR

Trade Media Limited                                                    Cayman Islands

Trade Point Hong Kong Limited                                          Hong Kong SAR

World Executive's Digest Limited                                       Cayman Islands

</TABLE>



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