**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**Washington,
      D.C. 20549**










**FORM
      10-KSB**









**(Mark
      One)**





xANNUAL
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF
      1934.


****


For
      the
      fiscal year ended December 31, 2006


OR


****


oTRANSITION
      REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.




**For the transition period from _________ to _________**





***Commission
      file number 000-26119***









**CHINA
      WORLD TRADE CORPORATION**


(Exact
      name of small business issuer as specified in its charter)







**Nevada**
              (State
                or other jurisdiction of
              incorporation
                or organization)
            ******87-0629754**
              (IRS
                Employer Identification No.)





**3rd
      Floor, Goldlion Digital Network Center**


**138
      Tiyu Road East, Tianhe**


**Guangzhou,
      PRC**


(Address
      of principal executive offices)





**(001-8620)
      -2886-0608**


(Issuer's
      telephone number)









(Former
      name, address and fiscal year, if changed since last report)





Securities
      registered under Section 12(b) of the Exchange Act: None





Securities
      registered under Section 12(g) of the Exchange Act:





Common
      Stock, par value $.001 per share


(Title
      of
      Class)












Check
      whether the issuer: (1) filed all reports required to be filed by Sections
      13 or
      15(d) of the Exchange Act during the past 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 o





Check
      if
      there is no disclosure of delinquent filers in response to Item 405 of
      Regulation S-B contained in this form, and no disclosure will be contained,
      to
      the best of registrant's knowledge, in definitive proxy or information
      statements incorporated by reference in Part III of this Form 10-KSB or any
      amendment to this Form 10-KSB. x





Issuer's
      revenues for its most recent fiscal year were $4,339,337





The
      aggregate market value of the issuer's common stock held by non-affiliates
      was
      approximately $9.24 million, based on the average closing bid and ask price
      for
      the common stock on January 31, 2007.





As
      of
      January 31, 2007, there were outstanding 43,865,923 shares of the issuer's
      common stock, par value $.001.





Transitional
      Small Business Disclosure Format (check one):  Yes o No x









*Table
          of Contents*





**CAUTIONARY
      STATEMENT REGARDING FORWARD LOOKING INFORMATION**





The
      discussion contained in this 10-KSB under the Securities Exchange Act of 1934,
      as amended, (the "Exchange Act") contains forward-looking statements that
      involve risks and uncertainties. The issuer's actual results could differ
      significantly from those discussed herein. These include statements about our
      expectations, beliefs, intentions or strategies for the future, which we
      indicate by words or phrases such as "anticipate," "expect," "intend," "plan,"
      "will," "we believe," "the Company believes," "management believes" and similar
      language, including those set forth in the discussion under "Description of
      Business," including the "Risk Factors" described in that section, and
      "Management's Discussion and Analysis or Plan of Operation" as well as those
      discussed elsewhere in this Form 10-KSB. We base our forward-looking statements
      on information currently available to us, and we assume no obligation to update
      them. Statements contained in this Form 10-KSB that are not historical facts
      are
      forward-looking statements that are subject to the "safe harbor" created by
      the
      Private Securities Litigation Reform Act of 1995.





2




**TABLE
                OF CONTENTS****Part
                I**Item
            
            Page1.
            Description
                of Business
            42.
            Description
                of Property
            253.
            Legal
                Proceedings
            254.
            Submission
                of Matters to a Vote of Security Holders
            26**Part
                II**5.
            Market
                for Common Equity and Related Stockholder
                Matters
            266.
            Management's
                Discussion and Analysis or Plan of
                Operation
            297.
            Financial
                Statements
            388.
            Changes
                in and Disagreements with Accountants on Accounting and
                Financial Disclosure
            748A.
            Disclosure
                Controls and Procedures
            75**Part
                III**9.
            Directors
                and Executive Officers of the
                Registrant
            7710.
            Executive
                Compensation
            7911.
            Security
                Ownership of Certain Beneficial Owners and Management
                and Related Stockholder Matters
            8112.
            Certain
                Relationships and Related
                Transactions
            8213.
            Exhibits,
                Lists and Reports on Form 8-K
            8314.
            Principal
                Accountant Fees and Services
            84**Other**Index
                to Exhibits
            85Signature
                Page
            86





3
 *Table
          of Contents*





**PART
      I**





**Item
      1** **.****Description
      of Business**




**History
      Of Our Company**




We
      were
      incorporated in the State of Nevada on January 29, 1998 under the name Txon
      International Development Corporation to conduct any lawful business, to
      exercise any lawful purpose and power, and to engage in any lawful act or
      activity for which corporations may be organized under the General Corporation
      Laws of Nevada.




On
      August
      14, 2000, pursuant to a share exchange agreement dated August 10, 2000, by
      and
      among Main Edge International Limited, a British Virgin Islands corporation,
      Virtual Edge Limited, a British Virgin Islands corporation and a wholly-owned
      subsidiary of Main Edge, Richard Ford, Jeanie Hildebrand and Gary Lewis, we
      acquired from Main Edge all of the shares of Virtual Edge (the “Acquisition”) in
      exchange for an aggregate of 1,961,175 shares of our common stock, which shares
      equaled 75.16% of Txon International’s issued and outstanding shares after
      giving effect to the Acquisition. Both Main Edge and Virtual Edge were a
      non-operating holding companies organized to own the stock of businesses which
      they acquired. On September 15, 2000, Txon International Development Corporation
      changed its name to China World Trade Corporation (China World Trade or
      CWTD) and effectuated an 8 for 1 forward stock split. As a result of the
      forward stock split, Main Edge held 15,689,400 shares of our common stock,
      which
      shares equaled 75.16% of our issued and outstanding shares.




In
      September 2002, we underwent a debt for equity capital restructuring whereby
      certain creditors of China World Trade converted an aggregate of $2,731,677
      into
      an aggregate of 4,000,000 shares of common stock.




On
      September 3, 2002, Powertronic Holdings Limited (“Powertronic”), a British
      Virgin Islands company, entered into a share purchase agreement with us (the
      “First Share Purchase Agreement”), to purchase 1,000,000 shares of our common
      stock and warrants to purchase up to 2,000,000 shares of our common stock (such
      warrants, the “First Warrants”), for the total purchase price of $500,000.
      Additionally, on December 17, 2002, Powertronic entered into a second share
      purchase agreement (the “Second Share Purchase Agreement”) with us , to purchase
      an additional 1,000,000 shares of our common stock and warrants to purchase
      up
      to an additional 2,000,000 shares of our common stock (such warrants, the
“Second Warrants”), for the total purchase price of $500,000. The First Warrants
      and the Second Warrants had an exercise price of $0.575 per share and were
      exercised in 2004.




On
      December 17, 2002, we entered into a share exchange agreement with Mr. William
      Chi Hung Tsang, the sole beneficial owner of the share capital in General
      Business Network (Holdings) Ltd., a Hong Kong company. Pursuant to the Share
      Exchange Agreement, we acquired from Mr. Tsang all of the issued and outstanding
      shares of General Business Network in exchange for 4,000,000 shares of our
      common stock and warrants to purchase an additional 4,000,000 shares of our
      common stock (the “Tsang Warrants”) at an exercise price of $0.92 per share. As
      of the date of acquisition, General Business Network owned two rental properties
      located at 20/F, Goldlion Digital Network Center, Unit 01-10, 138 Tiyu Road
      East, Tianhe, Guangzhou, the PRC and Flat B, 12/F., Champion Center, 301-309
      Nathan Road, Hong Kong, collectively valued in excess of $4,000,000. On January
      24, 2003, 4,000,000 shares of our common stock and the Tsang Warrants were
      issued to Mr. Tsang; to date, the Tsang Warrants have been fully exercised.




On
      May 7,
      2004, through one of our wholly-owned subsidiaries, we acquired 51% of the
      capital stock of CEO Clubs China Limited, a Hong Kong corporation (“CEO Clubs
      China”) for a total consideration in cash and shares of our common stock in the
      amount of $360,000, payable $120,000 in cash and $240,000 in market value of
      our
      common stock (80,000 shares) and a commitment to provide operating cash in
      the amount of $120,000. CEO Clubs China has authorized chapters to operate
      under
      the “CEO Clubs” trademarks in the Greater China Region, including the PRC, Hong
      Kong and Taiwan. Comprised of thirteen chapters in the U.S. and China, the
      CEO
      Clubs are a by-invitation-only membership association. Members must be chief
      executive officers of businesses that have above $2,000,000 in annual sales.
      Our
      average club member has $20,000,000 in annual sales. In fiscal year 2002, CEO
      Clubs opened its first international chapter in China.




4
 *Table
          of Contents*




On
      August
      2, 2004, we consummated an acquisition of 51% of the capital stock of Guangdong
      New Generation Commercial Management Limited (“New Generation”), a limited
      liability company organized and existing under the laws of the PRC, for an
      aggregate consideration of $10,232,000, payable approximately $2,741,000 in
      cash
      and approximately $7,487,000 in market value of our common stock (4,081,238
      shares). One of our purposes for the acquisition was because New Generation
      was
      a formidable competitor in the travel agency business through operations of
      its
      five subsidiaries and twenty-one selling points in Southern China and a
      significant competitor in ticketing sales for international and domestic flights
      as well as inbound business travel. In addition, New Generation’s goal was to
      become one of the major consolidators of hotel rooms and airline tickets in
      China. By acquiring New Generation, we have added value to our business and
      eliminated this competition. New Generation has already acquired the necessary
      licenses to operate as a ticketing and travel agent in the PRC, a highly
      regulated business. New Generation’s business also includes insurance operations
      through its subsidiary, Huahao Insurance, and it is a licensed insurance agent
      in China to provide accidental and life insurance policies. The two main
      revenues managed by New Generation are those from the travel agency business
      and
      the insurance business. The financial results from Huahao Insurance are
      consolidated with the financial results of New Generation after Huahao Insurance
      was acquired by New Generation on June 30, 2004. While there can be no
      assurances of success, we expect that New Generation will contribute a
      significant revenue base to our company.




On
      September 25, 2006, we entered into an agreement to acquire a 25% interest
      in
      CWT International Excursion Investment Limited (“CWT Excursion”), a business
      travel investment company, which owns a 51% controlling interest in Suzhou
      Tongli ( International) Excursion Development Limited (“Suzhou Tongli”), the
      sole legal tourism operator and planner for Tongli. Tongli is an ancient town
      in
      Jiangsu province of China and home of the Tuisi Garden, a UNESCO World Cultural
      Heritage site. Under
      the
      terms of the agreement, we issued nine million shares of our stock to acquire
      the interest in CWT Excursion. In addition, we were eligible to acquire an
      additional 35% interest (or up to 60% majority ownership) in CWT Excursion
      within the next 12 months. The acquisition of CWT Excursion provided us with
      the
      higher margin tourism segment of the travel business.




On
      September 29, 2006, China Chance Enterprises Limited,(“China Chance”), a wholly
      owned subsidiary of the Company, entered into a Sale and Purchase Agreement
      (the
“Agreement”) with Wisdom Plus Limited, a limited liability company organized and
      existing under the laws of the British Virgin Islands (“Wisdom Plus”), pursuant
      to which China Chance agreed to sell and Wisdom Plus agreed to purchase, all
      of
      the outstanding registered shares (the “Shares”) of Rejoice Success Limited,
      (“Rejoice Success”) an indirect wholly owned subsidiary of the Company. The
      purchase price for the Shares was $4.0 million, payable in installments in
      accordance with the schedule set forth in the Agreement. Rejoice Success
      owns 60% of the outstanding capital stock of General Business Network (Holdings)
      Ltd., a limited liability company organized under the laws of the Hong Kong
      SAR
      of the People’s Republic of China (“Holdings”), Holdings owns 100% of the
      outstanding capital stock of General (GZ) Business Network Limited, a limited
      liability company organized under the laws of the People’s Republic of China
      (“GZ Business”), and GZ Business owns 51% of the outstanding capital stock of
      New Generation. As a result of the sale, we transferred 30.6% ownership of
      New
      Generation to Wisdom Plus and will receive a total of $4.0 million in cash
      by
      July 29, 2007.




**History
      of Virtual Edge**




Virtual
      Edge was incorporated in the British Virgin Islands on February 18, 1999 as
      a
      non-operating holding company. We currently own 100% of the capital stock of
      Virtual Edge.




On
      October 5, 1999, pursuant to a share exchange, Virtual Edge acquired a majority
      interest in Infotech Enterprises Limited (“Infotech”). On October 18, 2000,
      pursuant to a Share Exchange Agreement with Vast Opportunity Limited, we
      acquired the remaining interest in Infotech. Infotech was incorporated on July
      2, 1999 and is engaged in building a bilingual (Chinese and English)
      Business-to-Business internet portal. We currently operate the business
      operations of Infotech through Virtual Edge.




5
 *Table
          of Contents*




On
      May 9,
      1997, the co-operative joint venture of our Beijing World Trade Center Club
      was
      formed initially by Canada Belford Enterprises Ltd. (Belford), a wholly owned
      company by our ex-CEO Mr. John Hui. On October 10, 1999, Virtual Edge signed
      an
      agreement with Belford pursuant to which Belford agreed to transfer its 75%
      interest in Beijing World Trade Center Club (“Beijing WTC Club”) to Virtual
      Edge. Beijing WTC Club was engaged in the establishment of the Beijing World
      Trade Center Club and currently provides and will continue to provide
      recreation, business center services, communication and information services,
      product exhibition services, commercial and trading brokerage services to its
      members. The Beijing World Trade Center Club is located at 2nd Floor, Office
      Tower II, Landmark Towers Beijing, 8 North Dongsanhuan Road, Beijing, the
      PRC.




On
      November 10, 2001, Virtual Edge signed an agreement with Guangzhou City
      International Exhibition Co., Ltd. pursuant to which a co-operative joint
      venture company, Guangzhou World Trade Center Club (“Guangzhou WTC Club”) was
      formed to operate a business club in Guangzhou, the PRC, which club shall
      provide services including food and beverages, recreation, business center,
      communication and information, products exhibitions, as well as commercial
      and
      trading brokerage services to its members. Virtual Edge shares 75% of the
      profits from the operation of Guangzhou WTC Club. Guangzhou WTC Club had its
      grand opening on January 28, 2002. The Guangzhou World Trade Center Club is
      located at 3 rd Floor,
      Goldlion Digital Network Center, 138 Tiyu Road East, Tianhe, Guangzhou
      PRC.




We
      currently operate the Beijing World Trade Center Club and Guangzhou World Trade
      Center Club through Virtual Edge.




**Overview
      Of Our Company’s Three Business Lines**




Our
      business plan involves the pursuit of three distinct lines of business
      including:




·
            **Business
                Clubs**.
                We have business clubs located in Guangzhou and Beijing. Each business
                club is indirectly associated with the World Trade Center Association,
                by
                which we have positioned ourselves as a platform to facilitate trade
                between China and the world
                markets.




·
            **Business
                Travel and Related Service**.
                We provide business travel and related services to our business club
                members through our affiliated New Generation Group of companies
                which
                provide business travel services, act as a consolidator of airline
                tickets
                and hotel accommodations in China and as an agent for the sale of
                life and
                accident insurance in the Guangzhou Province of China. The strategic
                acquisition of Suzhou Tongli provided the Company with entry into
                the high
                margin tourism segment of the travel
                business




·
            **Business
                Value-Added Services**.
                We provide value-added services, including business consulting services,
                interactive marketing and incentive programs for merchants, financial
                institutions, telecom operators, and large corporations. In addition
                to
                these services, we also plan to provide business consultancy services
                by
                focusing on (1) the financial advisory sectors, including market
                and
                industrial research and corporate restructuring and planning; (2)
                developing the international trade dimension of China enterprises
                and
                assisting foreign companies to establish their businesses in China;
                and
                (3) formulating marketing strategies. A small part of the business
                value-added services commenced operations in the year 2002 through
                Virtual
                Edge Limited, while the majority of these value added services commenced
                in the last fiscal quarter of 2004.




Our
      executive office is located at 3rd Floor, Goldlion Digital Network Center,
      138
      Tiyu Road East, Tianhe, Guangzhou, the PRC 510620.




Our
      segment revenues are stated in United States dollars and are prepared in
      accordance with United States generally accepted accounting principles. In
      this
      document, unless otherwise specified, all dollar amounts are expressed in United
      States Dollars.




6
 *Table
          of Contents*




**China
      World Trade Corporation**


**Segment
      Revenues**




**Year
      ended December 31**


**2006**
            
            **2005**
            
            **2004**US$
            
            %
            
            US$
            
            %
            
            US$
            
            %Business
                Club
            
            
            712,368
            
            
            16.4
            %
            
            894,550
            
            
            11.4
            %
            
            551,497
            
            
            17.8
            %Business
                Travel Services
            
            
            2,689,139
            
            
            62.0
            %
            
            4,983,468
            
            
            63.6
            %
            
            1,671,605
            
            
            54.1
            %Business
                Value-added
            
            
            927,445
            
            
            21.4
            %
            
            1,618,413
            
            
            20.6
            %
            
            40,695
            
            
            1.3
            %Others(1)
            
            
            10,385
            
            
            0.2
            %
            
            342,793
            
            
            4.4
            %
            
            828,947
            
            
            26.8
            %TOTAL
            
            
            4,339,337
            
            
            100.0
            %
            
            7,839,224
            
            
            100.0
            %
            
            3,092,744
            
            
            100.0
            %




**(1)**
            **Other
                revenues in year 2004, year 2005 and year 2006 were mostly generated
                from
                cattle hide trading business and rental income of our wholly  owned
                properties in Guangzhou and Hong
                Kong.**




**Our
      Corporate Structure**




We
      are a
      holding company for 11 direct and indirect, majority and wholly-owned
      subsidiaries that operate businesses in China. We are not an "investment
      company" as such term is defined in Section 3 of the Investment Company Act
      of 1940, as amended. Seven of these companies are incorporated under the
      laws of the British Virgin Islands, one under the laws of Hong Kong, and the
      remaining 3 in the People’s Republic of China. All of our business operations
      are located in China. Set forth below is an organizational chart depicting
      the
      relationships among our various companies.




·
            *Business
                Clubs:*We
                carry out our Business Clubs operations through our subsidiaries
                Guangzhou
                World Trade Center Club Limited, Beijing World Trade Center Club,
                and CEO
                Clubs China Limited. The Business Clubs commenced operations in August
                2002.




·
            *Business
                Travel:*Our
                Business Travel operations are managed by New Generation which consists
                of
                a group of seven individual companies and Suzhou Tongli International
                Execursion Development Ltd.. The main revenue streams generated by
                our
                Business Travel operations are from the travel agency business and
                the
                tourist entrance fee from Tongli.




·
            *Business
                Value-Added Services:*Our
                Business Value-Added Services are offered through three of our
                subsidiaries including (1) Guangzhou World Trade Link Information
                Service
                Limited, (2) Creative Idea Enterprise Limited and (3) Virtual Edge.
                Guangzhou WTC Link Information Service Limited has provided short
                message
                service and customer relationship management services since July
                2004.
                Creative Idea Enterprise Limited and Virtual Edge have each provided
                consultancy services since October 2002. Our consultancy services
                include
                the provision of market and industrial research, corporate restructuring
                and planning; and introduction of potential business affiliations.




The
      remainder of our revenues are generated from rental income on investment
      property held by our subsidiary General Business Network (Holdings) Limited.
      .









[The
      Remainder of Page Intentionally Left Blank]




7
 *Table
          of Contents*





8
 *Table
          of Contents*




Revenue
      Derived From Our Businesses




*Fiscal
      2006* :
      In
      fiscal 2006, we derived approximately $712,000 in revenues, representing 16.4%
      of total revenues from our Business Clubs operations; approximately $2,689,000
      in revenues, representing 62.0% of total revenues from our Business Travel
      Services; approximately $927,000 in revenues, representing 21.4% of total
      revenues from our Business Value-Added Services; and approximately $10,000,
      representing 0.2% of total revenues from Rental.




The
      rental properties include :




·
            Wholly
                owned rental property in Hong Kong located at 1209, 12/F., Champion
                Building, 301-309 Nathan Road, Kowloon, Hong Kong. This property
                generated
                $10,385 in revenue for fiscal 2006 and has been indirectly sold upon
                the
                disposal of 60% equity holding of General Business Network (Holding)
                Limited on September 29, 2006.




**Business
      Plan For Our Business Clubs**




**The
      Opportunity in China.** China
      has
      been considered one of the fastest growing economies in the world. The accession
      into the World Trade Organization will offer new opportunities for foreign
      companies to invest and do business in China. WTO membership for China will
      change the methods of market entry for overseas companies. Foreign companies
      will need to have well-tailored plans to cope with China’s target audience,
      services, marketing, finance, and human resources for the effective entry into
      the China market. The unique business culture and legal system in China will
      cause the local business information and services in China to become a key
      component to commerce.




As
      a
      result of lower barriers to entry into the China market, and a more attractive
      investment environment in recent years, we believe that many small and medium
      sized foreign enterprises will have investment opportunities in China for the
      first time. These foreign companies will need up-to-date business intelligence
      and know-how to successfully invest in the Chinese market.




China’s
      accession into the WTO also provides significant business opportunities to
      the
      small to medium size private Chinese companies. The increase in involvement
      from
      foreign companies and investors in the China market means more opportunities
      to
      do business with foreign companies. Under the trend of globalization, the
      Chinese market will evolve from many segmented and monopolized markets to an
      integrated national market that is open to the world economy. The small and
      medium sized companies in China will enjoy much lower cost to enter into the
      worldwide market but will also confront more competition, lowered profit
      margins, and new rules of the game. These Chinese companies will need up-to-date
      business intelligence, professional strategic planning and the access to the
      worldwide business networks to ensure success in the new environment. And with
      its imminent accession into WTO, there will be unique opportunities for foreign
      investment and international trade.




The
      World
      Trade Centers Association (“WTC Association”) is a not-for-profit corporation
      that focuses on promoting and assisting world trade activities. Its mission
      is
      to encourage world trade by fostering and supporting the development and
      operation of World Trade Centers in every region of the world. WTC Association
      was established in 1970 and has members from more than 330 cities in about
      100
      countries with global members of over 750,000 enterprises.




The
      World
      Trade Centers (“World Trade Centers”) are separate entities which are licensed
      by the WTC Association, each of which generate revenue and profit from operating
      businesses with access to a diverse array of state-of-the-art international
      trade services and facilities, which enables them to facilitate international
      trade. Under the jurisdiction of the WTC Association, there are two types of
      licenses that are available including (1) a license which enables the licensee
      to operate a World Trade Center Club in cooperation with China’s Commission for
      the Promotion of International Trade, and (2) a license which enables the
      licensee to designate a building as a “World Trade Center” but not operate such
      a club. We only have licenses that enable us to operate World Trade Center
      Clubs
      and, as previously mentioned, we currently have two World Trade Center Clubs
      in
      operation.




9
 *Table
          of Contents*




In
      the
      WTC Association, every local member of a World Trade Center in a city is
      automatically a member of all World Trade Centers worldwide. This helps the
      World Trade Centers to market their local membership, and also vastly increases
      the amount of services that a World Trade Center can offer to its local members.
      Therefore, the World Trade Centers worldwide form a reciprocal business network
      for businesses to access the international trade resources that may be expensive
      and even inaccessible in a domestic environment.




We
      plan
      to open and operate additional World Trade Center Clubs (also referred to as
      our
“Business Clubs”), which will be licensed by the WTC Association, in major
      cities in China, where Business Club members can relax, entertain, network
      and
      meet potential business affiliates in person, or via the Video Conferencing
      facilities of the WTC Association worldwide network.




The
      WTC
      Association has granted various licenses to the regional branches of the Trade
      Promotion Commission. The WTC Association can grant either regular full
      membership licenses or affiliate membership licenses to various branches of
      the
      Trade Promotion Commission, depending on the initial membership fee paid.




Through
      our wholly-owned subsidiary, Virtual Edge, we have formed 20-year co-operative
      joint ventures with the business subsidiaries of the Trade Promotion Commission
      including (1) the Beijing Wanlong Economic Consulting Limited for the
      joint-venture company Beijing World Trade Center Club and (2) the Guangzhou
      City
      International Exhibition Co. Ltd. for the joint venture company Guangzhou World
      Trade Center Club. Our Guangzhou World Trade Center Club and Beijing World
      Trade
      Center Club were both granted regular full membership licenses. We indirectly
      own 75% of the joint venture companies and the remaining 25% are owned by the
      business subsidiaries of the Trade Promotion Commission. Each arrangement may
      be
      terminated in the event the venture suffers material business setbacks or if
      a
      party materially breaches its obligations under the operating contract. We
      acquired the operation rights of regular full membership from WTC Association
      for running the world trade center clubs resulting from these two joint venture
      companies.




Under
      the
      co-operative joint venture of both Beijing World Trade Center Club and Guangzhou
      World Trade Center Club, we are obligated to pay a minimum of RMB150,000 (or
      approximately $18,500) annually until reaching their respective proportional
      profit sharing of 25% each to Beijing Wanlong Economic Consulting Limited and
      Guangzhou City International Exhibition Co. Ltd. They in turn pay WTC
      Association an annual fee of $10,000 for each individual world trade center
      club. Other than the annual fee which we pay to the business subsidiaries of
      the
      Trade Promotion Commission, we do not have any revenue sharing obligation with
      World Trade Center Association.




**Facilities.** The
      Guangzhou World Trade Center Club and Beijing World Trade Center Club provide
      a
      full range of top quality commercial and recreational services to our members.
      The clubhouses are luxuriously decorated and provide an elegant environment
      under which members can enjoy our facilities. ****




The
      facilities in our Beijing World Trade Center Club include snack bars, seminar
      and conference rooms, executive suites, office and meeting room packages,
      videoconferencing facilities, and exhibition rooms. The facilities in our
      Guangzhou World Trade Center Club include western fine dining, seminar and
      conference rooms, executive suites, office and meeting room packages,
      videoconferencing facilities, exhibition rooms, and cigar and wine corner.
      The
      business services offered by both the business clubs to its members include
      (i)
      liaison work with potential trading partners, (ii) international economic and
      trade exhibitions and seminars, (iii) interpreters and secretarial services,
      (iv) organized trips to participate in World Trade Center Association sponsored
      activities, (v) reception of visiting delegations of foreign World Trade Center
      Association member units, (vi) arrangement of meetings with Chinese government
      bodies, business corporations, and (vii) legal consultancy and travel management
      services.




**Events
      Management Services.** We
      assist
      foreign companies to organize and participate in conferences, exhibitions and
      special events such as the “beer festival” in China and assist Chinese companies
      to organize and participate in conferences and exhibitions overseas. We have
      already generated revenue from this fee based service business.




10
 *Table
          of Contents*




**Virtual
      Office.** Virtual
      office services help foreign companies to establish a presence in China at
      minimum cost. Each client will be assigned a dedicated phone number, fax number
      and mail address. The phone number can be forwarded to a number assigned by
      the
      client, or be answered by a well trained secretary who takes care of the
      communication for the client. Foreign companies can also manage their
      communication with their China affiliates over the Internet. These services
      started generating revenue in 2004 and a monthly fixed fee is charged for each
      account.




**Marketing
      Strategy.** We
      plan
      to market memberships in our Business Club mainly to (1) international
      companies, (2) businessmen who conduct business in China and with local Chinese
      companies and (3) businessmen seeking business opportunities within and outside
      China. We will utilize the good reputation and recognition of WTC Association
      name and the recreational and business facilities which will be offered at
      each
      Business Club to establish the Guangzhou Club, Beijing Club and other potential
      Business Clubs in various cities in the PRC as the premier business clubs of
      their kind. We also hope to make the ChinaWTC.com website into a distinctive
      Chinese/English language Internet portal.




We
      plan
      to achieve our marketing goals through (i) placing advertisements with
      traditional media, such as newspapers, television, radio, magazines etc., (ii)
      placing banners on high traffic web sites, (iii) sending e-mails to potential
      users, (iv) participating in trade shows, (v) employing the services of external
      public relations and marketing firms, (vi) airing television “infomercials” and
      talk shows, (vii) placing outdoor advertising signs and (viii) attending /
      holding press conferences. We intend to form strategic alliances with companies
      that can contribute services and local expertise in various market sectors.
      These alliances will increase our content and navigation services, support
      our
      advertising services and expand our distribution networks. We intend to form
      vertical alliances, such as exhibition management companies and travel agents,
      which will either allow us to integrate their products to our services offerings
      or to access their distribution networks. We will also form horizontal
      alliances, such as golf clubs and other business clubs, to increase our client
      base.




An
      integral part of our success is dependent on the development and enhancement
      of
      our products and services. We will incorporate new technologies from third
      parties, expand products and services internally and conduct market research
      to
      remain aware and informed of the evolving user tastes and latest technologies.
      The New Generation acquisition has demonstrated the success of our strategies
      to
      grow our revenues through vertical consolidation. By acquiring New Generation,
      we have integrated the services offered by New Generation into the services
      offered by the Business Clubs. The Business Clubs services have also created
      value to New Generation by allowing New Generation to offer premium services
      to
      a selected group of important clients.




On
      the
      other hand, the acquisition of the CEO Clubs China is an example of our
      strategies to horizontally consolidate other business clubs so as to increase
      our client base.




**Sources
      of Income.** We
      will
      generate income from our Business Clubs in several ways.




We
      intend
      to expand our Business Clubs and operate Business Clubs in major Chinese cities.
      While the worldwide business network from WTC Association together with the
      reciprocal services will be the core attraction to businesspersons in China,
      the
      business community that we maintain in the major Chinese cities will become
      a
      more valuable asset in the long term. Through our presence in major cities
      in
      China, we will develop a community of active businesspersons from small and
      medium sized enterprises with a common interest in world trade.




Additionally,
      our Business Clubs intend to generate revenue from the owners and senior
      management of small and medium sized enterprises in China, by providing a full
      range of top quality commercial and recreational services, and education and
      business networking programs. Our Business Club will also help members to liaise
      with potential trading partners from overseas, to join international economic
      and trade exhibitions and seminars, and to organize international business
      trips.




11
 *Table
          of Contents*




As
      part
      of the reciprocal arrangement under the WTC Association, the Business Clubs
      will
      also provide services to visiting delegations from foreign World Trade Center
      members. The China World Trade Business Club will help foreign companies or
      businesspersons to minimize the barrier of doing business in China. Services
      provided to foreign companies and businessperson may include organizing meetings
      with Chinese government bodies, business corporations and potential
      affiliates.




The
      revenue that we have derived already from the Business Club business comes
      directly from (1) membership fees, (2) fees collected from training and (3)
      events, such as seminars.




At
      each
      Business Club will be a Business Center, which is operated for the benefit
      of
      the members and others. While the Business Center’s services are not confined to
      members of the Business Club, members of the Business Club will enjoy special
      discounts for the Business Center services and more dedicated support from
      the
      staff of the Business Club.




The
      revenue we have derived from a Business Center comes directly from (1) rental
      fees of facilities and (2) service fees. We will derive income from the Business
      Center providing (i) temporary offices, seminar and conference rooms, video
      conferencing facility, exhibition rooms, interpreters and secretarial services
      and business consultation services.




**Primary
      Clientele.** The
      main
      clients of our Guangzhou World Trade Center Club in year 2006
      included *:*




·
            Greentree
                Financial Group (China) Ltd. which accounted for 19% of the total
                revenue
                of Guangzhou World Trade Center
                Club;




·
            Mercury
                Interactive Corporation, which accounted for 11% of the total revenue
                of
                Guangzhou World Trade Center Club;




·
            Hyperion
                Solutions Corporation, which accounted for 10% of the total revenue
                of
                Guangzhou World Trade Center Club;
                and




·
            Esko-Graphics
                (Shanghai).Ltd., which accounted for 5% of the total revenue of Guangzhou
                World Trade Center Club.




Collectively,
      the above four clients aggregately representing over 45% of the total revenue
      of
      Guangzhou World Trade Center Club. These above four clients account for a
      considerable portion of the total revenue of Guangzhou World Trade Center Club
      because all of these clients use our “Smart Office” under a fixed term from a
      one-month period to a 12 month period. We charge each of these clients
      additional fees for their uses of other facilities, such as teleconferencing,
      seminar rooms and other electronic equipment. In addition to these four main
      client, other clients include some international and domestic well-known
      enterprises, such as Koenig & Bauer AG, Landesk Ltd., Maguire Products Asia
      Pte., Ltd. etc.




12
 *Table
          of Contents*




The
      main
      clients of our Beijing World Trade Center Club in year 2006
      included:




·
            AirVana
                Holdings Inc., which accounted for 14% of the total revenue in
                2006;




·
            Virgin
                Atlantic Airway, Ltd., which accounted for 10%of total revenue in
                2006;




·
            Pegasus
                Solutions Asia, LLC, which accounted for 9% of the total revenue
                in 2006;
                and




·
            M.Tech
                (Shanghai) Co. Ltd..which accounted for 9% of the total revenue in
                2006.




Other
      clients included The Mathworks Inc., Standard Life Assurance Company, and other
      international companies.




**Potential
      Income From Potential License Agreements.** We
      intend
      to negotiate and acquire the necessary approval from WTC Association to license
      the China World Trade Center intellectual property rights including the logo
      and
      trademark to third parties. The licensees may use our logo and trademark to
      quickly establish a brand for their products such as office accessories, or
      to
      attract a group of clients for certain services such as credit cards offered
      by
      the Business Value-Added division. Revenue will be generated from royalty fees,
      which may be paid in cash, stock or other property.




**Competition.** There
      are
      a number of organizations utilizing the word of “Club” in China, such as the
      Beijing American Club, which offers more in terms of recreational facilities
      and
      services. There are other organizations, such as the American Chamber of
      Commerce, which provide limited trades and business information and networking
      capabilities. All other clubs and organizations in Guangzhou and Beijing only
      operate as clubhouses with local presence. On the contrary, we operate under
      the
      international brand name of “World Trade Center Club” exclusively in a certain
      region of PRC area. As a result, we out-compete the other players with our
      reciprocal membership advantage by leveraging on the global network of World
      Trade Center Clubs and among our World Trade Center Clubs in China. The
      management believes there will not be other business clubs in the regions that
      could operate under a similar model and this would provide the competitive
      advantage of our Business Clubs operations.




Our
      management believes that there is no single source of information and research
      report which is sophisticated enough for us to provide a meaningful estimate
      of
      the number of competitors and our competitive position in the business clubs
      industry.




**Employees.** We
      have
      39 employees in our Business Clubs as of December 31, 2006. None of them are
      parties to any union or collective bargaining agreement.




**Governmental
      Regulation of Business Club Operations in China.** The
      operation of our Business Clubs must conform to the governmental regulations
      and
      rules of the Peoples’ Republic of China. The practical effect of the People’s
      Republic of China legal system on our business operations in China can be viewed
      from two separate but intertwined considerations:




First,
      as
      a matter of substantive law, the Foreign Invested Enterprise laws provide
      significant protection from government interference. In addition, these laws
      guarantee the full enjoyment of the benefits of corporate Articles and contracts
      to Foreign Invested Enterprise participants. These laws, however, do impose
      standards concerning corporate formation and governance, which are not
      qualitatively different from the General Corporation Laws of the state of Nevada
      in the United States. Similarly, the People’s Republic of China accounting laws
      mandate accounting practices which are not consistent with US Generally Accepted
      Accounting Principles. The China accounting laws require that an annual
“statutory audit” be performed in accordance with People’s Republic of China
      accounting standards and that the books of account of Foreign Invested
      Enterprises are maintained in accordance with Chinese accounting laws. Article
      14 of the People’s Republic of China Wholly Foreign-Owned Enterprise Law
      requires a Wholly Foreign-Owned Enterprise to submit certain periodic fiscal
      reports and statements to designate financial and tax authorities, at the risk
      of business license revocation.




13
 *Table
          of Contents*




Second,
      while the enforcement of substantive rights may appear less clear than United
      States procedures, the Foreign Invested Enterprises and Wholly Foreign-Owned
      Enterprises are Chinese registered companies which enjoy the same status as
      other Chinese registered companies in business-to-business dispute resolution.
      Because the terms of the respective Articles of Association provide that all
      business disputes pertaining to Foreign Invested Enterprises are to be resolved
      by the Arbitration Institute of the Stockholm Chamber of Commerce in Stockholm,
      Sweden applying Chinese substantive law, the Chinese minority partner in our
      joint venture companies will not assume a privileged position regarding such
      disputes. Any award rendered by this arbitration tribunal is, by the express
      terms of the respective Articles of Association, enforceable in accordance
      with
      the “United Nations Convention on the Recognition and Enforcement of Foreign
      Arbitral Awards (1958)”. Therefore, as a practical matter, although no
      assurances can be given, the Chinese legal infrastructure, while different
      in
      operation from its United States counterpart, should not present any significant
      impediment to the operation of Foreign Invested Enterprises.




**China’s
      Accession into the WTO.** On
      November 11, 2001, China signed an agreement to become a member of the World
      Trade Organization, sometimes referred to as the WTO, which is the international
      body that sets most trade rules, further integrating China into the global
      economy and significantly reducing the barriers to international commerce.
      China’s membership in the WTO was effective on December 11, 2001. China has
      agreed upon its accession to the WTO to reduce tariffs and non-tariff barriers,
      remove investment restrictions, provide trading and distribution rights for
      foreign firms, and open various service sectors to foreign competition. China’s
      accession to the WTO may favorably affect our business in that reduced market
      barriers and a more transparent investment environment will facilitate increased
      investment opportunities in China, while tariff rate reductions and other
      enhancements will enable us to develop better investment strategies and attract
      investment capital. In addition, the WTO’s dispute settlement mechanism provides
      a credible and effective tool to enforce members’ commercial rights. Also, with
      China’s entry to the WTO, it is believed that the relevant laws on foreign
      investment in China will be amplified and will follow common
      practices.




**Business
      Plan For Businesses Travel Services**




We
      engaged in the businesses travel services through our indirect 51% ownership
      of
      the New Generation Group of companies and our indirect 12.8% ownership of
      SuzhouTongli. On September 29, 2006, management made a decision to sell 60%
      of our equity holding of General Business Network (Holdings) Ltd., which holds
      51% of the outstanding capital stock of New Generation. As a matter of fact,
      New
      Generation became one of our associated companies since the disposal of 60%
      equity holding of General Business Network (Holding) Ltd. New Generation has
      seven operating subsidiaries in Southern China through which it operates these
      businesses. We believe that the equity holding on both Tongli and New Generation
      will allow us to participate in a fast growing travel and tourism industry
      in China, which are set forth below, although there can be no assurances that
      we
      will be able to capitalize on them.




**New
      Generation’s Business Travel Services.**  We
      seek
      to serve China’s emerging class of frequent independent travelers, or FITs, who
      engage in business and leisure travel on their own instead of traveling in
      groups. Through our professional team of staff, our nationwide 24-hour toll-free
      call center, our user-friendly Chinese and English language website and our
      extensive reseller network, we provide our customers with consolidated travel
      information and the ability to book airline tickets at discounted rates
      nationwide within China. We also provide our customers with the ability to
      book
      hotel rooms at discounted rates in over 220 cities in China. The majority of
      our
      hotel suppliers are three-, four- or five-star hotels, as rated by the China
      National Tourism Bureau, catering to higher-end travelers. We also offer other
      travel related services, such as vacation packages and corporate travel
      services, at competitive prices.




We
      issue
      and deliver air tickets using a network of local agents throughout major cities
      in China. New Generation started its hotel booking business in April 2004 and
      revenue generated from this division is insignificant to date. At this stage
      in
      its development, management is concentrating on establishing a nationwide
      network through forging business affiliations and improving its information
      technology infrastructure.




14
 *Table
          of Contents*




To
      facilitate rapid growth in hotel booking business, New Generation has created
      a
      comprehensive IT platform to facilitate its operation. A call center and website
      approach are believed to be essential to overcome the requirement of having
      many
      geographic locations in order to conduct business. Through its telephone network
      and its website, New Generation’s hotel booking business is not limited to the
      established air ticketing network but rather is able to form a more extensive
      hotel booking network quickly, that will also benefit our air ticketing
      business.




**Suzhou
      Tongli’s Business Travel Services.**  Suzhou
      Tongli is the sole tourism operator and planner of all scenic sites in Tongli
      Town of Suzhou Province, China, including the Retreat and Reflection (Tuisi)
      Garden which is recognized as one of the UNESCO World Heritage sites. In
      additional to having entrance tickets operations rights for Tongli scenic
      destinations, Suzhou Tongli is working with the government of Tongli to
      implement tourism programs and to construct service facilities to expand the
      town’s reputation as the best ancient water village travel destination.




The
      redeployment of our investment into Suzhou Tongli ensures that the Company
      will
      establish an exclusive foothold into a growing and high-end travel market.
      At
      present, the revenue of Suzhou Tongli mainly comes from traditional sightseeing
      entrance tickets, and, in connection therewith, Suzhou Tongli owns the entrance
      tickets operation rights for 12 scenic spots in Tongli, which include 3
      exclusively operated scenic spots and 9 collaboratively operated scenic spots.
      Besides generating revenues from traditional sightseeing entrance ticketing,
      the
      Company endeavours to develop new tourism revenues from a combination of
      participative tourism programs, leisure tourism, extended vacation tourism,
      value-added business travel and so on. This new tourism revenue model will
      extend the Company’s traditional ticket source of revenues to a more
      comprehensive tourism revenue source which integrates various tourism
      programs.




Tongli
      Town is located in Wujiang city, within Jiangsu Province, on the eastern border
      of China near Shanghai. Well-developed water, land, and air transportation
      means
      that Tongli is easily accessible to other major cities, such as Shanghai, Suzhou
      and Hangzhou. Tongli is surrounded by rivers and lakes and is divided into
      15
      islands by more than 10 river courses, connected by more than 40 different
      ancient bridges built at different times, forming the streets going along-side
      the rivers, creating an interlinked pattern between roads and bridges. The
      bridges are considered to be Tongli’s signature architectural
      highlights.




Tongli
      Town is located at the central area of the Yantze River Delta, which consists
      of
      Shanghai, Zhejiang and Jiangsu. The Yantze River Delta is one of the fastest
      growing districts in China from an economic stand point.. The strong economy
      in
      the Yangtze River Delta produces strong demand for tourism and purchasing power
      in the tourists. For example, Jiangsu province has population of 743.25 million
      with average GDP per person of US$2,524, compared to China’s urban disposable
      income of its citizens of US$ 1,294
      in
      2004. Of the total employees in the Jiangsu province, approximately 10% work
      in
      the tourism industry. The average traveling expense in China increased
      approximately 50% compared with that in 2005.




**The
      Travel And Tourism Industry In China.** *The
      facts and statistics used in this registration statement relating to the travel
      industry and economy in China are derived from various government and institute
      research publications. While we have taken reasonable care to ensure that these
      facts and statistics presented are accurately reproduced from such sources,
      we
      have not independently verified them. These facts and statistics may not be
      comparable to similar facts and statistics collected for the industry or economy
      in the United States and other countries.*




15
 *Table
          of Contents*




In
      terms
      of domestic tourism spending in 2006, the approximately RMB583 billion (US$
      74.7
      billion) travel industry in China is large and growing rapidly. We expect the
      industry to continue to experience rapid growth as China’s economy continues to
      develop. Travel and tourism in China is characterized by a highly fragmented
      and
      inefficient travel service sector due to many factors, including the lack of
      consolidated hotel ownership, the lack of a centralized hotel reservation
      system, the localized nature of travel agencies and a dual regulatory regime.
      We
      believe that the fragmented nature of the travel market in China will create
      increasing demand for central reservation platforms such as our own capable
      of
      consolidating a wide range of travel information and negotiating favorable
      terms
      with travel suppliers on the basis of scale from our aggregated
      demand.




According
      to the China National Tourism Administration, as of the end of 2005, China
      had
      more than 16,800 travel agencies. As the requirements of travelers become more
      complex, we believe that these local agencies, which had been accustomed to
      providing services using state-owned travel suppliers, have been increasingly
      unable to respond to the changing needs of business and leisure travelers in
      China. In addition, the development of China’s tourism infrastructure has
      resulted in an increasing number of travelers who choose to engage in leisure
      travel without the constraints inherent in packaged group tours. These frequent
      independent travelers, or FITs, represent a key segment of the growing travel
      industry in China that we seek to serve.




The
      increasing accessibility of the Internet in China creates a foundation for
      new
      markets and opportunities, providing the ability to bring together a large
      number of segmented suppliers and customers in a highly fragmented travel
      industry. We believe that we are well positioned to benefit from these trends
      in
      China’s travel industry.




According
      to market data from CEIC Data Company Ltd., the frequent independent traveler,
      or FIT, segment of travelers grew at an approximately 10.3% compound annual
      growth rate from 2005 to 2006 and is the largest growing group of travelers
      in
      China. FITs are defined as travelers who do not travel with tour groups and
      who
      require flexibility in the selection of accommodations and transportation.
      FITs
      are typically more sophisticated urban dwellers who value customized
      experiences. We expect that as Chinese travelers become wealthier and more
      experienced with leisure travel, the appeal of traditional tours will become
      less important than the ability to arrange one’s own schedule.




Traditionally,
      most companies in China have relied on either local travel agencies or their
      internal resources for business travel planning. Companies in China have begun
      to recognize the importance of focusing on their core competency by outsourcing
      non-critical functions. A growing number of medium and large-sized companies
      are
      beginning to centralize their corporate travel management by outsourcing to
      professional travel service providers.




**Market
      Inefficiencies and Fragmentation.** The
      travel market in China is highly fragmented with an underdeveloped booking,
      reservation and fulfillment infrastructure, and with no dominant nationwide
      travel agencies. As a result of market reforms, a gradual shift from state-owned
      to privately-owned travel agencies and changing travel patterns, the travel
      market in China is undergoing a period of change. While competition among the
      older state-owned travel agencies and the privately owned travel agencies has
      significantly promoted the development of China’s travel service, the industry
      remains inefficient and is likely to remain so in the foreseeable
      future.




*Air-ticketing
      system.* Currently, TravelSky Technology Limited, or TravelSky, operates the only
      nationwide system for air-ticket reservations in China. Consumers in China
      do
      not have access to direct bookings on TravelSky unless it is done through
      individual travel agencies. Moreover, the delivery of air tickets remains
      inefficient. The majority of consumers in China receive their air tickets
      through physical delivery and payment to the travel agency is made upon
      delivery. The process of physical delivery means that consumers in China do
      not
      have a reliable or timely delivery process that can respond to last minute
      travel needs. For example, business travelers who change their flight
      destinations at the last minute often have to wait for the delivery of a
      physical ticket before they can initiate their travel. While some airlines
      in
      China have recently begun to offer electronic ticketing, there is currently
      no
      universal electronic ticketing system available. The International Air Transport
      Association recently announced that all members should adopt electronic tickets
      in 2007. As the employment of e-ticketing requires more capital investment
      on IT
      and relevant facilities, as well as more investment on staff training, smaller
      players will most likely be shaken out of the market during the process. On
      the
      other hand, this trend implies that business opportunities for larger agencies
      with relatively mature business models and operating at a large scale, such
      as
      New Generation, would survive.




16
 *Table
          of Contents*




*Hotel
      reservation system.* According to the Year Book of China Tourism Statistics 2006, as of December
      31,
      2005, China
      had
      11,828 star hotels, which includes 4,291 three-star hotels, 1,146 four-star
      hotels and 281 five-star hotels. Hotels
      in China are generally run independently and are not part of large chains.
      The
      largest hotel chains in China are small relative to the larger hotel chains
      in
      the United States. There is no industry wide electronic reservation
      infrastructure similar to that available in the United States and parts of
      Europe.




There
      is
      no national distribution system for hotel rooms in China. Travel agents
      generally have to negotiate room availability and rates with the hotel each
      time
      they make a booking. Hotel suppliers in China are not able to benefit from
      an
      efficient distribution system that is managed by a centralized process. Until
      recently, travelers in China did not have access to comprehensive hotel
      information or a central location for bookings. Instead, travelers in China
      are
      still mainly interacting through walk-in room reservations, direct call-in
      reservations, business conventions and traditional travel agency bookings.
      There
      are some business operators, such as CTRIP and E-Long, developing centralized
      hotel booking platforms in China by utilizing scalable information technology
      platforms. At present, 70% transactions of CTRIP have been done through
      telephone with the remaining 30% mainly fulfilled online.




In
      the
      on-line travel business, packaging air tickets with hotel rooms is increasingly
      popular for it reduces customers’ sensitivity on prices and the profit margin
      appears higher than the traditional method of providing ticketing and hotel
      booking separately. For Chinese companies conducting this business model, like
      CTRIP and eLong, hotel booking is the dominant source for revenues. In 2006,
      CTRIP derived $61,000,000 from hotel booking business, 57% of its total
      revenues. Air ticketing contributed 36.4% ($39,000,000) in the same year. *(Source:
      CTRIP Annual Report 2006* ).
      While
      in other countries where the “ticket + hotel room” model is more mature, air
      ticketing usually contributes to a larger portion of total revenues. Unlike
      either case, New Generation has been largely relying on air ticketing since
      its
      inception. For the year ended December 31, 2006, the revenue from air ticketing
      was about $2,440,000, representing 69.5% of its total revenues. For the nine
      months ended September 30, 2006, the revenue from air ticketing was $1,850,000,
      representing 68.9% of its total revenues. New Generation ceased to be a
      subsidiary of China World Trade Corporation on September 29, 2006 as mentioned
      in Business Plan For Business Travel Services paragraph on
      p.15.




*Traditional
      travel agencies.* Travel
      agencies in China tend to be unaffiliated, small office operations. Due to
      local
      licensing requirements, even the four travel agencies that operate on a
      nationwide basis are mostly structured such that each office operates
      independently from the others. Consumers in China have generally not been able
      to enjoy the benefits that can be offered by a nationwide, integrated travel
      agency.




*Inefficiencies
      created by separate regulatory regimes.* Under
      current regulations, two distinct regulatory bodies regulate the travel industry
      in China. In order to sell air tickets, travel agencies must obtain a permit
      from the Civil Aviation Administration of China. If a travel agency intends
      to
      conduct the air-ticketing business in more than one city, an air-ticketing
      permit is required for every city, as there is currently no national
      air-ticketing license. In addition, in order to conduct other travel-related
      business such as hotel reservations, the travel agency must obtain a separate
      license from the China National Tourism Administration. Consumers who wish
      to
      purchase both air tickets and make hotel reservations through a single agency
      must use a travel agency that performs both functions. Many traditional travel
      agencies are unable to perform both functions given the limited number of
      licenses that can be issued and the costs associated with obtaining each
      license. As a result, consumers are often forced to arrange travel plans with
      multiple travel agencies.




**Regulation.** The
      travel industry in China is subject to substantial regulation by the Chinese
      government. This section sets forth a summary of certain significant Chinese
      regulations that affect our business and our industry. Current PRC laws and
      regulations impose substantial restrictions on foreign ownership in
      air-ticketing, advertising and Internet businesses in China.




*Foreign
      Ownership*




*Air-ticketing.* The
      principal regulation governing foreign ownership in air-ticketing business
      in
      China is The Foreign Investment Industrial Guidance Catalogue (2004 revision).
      Under this regulation, a foreign investor is allowed to own 100% of any
      wholesale and commission-based agency in China after December 11, 2004. As
      inferred from the law, air-ticketing does not fall into the statutory prohibited
      industries like the wholesale of newspaper and magazine, drugs, agricultural
      chemicals and membrane, chemical fertilizer, refined oil and crude oil, so
      it is
      our understanding that beginning on December 11, 2004 foreign investors were
      permitted to own 100% of an air-ticket agency.




17
 *Table
          of Contents*




*Travel
      agencies.* The
      principal regulation governing foreign ownership in travel agencies in China
      is
      the Establishment of Foreign Controlled and Wholly Foreign Owned Travel Agencies
      Tentative Provisions (2003). Recently, foreign investors that (i) primarily
      engage in travel agency business; (ii) have annual revenue from travel services
      exceeding $40,000,000 (in the case of foreign-controlled travel agencies) or
      $500,000,000 (in the case of wholly foreign owned travel agencies; and (iii)
      are
      members of travel industrial associations in their home countries or regions
      have been permitted to establish or own travel agencies in Beijing, Shanghai,
      Guangzhou, Shenzhen, Xian or other approved national tourism areas, upon the
      approval of the PRC government, subject to substantial restrictions on the
      scope
      of their business. For example, foreign invested travel agencies are prohibited
      from engaging in the business of overseas travel by PRC citizens or travel
      by
      persons from the other regions of the PRC to Hong Kong, Macau or Taiwan. In
      addition, other than its head office, foreign-invested travel agencies are
      not
      allowed to open branch offices.




Our
      51%
      ownership of the New Generation Group of companies involves the foreign control
      of a travel agency doing business in the Peoples’ Republic of China. The control
      of a Chinese travel agency is permissible under the Establishment of Foreign
      Controlled and Wholly Foreign Owned Travel Agencies Tentative Provisions (2003), subject
      to compliance with the restrictions on the scope of business for passenger
      air
      ticket sales agents, commercial agency, tourist information services and
      marketing research planning. All such businesses are not categorized as
“restricted” or “prohibited” by The Foreign Investment Industrial Guidance
      Catalogue (2004 revision). We believe the competitive advantage of the travel
      agency business of New Generation is not limited by the scope of business
      restrictions referred to in the preceding sentence, and, therefore, our
      operations are not impacted by laws regulating travel agencies.




*Advertising
      Agencies.* The
      principal regulations governing foreign ownership in advertising agencies in
      China include the Foreign Investment Industrial Guidance Catalogue (2002);
      and
      the Administrative Regulations Concerning Foreign Invested Advertising
      Enterprises (2004). Under these regulations, foreign investors can currently
      own
      up to 70% of the equity interest in an advertising agency in China. Beginning
      on
      December 10, 2005, foreign investors will be permitted to own 100% of an
      advertising agency.




*Internet
      content provision.* The
      principal regulations governing foreign ownership in the Internet content
      provision business in China include the Administrative Rules for Foreign
      Investments in Telecommunications Enterprises (2001); and the Foreign Investment
      Industrial Guidance Catalogue (2002). Under these regulations, a foreign entity
      is prohibited from owning more than 50% of a Chinese entity that provides
      value-added telecommunications services, including Internet content
      provision.




*General
      Regulation of Businesses*




*Air-ticketing.* The
      air-ticketing business is subject to the supervision of the Civil Aviation
      Administration of China, or CAAC, and its regional branches. The principal
      regulation governing air-ticketing business in China is the Administration
      on
      Civil Aviation Transporting Marketing Agency Business Regulations (1993). Under
      this regulation, an air-ticketing agency must obtain a permit from CAAC or
      its
      regional branch in every city in which the agency proposes to conduct business.
      The two types of air-ticketing permits in China are permits for selling tickets
      for international flights and flights to Hong Kong, Macau and Taiwan and permits
      for selling tickets for domestic flights in China except flights to Hong Kong,
      Macau and Taiwan.




*Travel
      agencies.* The
      travel agency industry is subject to the supervision of the China National
      Tourism Administration and local tourism administrations. The principal
      regulations governing travel agencies in China include the Administration of
      Travel Agencies Regulations (1996), as amended, and the Rules of Implementation
      of the Administration of Travel Agencies Regulations (2001). Under these
      regulations, a travel agency must obtain a license from the China National
      Tourism Administration in order to conduct cross-border travel business, and
      a
      license from the provincial-level tourism administration in order to conduct
      a
      domestic travel agency business.




18
 *Table
          of Contents*




*Advertising.* **** The
      State
      Administration of Industry and Commerce is responsible for regulating
      advertising activities in China. The principal regulations governing
      advertising, including online advertising in China include the Advertising
      Law
      (1994); and the Administration of Advertising Regulations (1987). Under these
      regulations, any entity conducting advertising activities must obtain an
      advertising permit from the local Administration of Industry and
      Commerce.




*Internet
      content provision service and online commerce.* The
      provision of travel-related content on the websites is subject to Chinese laws
      and regulations relating to the ** telecommunications
      industry and the Internet, and regulated by various government authorities,
      including the Ministry of Information Industry and the State Administration
      of
      Industry and Commerce. The principal regulations governing the
      telecommunications industry and the Internet include the Telecommunications
      Regulations (2000); the Administrative Measures for Telecommunications Business
      Operating Licenses (2001); and the Internet Information Services Administrative
      Measures (2000). Under these regulations, Internet content provision services
      are classified as value-added telecommunications businesses, and a commercial
      operator of such services must obtain an Internet content provision license
      from
      the appropriate telecommunications authority in order to carry out any
      commercial Internet content provision operations in China.




With
      respect to online commerce, there are no specific Chinese laws at the national
      level governing or defining online commerce activities, and no government
      authority has been designated to regulate these activities. There are existing
      regulations governing retail business that require companies to obtain licenses
      in order to engage in the business. However, it is unclear whether these
      existing regulations will be applied to online commerce.




*Regulation
      of Foreign Currency Exchange and Dividend Distribution*




*Foreign
      currency exchange.* The
      principal regulation governing foreign currency exchange in China is the Foreign
      Currency Administration Rules (1996), as amended. Under these rules, the
      Renminbi is freely convertible for trade and service-related foreign exchange
      transactions, but not for direct investment, loans or investments in securities
      outside China without the prior approval of the State Administration of Foreign
      Exchange of the People’s Republic of China, or SAFE.




Pursuant
      to the Foreign Currency Administration Rules, foreign-invested enterprises
      in
      China may purchase foreign exchange without the approval of SAFE for trade
      and
      service-related foreign exchange transactions by providing commercial documents
      evidencing these transactions. They may also retain foreign exchange, subject
      to
      a cap approved by SAFE, to satisfy foreign exchange liabilities or to pay
      dividends. However, the relevant Chinese government authorities may limit or
      eliminate the ability of foreign-invested enterprises to purchase and retain
      foreign currencies in the future. In addition, foreign exchange transactions
      for
      direct investment, loan and investment in securities outside China are still
      subject to limitations and require approvals from SAFE.




*Dividend
      distribution.* The
      principal regulations governing distribution of dividends by foreign-invested
      companies include (i) the Sino-foreign Equity Joint Venture Law (1979), as
      amended; (ii) the Regulations of Implementation of the Sino-foreign Equity
      Joint
      Venture Law (1983), as amended; (iii) The Foreign Investment Enterprise Law
      (1986), as amended; and (iv) The Regulations of Implementation of the Foreign
      Investment Enterprise Law (1990), as amended. Under these regulations,
      foreign-invested enterprises in China may pay dividends only out of their
      accumulated profits, if any, determined in accordance with Chinese accounting
      standards and regulations. In addition, wholly foreign owned enterprises in
      China are required to set aside at least 10% of their respective accumulated
      profits each year, if any, to fund certain reserve funds unless such reserve
      funds have reached 50% of their respective registered capital. These reserves
      are not distributable as cash dividends.




19
 *Table
          of Contents*




In
      addition, our wholly-owned subsidiaries are required to allocate portions of
      their respective after-tax profits to their enterprise expansion funds and
      staff
      welfare and bonus funds at the discretion of their boards of directors. Our
      affiliated Chinese entities are required to allocate at least 5% of their
      respective after-tax profits to their respective statutory welfare funds.
      Allocations to these statutory reserves and funds can only be used for specific
      purposes and are not transferable to us in the forms of loans, advances, or
      cash
      dividends.




**Competitive
      Strengths.** We
      have
      capitalized on the following competitive strengths in building our travel
      service business:




*Established
      large scale ticketing business.* New
      Generation has achieved a large scale of transactions in the flight ticketing
      services. The number of companies providing air ticketing services is much
      less
      than those providing services for room reservations in China. And few players
      engage in both businesses. On the supply side, there are thousands of suppliers
      for room reservation services, while there is a very limited number of airlines
      in China. As a result, hotel operators are confronting more fierce competition
      than airlines are. A small company can easily establish contacts with hotels
      and
      be their agents since the capital required is small and the relationship with
      suppliers is easy to manage. In contrast, to be an air ticketing agent,
      companies have to overcome high capital barriers first and then work hard to
      maintain good relationships with the airlines. Both are normally very scarce
      and
      critical resources in this business. Since New Generation has achieved large
      scale in its operations, it has formed mutually dependant relationships with
      its
      upstream suppliers and has thereby achieved a strong bargaining position with
      its suppliers. And the capital requirement is not a barrier to entry or growth
      for New Generation since its systems are already in place. New Generation has
      achieved the scale necessary to deal with its upstream suppliers, which include
      the airlines, as well as its downstream customers. Potential entrants into
      the
      industry face these capital and scale barriers to entry.




*Extensive
      resources in the airport.* New
      Generation is the first travel agent in China who provides customers with
      seamless pre-boarding services in the terminal. In 1998, it established “Red
      Carpet Service Zone” in the old Guangzhou Baiyun International Airport, the
      third largest airport in China, to provide customers with extensive services
      ranging from air-ticketing, check-in services to airport pick-up. After that,
      Huahao Group, New Generation’s former parent company, and one of our
      shareholders, entered into a 10-year joint venture agreement with a subsidiary
      of Baiyun Airport Company Ltd. to provide easy boarding services. The joint
      venture was reported as the first example in China of cooperation between a
      private company and the highly regulated airport industry. It is indicative
      of
      our extensive resources and those of our affiliates employed at the
      airport.




*Brand
      leadership.* As one
      of the early movers in the industry to adopt modern communications and Internet
      technologies, we believe that we have established one of the best-known brands
      for travel services in Southern China. We believe our customers associate the
      New Generation brand with value, convenience and confidence.




*Nationwide
      reach for nationwide travel destinations.* Our
      customers can book domestic and international air tickets and make reservations
      for accommodations at over 3,000 hotels in more than 220 cities across China,
      vacation packages and rental cars by calling our centralized 24-hour call center
      from anywhere in China or by logging onto our website. New Generation is ranked
      one of the top air-ticketing companies in China, in terms of volume of tickets
      sold and value of transactions. We issue and deliver air tickets using a network
      of local agents in major cities in China, covering all of the 975 domestic
      routes.




*Total
      customer focus.* We
      provide our customers with comprehensive travel information, allowing them
      to
      conveniently compare prices, browse availability and amenity options, and select
      the price and supplier that best meet their individual travel needs. Our
      user-friendly websites, well trained call center representatives and continuous
      service development efforts reflect our focus on providing superior customer
      service.




20
 *Table
          of Contents*




*Strong
      supplier value.* We offer
      our travel suppliers access to aggregated consumer demand and the ability to
      promote their services to a large and growing base of frequent independent
      travelers seeking higher-end travel services. In addition, our call center
      and
      web-based transaction and service platform, with its easy-to-use supplier
      interface, allows our suppliers to promote their services at low incremental
      cost and with minimal changes to their existing systems.




*Streamlined
      business operations through tailored information management
      systems.* We have
      drawn on our in-depth knowledge of the business practices unique to China’s
      travel service industry to develop proprietary processes and technology-based
      systems for use in our business. These processes and systems incorporate
      customer relationship management, order processing, financial reporting and
      performance management and enable us to coordinate effectively the activities
      of
      our staff, agents, suppliers and resellers. This results in streamlined
      operations, a higher degree of operating flexibility and stronger customer
      relationships through enhanced customer service.




*Scalable
      and cost-efficient services.* Our
      services and transaction processing, enabled by our centralized call-center
      and
      web-based distribution technologies, provides superior scalability and
      significant cost advantages over traditional methods of travel service
      distribution. We can expand our range of services and extend our geographical
      reach without making major changes to our existing infrastructure or incurring
      significant capital costs.




*Experienced
      management.* We
      believe that our management team, which includes Mr. William Chi Hung Tsang,
      and
      a seasoned team of senior managers at the operations level with significant
      experience in the areas of travel service operations, marketing, technology
      and
      finance, is well qualified and experienced to handle the challenges of the
      travel service industry in China.




*Suzhou
      Tongli.*  The
      strengths of Tongli lie in its convenient traffic, deep cultural accumulation,
      rich sightseeing resources, and well-known public fame. Tongli is the only
      ancient town which contains a World Cultural Heritage - Tuisi Garden. Tongli
      is
      the only ancient town integrating the World Cultural Heritage and township
      lifestyle. Besides, Tongli is the only ancient town acquiring the title of
      Top
      10 Charming Chinese Towns in Jiangsu Province. Special strengths of Tongli
      comparing with other ancient towns include:(1) National AAAA tourism site;
      (2)
      The only provincial culturally protected town in Zhengsu province; (3) 2005
      National-Charm famous town; (4) Museum of Ming’s and Qing’s architectures; (5)
      World Cultural Heritage -- Tuisi Garden ; and (6) Being named as “Natural
      studio” by National Movie Association as a film base.




**Competition.** The
      travel service industry in China is extremely large, highly fragmented and
      intensely competitive. We compete with eLong, Inc., Ctrip.com International,
      Ltd, traditional travel agencies such as CTS, CITS and CYTS, and hotel suppliers
      that sell their room inventory directly to consumers. The major markets in
      which
      we currently compete include the relatively affluent coastal areas of China.
      As
      China’s market continues to grow, we may face further competition from other new
      domestic hotel room consolidators or international players such as expedia.com
      or priceline.com that may seek to expand into China. We may also face increasing
      competition from hotels and airlines should they further expand into the direct
      selling market or engage in alliances with other travel service providers
      besides us. We compete on the basis of brand recognition, selection, price,
      ease
      of use, accessibility of information, breadth of services offered, convenience,
      and customer service and satisfaction.




The
      management believes that there is no single source of information and research
      report which is sophisticated enough for us to provide a meaningful estimate
      of
      the number of competitors and our competitive position in the travel service
      industry.




We
      cannot
      assure you that we will compete successfully with any of our current or future
      competitors.




21
 *Table
          of Contents*




**Opportunity
      For Growth.** We
      expect
      the travel and tourism industry in China to continue to grow rapidly as China’s
      economy continues to expand. China’s travel service industry is fragmented and
      inefficient. This fragmentation creates a market opportunity for our centralized
      reservation system for air-ticketing and hotel reservations, which offers
      comprehensive information and favorable terms negotiated with travel service
      suppliers across China who are offered economies of scale from our aggregated
      demand, although the margin is very low.




**Business
      Strategy for Travel Services.** Our
      goal
      is to establish an exclusive foothold into a growing and high-end business
      travel market. It allowed us to enter into the high margin tourism segment
      of
      the travel business that contains a high entry barrier. We will re-focus our
      travel-related business services from low margin tourism segment, such as air
      ticketing to a high margin tourism segment, such as scenic site management
      with
      the co-operation and support from local government to become the leading
      management provider of travel services in China. We seek to achieve revenue
      and
      earnings growth by pursuing the following key business strategies:




*Strengthen
      brand awareness and marketing.* We seek
      to strengthen consumer awareness of our brand by pursuing an aggressive
      marketing strategy based on online and traditional media advertising. We seek
      to
      encourage consumer conversion and the use of our services through segment-based
      marketing, targeted promotions and focused telemarketing efforts.




We
      also
      seek to promote the awareness of our brand, including Suzhou Tongli, and
      increase our penetration among our target customers by leveraging the customer
      bases of other leading businesses and customer service companies, by (i)
      increasing advertising using publications such as company brochures and
      magazines; (ii) cooperating with commercial banks for them to offer co-branded
      credit cards; and (iii) entering into arrangements with major airlines in China,
      such as China Southern Airlines, under which travel booking inquiries are
      directed from their service hotlines to us.




*Expand
      our range of travel services.* We
      intend to capitalize on our leadership in air-ticketing utilizing a centralized
      modern call center and web-based distribution technologies and leverage the
      reach and efficiency of our distribution of services by growing our hotel
      reservations and other travel related services, such as vacation packages,
      car
      rentals and corporate travel services. We seek to expand the selection of our
      destination services, such as restaurant and entertainment bookings, and offer
      our customers greater flexibility in choosing the desired combination of travel
      services.




We
      believe that the extensive network resources based on air-ticketing, IT platform
      and strategic alliances with other product and service providers will be
      converted to our advantage, and that competitors will find them difficult
      to imitate.




*Enhance
      customer experience.* We seek
      to enhance our customer’s experience by providing more personalized care, and by
      strengthening and expanding travel supplier relationships to offer our customers
      a wider range of travel services. We seek to deliver consistently high-quality
      customer service through continuous improvements in the information technology
      systems utilized in our call center, and in the content, features and functions
      of our websites.




*Enhance
      efficiency and profitability.* We have
      built our operating infrastructure to take advantage of the inherent cost
      advantages of our centralized call center and web-based distribution
      technologies. We also seek to increase the efficiency of our marketing programs
      by tracking the effectiveness of our expenditures on various marketing
      activities.




22
 *Table
          of Contents*




We
      continue to capitalize on improvements in electronic commerce infrastructure,
      such as the introduction of electronic ticketing. By using exclusive online
      promotional offers, we believe we will be able to benefit from the increasing
      adoption of online commerce among consumers by attracting additional customers
      and moving existing customers to our websites, thereby lowering our operating
      costs.




*Enhance
      our technology infrastructure.* We
      design and maintain our systems with a view to enhancing consumer-friendliness
      and providing adaptive products and services for our airline and other travel
      service suppliers. We seek to streamline our transaction processes through
      ongoing technology upgrades to our transaction and services level.




*Selectively
      pursue complementary acquisitions.* We seek
      to supplement the organic growth of our business by pursuing acquisitions which
      would enable us to expand our service offerings, our customer base and our
      distribution network. We seek to capitalize on the opportunities for
      consolidation in China’s fragmented and inefficient travel service industry by
      selectively exploring opportunities to acquire other travel service businesses
      such as air-ticketing agencies, hotel-room consolidators, tour-package agencies
      and corporate travel providers.




*Develop
      travel products and services for corporate clients.* We will
      enhance our travel services by providing corporate travel services that cover
      more international corporations and large national corporations in the region.
      The corporate market is a fast growing market with high profit margin. With
      our
      comprehensive resources in ticketing, hotel reservations, business club
      facilities and airport services, we are confident that we can be one of the
      leading services providers in the region. At the moment, we have over 30
      corporate clients including large scale joint ventures such as Guangzhou Honda
      and Panasonic Wan Bao. We successfully entered into a service consignment
      agreement with the Purchasing Office of the Guangzhou City Government. This
      agreement will extend for two years from January 1, 2005 to December 31, 2006.
      Under this agreement, we will provide international business travel packages
      and
      related services to key personnel of the Guangzhou City Government at premium
      package prices.




**Business
      Plan For Our Business Value-Added Services**




We
      provide business value-added services to a variety of customers. These services
      concentrate on business consultancy services, interactive marketing and
      incentive programs management for merchant chains and large corporations with
      significant user bases.




**Business
      Consultancy Services.** Our
      consultancy services are focused in two areas. First, we provide consultancy
      services in the financial advisory sector including mergers and acquisitions
      advisory services, corporate restructuring advisory services and corporate
      finance advisory services. A specialty niche has been to consult with and advise
      local PRC companies in seeking foreign capital for their expansion programs.




Second,
      we assist Chinese companies in developing the international trade dimension
      of
      their own businesses and assist foreign companies to establish their businesses
      in China. We help Chinese companies in business development, marketing, sourcing
      and public relationship management in the international business environment.




These
      services are fee based, and our payment is structured either on a flat fee
      basis
      or on a success fee basis. Our consultancy services operation started in the
      last quarter of 2004 and our related revenues have been generated since early
      2005.




23
 *Table
          of Contents*




**BJ
      World Trade Full Capital Advisors Inc.** Our
      55%
      equity holding subsidiary BJ World Trade Full Capital Advisors Inc. (BWTFCA)
      is
      a consulting group with global vision providing business consultancy services
      for domestic and foreign companies by taking advantage of its own rich business
      resources, good relationship with governments, expertise and experience in
      running business at home and abroad. The major services include governance
      consultancy and international marketing.




**Incentive
      Programs -** In
      April
      2003, Guangzhou World Trade Center Club Limited (“Guangzhou WTC Limited”), a 75%
      indirectly owned subsidiary of us, entered into an agreement with the
      Agricultural Bank of China providing for the introduction of a co-branded credit
      card. Pursuant to the agreement, Guangzhou WTC Limited is entitled to 15% of
      processing fees obtained in connection with the issuance of the credit card,
      with such amount increasing to 20% once the number of cards issued exceeds
      10,000. The agreement is for a term of four years, subject to automatic
      extension for an additional four year term, unless terminated on two months’
prior notice.




In
      order
      to enhance the value and attraction of the co-brand credit card, Guangzhou
      World
      Trade Center Club Limited, formed in 2004 has implemented efforts to recruit
      merchants that will provide discounts of goods and services to the members
      of
      the co-brand credit card, and, as such, has become an aggregator for discount
      merchants. This program is still in development and has been tested out with
      a
      limited number of consumers and business associates. It has not been fully
      rolled out to consumers. There is a substantial risk that the Company will
      terminate this program due to an unforeseen adverse business
      environment.




**Competition.** The
      definition of value-added services varies from company to company and it is
      not
      meaningful to compare our market position with other potential competitors.
      We
      provide value-added services on a customized basis, and we are not aware of
      any
      other company that offers the services that we do.




Our
      management believe that there is no single source of information and research
      report which is sophisticated enough for us to provide a meaningful estimate
      of
      the number of competitors and our competitive position in the value-added
      service industry.




**Strategic
      Investments.** We
      expand
      our business activities through strategic investments in companies which will
      directly or indirectly contribute positively to our overall revenues or profits.
      Strategic ventures which have no positive operation effect with our business
      or
      have a negative impact on our cash flow will not be initially considered. A
      group of business entities or an entity that will enable us to experience
      intrinsic growth will be considered, especially if they will enable us to evolve
      into a conglomerate in the Chinese business environment. The Suzhou Tongli
      acquisition is an example of a major strategic investment by us. By acquiring
      Suzhou Tongli, we can establish an exclusive foothold into a growing and
      high-end business travel market, which was parallel to New Generation
      acquisition in 2004 as low-stream travel business while the Suzhou Tongli is
      classified as upper-stream travel business.




**Employees.** We
      currently have 11 employees in our Value-Added Services division. We believe
      our
      future success will depend in large part upon the continued service of our
      technical and senior management personnel and our ability to attract and retain
      technical and managerial personnel. There can be no assurance that we will
      retain our key technical and managerial employees or that we can attract,
      assimilate or retain other highly qualified technical and managerial personnel
      in the future. None of our employees are subject to any collective bargaining
      agreements.




24
 *Table
          of Contents*





**Item
      2** **.****Description
      of Property**




Our
      main
      office and the Guangzhou World Trade Center Club facilities are located at
      3rd
      Floor, Goldlion Digital Network Center, 138 Tiyu Road East, Tianhe, Guangzhou,
      and the PRC 510620. Such office and club facilities are held pursuant to a
      lease
      from Guangzhou Silver Disk Property Management Co. Ltd., which provides for
      an
      aggregate monthly rental of approximately $42,285 (RMB$350,000) and expires
      on
      July 31, 2007.




Our
      Beijing World Trade Center Club facilities are located at 2nd Floor, Office
      Tower II, Landmark Towers Beijing, 8 North Dongsanhuan Road, Beijing, the PRC.
      The five-year lease for the location of the Beijing WTC Club facilities, which
      runs from February 1, 2004 to January 31, 2009, was executed by Beijing Landmark
      Towers Co Ltd. and Beijing WTC Club. The terms of the lease provide for an
      aggregate monthly rental amount and management fees of approximately $14,640
      (RMB$121,180) and contains a rent free period from February 1, 2004 to January
      31, 2006.




Pursuant
      to the Share Exchange Agreement dated December 17, 2002, entered into by us
      and
      Mr. William Chi Hung Tsang, we acquired the entire issued share capital of
      General Business Network, which owned two commercial properties, one located
      at
      20/F, Goldlion Digital Network Center, Unit 01-10, 138 Tiyu Road East, Tianhe,
      Guangzhou, the PRC (the “PRC Property”) and the other at Flat B, 12/F, Champion
      Center, 301-309 Nathan Road, Hong Kong (the “Hong Kong Property”). The PRC
      Property was sold in May 2005 for approximately $2,460,000. The Hong Kong
      Property was sold together with the disposal of Rejoice Success Limited on
      September 29, 2006 after an account of rental income of $10,385
      (HK$81,000).




Our
      Hong
      Kong office is located Unit A, 5/F., Goldlion Holdings Centre, 13-15 Yuen Shun
      Circuit, Siu Lek Yue, Shatin, NT, Hong Kong. The office is held pursuant to
      a
      lease from Renard Investments Limited which provides for an aggregate monthly
      rental of HKD26,950 (or US$3,455). The lease runs from February 1, 2006 to
      January 31, 2008.





**Item
      3** **.****Legal
      Proceedings**





We
      are
      not aware of any pending or threatened legal proceedings, other than as set
      forth below, in which we are involved. In addition, we are not aware of any
      pending or threatened legal proceedings in which entities affiliated with our
      officers, directors or beneficial owners are involved.





On
      December 10, 2004, Kenneth P. Silverman, Esq., as Trustee for the Estate of
      Chief Executive Officers Clubs, Inc. (the “Trustee”), filed a Complaint against
      CEO Clubs China Limited, China World Trade Corporation, Simon Guo and J.P.
      Li
      (the “Complaint”), which commenced an Adversary Proceeding relating to a Chapter
      7 bankruptcy case pending in the U.S. Bankruptcy Court for the Southern District
      of New York, captioned as In Re: Chief Executive Officers Clubs, Inc., Debtor.
      The Complaint alleges, among other things, that certain assets of the Chief
      Executive Officers Clubs, Inc. bankruptcy estate were transferred to our Company
      in violation of Section 549 of the Bankruptcy Code. It requests that the
      Bankruptcy Court order, among other things, a return of such assets by our
      Company and/or seeks a judgment against us in the amount of not less than
      US$480,000.





As
      previously disclosed, on May 7, 2004, the Company acquired 51% of the
      outstanding capital stock of CEO Clubs China Limited, a Hong Kong corporation
      (“CEO Clubs China”), through one of its wholly-owned subsidiaries, for a total
      consideration of cash and shares of common stock amounting to US$480,000. CEO
      Clubs China is an authorized chapter to operate under the “CEO Clubs” trademarks
      in the Greater China region, including the Peoples’ Republic of China, Hong Kong
      and Taiwan.





We
      have
      engaged counsel and are vigorously defending the Adversary Proceeding. We filed
      a Motion To Dismiss which was heard on March 22, 2005, and the judge ruled
      in
      favor of the Trustee by refusing to dismiss the case at this preliminary stage
      of the proceedings. Notwithstanding that decision, our primary defense is that
      we purchased the stock of CEO Clubs China, and did not acquire any assets of
      the
      Chief Executive Officers Clubs, Inc. bankruptcy estate. On March 3, 2007, we
      were informed that the Trustee has made a Motion to have a settlement to be
      approved by the Court. We believe that this defense will be meritorious should
      the matter ever come to trial.




25
 *Table
          of Contents*





**Item
      4** **.****Submission
      of Matters To a Vote of Security Holders****.**





No
      matter
      was submitted to a vote of security holders during the fourth quarter of the
      fiscal year covered by this Report.





**PART
      II**





**Item
                5.**
            **Market
                for Common Equity and Related Stockholder Matters**





Market
      Information





Our
      common stock is currently quoted on a limited basis on the Over-the-Counter
      Bulletin Board (“OTCBB”) under the symbol “CWTD”. The quotation of our common
      stock on the OTCBB does not assure that a meaningful, consistent and liquid
      trading market currently exists. We cannot predict whether a more active market
      for our common stock will develop in the future. In the absence of an active
      trading market:





(1)
      Investors may have difficulty buying and selling or obtaining market
      quotation;


(2)
      Market visibility for our common stock may be limited; and


(3)
      A
      lack of visibility of our common stock may have a depressive effect on the
      market price for our common stock.





The
      following table sets forth the range of bid prices of our common stock as quoted
      on the OTCBB during the periods indicated. The prices reported represent prices
      between dealers, do not include markups, markdowns or commissions and do not
      necessarily represent actual transactions.





High
                (1)
            Low2006
            First
                Quarter
            $2.66
            $1.90Second
                Quarter
            $2.82
            $1.12Third
                Quarter
            $1.31
            $0.65.Fourth
                Quarter
            $0.68
            $0.202005
            First
                Quarter
            $2.66
            $1.90Second
                Quarter
            $3.25
            $1.80Third
                Quarter
            $2.56
            $1.89Fourth
                Quarter
            $2.10
            $1.31





Our
      common shares are issued in registered form. Interwest Transfer Company in
      Salt
      Lake City, Utah, is the registrar and transfer agent for our common stock.





Effective
      September 1, 2002, we executed a 1 for 30 reverse stock split of the outstanding
      shares of common stock.




26
 *Table
          of Contents*





As
      a
      result of a debt-to-equity capital restructuring in September 2002, we issued
      a
      total of 4,000,000 shares of common stock for a total debt of
      $2,731,677




As
      a
      result of two share purchase agreements dated September 3, 2002 and December
      17,
      2002, respectively, and entered into between us and Powertronic Holdings
      Limited, on January 24, 2003 we issued a total of 2,000,000 shares of common
      stock and warrants to purchase up to 4,000,000 shares of common stock for a
      total purchase price of $1,000,000 to Powertronic Holdings Limited.





As
      a
      result of a share exchange agreement dated December 17, 2002 entered into
      between the Company and Mr. William Chi Hung Tsang, on January 24, 2003, we
      issued 4,000,000 shares of common stock and warrants to purchase up to 4,000,000
      shares of common stock in exchange of 100% of the share capital of General
      Business Network (Holdings) Ltd.





As
      a
      result of a share exchange agreement dated September 25, 2006 entered into
      between the Company and Mr. William Chi Hung Tsang, we issued 9,000,000 shares
      of common stock in exchange of 25% share capital of CWT International Excurtion
      Investment Limited




As
      of
      December 31, 2006, there were 85 holders of record of 43,865,923 outstanding
      shares of common stock of the Company, not including approximately 5,000 holders
      of our shares in street name.





Dividends





We
      have
      not previously paid any cash dividends on its common stock and do not anticipate
      paying dividends on its common stock in the foreseeable future. It is the
      present intention of management to retain any earnings to provide funds for
      the
      operation and expansion of our business. Any future determination to pay
      dividends will be at the discretion of our board of directors and will depend
      on
      our results of operation, financial condition, contractual and legal
      restrictions and other factors the board of directors deem relevant.





Penny
      Stock Characterization





Our
      Shares are "penny stocks" within the definition of that term as contained in
      the
      Securities Exchange Act of 1934, which are generally equity securities with
      a
      price of less than $5.00. Our shares will then be subject to rules that impose
      sales practice and disclosure requirements on certain broker-dealers who engage
      in certain transactions involving a penny stock. These will impose restrictions
      on the marketability of the common stock.





Under
      the
      penny stock regulations, a broker-dealer selling penny stock to anyone other
      than an established customer or "accredited investor" must make a special
      suitability determination for the purchaser and must receive the purchaser's
      written consent to the transaction prior to the sale, unless the broker-dealer
      is otherwise exempt. Generally, an individual with a net worth in excess of
      $5,000,000 or annual income exceeding $200,000 individually or $300,000 together
      with his or her spouse is considered an accredited investor. In addition, unless
      the broker-dealer or the transaction is otherwise exempt, the penny stock
      regulations require the broker-dealer to deliver, prior to any transaction
      involving a penny stock, a disclosure schedule prepared by the Securities and
      Exchange Commission relating to the penny stock market. A broker-dealer is
      also
      required to disclose commissions payable to the broker-dealer and the Registered
      Representative and current bid and offer quotations for the securities. In
      addition a broker-dealer is required to send monthly statements disclosing
      recent price information with respect to the penny stock held in a customer's
      account, the account’s value and information regarding the limited market in
      penny stocks. As a result of these regulations, the ability of broker-dealers
      to
      sell our stock may affect the Selling Stockholders or other or other holders
      seeking to sell their shares in the secondary market. In addition, the penny
      stock rules generally require that prior to a transaction in a penny stock,
      the
      broker-dealer make a special written determination that the penny stock is
      a
      suitable investment for the purchaser and receive the purchaser's written
      agreement to the transaction.




27
 *Table
          of Contents*





These
      disclosure requirements may have the effect of reducing the level of trading
      activity in the secondary market for a stock that becomes subject to the penny
      stock rules. These additional sales practice and disclosure requirements could
      impede the sale of our securities. In addition, the liquidity for our securities
      may be adversely affected, with concomitant adverse affects on the price of
      our
      securities.




Agreements
      to Register





We
      have a
      Registration Rights Agreement, dated August 26, 2004, with the Purchasers under
      a Securities Purchase Agreement that was also executed on August 26, 2004,
      covering an aggregate of 2,321,003 shares of common stock issued to the
      Purchasers, and shares of common stock issuable to the Purchasers upon the
      exercise of warrants. In addition, we have a Registration Rights Agreement
      with
      Cornell Capital Partners, LP, dated November 15, 2004, covering the 14,285,714
      shares of our common stock that may be registered for sale pursuant to the
      SEDA,
      in addition to 375,000 shares of common stock issued as compensation under
      the
      SEDA.





Shares
      Eligible for Future Sale





Upon
      successful filing with the commission of a Registration Statement on Form SB-2,
      the 16,981,717 shares of common stock sold in this offering will be freely
      tradable without restrictions under the Securities Act of 1933, except for
      any
      shares held by our "affiliates", which will be restricted by the resale
      limitations of Rule 144 under the Securities Act of 1933.





In
      general, under Rule 144 as currently in effect, any of our affiliates and any
      person or persons whose sales are aggregated who has beneficially owned his
      or
      her restricted shares for at least one year, may be entitled to sell in the
      open
      market within any three-month period a number of shares of common stock that
      does not exceed the greater of (i) 1% of the then outstanding shares of our
      common stock, or (ii) the average weekly trading volume in the common stock
      during the four calendar weeks preceding such sale. Sales under Rule 144 are
      also affected by limitations on manner of sale, notice requirements, and
      availability of current public information about us. Non-affiliates who have
      held their restricted shares for two years may be entitled to sell their shares
      under Rule 144 without regard to any of the above limitations, provided they
      have not been affiliates for the three months preceding such sale.





Further,
      Rule 144A as currently in effect, in general, permits unlimited resales of
      restricted securities of any issuer provided that the purchaser is an
      institution that owns and invests on a discretionary basis at least $100 million
      in securities or is a registered broker-dealer that owns and invests $10 million
      in securities. Rule 144A allows our existing stockholders to sell their shares
      of common stock to such institutions and registered broker-dealers without
      regard to any volume or other restrictions. Unlike under Rule 144, restricted
      securities sold under Rule 144A to non-affiliates do not lose their status
      as
      restricted securities.





Currently,
      approximately 10,900,000 shares of our common stock are available for sale
      in
      accordance with the provisions of Rule 144. Additionally, future sales of stock
      owned by our affiliates may be permitted according to Rule 144. The availability
      for sale of substantial amounts of common stock under Rule 144 could adversely
      affect prevailing market prices for our securities.





Changes
      of Equity Securities During Period Covered By Report




On
      April
      27, 2006, the Company issued 280,000 shares to Grace Motion Inc. for consulting
      services provided which included a due diligence report on a target project
      in
      China; a financial modeling report on the target,; and providing advice on
      any
      possible change of the structure in order to enhance the profitability of the
      target project. We relied on an exemption from registration provided by Section
      4(2) under the Securities Act of 1933, as amended, in connection with this
      issuance.




28
 *Table
          of Contents*




On
      April
      27, 2006, the Company issued 117,000 shares to Mr. Andy Lau for consulting
      services included information technology and technical framework and
      infrastructure for information technology in China. We relied on an exemption
      from registration provided by Section 4(2) under the Securities Act of 1933,
      as
      amended, in connsection with this issuance.





On
      August
      15, 2006 we issued 800,000 shares of common stock to Greentree Financial Group,
      Inc. for consulting services which included (a) assistance in the preparation
      of
      private offering documents, (b) compliance with Blue Sky regulations, (c)
      compliance with the SEC's periodic reporting requirements, (d) tax and
      accounting services, (e) EDGAR services, (f) preparation of interim financial
      information, (g) locating product vendors and (h) other consulting
      services. We relied on an exemption from registration provided by Section 4(2)
      of the Securities Act of 1933, as amended, in connection with this issuance.





On
      September 25, 2006 , the
      Company entered into a Share Exchange Agreement (the “Agreement”) with Rainbow
      Wish Limited, a company organized and existing under the laws of the British
      Virgin Islands and a wholly owned subsidiary of the Company (“Rainbow Wish”),
      CWT International Excursion Investment Limited, a company organized and existing
      under the laws of the British Virgin Islands (“CWT Excursion”), and Chi Hung
      Tsang (“Tsang”), the Chairman of the Company and holder of sixty percent (60%)
      of the capital stock of CWT Excursion, Pursuant to the terms of the Agreement,
      the Company issued 9,000,000 shares of common stock to Tsang in exchange for
      the
      transfer by Tsang of twenty-five (25) common shares of CWT Excursion (the “CWT
      Excursion Shares”) to Rainbow Wish, representing a 25% equity interest in CWT
      Excursion. We relied on an exemption from registration provided by Regulation
      S
      under the Securities Act of 1933, as amended, in connection with the issuance
      of
      shares to Tsang.





**Item
      6** **.****Management's
      Discussion and Analysis or Plan of Operation**





**PRELIMINARY
      NOTE REGARDING FORWARD-LOOKING STATEMENTS**





This
      discussion contains forward-looking statements. The reader should understand
      that several factors govern whether any forward-looking statement contained
      herein will be or can be achieved. Any one of those factors could cause actual
      results to differ materially from those projected herein. These forward-looking
      statements include plans and objectives of management for future operations,
      including plans and objectives relating to the products and the future economic
      performance of the company. Assumptions relating to the foregoing involve
      judgments with respect to, among other things, future economic, competitive
      and
      market conditions, future business decisions, and the time and money required
      to
      successfully complete development projects, all of which are difficult or
      impossible to predict accurately and many of which are beyond the control of
      the
      company. Although the company believes that the assumptions underlying the
      forward-looking statements contained herein are reasonable, any of those
      assumptions could prove inaccurate and, therefore, there can be no assurance
      that the results contemplated in any of the forward-looking statements contained
      herein will be realized. Based on actual experience and business development,
      the company may alter its marketing, capital expenditure plans or other budgets,
      which may in turn affect the company's results of operations. In light of the
      significant uncertainties inherent in the forward-looking statements included
      therein, the inclusion of any such statement should not be regarded as a
      representation by the company or any other person that the objectives or plans
      of the company will be achieved.





OVERVIEW





We
      were
      incorporated in the State of Nevada in 1998 to engage in any lawful corporate
      undertaking. Initially, our business objective was to open and operate business
      clubs in the major cities of China in association with the World Trade Center
      Association in order to position ourselves as the platform to facilitate trade
      between China and the world market. We currently operate two clubs, one in
      Guangzhou and the other in Beijing, PRC. Additionally, we expect to open clubs
      in Shanghai and Shenzhen, PRC in the foreseeable future. We have grown through
      acquisitions and internal growth and our business objectives have expanded
      as
      set forth in the following paragraphs.




29
 *Table
          of Contents*





Our
      growth and development as a business enterprise has been marked by a number
      of
      significant corporate events. Pursuant to a Share Exchange Agreement, dated
      as
      of August 10, 2000, between Virtual Edge Limited ("Virtual Edge") and Main
      Edge
      International Limited ("Main Edge"), Main Edge transferred all of the issued
      and
      outstanding shares of the capital stock of Virtual Edge to the Company in
      exchange for 1,961,175 shares of our pre-split common stock, representing
      approximately 75% of our outstanding shares of the common stock. Accordingly,
      we
      controlled the operations of Virtual Edge, and Main Edge became our majority
      stockholder. We then undertook an 8-for-1 forward split that was effective
      on
      15th day of September 2000, which resulted in Main Edge owning 15,689,400 shares
      of our common stock. Then, five major developments occurred. These were: (i)
      the
      consummation of two private placement financings by Powertronic Holdings Limited
      ("Powertronic") in September 2002 and December 2002 in which it acquired shares
      of our common stock, (ii) an acquisition of all the issued and outstanding
      shares of General Business Network (Holdings) Ltd. in December 2002, (iii)
      a
      1-for-30 reverse stock split that was effective on September 1, 2002, (iv)
      the
      assignment of the rights of the after tax rental income of certain premises
      from
      Mr. Tsang for a five year period in December 2003, and (v) the exercise of
      warrants for the shares of our common stock by Mr. Tsang and Powertronic in
      March 2004 and in July 2004, and the further exercise additional warrants in
      December 2004. As a result of these transactions, Mr. Chi Hung Tsang became
      the
      new major shareholder and owns over 12,600,000 shares of our common stock and
      Powertronic owns over 5,500,000 shares. Mr. Chi Hung Tsang is currently
      President and Chairman of our Board of Directors.





China
      World Trade Corporation ("China World Trade") has recently established its
      businesses into three distinct divisions, namely the club and business center;
      the business travel services; and the business value-added services. The Club
      and Business Center division is devoted to the building of the World Trade
      brand
      in China. Its objective is to open and operate business clubs in the major
      cities of China in association with the World Trade Center Association, in
      order
      to position the company as the platform to facilitate trade between China and
      the world market. China World Trade currently operates the Guangzhou World
      Trade
      Center Club, consisting of over 4,000 square meters, and The Beijing World
      Trade
      Center Club, which is located at 2nd Floor, Office Tower II, Landmark Towers
      Beijing, 8 North Dongsanhuan Road, Beijing PRC, and consisting of 730 square
      meters. In addition, since the acquisition of CEO Clubs China Limited ("CEO
      Clubs") in May 2004, CEO Clubs will complement China World Trade's offerings
      by
      targeting higher profile leadership from larger companies than those normally
      associated with China World Trade. The CEO Clubs family, of which each family
      member operates independently of each other, has thirteen chapters in the US
      and
      China. It focuses on recruiting CEO's of companies with annual sales exceeding
      $2 million as members. The average member of our affiliated CEO Clubs family
      has
      $20 million in annual sales.





Since
      the
      completion of the acquisition of majority stake of Guangdong New Generation
      Commercial Management Limited (the “New Generation Group” or “New Generation”)
      in August 2004, the Business Travel Services division has provided the necessary
      platform for China World Trade Corporation to focus on the high growth, travel
      related businesses. Although New Generation has contributed most of the revenue
      for the Company since the acquisition, the management of the Company, after
      careful monitoring the industry for a period of time, noticed that the profit
      margin of air-ticketing business is diminishing because of the continuous higher
      fuel price and additional cost associated into it, not to mentioned the
      foreseeable huge increasing cost on manpower in China because of its improving
      living standards. The management made a decision on September 29, 2006 to sell
      60% of our equity holding on General Business Networks (Holdings) Limited which
      holds 51% of the outstanding capital stock of Guangdong New Generation
      Commercial Management Limited. In order to diversify our interest in business
      related travel services, the management acquired Tongli on September 25, 2006.
      This strategic acquisition is believed to provide the Company with entry into
      the high margin tourism segment of the travel business because  Tongli
      town is quickly becoming one of the most popular domestic and international
      tourist destinations in China with strong tourism, business travel growth
      opportunities in the region,





The
      Business Value-Added Services division concentrates on value-added services
      of
      merchant related businesses as well as on consultancy services. Our Company
      will
      leverage the network and database of the Business Clubs, New Generation and
      Tongli to provide business related services to its clients. In addition, this
      division also provides consultancy services to China World Trade's members
      and
      clients in the corporate strategy and business development areas including
      mergers and acquisitions, corporate restructuring and financing.




30
 *Table
          of Contents*





RESULTS
      OF OPERATIONS





The
      following table shows the financial data of the consolidated statements of
      operations of the Company and its subsidiaries for the years ended December
      2006
      and 2005. The data should be read in conjunction with the audited consolidated
      financial statements of the Company and related notes thereto.





Year
                Ended
            
            %
                of
            
            Year
                Ended
            
            %
                ofDec.
                31
            
            Revenue
            
            Dec.
                31
            
            Revenue2006
            
            
            
            2005(In
              US$ thousands except per share data)**Operating
                revenues**Club
                and business centre
            
            
            712
            
            
            16.4
            
            
            895
            
            
            11.4Business
                traveling services
            
            
            2,689
            
            
            62.0
            
            
            4,983
            
            
            63.6Business
                value-added services
            
            
            928
            
            
            21.4
            
            
            1,618
            
            
            20.6Others
            
            
            10
            
            
            0.2
            
            
            343
            
            
            4.4Total
                operating revenues
            
            
            4,339
            
            
            100.0
            
            
            7,839
            
            
            100.0**Gross
                profit**Club
                and business centre
            
            
            675
            
            
            15.6
            
            
            735
            
            
            9.4Business
                traveling services
            
            
            2,167
            
            
            49.9
            
            
            4,256
            
            
            54.3Business
                value-added services
            
            
            927
            
            
            21.4
            
            
            (895
            )
            
            (11.4
            )Others
            
            
            10
            
            
            0.2
            
            
            124
            
            
            1.6**Total
                Gross Profit**
            
            
            3,779
            
            
            87.1
            
            
            4,220
            
            
            53.8**Other
                expenses**Bad
                debts
            
            
            (28
            )
            
            (0.7
            )
            
            0
            
            
            0.0Impairment
                loss and depreciation
            
            
            (319
            )
            
            (7.3
            )
            
            (342
            )
            
            (4.4
            )Selling,
                general and administrative expenses
            
            
            (8,041
            )
            
            (185.3
            )
            
            (9,168
            )
            
            (116.9
            )**Loss
                From Operations**
            
            
            (4,609
            )
            
            (106.2
            )
            
            (5,290
            )
            
            (67.5
            )**Non-operating
                income (expense)**Other
                income
            
            
            44
            
            
            1.0
            
            
            42
            
            
            0.5Interest
                income
            
            
            38
            
            
            0.9
            
            
            28
            
            
            0.4Interest
                expense
            
            
            (209
            )
            
            (4.8
            )
            
            (136
            )
            
            (1.7
            )Equity
                in earnings of affiliates
            
            
            (180
            )
            
            (4.2
            )
            
            0
            
            
            0.0Impairment
                loss on investment in an affiliate
            
            
            (2,140
            )
            
            (49.3
            )
            
            0
            
            
            0.0Gain
                (loss) on disposal of interest in a subsidiary
            
            
            (3,211
            )
            
            (74.0
            )
            
            86
            
            
            1.1Loss
                on disposal of dormant subsidiaries
            
            
            (321
            )
            
            (7.4
            )
            
            0
            
            
            0.0Realized
                gain on disposal of available-for-sale securities
            
            
            46
            
            
            1.1
            
            
            6,080
            
            
            77.6Loss
                on disposal of property, plant and equipment
            
            
            (9
            )
            
            (0.2
            )
            
            (255
            )
            
            (3.2
            )**Profit/(loss)
                before income tax and minority interests**
            
            
            (10,551
            )
            
            (243.1
            )
            
            555
            
            
            7.1Income
                tax expense
            
            
            (103
            )
            
            (2.4
            )
            
            (254
            )
            
            (3.2
            )**Profit/(loss)
                before minority interests**
            
            
            (10,654
            )
            
            (245.5
            )
            
            301
            
            
            3.8Minority
                interests
            
            
            563
            
            
            13.0
            
            
            (283
            )
            
            (3.6
            )**Net
                income/(loss)**
            
            
            (10,091
            )
            
            (232.5
            )
            
            18
            
            
            0.2**Earnings
                (loss) per share**Basic
            
            
            (0.29
            )
            
            
            
            
            0.00Diluted
            
            
            (0.29
            )
            
            
            
            
            0.00





31
 *Table
          of Contents*




FISCAL
      YEAR ENDED DECEMBER 31, 2006 COMPARED TO YEAR ENDED DECEMBER 31, 2005.





OPERATING
      REVENUE





The
      Company has started to recruit members, and to provide club and business center
      services through its subsidiary Guangzhou World Trade Center Club located in
      Guangdong Province, the PRC since June 2002, business value-added services
      and
      others business through other subsidiaries of the Company since March 2003.
      We
      have commenced our operation in the business travel business since our
      acquisition of New Generation in August 2004. Investment in listed shares and
      rental incomes are grouped under others operating revenues and others gross
      profit. Consolidated operating revenue for the twelve-month period ended
      December 31, 2006 was $4,339,000, compared to $7,839,000 for the same
      corresponding period in year 2005, a decrease of $3,500,000 or 44.6%. The
      decrease was mainly the result of the decrease in revenue generated from
      business travel services; club and business center; the business value-added
      services and rental incomes.





Of
      the
      $4,339,000 revenue in the twelve-month period ended December 31, 2006,
      approximately $712,000 (16.4%) was generated from providing club related
      services by Guangzhou World Trade Center Club and Beijing World Trade Center
      Club, $2,689,000 (62.0%) from business travel services resulting from the
      acquisition of the New Generation Group, $928,000 (21.4%) from business
      value-added services, and the remaining $10,000 (or 0.2%) from rental income.
      The disposal of 60% of our equity holding of General Business Network (Holdings)
      Limited (“GBN”), which held a 51% equity interest in New Generation, has
      significantly reduced our operating revenues. Since the disposal was effective
      on September 29, 2006, only 9 months of operating revenues from New
      Generation were consolidated into our results of operations.





Consolidated
      gross profit decreased by $441,000 or 10.4% for the twelve-month period ended
      December 31, 2006 over the same corresponding period in year 2005. The decrease
      was predominantly caused by our business travel services resulting from the
      disposal of 60% of our equity holdings of GBN and New Generation in September
      2006 and our club and business center services. Such a decrease was partially
      offset by the increase in the business value-added services. As a percentage
      of
      total operating revenues, consolidated gross profit margins of 87.1% in 2006
      increased from 53.8% in 2005. However, the higher profit margin as a percent
      of
      operating revenues for the year ended December 31, 2006 as compared to the
      same
      corresponding period in 2005 was primarily contributed by the positive margin
      from our business value-added services as well as the increased profit margin
      in
      our club and business centre. We received common stock as compensation from
      the
      client for our services rendered. According to EITF Issue No. 00-8, we recognize
      our revenue in relation to a project using the share price of the common stock
      we received on the contract date. Subsequently, we subcontracted part of the
      services of the same project to an independent consultant at a later date and
      according to FAS 123, paragraph 8, we needed to record the compensation paid
      to
      non-employees in exchange of goods and services at fair value. The positive
      gross profit margin for the year ended December 31, 2006 of our consulting
      business was the result of the timing difference between the dates of the
      contract with our client and the subcontracting during an upward trend of the
      share prices of the common stock we received for services rendered.





Of
      the
      $3,779,000 total gross profit for the year ended December 31, 2006,
      approximately $675,000 (or 17.9%) was generated from providing club and business
      center services, approximately $2,167,000 (or 57.3%) from business travel
      services, approximately $927,000 (or 24.5%) from providing business value-added
      services, and approximately $10,000 (or 0.3%) from rental income. As compared
      to
      the same corresponding period in year 2005, the club and business center
      services represented a 17.4% (or $735,000) of the total gross profit; 100.8%
      (or
      $4,256,000) was generated from the business travel business; a negative 21.2%
      (or $895,000) from providing business value-added services; and the remaining
      2.9% (or $124,000) from other (rental and trading) businesses. The shift in
      segmental distribution was primarily due to the increase in gross profit in
      the
      business value-added services, resulting from the services fee renders from
      our
      clients. We foresee that this segment mix will continue to change and balance
      out in year 2007 upon further development in the club and business centre
      business.




32
 *Table
          of Contents*





SELLING,
      GENERAL AND ADMINISTRATIVE EXPENSES





Selling,
      general and administrative expenses decreased by approximately $1,127,000 or
      12.3% to $8,041,000 for the year ended December 31, 2006 from $9,168,000 for
      the
      same corresponding period in 2005. The decrease was mainly a combination of
      the
      decrease in the subcontract fee resulting from our consulting business in the
      amount of approximately $1,200,000, the decrease in general expense of
      $1,000,000 incurred from disposed New Generation which accounted for 9 months
      and offset by the increase in other professional fees and marketing and
      information and technology in the total amount of approximately $1,000,000,.




Of
      the
      $8,041,000 selling, general and administrative expenses incurred for the year
      ended December 31, 2006, the majority of it was approximately $1,524,000 in
      staff related costs; approximately $1,660,000 in professional expenses in 
financial consultancy, investor relations and marketing consultancy;
      approximately $847,0000 in building management and rental expenses which were
      necessary for the operations of our world trade centre clubs in Guangzhou and
      Beijing; approximately $254,000 in director related salaries; approximately
      $211,000 in the expenses of liquidated damage. Despite the management expects
      this decreasing trend will likely continue subsequent to the disposal of 60%
      of
      our equity interest in GBN and New Generation, they will continue to impose
      respective measures for trimming costs.





BAD
      DEBTS, IMPAIRMENT LOSS AND DEPRECIATION





A
      provision for bad debt of approximately $28,000 for the year ended December
      31,
      2006, as compared to none for the same corresponding period in year 2005. Total
      impairment loss and depreciation were approximately $319,000 for the year ended
      December 31, 2006, as compared to the same corresponding period in year 2005,
      a
      decrease of $23,000 or 6.7% from $342,000. The decrease was mainly due to the
      decrease in depreciation and amortization charge in the amount of approximately
      $23,000 over the corresponding period in year 2005.





FINANCIAL
      INCOME/(EXPENSES), NET





Interest
      expenses were approximately $209,000 for the year ended December 31, 2006,
      as
      compared to the same corresponding period in year 2005 in the amount of
      $136,000, an increase of $73,000 or 53.7%. The majority of the increase was
      the
      result of consolidating the interest expenses incurred by the New Generation
      during the period from Janauary 1 to September 29, 2006 in relation to an
      increased bank loan in the amount of approximately RMB12,250,000 (approximately
      equals US$1.5 million) to RMB31,250,000 (approximately equals to US$3.9 million)
      immediately before disposal of 60% of our equity holding of GBN and New
      Generation on September 29, 2006,.





OTHER
      INCOME AND REALIZED GAIN





The
      other
      income and realized gain decreased by approximately $6,032,000 for the year
      ended December 31, 2006. The decrease was the result of the reduction on
      disposal of securities during the reporting period which we received as
      compensation for our consultancy services rendered. These securities may be
      sold
      only when earned under the respective consulting agreements, and it is our
      intention to sell shares earned as promptly as practicable in order to generate
      income for the company, subject to compliance with federal securities
      laws.




33
 *Table
          of Contents*





LOSS
      ON
      DISPOSAL OF INTEREST IN A SUBSIDIARY





Loss
      on
      disposal of interest in a subsidiary recorded at approximately $3,211,000 for
      the year ended December 31, 2006 compared to a gain of $86,000 none for the
      same
      corresponding period in year 2005. The loss resulted from the disposal of 60%
      of
      our equity holdings in our subsidiary GBN, which is the holding company of
      New
      Generation.





IMPAIRMENT
      LOSS ON INVESTMENT IN AN AFFILIATE





Impairment
      loss on investment in an affiliate was recorded at approximately $2,140,000
      for
      the year ended December 31, 2006 compared to none for the same corresponding
      period in year 2005. The loss resulted from the difference between the
      investment cost and the carrying value on our disposed affiliate.




LOSS
      ON
      DISPOSAL OF LEASEHOLD LAND AND BUILDING





The
      loss
      on disposal of leasehold land and building decreased by approximately $246,000
      to $9,000 for the year ended December 31, 2006, as compared to approximately
      $255,000 for the same corresponding period in year 2005. The decrease in loss
      was primarily due to that there is no payment of PRC tax and levy resulting
      from
      the disposal of our Guangzhou property for the year ended December 31, 2006,
      which occurred only for the year ended December 31, 2005.




INCOME
      TAXES





The
      Group
      is subject to income taxes on an equity basis on income arising in or derived
      from the tax jurisdiction in which it is domiciled and operates.





The
      Hong
      Kong subsidiaries incurred losses for taxation purposes for the period and
      thus
      Hong Kong Profits Tax has not been provided.





Several
      of our PRC subsidiaries are subject to PRC Enterprise Income Taxes (“EIT”) on an
      entity basis on income arising in and derived from the PRC. The applicable
      EIT
      rate is 33%.





Income
      taxes were $103,000 for the year end December 31, 2006, as compared to
      US$254,000 for the same corresponding period in year 2005. The decrease of
      income taxes was mainly from the operation of New Generation.





NET
      LOSS





Net
      loss
      was approximately $10,091,000 for the year ended December 31, 2006, as compared
      to the same corresponding period in year 2005, a decrease of $10,108,000 or
      56,155.6% from a profit of $18,000. The increase in net loss was the result
      of
      the recognition of the impairment loss on disposal of interest in a subsidiary
      and the impairment loss on investment in an affiliate. The loss was also the
      result of the decrease of net gain from the disposal of securities which were
      received for compensation of our consultancy services. Management believes
      that
      our operations will continue to improve and we do not foresee a trend of
      losses.




34
 *Table
          of Contents*




LIQUIDITY
      AND CAPITAL RESOURCES





Upon
      disposal of 60% of our equity interest in our former subsidiary, General
      Business Network (Holdings) Ltd. (“GBN”), on September 29, 2006, we no longer
      had any banking facilities and outstanding lines of credit as of December 31,
      2006.





However,
      during the nine months period from January 1 to September 29, 2006,
      w e had
      banking facilities, through our former subsidiary New Generation Commercial
      Management Ltd., granted in the total amount of approximately $4.2 million,
      of
      which approximately $3.9 million had been utilized as of September 29, 2006.
      These facilities relate to $4.2 million in a short term loan with pledged
      deposits of $247,000. The weighted average interest rate for these facilities
      is
      about 6.635% per annum. These banking facilities, related to a bank loan and
      pledged deposit and have been disposed indirectly upon the disposal of GBN
      on
      September 29, 2006 as mentioned above.





As
      of
      December 31, 2006, cash and cash equivalents totaled $107,144. This cash
      position was the result of a combination of net cash provided by financing
      activities in the amount of $3,087,415, offsetting by net cash used in investing
      activities in the amount of $1,875,448 and the net cash used in operating
      activities in the amount of $4,339,686. The increase in financing activities
      was
      mainly due to the increase in the proceeds of additional bank loan of
      $2,037,716, offsetting by a repayment of $524,866 during the 9 months period
      from January 1 to September 29, 2006, through our previous subsidiary New
      Generation, and the advance from a shareholder of $1,529,565. The net cash
      used
      in investing activities was mainly due to the disposal of a subsidiary of
      $1,253,749, acquisition of a subsidiary amount to $394,641 and the acquisition
      of property, plant and equipment of $406,267. The net cash used in operating
      activities was mainly the result from the net loss of $10,090,975, increase
      in
      account receivables of $1,002,201 and increase in due from related companies
      of
      $1,156,351 offsetting by loss on disposal of a subsidiary $3,210,538 and
      impairment loss on investment in an affiliate $2,140,359; and the stock, option
      and warrants issued for services amount to $1,391,977.





We
      believe that the level of financial resources is a significant factor for our
      future development and accordingly may choose at any time to raise capital
      through private debt or equity financing to strengthen its financial position,
      facilitate growth and provide us with additional flexibility to take advantage
      of business opportunities.





The
      Company has taken the position that its
      earlier filing with the Commission of a Registration Statement on Form SB-2
      covering the proposed sale in a secondary offering of $30.0 million of
      Registrable Securities pursuant to a Standby Equity Distribution Agreement,
      and
      the proposed sale of other securities pursuant to a Securities Purchase
      Agreement dated August 26, 2004, has been terminated as a result of the failure
      of such registration statement to be declared effective by the Commission after
      the filing of a sixth and final amendment on February 3, 2006. We
      do not
      have immediate plans to have a public offering of our common stock.





OTHER
      SIGNIFICANT EVENTS





On
      September 29, 2006, the Company through its wholly owned subsidiary, China
      Chance Enterprises Limited, sold 100% outstanding capital stock of Rejoice
      Success Limited (“Rejoice”) to Wisdom Plus Limited (“Wisdom Plus”) at a
      consideration of $4,000,000. Rejoice owns 60% of the outstanding capital stock
      of General Business Network (Holdings) Limited (“GBN”), which indirectly owns
      51% of the outstanding capital stock of New Generation Commercial Management
      Limited (“New Generation”).




35
 *Table
          of Contents*





New
      Generation engages in the travel agency business by operating ten subsidiaries
      in Southern China. To date, New Generation has accumulated a substantial market
      share in ticketing sales for international and domestic flights as well as
      inbound business travel. In addition, Guangzhou Huahao Insurance Agency Limited,
      one of the New Generation group of companies, is also a licensed insurance
      agent
      in China, providing accidental and life insurance to individual policy holders
      in the Guangzhou Province of China.





The
      purchase price will be paid by 4 installments from September 30, 2006 to July
      29, 2007 in cash or shares of common stock issued by any Pink Sheet companies
      or
      OTCBB companies in lieu of the consideration. The amount of share certificates
      shall be agreed by both parties in a separate agreement.





While
      cash of US$100,000 had been received as of December 31, 2006, the second payment
      of cash of $900,000 was received on February 8, 2007 in accordance with the
      Agreement with the following schedules: US$100,000 to be paid on September
      30,
      2006; US$900,000 to be paid on January 29, 2007; US$1,000,000 to be paid on
      April 29, 2007; and US$2,000,000 to be paid on July 29, 2007.  As
      of the
      date of issuance of this report, total cash of US$1,000,000 had been duly
      received in accordance with the Agreement.





On
      September 25, 2006, the Company together with its wholly owned subsidiary,
      Rainbow Wish Limited (“Rainbow Wish”), entered into a Share Exchange Agreement
      (the “Agreement”) with CWT International Excursion Investment Limited, a company
      organized and existing under the laws of the British Virgin Islands (“CWT
      Excursion”), and Chi Hung Tsang, the Chairman of the Company and holder of sixty
      percent (60%) of the capital stock of CWT Excursion, and also a citizen and
      resident of the People’s Republic of China. Pursuant to the terms of the
      Agreement, the Company will issue 9,000,000 shares of its common stock (the
      “CWTD Shares”) to Mr. Tsang in exchange for 25 common shares of CWT Excursion
      owned by him (the “CWT Excursion Shares”) to Rainbow Wish, presenting a 25%
      equity interest in CWT Excursion.




CWT
      Excursion was incorporated on March 22, 2006, and is the owner of 51% of the
      equity interest in a joint venture company known as Suzhou Tongli
      (International) Excursion Development Limited, which is a company organized
      and
      existing under the laws of the People’s Republic of China (“Suzhou Tongli”).
      Suzhou Tongli is in the business of operating tourist concessions in Tongli
      Town, Suzhou City, Jiangsu Province, People’s Republic of China.





Pursuant
      to the Agreement, Mr. Tsang has also agreed to grant Rainbow Wish the option
      to
      purchase an additional 35% of the capital stock of CWT Excursion within twelve
      months of the date hereof, at a price that will be agreed upon by both parties
      at the time of exercise of said option in a separate agreement.





The
      acquisition consideration of CWT Excursion amounts to $6,408,000. It is the
      fair
      market value of the CWTD Shares to be issued to Mr. Tsang, based on the closing
      bid price for the common stock of CWTD in the last five trading days preceding
      the date of the Agreement of $0.712.




CRITICAL
      ACCOUNTING POLICIES




In
      presenting our financial statements in conformity with generally accepted
      accounting principles, we are required to make estimates and assumptions that
      affect the amounts reported therein. Several of the estimates and assumptions
      we
      are required to make relate to matters that are inherently uncertain as they
      pertain to future events. However, events that are outside of our control cannot
      be predicted and, as such, they cannot be contemplated in evaluating such
      estimates and assumptions. If there is a significant unfavourable change to
      current conditions, it could result in a material adverse impact to our
      consolidated results of operations, financial position and liquidity. We believe
      that the estimates and assumptions we used when preparing our financial
      statements were the most appropriate at that time. Presented below are those
      accounting policies that we believe require subjective and complex judgments
      that could potentially affect reported results. However, the majority of our
      businesses operate in environments where we pay a fee for a service performed,
      and therefore the results of the majority of our recurring operations are
      recorded in our financial statements using accounting policies that are not
      particularly subjective, nor complex.




36
 *Table
          of Contents*




**Valuation
      of long-lived assets**





We
      review
      our long-lived assets for impairment, including property, plant and equipment,
      and identifiable intangibles with definite lives, whenever events or changes
      in
      circumstances indicate that the carrying amount of the assets may not be fully
      recoverable. To determine recoverability of our long-lived assets, we evaluate
      the probability that future undiscounted net cash flows will be greater than
      the
      carrying amount of our assets. Impairment is measured based on the difference
      between the carrying amount of our assets and their estimated fair value.





**Allowance
      for Doubtful Accounts**





We
      perform ongoing credit evaluations of our customers and adjust credit limits
      based upon customer payment history and current creditworthiness. We
      continuously monitor collections and payments from our customers and maintain
      a
      provision for estimated credit losses based upon our historical experience
      and
      any specific customer collection issues that have been identified. While such
      credit losses have historically been within our expectations and the provisions
      established, we cannot guarantee that we will continue to experience credit
      loss
      rates similar to those we have experienced in the past. Measurement of such
      losses requires consideration of historical loss experience, including the
      need
      to adjust for current conditions, and judgments about the probable effects
      of
      relevant observable data, including present economic conditions such as
      delinquency rates and financial health of specific customers.





**Goodwill
      on consolidation**





Our
      long-lived assets include goodwill. SFAS No. 142 "Goodwill and Other
      Intangible Assets" requires that goodwill be tested for impairment at the
      reporting unit level (operating segment or one level below an operating segment)
      on an annual basis and between annual tests in certain circumstances.
      Application of the goodwill impairment test requires judgment, including the
      identification of reporting units, assigning assets and liabilities to reporting
      units, assigning goodwill to reporting units, and determining the fair value
      of
      each reporting unit. Significant judgments required to estimate the fair value
      of reporting units include estimating future cash flows, determining appropriate
      discount rates and other assumptions. Changes in these estimates and assumptions
      could materially affect the determination of fair value for each reporting
      unit.




37
 *Table
          of Contents*





**Item
      7** **.****Financial
      Statements**





The
      information required by this Item is located following the signature page and
      exhibits of this annual report.





**CHINA
      WORLD TRADE CORPORATION AND SUBSIDIARIES**








**INDEX
      TO CONSOLIDATED FINANCIAL STATEMENTS**











**Page**Report
                of Child, Van Wagoner & Bradshaw, PLLC, Independent Registered Public
                Accounting Firm
            39ConsolidatedBalance
                Sheet
            40ConsolidatedStatements
                of Operations and Comprehensive Income (Loss)
            41ConsolidatedStatements
                of Changes in Shareholders’ Equity
            42ConsolidatedStatements
                of Cash Flows
            43Notes
                to Consolidated Financial Statements
            44




38
 *Table
          of Contents*


**REPORT
      OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**








The
      Board
      of Directors and Shareholders


**China
      World Trade Corporation**





We
      have
      audited the accompanying consolidated balance sheet of China World Trade
      Corporation and subsidiaries as of December 31, 2006, and the related
      consolidated statements of operations and comprehensive income (loss), changes
      in shareholders’ equity, and cash flows for the years ending December 31,
      2006 and 2005. These consolidated financial statements are the responsibility
      of
      the Group’s management. Our responsibility is to express an opinion on these
      consolidated financial statements based on our audits.





We
      conducted our audits in accordance with the standards of the Public Accounting
      Oversight Board (United States). Those standards require that we plan and
      perform the audits to obtain reasonable assurance about whether the consolidated
      financial statements are free of material misstatement. The Group is not
      required to have, nor were we engaged to perform, an audit of its internal
      control over financial reporting. Our audits include consideration of internal
      control over financial reporting as a basis for designing audit procedures
      that
      are appropriate in the circumstances, but not for the purpose of expressing
      an
      opinion on the effectiveness of the Group’s internal control over financial
      reporting. Accordingly, we express no such opinion. An audit also includes
      examining, on a test basis, evidence supporting the amounts and disclosures
      in
      the consolidated financial statements, 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 financial position of China World
      Trade Corporation and subsidiaries as of December 31, 2006, and the results
      of their operations and their cash flows for the years ending December 31,
      2006 and 2005, in conformity with accounting principles generally accepted
      in
      the United States of America.





The
      accompanying financial statements have been prepared assuming that the Company
      will continue as a going concern. As discussed in Note 3 to the financial
      statements, the Company has suffered losses from operations during the year,
      despite having a positive working capital, that raise substantial doubt about
      its ability to continue as a going concern. Management’s plans in regard to
      these matters are also described in Note 3. The financial statements do not
      include any adjustments that might result from the outcome of this
      uncertainty.







/s/
      Child, Van Wagoner & Bradshaw, PLLC


Child,
      Van Wagoner & Bradshaw, PLLC




Certified
      Public Accountants




Salt
      Lake
      City, Utah, USA


April
      16,
      2007





39
 *Table
          of Contents*





**CHINA
                WORLD TRADE CORPORATION AND SUBSIDIARIES**
              **CONSOLIDATED
                BALANCE SHEET**
              **(Expressed
                in United States Dollar (“US$”), except for per share
                data)****December
                31, 2006****ASSETS**
            
            ***Note***Current
                assets:Cash
                and cash equivalents
            
            
            
            
            $
            107,144Accounts
                receivable, net
            
            
            *8*
            
            
            6,160Prepayments
            
            
            
            
            
            250,648Other
                current assets
            
            
            
            
            
            28,586Disposal
                consideration receivable
            
            
            *10*
            
            
            3,900,000Rental
                and other deposits
            
            
            *9*
            
            
            255,314Due
                from affiliate company
            
            
            *11
                (c)*
            
            
            25,163Total
                Current Assets
            
            
            
            
            
            4,573,015Property,
                Plant and Equipment:Property,
                plant and equipment, net
            
            
            *15*
            
            
            65,714Investment
                in affiliate companies
            
            
            *6*
            
            
            8,894,492Total
                Assets
            
            
            
            
            $
            13,533,221**LIABILITIES
                AND STOCKHOLDERS’ EQUITY**Current
                liabilities:Accounts
                payable
            
            
            
            
            $
            12,412Accrued
                expenses
            
            
            
            
            
            625,518Due
                to a shareholder
            
            
            *19*
            
            
            1,679,225Due
                to related companies
            
            
            *11
                (e)*
            
            
            51,282Deferred
                income
            
            
            
            
            
            5,096Other
                current liabilities
            
            
            
            
            
            148,782Total
                Current Liabilities
            
            
            
            
            
            2,522,315Total
                Liabilities
            
            
            
            
            
            2,522,315Minority
                interest in consolidated subsidiaries
            
            
            
            
            
            17,606Commitments
                and contingencies (Note 29)**STOCKHOLDERS’
                EQUITY**Preferred
                stock, par value of US$0.001;10,000,000
                shares authorized, none issued or outstanding
            
            
            
            
            
            -Common
                stock, par value of US$0.001; 50,000,000 shares authorized, 43,865,923
                shares issued and outstanding as of December 31, 2006
            
            
            *22*
            
            
            43,866Additional
                paid-in capital
            
            
            
            
            
            39,054,982Statutory
                reserves
            
            
            
            
            
            -Accumulated
                other comprehensive income
            
            
            
            
            
            59,462Accumulated
                deficit
            
            
            
            
            
            (28,165,010
            )Total
                Stockholders’ Equity
            
            
            
            
            
            10,993,300Total
                Liabilities and Stockholders’ Equity
            
            
            
            
            $
            13,533,221








40
 *Table
          of Contents*





**CHINA
                WORLD TRADE CORPORATION AND SUBSIDIARIES**
              **CONSOLIDATED
                STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
                (LOSS)**
              **(Expressed
                in United States Dollar (“US$”), except for per share
                data)**Year
                EndedDecember
                31**Note**
            
            2006
            
            2005**Operating
                revenues**Club
                and business centre
            
            
            2
              (k)
            
            $
            712,368
            
            $
            894,550Business
                traveling services
            
            
            
            
            
            2,689,139
            
            
            4,983,468Business
                value-added services
            
            
            
            
            
            927,445
            
            
            1,618,413Rental
            
            
            
            
            
            10,385
            
            
            221,699Trading
                and others
            
            
            
            
            
            0
            
            
            121,0944,339,337
            
            
            7,839,224**Operating
                costs and expenses**Club
                and business centre
            
            
            
            
            
            (37,118
            )
            
            (159,742
            )Business
                traveling services
            
            
            
            
            
            (522,610
            )
            
            (727,089
            )Business
                value-added services
            
            
            
            
            
            (252
            )
            
            (2,513,523
            )Rental
            
            
            
            
            
            -
            
            
            (98,762
            )Trading
                and others
            
            
            
            
            
            -
            
            
            (119,767
            )(559,980
            )
            
            (3,618,883
            )GROSS
              PROFIT
            
            
            
            
            
            3,779,357
            
            
            4,220,341**Other
                expenses**Depreciation
                and amortization
            
            
            
            
            
            (274,439
            )
            
            (303,797
            )Bad
                debts
            
            
            
            
            
            (28,217
            )
            
            -Impairment
                losses on current assets
            
            
            
            
            
            (44,136
            )
            
            -Impairment
                of property, plant and equipment
            
            
            
            
            
            -
            
            
            (38,598
            )Selling,
                general and administrative expenses
            
            
            
            
            
            (8,041,684
            )
            
            (9,167,728
            )(8,388,476
            )
            
            (9,510,123
            )**Loss
                from operations**
            
            
            
            
            
            (4,609,119
            )
            
            (5,289,782
            )**Non-operating
                income (expense)**Other
                income
            
            
            
            
            
            44,735
            
            
            42,581Interest
                income
            
            
            
            
            
            37,751
            
            
            28,171Interest
                expense
            
            
            
            
            
            (209,099
            )
            
            (136,426
            )Equity
                in earnings of affiliates
            
            
            
            
            
            (180,175
            )
            
            -Impairment
                loss on investment in an affiliate
            
            
            5
            
            
            (2,140,359
            )
            
            -Gain
                (loss) on disposal of interest in a subsidiary
            
            
            4
            
            
            (3,210,538
            )
            
            85,854Loss
                on disposal of dormant subsidiaries
            
            
            
            
            
            (321,185
            )
            
            -Realized
                gain on disposal of available-for-sale securities
            
            
            
            
            
            46,000
            
            
            6,079,960Loss
                on disposal of property, plant and equipment
            
            
            
            
            
            (9,395
            )
            
            (254,740
            )**Profit/(loss)
                before income tax and minority interests**
            
            
            
            
            
            (10,551,384
            )
            
            555,618Income
                tax expense
            
            
            7
            
            
            (103,037
            )
            
            (254,419
            )**Profit/(loss)
                before minority interests**
            
            
            
            
            
            (10,654,421
            )
            
            301,199Minority
                interests
            
            
            
            
            
            563,446
            
            
            (282,975
            )**Net
                income/(loss)**
            
            
            
            
            $
            (10,090,975
            )
            $
            18,224**Per
                share data:**
            
            
            
            
            
            (10,090,975
            )
            
            18,224**Earnings
                (loss) per share**Basic
            
            
            2(v)
            
            
            (0.29
            )
            
            0.00Diluted
            
            
            2(v)
            
            
            (0.29
            )
            
            0.00**Weighted
                average number of shares outstanding**Basic
            
            
            
            
            
            35,252,090
            
            
            31,154,526Diluted
            
            
            
            
            
            35,252,090
            
            
            31,154,526Net
                income/(loss)
            
            
            
            
            $
            (10,090,975
            )
            $
            18,224Other
                comprehensive income (loss):Unrealized
                gains on available-for-sale securitiesUnrealized
                holding gain (loss) arising during the year
            
            
            
            
            
            (1,108,375
            )
            
            751,250Less:Reclassification
                adjustment for gains or losses included in net profit
                (loss)
            
            
            
            
            
            357,125Foreign
                currency translation adjustments
            
            
            
            
            
            35,472
            
            
            23,990Comprehensive
                income (loss)
            
            
            
            
            $
            (10,806,753
            )
            $
            793,464




See
      accompanying notes to consolidated financial statements.




41
 *Table
          of Contents*


**CHINA
                WORLD TRADE CORPORATION AND SUBSIDIARIES**
              **CONSOLIDATED
                STATEMENTS OF CHANGES IN SHAREHOLDER’S EQUITY**
              **(Expressed
                in United States Dollar (“US$”), except per share
                data)****Common
                stock****Note**
            
            **No.
                of shares**
            
            **Amount
                issued**
            
            **Additional
                paid in capital**
            
            **Accumulated
                other comprehensive income (loss)**
            
            **Statutory
                reserves**
            
            **Accumulated
                deficit**
            
            **Total**Balance
                as of January 1,2005
            
            
            
            
            
            30,889,997
            
            
            30,890
            
            
            30,817,729
            
            
            -
            
            
            44,403
            
            
            (17,964,755
            )
            
            12,928,267Common
                stock issued inexchange
                for consultancy
              services
                on April 19, 2005
            
            
            
            
            
            100,000
            
            
            100
            
            
            199,900
            
            
            -
            
            
            -
            
            
            -
            
            
            200,000Exercise
                of warrants onDecember
                2, 2005
            
            
            
            
            
            2,429,448
            
            
            2,429
            
            
            (2,429
            )
            
            -
            
            
            -
            
            
            -
            
            
            -Exercise
                of options of The2003
                Plan on December 29,2005
            
            
            
            
            
            249,478
            
            
            250
            
            
            (251
            )
            
            -
            
            
            -
            
            
            -
            
            
            (1
            )Net
                profit
            
            
            
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            18,224
            
            
            18,224Transfer
                to statutory reserve
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            125,221
            
            
            (125,221
            )
            
            -Foreign
                currency translationadjustment
            
            
            
            
            
            -
            
            
            -
            
            
            -
            
            
            23,990
            
            
            -
            
            
            -
            
            
            23,990Unrealized
                gain onavailable-for-sale
                securities
            
            
            
            
            
            -
            
            
            -
            
            
            -
            
            
            751,250
            
            
            -
            
            
            -
            
            
            751,250Balance
                as of December 31,2005
            
            
            
            
            
            33,668,923
            
            
            33,669
            
            
            31,014,949
            
            
            775,240
            
            
            169,624
            
            
            (18,071,752
            )
            
            13,921,730Common
                stock issued for service on April 27, 2006
            
            
            *22(a*
            *)*
            
            280,000
            
            
            280
            
            
            383,320
            
            
            -
            
            
            -
            
            
            -
            
            
            383,600Common
                stock issued for service on April 27, 2006
            
            
            *22(b*
            *)*
            
            117,000
            
            
            117
            
            
            162,513
            
            
            -
            
            
            -
            
            
            -
            
            
            162,630Common
                stock issued for service on August 15, 2006
            
            
            *22(c*
            *)*
            
            800,000
            
            
            800
            
            
            1,095,200
            
            
            -
            
            
            -
            
            
            -
            
            
            1,096,000Common
                stock issued as consideration for acquisition of an affiliate on
                November
                20, 2006
            
            
            *22(d*
            *)*
            
            9,000,000
            
            
            9,000
            
            
            6,399,000
            
            
            -
            
            
            -
            
            
            -
            
            
            6,408,000Net
                loss
            
            
            
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (10,090,975
            )
            
            (10,090,975
            )Transfer
                to statutory reserve
            
            
            
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            2,283
            
            
            (2,283
            )
            
            -Foreign
                currency translationadjustment
            
            
            
            
            
            -
            
            
            -
            
            
            -
            
            
            35,472
            
            
            -
            
            
            -
            
            
            35,472Unrealized
                gain onavailable-for-sale
                securities
            
            
            
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -Unrealized
                holding (loss) gain arising during the year
            
            
            
            
            
            -
            
            
            -
            
            
            -
            
            
            (1,108,375
            )
            
            -
            
            
            -
            
            
            (1,108,375
            )Less:
                Reclassification adjustment for gains or losses included in net profit
                (loss)
            
            
            
            
            
            -
            
            
            -
            
            
            -
            
            
            357,125
            
            
            -
            
            
            -
            
            
            357,125Adjustment
                on disposal of a subsidiary
            
            
            (1
            )
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (171,907
            )
            
            -
            
            
            (171,907
            )Balance
                as of December 31,2006
            
            
            
            
            
            43,865,923
            
            
            43,866
            
            
            39,054,982
            
            
            59,462
            
            
            -
            
            
            (28,165,010
            )
            
            10,993,300


**Notes:**


**(1)**  Being
      adjustment on Statutory Reserves upon disposal of General Business Network
      (Holdings) Limited on September 29, 2006 as detailed in Note 4
      below;




See
      accompanying notes to consolidated financial statements.




42
 *Table
          of Contents*





**CHINA
                WORLD TRADE CORPORATION AND SUBSIDIARIES**
              **CONSOLIDATED
                STATEMENTS OF CASH FLOWS**
              **(Expressed
                in United States Dollar (“US$”))**For
                the Year EndedDecember
                31,2006
            
            2005RestatedCash
                flows from operating activitiesNet
                income (loss)
            
            $
            (10,090,975
            )
            $
            18,224Adjustments
                to reconcile net loss to net cash used in operating activities:Minority
                interest
            
            
            (563,446
            )
            
            282,975Amortization
                on intangible asset
            
            
            -
            
            
            90,000Depreciation
                and amortization
            
            
            274,439
            
            
            303,797Bad
                debts
            
            
            28,217
            
            
            -Loss
                on sale of land and building
            
            
            -
            
            
            25,676Loss
                on sale of motor vehicle
            
            
            9,395
            
            
            -Loss
                on disposal of dormant subsidiaries
            
            
            321,185
            
            
            -Loss
                (gain) on disposal of a subsidiary
            
            
            3,210,538
            
            
            (85,854
            )Impairment
                loss on investment in an affiliate
            
            
            2,140,359
            
            
            -Equity
                in earnings of affiliates
            
            
            180,175
            
            
            -Impairment
                loss on property, plant and equipment
            
            
            -
            
            
            38,598Impairment
                loss on current assets
            
            
            44,136
            
            
            105,799Stock,
                options and warrants issued for services
            
            
            1,391,977
            
            
            232,500Realized
                gain on available-for-sale securities
            
            
            (46,000
            )
            
            (6,079,960
            )Available
                for sale securities received as income
            
            
            (375,000
            )
            
            (1,042,043
            )Changes
                in working capital:Pledged
                deposit
            
            
            165,487
            
            
            (412,484
            )Accounts
                receivables
            
            
            (1,002,201
            )
            
            (1,913,350
            )Other
                current assets
            
            
            (173,805
            )
            
            (189,583
            )Loans
                receivable
            
            
            406,830
            
            
            (410,946
            )Due
                from related parties
            
            
            (72
            )
            
            109,037Due
                from related companies
            
            
            (1,156,351
            )
            
            237,791Due
                from an affiliate
            
            
            (25,163
            )
            
            -Rental
                and other deposits
            
            
            204,924
            
            
            (721,732
            )Prepayments
            
            
            (687,785
            )
            
            (201,525
            )Inventories
            
            
            -
            
            
            136,112Hire
                purchase creditor
            
            
            71,031
            
            
            50,000Account
                payables
            
            
            814,614
            
            
            703,764Accrued
                expenses
            
            
            162,432
            
            
            258,939Decrease
                in deferred income
            
            
            (985
            )
            
            (20,642
            )Other
                current liabilities
            
            
            294,879
            
            
            33,710Due
                to related parties
            
            
            2,470
            
            
            (58,317
            )Due
                to related companies
            
            
            (26,296
            )
            
            51,494Income
                tax payable
            
            
            49,833
            
            
            205,952**Net
                cash provided from (used in) operating activities**
            
            
            (4,375,158
            )
            
            (8,252,068
            )**Cash
                flows from investing activities:**Acquisition
                of a subsidiary
            
            
            (394,641
            )
            
            (92,327
            )Acquisition
                of property, plant and equipment
            
            
            (406,267
            )
            
            (508,153
            )Disposal
                of a subsidiary
            
            
            (1,253,749
            )
            
            (272,477
            )Disposal
                of dormant subsidiaries
            
            
            4
            
            
            -Proceeds
                from disposal of property, plant and equipment
            
            
            33,205
            
            
            2,457,382Proceeds
                from disposal of short-term investment
            
            
            -
            
            
            24,163Proceeds
                from disposal of available-for-sale securities
            
            
            146,000
            
            
            6,838,178Proceeds
                from disposal of intangible asset
            
            
            -
            
            
            1,320,000Acquisition
                of available-for-sale securities
            
            
            -
            
            
            (3,675
            )**Net
                cash used in investing activities**
            
            
            (1,875,448
            )
            
            9,763,091**Cash
                flows from financing activities:**Advance
                from (Repayment to) a shareholder
            
            
            1,529,565
            
            
            (183,405
            )Proceeds
                from new bank loan
            
            
            2,037,716
            
            
            1,111,482Repayment
                of amount borrowed
            
            
            (524,866
            )
            
            (1,052,495
            )Capital
                contribution from minority shareholder of a subsidiary
            
            
            45,000
            
            
            -**Net
                cash provided by financing activities**
            
            
            3,087,415
            
            
            (124,418
            )**Foreign
                currency translation adjustments**
            
            
            35,472
            
            
            23,990**Net
                increase in cash and cash equivalents**
            
            
            (3,127,719
            )
            
            1,410,595**Cash
                and cash equivalents at beginning of year**
            
            
            3,234,863
            
            
            1,824,268**Cash
                and cash equivalents at end of year**
            
            $
            107,144
            
            
            3,234,863**Supplemental
                disclosure information:**Interest
                paid
            
            $
            210,418
            
            $
            138,757Income
                tax paid
            
            $
            103,037
            
            $
            52,108**Non-cash
                operating, investing and financing activities:**Purchase
                of an affiliate by:-
                issuance of common stock
            
            $
            6,408,000
            
            $
            -Disposal
                of a subsidiary by:-
                disposal consideration in arrears
            
            $
            3,900,000
            
            $
            225,644




See
      accompanying notes to consolidated financial statements.




43
 *Table
          of Contents*


**1.**  **ORGANIZATION
      AND DESCRIPTION OF BUSINESS**





China
      World Trade Corporation (“CWTC”) was incorporated under the laws of the State of
      Nevada on January 29, 1998 as Weston International Development Corporation.
      On
      July 28, 1998, the name was changed to Txon International Development
      Corporation. On September 15, 2000 CWTC changed to its existing name. CWTC
      acts
      as an investment holding company, not an investment company.





The
      Company and subsidiaries are hereinafter collectively referred to as the
“Group”.





Details
      of the major direct and indirectly owned subsidiaries and their principal
      activities as of the date of this report are summarized below:





**Name
                of company**
            **Date
                of acquisition/**
              **formation**
            **Place
                of**
              **incorporation**
            **Equity
                interest owned by the Company**
            **Principal
                activities**Beijing
                World Trade Centre Club
            April
                1, 1999
            PRC
            75%
            Club
                servicesBeijing
                World Trade Full Capital Advisors Inc.
            December
                9, 2005
            PRC
            55%
            Business
                consulting serviceCEO
                Clubs China Limited
            May
                7, 2004
            Hong
                Kong
            51%
            LicensingChina
                Chance Enterprises Limited
            January
                26, 2004
            BVI
            100%
            Equity
                holding companyChina
                World Trade Corporation
            May
                5, 2004
            BVI
            100%
            Equity
                holding companyCreative
                Idea Group Limited
            January
                2, 2004
            BVI
            100%
            Business
                consulting serviceGuangzhou
                World Trade Centre Club Limited
            December
                29, 2001
            PRC
            75%
            Club
                servicesJune
                Success Limited
            August
                17, 2006
            BVI
            100%
            Equity
                holding companyRainbow
                Wish Limited
            August
                17, 2006
            BVI
            100%
            Equity
                holding companySinopac
                Success Limited
            August
                17, 2006
            BVI
            100%
            Equity
                holding companyVirtual
                Edge Limited
            August
                14, 2000
            BVI
            100%
            Equity
                holding company





44
 *Table
          of Contents*





**2.**  **SUMMARY
      OF SIGNIFICANT ACCOUNTING POLICIES**





(a)  Basis
      of
      consolidation





These
      accompanying consolidated financial statements include the financial statements
      of CWTC and subsidiaries and have been prepared in accordance with accounting
      principles generally accepted in the United States of America (“US GAAP”). The
      results of subsidiaries acquired or disposed of during the year are consolidated
      from or up to the date of their effective dates of acquisition or disposal,
      respectively.





















All
      significant inter-company balances and transactions have been eliminated in
      consolidation.









(b)  Use
      of
      estimates





The
      preparation of consolidated financial statements requires management of the
      Group to make estimates and assumptions that affect the reported amounts of
      assets and liabilities and disclosure of contingent assets and liabilities
      at
      the date of the financial statements and the reported amounts of revenues and
      expenses during the reporting period. Actual results could differ from those
      estimates.





(c)  Cash
      and
      cash equivalents





Cash
      and
      cash equivalents of US$107,144 as of December 31, 2006 consist principally
      of
      cash at bank. For purposes of the consolidated statements of cash flows, the
      Group considers all highly liquid debt instruments with original maturities
      of
      three months or less to be cash equivalents. None of the Group’s cash is
      restricted as to withdrawal, which if any, has been separately disclosed in
      current assets.





(d)  Accounts
      receivable





Trade
      accounts receivable are recorded at the invoiced amount and do not bear
      interest. The allowance for doubtful accounts is the Group’s best estimate of
      the amount of probable credit losses in the Group’s existing accounts
      receivable. The Group determines the allowance based on historical write-off
      experience of the Group. The Group reviews its allowance for doubtful accounts
      on a regular basis. Past due balances over 90 days and over a specified amount
      are reviewed individually for collectibility. All other balances are reviewed
      on
      a pooled basis by industry. Account balances are charged off against the
      allowance after all means of collection have been exhausted and the potential
      for recovery is considered remote. The Group does not have any off-balance-sheet
      credit exposure related to its customers.





(e)  Property-use
      rights





Property-use
      rights are stated at cost less accumulated amortization and impairment losses.
      Costs of the property-use rights are amortized over the term of the relevant
      rights on a straight line basis.




45
 *Table
          of Contents*





(f)  Property,
      plant and equipment





Property,
      plant and equipment and leasehold improvements are stated at cost less
      accumulated depreciation and impairment losses, if any. Depreciation is
      calculated on the straight-line method over the estimated useful lives of the
      assets. The estimated useful lives of the assets are as follows:





Depreciable
                lifeLeasehold
                land and buildings
            50
                yearsLeasehold
                improvements
            2
                -
                3 yearsOffice
                and computer equipment
            3
                -
                5 yearsMotor
                vehicles
            3
                -
                6 yearsFurniture
                and fixtures
            3
                -
                10 years




(g)  Goodwill
      on consolidation





Goodwill
      represents the excess of the purchase consideration payable in acquisitions
      of
      subsidiaries over the fair value of the net assets acquired at the time of
      acquisition. Goodwill on consolidation is stated at cost when it arises. As
      part
      of an ongoing review of the valuation of goodwill, management assesses the
      carrying value of the goodwill to determine if changes in facts and
      circumstances suggest that it may be impaired. If this review indicates that
      the
      goodwill is not recoverable, the carrying value of the goodwill would be reduced
      to its estimated fair market value.





On
      disposal of a subsidiary, any attributable amount of purchased goodwill is
      included in the calculation of the gain or loss on disposal.





(h)  Investment
      in affiliate companies





The
      Company accounts for its affiliate companies under the equity method of
      accounting, by which the Company’s share of income or loss of affiliates are
      recorded as “Equity in earnings of affiliates” in the consolidated statement of
      operation. The investment in affiliate companies is included in balance sheet
      at
      cost plus equity accounting adjustments which are the Company’s share of losses
      since acquisition of the affiliates.





(i)  Impairment
      of long-lived assets





In
      accordance with FASB Statement 144, long-lived assets, such as property, plant
      and equipment, and purchased intangibles subject to amortization, are reviewed
      for impairment whenever events or changes in circumstances indicate that the
      carrying amount of an asset may not be recoverable. Recoverability of assets
      to
      be held and used is measured by a comparison of the carrying amount of an asset
      to estimated undiscounted future cash flows expected to be generated by the
      asset. If the carrying amount of an asset exceeds its estimated future cash
      flows, an impairment charge is recognized by the amount by which the carrying
      amount of the asset exceeds the fair value of the asset. Assets to be disposed
      of would be separately presented in the balance sheet and reported at the lower
      of the carrying amount or fair value less costs to sell, and are no longer
      depreciated. The assets and liabilities of a disposed group classified as held
      for sale would be presented separately in the appropriate asset and liability
      sections of the balance sheet.





Goodwill
      is tested annually for impairment, and is tested for impairment more frequently
      if events and circumstances indicate that the asset might be impaired. An
      impairment loss is recognized to the extent that the carrying amount exceeds
      the
      asset’s fair value. This determination is made at the reporting unit level and
      consists of two steps. First, the Group determines the fair value of a reporting
      unit and compares it to its carrying amount. Second, if the carrying amount
      of a
      reporting unit exceeds its fair value, an impairment loss is recognized for
      any
      excess of the carrying amount of the reporting unit’s goodwill over the implied
      fair value of that goodwill. The implied fair value of
      goodwill is determined by allocating the fair value of the reporting unit in
      a
      manner similar to a purchase price allocation, in accordance with FASB Statement
      141, *Business
      Combinations.* The
      residual fair value after this allocation is the implied fair value of the
      reporting unit goodwill.




46
 *Table
          of Contents*





(j)  Deferred
      income





Deferred
      income represents unamortized non-refundable admission fees, membership fees
      and
      licensing fees received but the related services, or portion of the services,
      have not yet been rendered.





(k)  Revenue
      recognition





The
      Group
      recognizes revenue when persuasive evidence of an arrangement exists, the
      element has been delivered, the fee is fixed or determinable, collection of
      the
      resulting receivable is probable, and VSOE of the fair value of any undelivered
      element exists. A discussion about these revenue recognition criteria and their
      applicability to the Group’s transactions as follows:





*Persuasive
      evidence of an arrangement* :
      The
      Group uses either contract signed by both the customer and the Group or written
      sales receipt issued by the Group that legally bind the Group and the customer
      as evidence of an arrangement.





*Product
      delivery* :
      The
      Group deems delivery to have occurred when the air tickets are accepted by
      and
      title and risk of ownership has passed to the customer. Delivery of other
      services are recognized as services are rendered under the terms of the
      contract.





*Fixed
      or determinable fee* :
      The
      Group considers the fee to be fixed or determinable if the fee is not subject
      to
      refund or adjustment and the payment terms are within its normal established
      practices. If the fee is not fixed or determinable, the Group recognizes the
      revenue as amounts become due and payable.





*Collection
      is deemed probable* :
      The
      Group conducts a credit review for all significant transactions at the time
      of
      the arrangement to determine the credit-worthiness of the customer. Collection
      is deemed probable if the Group expects that the customer will pay amounts
      under
      the arrangement as payments become due.





(i)
            Club
                and business center





The
      Group, through its Business Club, provides members a commercial and recreational
      service, education programs and business networking programs. The Group
      generally records membership revenue as deferred income on its consolidated
      balance sheets and recognizes it over the membership period. Revenues generated
      from memberships that are subject to a pro rata refund are recognized ratably
      over the membership period.





(ii)
            Business
                traveling services





*Travel
      distribution services*





The
      Group
      engages in the air-ticketing, hotel room booking and travel agency businesses
      and receives commissions from travel suppliers for air travel, hotel rooms,
      vacation packages and cruises booked through its toll-free call center, websites
      and reseller network. Commissions from travel providers are recognized upon
      delivery of the appropriate confirmation or air ticket to the customers.
      Commissions from hotel room booking are recognized upon the confirmation of
      a
      customer’s stay with the hotel. The Company is not the primary obligor of the
      arrangement of these services and revenue is reported net in accordance with
      EITF 99-19, “Reporting Revenue Gross as a Principal versus Net as an
      Agent”.




47
 *Table
          of Contents*





For
      informational purposes, the commission income of the Group was derived from
      air-ticketing services with total values as follows:





Year
                ended December 312006
            
            2005US$
            
            US$Value
                of air-ticket fare
            
            
            131,254,359
            
            
            147,995,206





The
      2006
      figure above is the 9 months’ total values, as a result of the disposal of the
      air-ticketing business upon disposal of GBN on September 29, 2006 (please see
      note 4 for details), as compared with the 12 months’ total values of
      2005.





*Life
      and accident insurance agency business*





The
      Group
      engages in the accident insurance agency business in PRC. Life insurance
      business ceased effective from January 2006. Commission revenues from the
      carriers for accident insurance are received and recognized during the
      underlying policy period.





For
      informational purposes, the commission income of the Group was derived from
      insurance policies with total premium income as follows:





Year
                ended December 312006
            
            2005US$
            
            US$Premium
                income of insurance policies
            
            
            3,533,643
            
            
            11,892,144





The
      2006
      figure above is the 9 months’ total values, as a result of the disposal of the
      air-ticketing business upon disposal of GBN on September 29, 2006 (please see
      note 4 for details), as compared with the 12 months’ total values of
      2005.





(iii)
            Business
                value-added services





Revenues
      from various business consultancy services contracts are recognized as services
      are provided. There are two basic types of services contracts: (1) fixed price
      (or flat fee basis) services contracts and (2) services contracts which may
      or
      may not be signed in advance for similar service on a success basis (success
      fee
      basis). Fixed price services contracts are generally performed evenly over
      the
      contract period, and, accordingly, revenue is recognized on a pro-rata basis
      over the life of the contract. Revenues derived from other services contracts
      are recognized when the services are performed in accordance with Staff
      Accounting Bulletin No. 104, “Revenue Recognition, revised and updated.”
Expenses related to all services contracts are recognized as incurred.





For
      fixed
      price services contracts for which fees are received in the form of marketable
      securities, revenue is recognized with reference to the fair value of marketable
      securities as of the vested date. Vested date is taken as the contract date
      and
      fair value of the marketable securities is determined by multiplying quantity
      of
      shares received by the closing market price as of contract date. Revenue is
      recognized on a pro-rata basis over the life of the contract.




48
 *Table
          of Contents*





(iv)
            Rental
                and others





*Rental*





The
      Company also leases business facilities to members of the Club. These leases
      are
      classified as operating leases and the lease revenues are recognized based
      on
      the lease term of the facilities.





*Others*





The
      Company recognizes revenue in accordance with SEC Staff Accounting Bulletin
      No.
      101 “Revenue Recognition of Financial Statements”, when the title and risk of
      loss have passed to the customer, there is persuasive evidence of an
      arrangement, delivery has occurred or services have been rendered, the sales
      price is determinable, and collectibility is reasonably assured.





(v)
            Interest
                income





Interest
      income is recognized on a time apportionment basis, taking into account the
      principal amounts outstanding and the interest rates applicable.





(l)  Advertising
      costs





The
      Group
      expenses advertising costs as incurred in accordance with the SOP 93-7,
“Reporting for Advertising Costs”. Advertising costs are expensed as incurred
      and were US$274,486 for the year ended December 31, 2006 and US$312,207 for
      the
      year ended December 31, 2005.





(m)  Income
      taxes





The
      Group
      accounts for income tax using SFAS No. 109 “Accounting for Income Taxes”, which
      requires the asset and liability approach for financial accounting and reporting
      for income taxes. Under this approach, deferred income taxes are provided for
      the estimated future tax effects attributable to temporary differences between
      financial statement carrying amounts of assets and liabilities and their
      respective tax bases, and for the expected future tax benefits from loss
      carry-forwards and provisions, if any. Deferred tax assets and liabilities
      are
      measured using the enacted tax rates expected in the years of recovery or
      reversal and the effect from a change in tax rates is recognized in the
      statement of operations in the period of enactment. A valuation allowance is
      provided to reduce the amount of deferred tax assets if it is considered more
      likely than not that some portion of, or all of the deferred tax assets will
      not
      be realized. For details please refer to Note 7 to these financial
      statements.





(n)  Foreign
      currency translation





Assets
      and liabilities of the Group whose functional currency is the local currency
      are
      translated into U.S. dollars at exchange rates prevailing at the balance sheet
      date. Revenues and expenses are translated at average exchange rates for the
      year. The net exchange differences resulting from these translations are
      reported in accumulated other comprehensive income. Gains and losses resulting
      from foreign currency transactions are included in the consolidated statements
      of operations.




49
 *Table
          of Contents*





(o)
            Business
                segment reporting





SFAS
      No.
      131 “Disclosures about Segments of an Enterprise and Related Information”
establishes standards for reporting information about operating segments on
      a
      basis consistent with the Group’s internal organization structure as well as
      information about geographical areas, business segments and major customers
      in
      financial statements.





The
      Group
      operates in five principal business segments: club and business centre, business
      traveling services, business value-added services, rental and others. There
      reportable segments are strategic business units that offer different services.
      They are managed separately because they provide distinct service that requires
      different knowledge and marketing strategies.





(p)
            Stock-based
                compensation





In
      December 2004, the FASB issued SFAS No. 123(R), “Share-Based Payment,”
which is a revision of SFAS No. 123, “Accounting for Stock-Based
      Compensation.” Generally, the approach in SFAS No. 123(R) is similar
      to the approach described in SFAS No. 123. However, SFAS
      No. 123(R) requires all share-based payments to employees, including
      grants of employee stock options, to be recognized in the income statement
      based
      on their fair values. Pro forma disclosure is no longer an alternative. The
      new
      standard will be effective for public entities (excluding small business
      issuers) for the fiscal year beginning after June 15, 2005. The Group
      adopted SFAS No. 123(R) on January 1, 2006 using the
      modified-prospective transition method. Had the Group adopted SFAS
      No. 123(R) for the year ended December 31, 2005, its diluted
      earnings per share would have been unchanged, and going forward, the Group
      expects that the adoption of SFAS No. 123(R) will have a similar
      effect on diluted earnings per share.





The
      Company records compensation expense for stock-based employee compensation
      plans
      using the intrinsic value method in which compensation expense, if any, is
      measured as the excess of the market price of the stock over the exercise price
      of the award on the measurement date.





On
      December 31, 2003, the Board of Directors adopted a stock option plan (The
      2003
      Plan). The 2003 Plan allows the Board of Directors to grant stock options to
      various employees of the Company. 1,000,000 stock options were granted in
      accordance with the terms of the 2003 Plan on December 31, 2003 to certain
      officers and directors at an exercise price of US$0.673 per share. The stock
      options will vest and become exercisable according to the following schedule:





On
      April
      30,
      2004:                                                            
    25%





On
      December 30,
      2004:                                                        
25%





Each
      quarter
      thereafter:                                                        
6.25% (until fully vested)





By
      an
      ordinary resolution passed at a directors’ meeting held on October 31, 2004, the
      option holders of The 2003 Plan were allowed to begin exercising 50% of the
      total entitlements as of November 1, 2005 (ahead of the original entitlement
      on
      December 30, 2004) and on a cashless basis. The terms and conditions of the
      remaining 50% of their entitlements under The 2003 Plan shall stay the same.





As
      the
      exercise price of the Company’s incentive stock options is higher than the
      market price of the underlying stock on the date of grant, pursuant to APB
      Opinion No. 25, no compensation expense has been recognized for stock options
      granted to employees at the date of grant. Following
      modification the options granted under The 2003 Plan, the modified award (i.e.
      50% of the total entitlements) was fully vested at October 31, 2004. The new
      measurement of stock-based compensation was required and based on the intrinsic
      value of the Company’s common stock at the date immediately prior to the
      modification (i.e. October 31, 2004). The compensation cost was recognized
      in
      the consolidated statement of operations and the same amount was credited to
      the
      Company’s additional paid-in capital.




50
 *Table
          of Contents*





Had
      compensation expense for the same stock options been determined based on their
      fair values at the dates of grant and been amortized over the period from the
      date of grant to the date that the award is vested, as consistent with the
      provisions of SFAS No. 123, the Company's net loss and loss per share would
      have
      been reported as follows:





Year
                ended December 312006
            
            2005Net
                profit (loss), as reported
            
            
            (10,090,975
            )
            
            18,224Total
                stock-based employee compensation expense determined under intrinsic
                value
                based on method for all awards, net of tax
            
            
            Nil
            
            
            NilTotal
                stock-based employee compensation expense determined under fair value
                based on method for all awards, net of tax
            
            
            Nil
            
            
            NilPro
                forma
            
            
            (10,090,975
            )
            
            18,224Earning
                (loss) per share-
                Basic and dilutedAs
                reported
            
            
            0.00
            
            
            0.00Pro
                forma
            
            
            0.00
            
            
            0.00





The
      fair
      value of the options granted is estimated on the date of grant and date of
      modification using a Black-Scholes option pricing model with the following
      weighted average assumptions used:




Years
                ended December 31,2006
            
            
            2005Dividend
                yield
            
            
            -
            
            
            -Expected
                price volatility
            
            
            224
            %
            
            224
            %Risk-free
                interest rate
            
            
            2.1
            %
            
            2.1
            %Expected
                life of options (in years)
            
            
            3
            
            
            3Weighted-average
                fair value of options granted or modified
            
            $
            0.62
            
            $
            0.62





The
      weighted average fair value per option granted at the date of grant and date
      of
      modification was US$0.62 and US$1.97 respectively. For purposes of pro forma
      disclosure, the estimated fair value of the options is amortized on a straight
      line basis to expense over the options’ vesting periods, i.e., 3 years as
      prescribed under The 2003 Plan.





(q)
            Comprehensive
                income (loss)





Accumulated
      comprehensive income, as presented in the accompanying consolidated statement
      of shareholders' equity consists of changes in unrealized gains and losses
      on foreign currency translation as well as unrealized gains or losses from
      available-for-sale securities. This comprehensive income is not included in
      the
      computation of income tax expense or benefit.




51
 *Table
          of Contents*





(r)
            Related
                party




Parties
      are considered to be related if one party has the ability, directly or
      indirectly, to control the other party or exercise significant influence over
      the party in making financial and operating decisions or vice versa, or where
      the Group and the party are subject to common control or common significant
      influence. Related parties may be individuals or other entities. All material
      related party transactions have been disclosed in the disclosure note 15 to
      the
      financial statements.





(s)
            Concentrations
                of credit risk





Financial
      instruments that potentially subject the Group to significant concentrations
      of
      credit risk consist principally of cash and trade accounts receivable. The
      Group
      performs ongoing credit evaluations of its customers' financial condition,
      but
      does not require collateral to support such receivables.





The
      Group
      utilizes a limited number of suppliers for certain components used in its
      products but has no long-term supply contracts with them.





(t)
            Fair
                value of financial instruments





Management
      considers that the carrying amounts of the Group’s cash, receivables, and
      payables approximate their fair value because of the short maturity of these
      instruments. Amounts due to related companies do not bear interest and do not
      have fixed payment terms. Management is therefore unable to estimate the fair
      value of such financial instruments.





(u)  Operating
      leases





Leases
      where substantially all the rewards and risks of ownership of assets remain
      with
      the leasing company are accounted for as operating leases. Rent payable and
      receivable under operating leases are recognized as expense and revenue on
      the
      straight line basis over the lease terms.





The
      Company leases certain premises under non-cancellable operating leases. Rental
      expenses under operating leases were US$551,387 and US$690,283 for the years
      ended December 31, 2006 and 2005, respectively.





(v)  Earnings
      per share





The
      Company computes earnings per common share (“EPS”) in accordance with SFAS
      No. 128, “Earnings per Share.” Basic earnings per common share (“Basic
      EPS”) are calculated using the weighted average number of shares of common stock
      outstanding during each period. Diluted earnings per common share (“Diluted
      EPS”) reflect the potential dilutive effect of additional common shares that are
      issuable upon exercise of outstanding stock options, deferred compensation,
      restricted stock units, and the outstanding commitment to issue shares under
      the
      Employee Stock Purchase Plan, determined by the treasury stock
      method.




As
      of
      December 31, 2006, the Company had outstanding stock warrants and options which
      exercise on conversion could, under certain circumstances, further
      dilute loss per share. The following shares of potentially issuable common
      stock were not included in the above weighted average shares outstanding because
      to do so would have an anti-dilutive effect on loss per share for the year
      presented.





As
                of December 312006
            
            2005Warrants
            
            
            921,002
            
            
            921,002Options
            
            
            1,400,000
            
            
            1,400,000**2,321,002**
            
            
            **2,321,002**





2005
      figure is restated to conform with current year’s presentation.




52
 *Table
          of Contents*





(w)  Available-for-sale
      securities





Available-for-sale
      securities received in respect of the services rendered in our business
      value-added segment are accounted for as a current asset for non-legend free
      trading shares, at fair value as of the vested date. Vested date refers to
      the
      contract date which the Company is entitled to the receipt of the shares in
      respect of its services rendered pursuant to the consultancy service engagement
      contract. Fair value is taken as the number of shares multiplied by the closing
      market price of the marketable securities received. For those restricted shares,
      it is accounted for as a non-current asset upon receipt of securities. For
      those
      available-for-sale securities still on hand as of year-end or quarter-end date,
      amounts are stated at fair value as of the reporting date. They will be
“marked to market” by multiplying the number of shares on hand by the
      closing market price as of the reporting date. The change in unrealized gain
      or
      loss will be directly adjusted to accumulated other comprehensive income -
      unrealized gain on available-for-sale securities.





Please
      refer to footnote 2(k)(iii) for method of revenue recognition in respect of
      the
      consultancy income relating to the receipt of available-for-sale securities.
      Realized gain on sale of available-for-sale securities is calculated by
      deducting fair value of shares disposed (number of shares disposed multiplied
      by
      market price as of vested date) from net proceeds on disposal (which selling
      expenses including brokerage commission and levies have been
      deducted).




(x)  Recently
      Issued Accounting Standards




In
      February 2006, the FASB issued SFAS Statement No. 155, “Accounting for Certain
      Hybrid Financial Instruments—an amendment of FASB Statements No. 133 and 140”
("SFAS 155"). This Statement amends FASB Statements No. 133, Accounting for
      Derivative Instruments and Hedging Activities, and No. 140, Accounting for
      Transfers and Servicing of Financial Assets and Extinguishments of Liabilities.
      This Statement resolves issues addressed in Statement 133 Implementation Issue
      No. D1, “Application of Statement 133 to Beneficial Interests in Securitized
      Financial Assets.” This Statement permits fair value re-measurement for any
      hybrid financial instrument that contains an embedded derivative that otherwise
      would require bifurcation, clarifies which interest-only strips and
      principal-only strips are not subject to the requirements of Statement 133,
      establishes a requirement to evaluate interests in securitized financial assets
      to identify interests that are freestanding derivatives or that are hybrid
      financial instruments that contain an embedded derivative requiring bifurcation,
      clarifies that concentrations of credit risk in the form of subordination are
      not embedded derivatives and amends Statement 140 to eliminate the prohibition
      on a qualifying special-purpose entity from holding a derivative financial
      instrument that pertains to a beneficial interest other than another derivative
      financial instrument. SFAS 155 is effective for all financial instruments
      acquired or issued for the Group for fiscal year begins after September 15,
      2006. The Group is currently evaluating the impact of SFAS 155 on its financial
      statements.


In
        March
        2006, the Financial Accounting Standards Board issued Statement of Financial
        Accounting Standards No. 156 (“SFAS 156”), Accounting for Servicing of
        Financial Assets—an amendment of FASB Statement No. 140, which requires an
        entity to recognize a servicing asset or servicing liability each time it
        undertakes an obligation to service a financial asset by entering into a
        servicing contract under certain circumstances. The Company does not expect
        the
        adoption of FIN 48 to materially impact its financial position or results
        of
        operations.
 
 In
        July
        2006, the Financial Accounting Standards Board issued Interpretation No. 48
        (“FIN 48”), Accounting for Uncertainty in Income Taxes, which clarifies the
        accounting for uncertainty in income taxes recognized in an enterprise’s
        financial statements in accordance with FASB Statement No. 109, Accounting
        for Income Taxes. FIN 48 provides guidance on the financial statement
        recognition and measurement of a tax position taken or expected to be taken
        in a
        tax return. FIN 48 also provides guidance on derecognition, classification,
        interest and penalties, accounting in interim periods, disclosures, and
        transition. FIN 48 is effective for fiscal years beginning after
        December 15, 2006. The Company does not expect the adoption of FIN 48 to
        materially impact its financial position or results of operations.
 
 In
        September 2006, the Financial Accounting Standards Board issued Statement
        of
        Financial Accounting Standards No. 157 (“SFAS 157”), Fair Value
        Measurements. SFAS 157 clarifies the principle that fair value should be
        based
        on the assumptions market participants would use when pricing an asset or
        liability and establishes a fair value hierarchy that prioritizes the
        information used to develop those assumptions. Under the standard, fair value
        measurements would be separately disclosed by level within the fair value
        hierarchy. SFAS 157 is effective for financial statements issued for fiscal
        years beginning after November 15, 2007 and interim periods within those
        fiscal years, with early adoption permitted. The Company does not expect
        the
        adoption of SFAS 157 to materially impact its financial position or results
        of
        operations.
 
 In
        September 2006, the SEC released SAB No. 108, *“Considering
        the Effects of Prior Year Misstatements when Quantifying Misstatements in
        Current Year Financial Statements”* (“SAB
        108”). SAB 108 provides interpretive guidance on the SEC’s views on how the
        effects of the carryover or reversal of prior year misstatements should be
        considered in quantifying a current year misstatement. The provision of SAB
        108
        is effective for the Company in the current fiscal year ended December 31,
        2006.
        The Company is currently evaluating the impact of SAB 108 but does not believe
        that the application of SAB 108 would have a material effect on its financial
        position, cash flows nor results of operations.
 
 In
        February 2007, the Financial Accounting Standards Board issued Statement
        of
        Financial Accounting Standards No. 159 (“SFAS 159”), The Fair Value Option
        for Financial Assets and Financial Liabilities—Including an amendment of FASB
        Statement No. 115. This Statement permits entities to choose to measure many
        financial instruments and certain other items at fair value. The objective
        is to
        improve financial reporting by providing entities with the opportunity to
        mitigate volatility in reported earnings caused by measuring related assets
        and
        liabilities differently without having to apply complex hedge accounting
        provisions. This Statement is expected to expand the use of fair value
        measurement, which is consistent with the Board’s long-term measurement
        objectives for accounting for financial instruments. SFAS 157 is effective
        for
        financial statements issued for fiscal years beginning after November 15,
        2007. The Company has not determined the affect of adopting this
        standard.


53
 *Table
          of Contents*





**3.**  **GOING
      CONCERN CONSIDERATIONS**





Though
      the Company has a positive working capital of US$2,050,700 as of December 31,
      2006, the Company had net loss of US$10,090,975 and net profit of US$18,224
      for
      the years ended December 31, 2006 and 2005 respectively.





Continuation
      of the Company as a going concern is dependent upon obtaining additional working
      capital through additional equity funding and attaining profitable operations
      in
      the future. Management has developed a strategy, which they believe can be
      accomplished and will enable the Company to operate in the future. However,
      there can be no assurance that the Company will be successful with their efforts
      to attain profitable operations. The inability of the Company to secure
      additional financing and attain profitable operations in the near term could
      adversely impact the Company’s business, financial position and
      prospects.




**4.**  **DISPOSAL
      OF A SUBSIDIARY**





On
      September 29, 2006, the Company through its wholly owned subsidiary, China
      Chance Enterprises Limited, sold 100% outstanding capital stock of Rejoice
      Success Limited (“Rejoice”) to Wisdom Plus Limited (“Wisdom Plus”) at a
      consideration of $4,000,000. Rejoice owns 60% of the outstanding capital stock
      of General Business Network (Holdings) Limited (“GBN”), which indirectly owns
      51% of the outstanding capital stock of New Generation Commercial Management
      Limited (“New Generation”).





New
      Generation engages in the travel agency business by operating ten subsidiaries
      in Southern China. To date, New Generation has accumulated a substantial market
      share in ticketing sales for international and domestic flights as well as
      inbound business travel. In addition, Guangzhou Huahao Insurance Agency Limited,
      one of the New Generation group of companies, is also a licensed insurance
      agent
      in China, providing accidental and life insurance to individual policy holders
      in the Guangzhou Province of China.





The
      purchase price will be paid by 4 instalments from September 30, 2006 to July
      29,
      2007 in cash or shares of common stock issued by any Pink Sheet companies or
      OTCBB companies in lieu of the consideration. The amount of share certificates
      shall be agreed by both parties in a separate agreement.





While
      cash of US$100,000 had been received as of December 31, 2006, second payment
      of
      cash of $900,000 was received on February 8, 2007 in accordance with the
      Agreement with the following schedules: US$100,000 to be paid on September
      30,
      2006; US$900,000 to be paid on January 29, 2007; US$1,000,000 to be paid on
      April 29, 2007; and US$2,000,000 to be paid on July 29, 2007.  As
      of the
      date of issuance of this report, total cash of US$1,000,000 had been duly
      received in accordance with the Agreement.




54
 *Table
          of Contents*




Loss
      on
      disposal of GBN is determined as follows:





**Year
                ended December 31, 2006****US$**Net
                Assets disposedProperty,
                plant and equipment
            
            
            1,488,347Goodwill
            
            
            11,409,514Rental
                use rights
            
            
            1,543,413Cash
                and cash equivalents
            
            
            1,353,749Pledged
                bank deposit
            
            
            246,996Account
                receivables
            
            
            4,386,375Available-for-sale
                securities
            
            
            159,375Due
                from a related company
            
            
            1,157,343Due
                from related parties
            
            
            614,255Due
                from a director
            
            
            8,265Rental
                and other deposits
            
            
            1,992,209Prepayments
            
            
            918,818Loan
                receivable
            
            
            4,116Other
                current assets
            
            
            515,215Lines
                of credit
            
            
            (3,859,311
            )Due
                to related parties
            
            
            (30,116
            )Accounts
                payable
            
            
            (3,957,938
            )Accruals
            
            
            (181,952
            )Tax
                payables
            
            
            (1,472,141
            )Tax
                penalty
            
            
            (1,026,680
            )Hire
                purchase creditor
            
            
            (121,032
            )Other
                current liabilities
            
            
            (1,440,673
            )Minority
                interest
            
            
            (1,690,583
            )Net
                asset value
            
            
            12,017,56460%
                thereof
            
            
            7,210,538Consideration
            
            
            4,000,000Loss
                on disposal of a subsidiary
            
            
            3,210,538





55
 *Table
          of Contents*




**5.**  **IMPAIRMENT
      LOSS ON AFFILIATE**





Upon
      disposal of 60% of General Business Network (Holdings) Limited (“GBN”) common
      shares per note 4 above, the Company holds 40% of its outstanding capital stock.
      GBN becomes an affiliate subsequent to the disposal. With reference to the
      consideration relating to 60% of equity of GBN which has been disposed, the
      impairment loss is determined as follows:





**Year
                ended December 31, 2006****US$**Cost
                of investment of GBN (40% of net asset value $12,017,564 immediately
                before disposal)
            
            
            4,807,026Carrying
                value of GBN with reference to consideration for 60% equity disposed
                of
                ($4,000,000 x 40%/60%)
            
            
            2,666,667Impairment
                loss
            
            
            2,140,359




**6.**  **INVESTMENT
      IN AFFILIATES**





The
      Company accounts for its 25% interest in CWT International Excursion Investment
      Limited (“CWT Excursion”), a company organized and existing under the laws of
      the British Virgin Islands, and 40% interest in General Business Network
      (Holdings) Limited (“GBN”), a company organized and existing under the laws of
      Hong Kong SAR, under the equity method of accounting. Under the equity method
      of
      accounting, the Company’s share of income or loss of CWT Excursion and GBN are
      recorded as “Equity in earnings of affiliates” in the consolidated statement of
      operation. Equity in earnings of both affiliates have been accounted for in
      the
      statement of operation for year ended December 31, 2006.





Carrying
      value of affiliates consists of the following:





**As
                of December 31, 2006****US
                $**General
                Business Network (Holdings) Limited.Carrying
                value with reference to consideration for 60% equity disposed ($4,000,000
                x 40%/60%)
            
            
            2,666,667Equity
                in earnings of GBN
            
            
            (128,138
            )Cash
                dividend received from GBN
            
            
            --2,538,529CWT
                International Excursion Investment LimitedCarrying
                value with reference to closing bid price for the 9,000,000 common
                stock
                of the Company issued as consideration in the last five trading days
                preceding the date of the Agreement of $0.712 ($0.712 x 6,000,000
                shares)
            
            
            6,408,000Equity
                in earnings of CWT Excursion
            
            
            (52,037
            )Cash
                dividend received from CWT Excursion
            
            
            --6,355,963Carrying
                value in affiliates
            
            
            8,894,492




56
 *Table
          of Contents*





(a)
            Acquisition
                of affiliate





On
      September 25, 2006, the Company together with its wholly owned subsidiary,
      Rainbow Wish Limited (“Rainbow Wish”), entered into a Share Exchange Agreement
      (the “Agreement”) with CWT International Excursion Investment Limited, a company
      organized and existing under the laws of the British Virgin Islands (“CWT
      Excursion”), and Chi Hung Tsang, the Chairman of the Company and holder of sixty
      percent (60%) of the capital stock of CWT Excursion, and also a citizen and
      resident of the People’s Republic of China. Pursuant to the terms of the
      Agreement, the Company will issue 9,000,000 shares of its common stock (the
      “CWTD Shares”) to Mr. Tsang in exchange for 25 common shares of CWT Excursion
      owned by him (the “CWT Excursion Shares”) to Rainbow Wish, presenting a 25%
      equity interest in CWT Excursion.




CWT
      Excursion was incorporated on March 22, 2006, and is the owner of 51% of the
      equity interest in a joint venture company known as Suzhou Tongli
      (International) Excursion Development Limited, which is a company organized
      and
      existing under the laws of the People’s Republic of China (“Suzhou Tongli”).
      Suzhou Tongli is in the business of operating tourist concessions in Tongli
      Town, Suzhou City, Jiangsu Province, People’s Republic of China.





Pursuant
      to the Agreement, Mr. Tsang has also agreed to grant Rainbow Wish the option
      to
      purchase an additional 35% of the capital stock of CWT Excursion within twelve
      months of the date hereof, at a price that will be agreed upon by both parties
      at the time of exercise of said option in a separate agreement.





The
      acquisition consideration of CWT Excursion amounts to $6,408,000. It is the
      fair
      market value of the CWTD Shares to be issued to Mr. Tsang, based on the closing
      bid price for the common stock of CWTD in the last five trading days preceding
      the date of the Agreement of $0.712.





The
      investment in CWT Excusion is categorized as an affiliate because the Company
      owns 25% of its equity, which is 20% or more and is 50% or less of its
      outstanding capital stock. It is included in the consolidated income statement
      using the equity method of accounting and is included in balance sheet at cost
      plus equity accounting adjustments.





(b)
            Addition
                of affiliate





Upon
      disposal of 60% of General Business Network (Holdings) Limited (“GBN”) common
      shares per note 4 above, the Company holds 40% of its outstanding capital stock.
      GBN becomes an affiliate subsequent to the disposal.




**7.**  **INCOME
      TAXES**





The
      Group
      are subject to income taxes on an entity basis on income arising in or derived
      from the tax jurisdiction in which it is domiciled and operated.





The
      Hong
      Kong subsidiaries incurred losses for taxation purposes for the year and thus
      Hong Kong Profits Tax has not been provided.





Several
      PRC subsidiaries are subject to PRC Enterprise Income Taxes (“EIT”) on an entity
      basis on income arising in or derived from the PRC. Income tax expense comprises
      of the following:





Year
                ended December 31,2006
            
            2005Current
                tax
            
            
            103,037
            
            
            254,419Deferred
                tax
            
            
            -
            
            
            --
            
            
            103,037
            
            
            254,419





57
 *Table
          of Contents*




A
      reconciliation of the income tax expense to the amount computed by applying
      the
      current tax rate to the income before income taxes in the consolidated
      statements of income is as follows:





Year
                ended December 31,2006
            
            2005%
            
            %Statutory
                rate
            
            
            33.0
            
            
            33.0Non-deductible
                expenses
            
            
            5.9
            
            
            211.5Tax
                exempt income
            
            
            -
            
            
            (18.6
            )Tax
                effect of net operating losses
            
            
            (41.9
            )
            
            4,123.8Unrecognised
                temporary differences
            
            
            2.9
            
            
            831.4Subsidiary
                not subject to tax
            
            
            (0.8
            )
            
            (5,022.6
            )Tax
                rate differential between subsidiaries
            
            
            (0.1
            )
            
            569.6Over
                provision in prior years related to a newly-acquired
                subsidiary
            
            
            -
            
            
            -Others
            
            
            -
            
            
            668.0(1.0
            )
            
            1,396.1





Deferred
      income taxes reflect the net tax effects of temporary differences between the
      carrying amounts of assets and liabilities for financial reporting purposes
      and
      the amounts used for income tax purposes. Significant components of the Group’s
      deferred tax assets and liabilities are as follows:





As of December 312006
            
            2005**Deferred
                tax assets**Net
                operating loss
            
            
            4,802,923
            
            
            8,500,133Depreciation
            
            
            51,041
            
            
            101,462Deferred
                expenditure
            
            
            638,148
            
            
            2,952,3365,492,112
            
            
            11,553,931Valuation
                allowance
            
            
            (5,492,112
            )
            
            (11,553,931
            )**Total
                deferred tax assets**
            
            
            -
            
            
            **-**





In
      assessing the realizability of deferred tax assets, management considers whether
      it is more likely than not that some portion or all of the deferred tax assets
      will not be realized. The ultimate realization of deferred tax assets is
      dependent upon the generation of future taxable income during the periods in
      which those temporary differences become deductible.




58
 *Table
          of Contents*





**8.**  **TRADE
      RECEIVABLES, NET**





As
                of December 31, 2006US$Trade
                receivables, net
            
            
            6,160





Provision
      of bad and doubtful debts amounting to US$28,217 has been made in these
      consolidated financial statements. Management considers that the accounts
      receivable after provision for bad and doubtful debts are stated at fair value
      because it represents balances due from reputable customers and expects to
      collect their outstanding balances in full.





**9.**  **RENTAL
      AND OTHER DEPOSITS**





Included
      in rental and other deposits are deposits paid to Guangzhou Goldlion City
      Properties Co., Ltd. of US$78,605 and Guangzhou Goldlion Environmental
      Technology Co., Ltd. of US$143,711 as of December 31, 2006. For relationship
      with the Group, please refer to note 15 (a) to these financial statements.





**10.**  **DISPOSAL
      CONSIDERATION RECEIVABLE**





Disposal
      consideration receivable is the consideration receivable from Wisdom Plus
      Limited relating to the disposal of GBN on September 29, 2006 as detailed in
      Note 4 above.





The
      total
      consideration of US$4,000,000 is to be paid by 4 instalments from September
      30,
      2006 to July 29, 2007 in cash or shares of common stock issued by any Pink
      Sheet
      companies or OTCBB companies in lieu of the consideration. While
      cash of US$100,000 had been received as of December 31, 2006, second payment
      of
      cash of $900,000 was received on February 8, 2007 in accordance with the
      Agreement with the following schedules: US$100,000 to be paid on September
      30,
      2006; US$900,000 to be paid on January 29, 2007; US$1,000,000 to be paid on
      April 29, 2007; and US$2,000,000 to be paid on July 29, 2007.  As
      of the
      date of issuance of this report, total cash of US$1,000,000 had been duly
      received in accordance with the Agreement.





**11.**  **AMOUNT
      DUE FROM/TO RELATED PARTIES**





(a) Due
                from related partiesAs
                of December 31,2006US$Classified
                as current assets
            
            
            -




59
 *Table
          of Contents*




(b)
                Due from related companiesAs
                of December 31, 2006US$Classified
                as current assets
            
            
            -








(c)
                Due from affiliate companyAs
                of December 31, 2006US$CWT
                International Excursion Investment Ltd.
            
            
            25,163Classified
                as current assets
            
            
            25,163The
                amounts due from related parties and related companies and affiliate
                company as of December 31, 2006 represented unsecured advances which
                were
                interest-free and repayable on
                demand.




(d)
                Due to related partiesAs
                of December 31,2006US$Classified
                as current liabilities
            
            
            -





(e)
                Due to related companiesAs
                of December 31,2006US$Guangzhou
                Goldlion City Properties Co., Ltd.
            
            
            3,258Beijing
                Wanlong Economic Consultancy Corporation Ltd.
            
            
            28,814Guangzhou
                City International Exhibition Co.
            
            
            19,210Classified
                as current liabilities
            
            
            51,282




The
      amounts due to related parties as of December 31, 2006 represented unsecured
      advances which were interest-free and repayable on demand.




The
      amount due to related companies relates to rental and management fees and
      advisory fees.




60
 *Table
          of Contents*





**12.**  **SHORT-TERM
      INVESTMENTS**





The
      balance represents equity securities classified as “available-for-sale”. As at
      the balance sheet date, the “available-for-sale” securities are stated at the
      fair value and correspondingly an unrealized gain of US$Nil is carried on the
      balance sheet as accumulated other comprehensive income.





Amount
      of
      short-term investments as of December 31, 2006 is Nil subsequent to the disposal
      of GBN detailing in note 4 above.




**13.**  **PROPERTY
      USE RIGHTS**





Pursuant
      to agreements entered into between a subsidiary of the Company, Guangdong New
      Generation Commercial Management Limited (“GNGMC”), and Guangdong Hauhao
      Industries Group Co. Limited and Chen Zeliang dated December 28, 2004, GNGMC
      acquired the property use rights of their office premises located in Guangzhou
      for a 41-year period and 42-year period commencing from the date of agreements
      to October 30, 2045 and March 30, 2046 respectively. The total consideration
      of
      these transactions were US$1,611,648 The property use rights acquired have
      been
      capitalized and are being amortized on a straight-line basis over their lease
      terms.





Amount
      of
      property use rights of December 31, 2006 is Nil subsequent to the disposal
      of
      GBN detailing in note 4 above.




**14.**  **GOODWILL**





As
                of December 31,2006US$Carrying
                value, beginning of year
            
            
            11,279,314Carrying
                value, end of year
            
            
            -





Amount
      of
      goodwill as of December 31, 2006 is Nil subsequent to the disposal of GBN
      detailing in note 4 above.




**15.**  **PROPERTY,
      PLANT AND EQUIPMENT**





Property,
      plant and equipment consist of the following:





As
                of December 31, 2006US$Office
                and computer equipment
            
            
            22,651Motor
                vehicles
            
            
            63,02385,674Less:
                Accumulated depreciation
            
            
            19,960Net
                book value
            
            
            65,714





Total
      depreciation for the years ended December 31, 2006 and 2005 was US$245,196
      and
      US$265,062, respectively.





Despite
      the operating loss experienced by the club operations of the Group, management
      considers that impairment losses are not necessary for the year ended
      December 31, 2006 because of the immaterial amount (2005:
      US$38,598).




61
 *Table
          of Contents*





**16.**  **LOAN
      RECEIVABLE**





The
      loans
      receivable are those loans to non-related companies which are interest bearing
      and having a fixed repayment schedule.





**17.**  **SHORT-TERM
      BANK LOAN**





Guangdong
      Hauhao Industries Holdings Limited, Guangdong Hauhao Insurance Agency Limited,
      Chen Zeliang and a third party, Guangzhou Qidu Guarantee Service Company Limited
      provided corporate and personal guarantee to the bank against the bank loans
      of
      US$1,234,979 granted to GNGCM.





A
      pledged
      deposit of US$412,484 was used to secure the bank loans of US$1,111,482 granted
      to Guangdong Airport Tour Service Limited. In additions, GNGCM, Chen Zeliang
      and
      Suo Hong Xia provided corporate and personal guarantee to the bank against
      the
      bank loans.





Please
      refer to note 15(a) to these financial statements for details of relationship
      of
      these guarantors with the Group.





Amount
      of
      short-term bank loan as of December 31, 2006 is Nil subsequent to the disposal
      of GBN detailing in note 4 above.





**18.**  **RELATED
      PARTY TRANSACTIONS**





(a)  Names
      and
      relationship of related parties





Existing
                relationships with the CompanyBeijing
                Wanlong Economic Consultancy Corporation Ltd.
            PRC
                partner of a subsidiaryBernard
                Chan
            An
                ex-officer and an ex-shareholder of the CompanyChan
                Chi Ming
            A
                director, shareholder and officer of the CompanyChen
                De Xiong
            A
                shareholder and director of a subsidiaryChen
                Zeliang
            A
                shareholder and director of the CompanyChinamax
                International Ltd.
            An
                ex-shareholder of a former subsidiaryGlory
                River Corporation
            A
                company which an officer of the Company is a directorGoldlion
                Holding Ltd.
            A
                company controlled by close family members of a
                directorGuangdong
                Huahao Industries Group Co. Ltd.
            A
                shareholder of a subsidiaryGuangdong
                WTC Link Information Services Ltd.
            A
                former subsidiary company which a director of the Company is a
                directorGuangzhou
                City International Exhibition Co.
            PRC
                partner of a subsidiaryGuangzhou
                Cyber Strategy Limited
            A
                company in which a director of the Company has beneficial interestGuangzhou
                Goldlion City Properties Co., Ltd.
            A
                company controlled by close family members of a directorGuangzhou
                Goldlion Environmental Technology Co., Ltd.
            A
                company controlled by close family members of a
                directorGuangzhou
                Sanranxin Travel Ltd
            A
                company which a director of the Company has beneficial interestHo
                Chi Kin
            An
                independent director of the CompanyHK
                (Xian) Trade Association Ltd.
            A
                non-profit making organization which a director of the Company is
                a
                directorHuang
                Ze Hua
            A
                shareholder and director of a subsidiaryJohn
                Hui
            A
                director, shareholder and ex-officer of the CompanyLuo
                Chao Ming
            A
                director of the CompanySuo
                Hong Xia
            A
                shareholder and director of a subsidiaryWilliam
                Tsang
            A
                director, shareholder and officer of the Company




62
 *Table
          of Contents*




(b)  Summary
      of related party transactions




Year
                ended December 31,Notes
            
            2006
            
            2005US$
            
            US$Disposed
                property, plant and equipment toGuangzhou
                Goldlion Environmental Technology Co., Ltd.
            
            
            (i
            )
            
            -
            
            
            2,457,382Disposed
                rental income rights toWilliam
                Tsang
            
            
            (ii
            )
            
            -
            
            
            1,320,000Increase
                (decrease) in allowance for doubtful accounts toGuangzhou
                Cyber Strategy Limited
            
            
            (iii
            )
            
            (4,859
            )
            
            12,031Guangdong
                WTC Link Information Services Ltd.
            
            
            
            
            
            15,525
            
            
            -Consultancy
                fee expenses toBeijing
                Wanlong Economic Consultancy Corporation Ltd.
            
            
            (iv
            )
            
            18,816
            
            
            18,323Guangzhou
                City International Exhibition Co.
            
            
            (v
            )
            
            18,816
            
            
            18,323Glory
                River Corporation
            
            
            (xvii
            )
            
            65,385
            
            
            -Bernard
                Chan
            
            
            (x
            )
            
            12,821
            
            
            88,650Huang
                Zehua
            
            
            (xii
            )
            
            2,779
            
            
            3,638Suo
                Hongxia
            
            
            (xiii
            )
            
            1,389
            
            
            1,835Chen
                Dexiong
            
            
            (xiv
            )
            
            4,446
            
            
            5,202Director
                fee to:Ho
                Chi Kin
            
            
            (vi
            )
            
            1,000
            
            
            6,000William
                Tsang
            
            
            (ii
            )
            
            150,000
            
            
            162,500Chan
                Chi Ming
            
            
            (vii
            )
            
            77,062
            
            
            92,197John
                Hui
            
            
            (viii
            )
            
            -
            
            
            150,000Luo
                Chao Ming
            
            
            (ix
            )
            
            11,961
            
            
            19,142Chen
                Zeliang
            
            
            (xi
            )
            
            14,820
            
            
            29,445




63
 *Table
          of Contents*




Year
                ended December 31,Notes
            
            2006
            
            2005Rent
                and related expenses toGuangzhou
                Goldlion City Properties Co., Ltd.
            
            
            (xv
            )
            
            231,068
            
            
            256,893Guangzhou
                Goldlion Environmental Technology Co., Ltd.
            
            
            (i
            )
            
            179,948
            
            
            139,446Personal
                guarantee granted fromMr.
                William Tsang
            
            
            (ii
            )
            
            -
            
            
            19,231Traveling
                expenses toGuangzhou
                Sanranxin Travel Ltd.
            
            
            (xvi
            )
            
            115,553
            
            
            6,125Other
                expenses toGoldlion
                Holdings Ltd.
            
            
            (xvii
            )
            
            1,362
            
            
            4,643Other
                income fromGuangzhou
                Goldlion City Properties Co., Ltd.
            
            
            (xv
            )
            
            -
            
            
            3,854Sponsorship
                donation toHK
                (Xian) Trade Association Ltd.
            
            
            (xx
            )
            
            38,462
            
            
            -





Notes:


(i)
            As
                of December 31, 2006, the amount due from/to Guangzhou Goldlion
                Environmental Technology Co., Ltd. is
                US$Nil.


(ii)
            As
                of December 31, 2006, the amount due to Mr. William Tsang is
                US$1,666,696.


(iii)
            As
                of December 31, 2006, the amount due from/to Guangzhou Cyber Strategy
                Limited is US$Nil.


(iv)
            As
                of December 31, 2006, the amount due to Beijing Wanlong Economic
                Consultancy Corporation Ltd. is
                US$28,814.


(v)
            As
                of December 31, 2006, the amount due to Guangzhou City International
                Exhibition Co. is US$19,209.


(vi)
            As
                of December 31, 2006, the amount due from/to Mr. Ho Chi Kin is
                US$Nil.


(vii)
            As
                of December 31, 2006, the amount due from/to Mr. Chan Chi Ming is
                US$Nil.


(viii)
            As
                of December 31, 2006, the amount due from/to Mr. John Hui is
                US$Nil.


(ix)
            As
                of December 31, 2006, the amount due from/to Mr. Luo Chao Ming is
                US$Nil.


(x)
            As
                of December 31, 2006, the amount due from/to Mr. Bernard Chan is
                US$Nil.


(xi)
            As
                of December 31, 2006, the amount due from/to Mr. Chen Zeliang is
                US$Nil.


(xii)
            As
                of December 31, 2006, the amount due from Ms. Huang Zehua is
                US$Nil.


(xiii)
            As
                of December 31, 2006, the amount due to Ms. Suo Hongxia is
                US$Nil.


(xiv)
            As
                of December 31, 2006, the amount due from Mr. Chen Dexiong is
                US$Nil.


(xv)
            As
                of December 31, 2006, the amount due to Guangzhou Goldlion City Properties
                Co., Ltd. is US$3,258.


(xvi)
            As
                of December 31, 2006, the amount due from Guangzhou Sanranxin Travel
                Ltd.
                is US$Nil.


(xvii)
            As
                of December 31, 2006, the amount due to Goldlion Holdings Ltd. is
                US$Nil.


(xviii)
            As
                of December 31, 2006, the amount due to Glory River Corporation is
                US$Nil.


(xix)
            As
                of December 31, 2006, the amount due from Guangdong WTC Link Information
                Services Ltd, is US$Nil.


(xx)
            As
                of December 31, 2006, the amount due to HK (Xian) Trade association
                Ltd.
                is US$Nil.





64
 *Table
          of Contents*





**19.**  **AMOUNT
      DUE TO A SHAREHOLDER**





The
      amount due to Mr. William Tsang represented unsecured advances which were
      interest-free and repayable on demand.





**20.**  **OPERATING
      LEASE COMMITMENT**





(a)  Operating
      lease payables





As
      of
      December 31, 2006, the Group has total outstanding commitments not provided
      for
      under non-cancelable operating leases, which are payable as follows:




As
                of December 31,2006
            
            
            2005US$
            
            
            US$2007
            
            
            504,389
            
            
            706,7232008
            
            
            475,618
            
            
            472,5932009
            
            
            344,134
            
            
            194,4162010
            
            
            332,496
            
            
            32,3912011
            
            
            193,956
            
            
            -1,850,593
            
            
            1,406,123





In
      addition, the Group has committed to pay contingent rent at 2% to 10% on the
      monthly turnover of a subsidiary when the subsidiary's monthly turnover exceeds
      RMB500,000 (US$64,031) during the lease period ending in July 2007.





The
      Group
      has also committed to pay contingent rental at the higher of the agreed rent
      and
      the following portion of the membership fee income of a subsidiary:





·
            15%
                on the membership fee income of the subsidiary for the period from
                February 1, 2005 to January 31, 2006·
            7.5%
                on the membership fee income of the subsidiary for the period of
                February
                1, 2006 to January 31, 2009





(b)  Operating
      lease receivables





The
      total
      outstanding commitments under non-cancelable operating leases, which are
      receivable as follows:




As
                of December 31,2006
            
            2005US$
            
            US$2007
            
            
            105,597
            
            
            109,4252008
            
            
            -
            
            
            12,226105,597
            
            
            121,651





As
      of
      December 31, 2006, property, plant and equipment held for use under operating
      leases include gross amounts of US$85,675 and accumulated depreciation.
      Depreciation of property, plant and equipment in respect of assets held for
      use
      under operating leases are US$20,373 and US$7,899 for the year ended December
      31, 2006 and 2005 respectively.




65
 *Table
          of Contents*





**21.**  **RETIREMENT
      PLAN**





The
      Group
      operates a Mandatory Provident Fund (“MPF”) plan for its Hong Kong employees.
      The pension expenses charged to the consolidated statement of operations
      amounted to US$5,215 and US$5,366 for the year ended December 31, 2006 and
      2005
      respectively. Total contribution to the MPF including employee contribution
      (which is accounted for as salary and wages) charged to the consolidated
      statement of operations amounted to US$10,430 and US$10,627 for the year ended
      December 31, 2006 and 2005 respectively.





As
      stipulated by the PRC regulations, all retired employees of the Group who are
      residents of the PRC are entitled to an annual pension equal to their basic
      annual salary upon retirement. The Group contributed to a state-sponsored
      retirement plan at a certain percentage of the gross salary of its employees
      and
      has no further obligations for the actual pension payments or post-retirement
      benefits beyond the annual contributions. The state-sponsored retirement plan
      is
      responsible for the entire pension obligations payable to all employees. The
      pension expense for the year ended December 31, 2006 and 2005 was US$167,177
      and
      US$171,837, respectively.





**22.**  **COMMON
      STOCK**




(a)
            On
                April 27, 2006, the Company issued 280,000 shares to Grace Motion
                Inc. for
                consulting services provided. Consultancy fee amounting to $383,600
                had
                been fully accounted for during the year ended December 31, 2006
                in
                accordance with terms of the consultancy contract, which is based
                on the
                vested date (that is, contract date) share price of $1.37 as of April
                17,
                2006 multiplied by the 280,000 shares issued. The shares issued were
                unrestricted, pursuant to an S-8 registration filed with the SEC
                on
                October 28, 2003.




(b)
            On
                April 27, 2006, the Company issued 117,000 shares to Mr. Andy Lau
                for
                consulting services provided. Consultancy fee $162,630 had been fully
                accounted for during the year ended December 31, 2006 in accordance
                with
                terms of the consultancy contract, which is based on the vested date
                (that
                is, contract date) share price of $1.39 as of April 21, 2006 multiplied
                by
                the 117,000 shares issued. The shares issued were unrestricted, pursuant
                to an S-8 registration filed with the SEC on October 28,
                2003.




(c)
            On
                August 15, 2006, the Company issued 800,000 shares to Greentree Financial
                Group, Inc. for consulting services provided. Of the total amount
                of
                consultancy fee $1,096,000, $845,747 had been accounted for during
                the
                year ended December 31, 2006 in accordance with terms of the consultancy
                contract, which is based on the vested date (that is, contract date)
                share
                price of $1.37 as of March 23, 2006 multiplied by the 800,000 shares
                issued. The shares issued were unrestricted, pursuant to an S-8
                registration filed with the SEC on June 8,
                2006.




(d)
            On
                November 20, 2006, the Company issued 9,000,000 shares to Mr. Chi
                Hung
                Tsang to acquire25
                common shares of CWT International Excursion Investment Limited,
                a company
                organized and existing under the laws of the British Virgin Islands
                (“CWT
                Excursion”),presenting
                a 25% equity interest in CWT Excursion.The
                acquisition consideration of CWT Excursion amounts to $6,408,000.
                It is
                the fair market value of the CWTD Shares issued to Mr. Tsang, based
                on the
                closing bid price for the common stock of CWTD in the last five trading
                days preceding the date of the Agreement of
                $0.712.




66
 *Table
          of Contents*




**23.**  **OPTIONS
      PLAN**




(a)
            (i)
                On December 31, 2003, the Company adopted The 2003 Plan which was
                approved
                by the shareholders on the same date. The 2003 Plan allows the Board
                of
                Directors, or a committee thereof at the Board’s discretion, to provide
                for a total 1,000,000 stock options to officers, directors and key
                employees of the Company. All the stock options provided, were issued
                in
                accordance with the terms of The 2003 Plan on the same day to certain
                officers, directors and key employees of the Company at an exercise
                price
                of US$0.673 per share and are exercisable during the period from
                April 30,
                2004 to December 30, 2006.




(ii)  On
      February 20, 2004, the Company cancelled 65,000 options and 30,000 options
      for
      the reason of resignation and job reposting respectively.




(b)
            On
                February 27, 2004, the Company entered into an agreement with Xelex
                Inc.
                for consulting services provided. Apart from the consultancy fee
                expenses,
                an option to acquire 80,000 shares at an exercise price of US$1 per
                share
                was issued to Xelex Inc.. The stock option was fully vested and became
                exercisable on September 1, 2004. On November 9, 2004, the option
                was
                fully exercised on a cashless basis. A total of 58,552 common stocks
                of
                the Company were issued




The
      fair
      value of this option, which is estimated by the Black-Scholes option pricing
      model, was US$3.89. The additional expense was recognized in the preceding
      year
      consolidated statement of operations and the same amount was credited to the
      Company’s additional paid-in capital. The following weighted-average assumptions
      have been adopted in applying the Black-Scholes option pricing model:




Expected
                dividend yield
            NoneRisk-free
                interest rate
            2.1%Expected
                volatility
            367%Contractual
                life
            2
                years





(c)  The
      stock
      options activities and related information are summarized as
      follows:




Year
                ended December 31,2006
            
            2005Number
                of Options
            
            Weighted
                average exercise price
            
            Number
                of Options
            
            Weighted
                average exercise priceUS$
            
            
            
            US$Outstanding,
                beginning of year
            
            
            1,400,000
            
            
            3.0
            
            
            1,852,500
            
            
            2.432Granted
            
            
            -
            
            
            -
            
            
            -
            
            
            -Granted
            
            
            -
            
            
            -
            
            
            -
            
            
            -Exercised-
                The 2003 Plan
            
            
            -
            
            
            -
            
            
            (452,500
            )
            
            0.673-
                Xelex Inc.
            
            
            -
            
            
            -
            
            
            -
            
            
            -Cancelled
            
            
            -
            
            
            -
            
            
            -
            
            
            -Outstanding,
                end of year
            
            
            1,400,000
            
            
            3.0
            
            
            1,400,000
            
            
            3.0Exercise
                price is less than market
              price
                on date of grant
            
            
            Nil
            
            
            Nil
            
            
            Nil
            
            
            NilExercisable,
                end of year
            
            
            1,400,000
            
            
            3.0
            
            
            1,400,000
            
            
            3.0





67
 *Table
          of Contents*





As
                of December 31,2006Weighted
                average remaining contractual life
            
            0.5
                yearRange
                of exercise priceUS$3.0
            
            
            1,400,000








**24.**  **PRIVATE
      PLACEMENTS OF COMMON STOCK AND WARRANTS TO PURCHASE COMMON
      STOCK**




68
 *Table
          of Contents*
  (a)
              On
                  August 26, 2004, the Company entered into a Securities Purchase
                  Agreement
                  with Bridges & PIPES, LLC, TCMP3 Partners, Cornell Capital Partners,
                  LP and Stealth Capital, LLC (the “Purchasers”), providing for the issuance
                  by the Company to the Purchasers, of the (i) number of shares of
                  Common
                  Stock, and (ii) Series A Warrants, subject to an option in favor
                  of the
                  Purchasers to purchase additional shares of common stock and receive
                  additional warrants.





On
      August
      26, 2004 and December 3, 2004 under the Securities Purchase Agreement, the
      Purchasers acquired in the aggregate 433,333 and 966,667 shares of common stock
      respectively, at a price of US$1.5 per share, for an aggregate purchase price
      of
      US$2,100,000. Upon purchase, the Purchasers were also issued 700,001 five-year
      Series A Warrants to purchase that number of warrant shares at an exercise
      price
      equal to US$2.5 per share, without any additional consideration. In addition,
      the Company granted each Purchaser an option (the "Option") to purchase that
      number of shares of common stock equal to 1,400,001 shares (the "Firm Shares").
      Upon exercise of the Option at a purchase price of US$3 per share of common
      stock, the Purchaser would also receive, without additional consideration,
      five-year Series B Warrants to purchase 50% of the Firm Shares at an exercise
      price equal to US$4 per share.




The
      fair
      values of attached Series A Warrants, Options and Series B Warrants were
      recorded in the Company’s additional paid-in capital.




In
      addition, the Company has issued 112,667 Placement Agent's Warrants to Duncan
      Capital, LLC, who acted as Placement Agent to the Company in connection with
      the
      offering. Such warrants are five-year non-cashless exercise, provisioned
      warrants to purchase shares of common stock at US$2.5 per share. The costs
      associated with these transactions are also accounted for based on the fair
      value of these warrants at the date of issue.




On
      August
      26, 2004, the Company also entered into a Registration Rights Agreement with
      the
      investors signatories thereto, which provides that on or prior to 45 days after
      the Escrow Date, the Company shall prepare and file with the Commission a
      Registration Statement covering the resale of all of the Registrable Securities
      (defined as the Firm Shares, Option Shares, shares issuable upon exercise of
      the
      Agent's Warrants and shares issuable upon exercise of the Series A Warrants
      and
      the Series B Warrants) for an offering to be made on a continuous basis pursuant
      to Rule 415 under the Securities Act. In addition, the Registration Rights
      Agreement also contains certain piggy-back registration rights in favor of
      the
      holders of Registrable Securities. All fees and expenses incident to the
      performance of or compliance with the Registration Rights Agreement are to
      be
      borne by the Company.




(b)
            On
                November 22, 2004, the Company entered into a Standby Equity Distribution
                Agreement (a "SEDA") and a Registration Rights Agreement, with US-based
                investment fund, Cornell Capital Partners, LP ("Cornell Capital")
                for
                US$30,000,000. Under the SEDA, Cornell has committed to provide up
                to
                US$30,000,000 of funding to the Company over a 24-month period, to
                be
                drawn down at the Company's discretion by the purchase of the Company's
                common stock. The purchase price of the shares purchased under the
                SEDA
                with respect to any advance will equal 99% of, or a 1% discount to,
                the
                lowest closing bid price of the common stock during the five consecutive
                trading day period immediately following the notice date. The amount
                of
                each advance is subject to a maximum advance amount of $1,500,000,
                except
                for the first advance, which may be in the amount of $3,000,000.
                Cornell
                Capital intends to sell any shares purchased under the SEDA at the
                then
                prevailing market price. Duncan Capital, LLC has been engaged by
                the
                Company to act as Placement Agent with respect to the SEDA.




(c)
            In
                connection with the SEDA, the Company has entered into a Letter Agreement,
                dated as of November 19, 2004 (the "Letter Agreement"), pursuant
                to which
                it agreed to (a) not make any draw-downs under the SEDA for a period
                of
                thirty days from the date of effectiveness of the soon-to-be-filed
                registration statement, and (b) issue to Bridges & PIPES, LLC and
                TCMP3 Partners, the two Purchasers at the first closing referred
                to above,
                83,334 Series A Warrants and 25,000 Series A Warrants, respectively,
                in
                order to induce such Purchasers to waive their rights to be the sole
                registrants on the registration statement. The costs associated with
                these
                compensations are also accounted for based on the fair value of these
                warrants at the date of issue.





Using
      the
      Black-Scholes option pricing model with the following weighted-average
      assumptions:





Expected
                dividend yield
            NoneRisk-free
                interest rate
            3.61%Expected
                volatility
            211%Contractual
                life
            2.86
                years





The
      fair
      value of these warrants was estimated as US$0.201 for the year ended December
      31, 2006. The additional expenses for placement services provided and
      compensation of were recognized in the preceding year consolidated statement
      of
      operations and the same amounts were credited to the Company’s additional
      paid-in capital. No additional expenses was recognized during the year because
      of no further issue of warrants for services.




69
 *Table
          of Contents*





The
      warrant activities and related information are summarized as follows:




Year
                ended December 31,2006
            
            2005Number
                of Warrants
            
            Weighted
                average exercise price
            
            Number
                of Warrants
            
            Weighted
                average exercise priceUS$
            
            
            
            US$Outstanding,
                beginning of year
            
            
            921,002
            
            
            2.5
            
            
            5,421,002
            
            
            1.047Granted
            
            
            -
            
            
            
            
            
            -
            
            
            -Exercised
            
            
            -
            
            
            
            
            
            (4,500,000
            )
            
            0.749Outstanding,
                end of year
            
            
            921,002
            
            
            2.5
            
            
            921,002
            
            
            2.500Exercise
                price is less than
              market
                price on date of grant
            
            
            Nil
            
            
            Nil
            
            
            Nil
            
            
            NilExercise
                price exceeds market
              Price
                on date of grant
            
            
            921,002
            
            
            2.500
            
            
            921,002
            
            
            2.500Exercisable,
                end of year
            
            
            921,002
            
            
            2.500
            
            
            921,002
            
            
            2.500








**As
                of December 31, 2006**Weighted
                average remaining contractual life
            2.86
                yearsRange
                of exercise priceUS$
                2.500
            921,002





(d)
            The
                Group had fully accounted for liquidated damage expense of US$211,500
                and
                US$208,500 for the year ended December 31, 2006 and 2005 respectively
                in
                connection with the failure to have its registration statement become
                effective as required under the terms of the Securities Purchase
                Agreement
                in which US$650,000 was raised in August 2004 and US$1,400,000 was
                raised
                in December 2004. Under section 2(c) of the Registration Rights Agreement,
                in part, that each investor is entitled to be paid an amount in cash
                until
                a registration statement is declared effective and/ or the Registrable
                Securities may be sold pursuant to Rule 144(k) (which requires a
                two years
                holding period. If a registration statement is not declared effective
                on
                or prior to one hundred twenty days (120) days of closing, such amount
                is
                equal to one percent (1%) of the aggregate purchase price paid by
                the
                Investors. We quantified the amount with reference to the date when
                the
                120 days period expires and accrued the liquidated damage expense
                on a
                time apportionment basis in respect of both amounts raised in August
                and
                December 2005 amounting to US$650,000 and US$1,400,000 respectively.
                Of
                total amount of US$420,000 provided, US$145,000 had been paid in
                March
                2006.





(e)
            The
                Company has taken the position thatits
                earlier filing with the Commission of a Registration Statement on
                Form
                SB-2 covering the proposed sale in a secondary offering of $30.0
                million
                of Registrable Securities pursuant to a Standby Equity Distribution
                Agreement, and the proposed sale of other securities pursuant to
                a
                Securities Purchase Agreement dated August 26, 2004, has been terminated
                as a result of the failure of such registration statement to be declared
                effective by the Commission after the filing of a sixth and final
                amendment on February 3, 2006. .




70
 *Table
          of Contents*




**25.**  **STATUTORY
      RESERVES**





Statutory
      reserves of the Company’s PRC subsidiaries include the statutory common reserve
      fund and the statutory common welfare fund. Pursuant to regulations in the
      PRC,
      the subsidiaries set aside 10% of their profits after tax for the statutory
      common reserve fund (except when the fund has reached 50% of the Company’s
      registered capital) and 5% of their profits after tax for the statutory common
      welfare fund. The statutory common reserve fund can be used for the following
      purposes:





-
            to
                make good losses in previous years; or





-
            to
                convert into capital, provided such conversion is approved by a resolution
                at a owners’ general meeting and the balance of the statutory common
                reserve fund does not fall below 25% of the registered
                capital.





The
      statutory common welfare fund, which is to be used for the welfare of the staff
      and workers of the subsidiaries, is of a capital nature.





Amount
      of
      statutory reserve as of December 31, 2006 is Nil subsequent to the disposal
      of
      GBN detailing in note 4 above.





**26.**  **SEGMENTAL
      REPORTING**




The
      Group
      has four reportable segments; club and business centre, business traveling
      services, business value-added services and rental and others with four separate
      businesses lines in access services and product sales.






The
      following table presents information about the Company's business segments
      for
      the years ended December 31, 2006 and 2005:




**27.**  **BUSINESS
      SEGMENT INFORMATION**





**Year
                ended December 31,****2006**
            
            **2005****Operating
                revenues**
            
            **US$**
            
            **US$**Club
                and business centre
            
            
            712,368
            
            
            894,550Business
                traveling services
            
            
            2,689,139
            
            
            4,983,468Business
                value-added services
            
            
            927,445
            
            
            1,618,413Rental
            
            
            10,385
            
            
            221,699Trading
                and others
            
            
            -
            
            
            121,0944,339,337
            
            
            7,839,224




71
 *Table
          of Contents*




US$
            
            US$**Profit
                (Loss) from operations**Club
                and business centre
            
            
            (328,938
            )
            
            (403,250
            )Business
                traveling services
            
            
            (754,320
            )
            
            976,896Business
                value-added services
            
            
            29,469
            
            
            (3,125,705
            )Rental
            
            
            (130,975
            )
            
            (336,406
            )Trading
                and others
            
            
            -
            
            
            (67,247
            )(1,184,764
            )
            
            (2,955,712
            )Corporate
                expenses
            
            
            (3,424,355
            )
            
            (2,334,070
            )Consolidated
                operating loss
            
            
            (4,609,119
            )
            
            (5,289,782
            )Realized
                gain on available-for-sale securitiesOther
                income
            
            
            44,735
            
            
            42,581Interest
                income
            
            
            37,751
            
            
            28,171Interest
                expense
            
            
            (209,099
            )
            
            (136,426
            )Equity
                in earnings of affiliates
            
            
            (180,175
            )
            
            -Impairment
                loss on investment in an affiliate
            
            
            (2,140,359
            )
            
            -Gain
                (loss) on disposal of a subsidiary
            
            
            (3,210,538
            )
            
            85,854Realized
                gain on disposal of available-for-sale securities
            
            
            46,000
            
            
            6,079,960Loss
                on disposal of property, plant and equipment
            
            
            (9,395
            )
            
            (254,740
            )Loss
                on disposal of dormant subsidiaries
            
            
            (321,185
            )
            
            -Net
                loss before income taxes
            
            
            (10,551,384
            )
            
            555,618






As
                of December 31,
              2006**Total
                assets**
            
            US$Club
                and business centre
            
            
            453,995Business
                traveling services
            
            
            8,894,492Business
                value-added services
            
            
            46,084Rental
            
            
            -Trading
                and others
            
            
            4,138,65013,533,221




72
 *Table
          of Contents*




**28.**  **CONCENTRATIONS
      AND RISKS**





(i)  Major
      Customers





The
      following is a table summarizing the revenues from customers that individually
      represent greater than 10% of the total revenues for the year ended December
      31,
      2006 and their outstanding balances as at year end date:




Year
                ended December 31,2006
            
            2005US$
            
            US$Customer
                A
            
            
            1,487,780
            
            
            3,087,215





As
      of
      December 31, 2006, the balances due to the Group amounted to
      US$Nil.





(ii)  Major
      Vendors





The
      following is a table summarizing the purchases from vendors that individually
      represent greater than 10% of the total purchases for the year ended December
      31, 2006 and their outstanding balances as at year end date:




Year
                ended December 31,2006
            
            2005US$
            
            US$Vendor
                A
            
            
            845,747
            
            
            2,500,990





As
      of
      December 31, 2006, the balances due from the Group amounted to
      US$Nil.





(iii)  Credit
      Risk





Financial
      instruments that are potentially subject to credit risk consist principally
      of
      trade receivables. The Group believes the concentration of credit risk in its
      trade receivables is substantially mitigated by its ongoing credit evaluation
      process and relatively short collection terms. The Group does not generally
      require collateral from customers. The Group evaluates the need for an allowance
      for doubtful accounts based upon factors surrounding the credit risk of specific
      customers, historical trends and other information.





(iv)  Exchange
      risk





The
      Group
      cannot guarantee that the current exchange rate will remain steady; therefore
      there is a possibility that the Group could post the same amount of profit
      for
      two comparable periods and because of the fluctuating exchange rate actually
      post higher or lower profit depending on exchange rate of RMB and HK$ converted
      to US$ on that date. The exchange rate could fluctuate depending on changes
      in
      political and economic environments without notice.




73
 *Table
          of Contents*




**29.**  **CONTINGENCIES**





Prior
      to
      the completion of acquisition by the Company, Guangdong New Generation
      Commercial Management Ltd. (“New Generation”), a former subsidiary of the
      Company, had been paying Mainland China income tax at a basis of calculation
      which was not in accordance with the standard basis of calculation as stipulated
      by the Mainland China tax law. The shortfall of the underpaid tax liabilities,
      related surcharges and penalty up to the date of acquisition by the Company
      has
      already been fully provided in the consolidated financial statements. However,
      New Generation would potentially be liable to further surcharge for late payment
      and penalty, additional to the amount being provided, for the period since
      the
      date of acquisition by the Company and up to the balance sheet date. A
      shareholder of New Generation has undertaken to indemnify the Company against
      such shortfall and additional tax-related liabilities. As of December 31, 2006,
      the estimated further surcharges and penalties which New Generation was
      potentially liable amounted to US$9,470,714 and US$185,771 respectively. The
      estimated further penalties were based on the highest charge rate of the range
      from 50% to 500%.





Subsequent
      to the disposal of GBN on September 29, 2006 as detailing in note 4 above,
      New
      Generation ceased to be a subsidiary of the Company and this contingency will
      have a potential indirect effect on the carrying value of the investment in
      affiliate companies. Of total US$8,894,492, investment in affiliate company
      relating to GBN amounted to US$2,538,529 as of December 31, 2006.




**30.
      DORMANT SUBSIDIARIES**




The
      following subsidiaries are dormant during the year ended December 31,
      2006.




(i)
            China
                Chance Enterprises Limited(ii)
            June
                Success Ltd.(iii)
            Rainbow
                Wish Ltd.(iv)
            Sinopac
                Success Ltd.





**Item
      8** **.****Changes
      in and Disagreements With Accountants on Accounting and Financial Disclosure**




On
      February
      16, 2006, Moore Rowland Mazars, Chartered Accountants (“MRM”) resigned as the
      independent registered public accounting firm for the Company. MRM had been
      the
      independent registered public accounting firm for and audited the consolidated
      financial statements of the Company for the year ended September 30, 2003,
      for
      the three months ended December 31, 2003, and for the year ended December 31,
      2004. All of the foregoing audited consolidated financial statements are
      hereinafter collectively referred to as the “consolidated financial statements.”
The reports of MRM on the consolidated financial statements for the past fiscal
      years indicated contained no adverse opinion or disclaimer of opinion, and
      were
      not qualified or modified as to uncertainty, audit scope or accounting
      principles, except for an explanatory paragraph relating to the Company’s
      ability to continue as a "going concern." The tender of resignation by MRM
      was
      approved unanimously by the Board of Directors.




In
      connection
      with the audits for the two most recent fiscal years and in connection with
      MRM’s review of the subsequent interim periods through February 16, 2006, there
      have been no disagreements between the Company and MRM on any matter of
      accounting principles or practices, financial statement disclosure, or auditing
      scope or procedure, which, if not resolved to the satisfaction of MRM, would
      have caused MRM to make reference thereto in their report on the Company’s
      financial statements for these fiscal years. MRM agreed with the foregoing
      statements in the letter that it was required to send to the Commission pursuant
      to Item 304 of Regulation S-B.




74
 *Table
          of Contents*




On
      February
      16, 2006, the Company engaged Zhong Yi (Hong Kong) C.P.A. Company Limited as
      its
      independent registered public accounting firm. The Company had not consulted
      with Zhong Yi (Hong Kong) C.P.A. Company Limited regarding the application
      of
      accounting principles to any contemplated or completed transactions nor the
      type
      of audit opinion that might be rendered on the Company’s financial statements,
      and neither written nor oral advice was provided that would be an important
      factor considered by the Company in reaching a decision as to an accounting,
      auditing or financial reporting issues. At the time of its engagement, Zhong
      Yi
      (Hong Kong) C.P.A. Company Limited had not yet been credentialed for practice
      before the Commission, although it began the credentialing process in November
      of 2005.




On
      March 23,
      2006, Zhong Yi (Hong Kong) C.P.A. Company Limited (“Zhong Yi”) resigned as the
      independent registered
      public accounting firm for the Company. Zhong Yi had been engaged on February
      16, 2006 as the independent registered public accounting firm to audit the
      consolidated financial statements of the Company for the year ended December
      31,
      2005. Zhong Yi was not credentialed to practice accounting before the
      Commission, but it had an application to be admitted pending with the Commission
      since November of 2005. Zhong Yi determined that it may not be credentialed
      in
      time and may not be able to finish and submit its audit report to the Commission
      in connection with the filing of this Annual Report on Form 10-KSB for the
      year
      ended December 31, 2005. As a result, Zhong Yi chose to resign in order to
      give
      the Company an opportunity to engage a credentialed auditing firm. The draft
      report of Zhong Yi on the
      audited consolidated financial statements for the past fiscal year contained
      no
      adverse opinion or disclaimer of opinion, and was not qualified or modified
      as
      to uncertainty, audit scope or accounting principles, except for an explanatory
      paragraph relating to the Company’s ability to continue as a "going concern."
      Zhong Yi’s tender of resignation was approved unanimously by the Board of
      Directors.




In
      connection
      with the audit for the most recent fiscal year and in connection with Zhong
      Yi’s
      review of the subsequent interim periods through March 23, 2006, there have
      been
      no disagreements between the Company and Zhong Yi on any matter of accounting
      principles or practices, financial statement disclosure, or auditing scope
      or
      procedure, which, if not resolved to the satisfaction of Zhong Yi, would have
      caused Zhong Yi to make reference thereto in its report on the Company’s
      financial statements for the last fiscal year. Zhong Yi agreed with the
      foregoing statements in the letter that it was required to send to the
      Commission pursuant to Item 304 of Regulation S-B.





On
      March
      23, 2006, the Company engaged Child, Van Wagoner & Bradshaw,
      PLLC  as
      its
      independent registered public accounting firm. The Company had not consulted
      with Child, Van Wagoner & Bradshaw, PLLC regarding the application of
      accounting principles to any contemplated or completed transactions nor the
      type
      of audit opinion that might be rendered on the Company’s financial statements,
      and neither written nor oral advice was provided that would be an important
      factor considered by the Company in reaching a decision as to an accounting,
      auditing or financial reporting issue





**Item
      8A** **.
      Controls and Procedures**





*Annual
      Evaluation of Controls* .
      As of
      the end of the period covered by this annual report on Form 10-KSB, we evaluated
      the effectiveness of the design and operation of our disclosure controls and
      procedures ("Disclosure Controls"). This evaluation (“Evaluation”) was performed
      by our Chief Executive Officer, Chi Ming Chan (our “CEO”), and our Chief
      Financial Officer, Man Ha (our “CFO”). In addition, we have discussed these
      matters with our securities counsel. In this section, we present the conclusions
      of our CEO and CFO based on and as of the date of the Evaluation with respect
      to
      the effectiveness of our Disclosure Controls..





*CEO
      and CFO Certifications* .
      Attached to this annual report are certain certifications of the CEO and CFO,
      which are required in accordance with the Exchange Act and the Commission's
      rules implementing such section (the "Rule 13a-14(a)/15d-14(a) Certifications").
      This section of the annual report contains the information concerning the
      Evaluation referred to in the Rule 13a-14(a)/15d-14(a) Certifications. This
      information should be read in conjunction with the Rule 13a-14(a)/15d-14(a)
      Certifications for a more complete understanding of the topic
      presented.




75
 *Table
          of Contents*





*Disclosure
      Controls* .
      Disclosure Controls are procedures designed with the objective of ensuring
      that
      information required to be disclosed in our reports filed with the Commission
      under the Exchange Act, such as this annual report, is recorded, processed,
      summarized and reported within the time period specified in the Commission's
      rules and forms. Disclosure Controls are also designed with the objective of
      ensuring that material information relating to us is made known to the CEO
      and
      the CFO by others, particularly during the period in which the applicable report
      is being prepared.




*Limitations
      on the Effectiveness of Controls* .
      Our
      management does not expect that our Disclosure Controls will prevent all error
      and all fraud. A control system, no matter how well developed and operated,
      can
      provide only reasonable, but not absolute assurance that the objectives of
      the
      control system are met. Further, the design of the control system must reflect
      the fact that there are resource constraints, and the benefits of controls
      must
      be considered relative to their design and monitoring costs. Because of the
      inherent limitations in all control systems, no evaluation of controls can
      provide absolute assurance that all control issues and instances of fraud, if
      any, within the Company have been detected. These inherent limitations include
      the realities that judgments in decision-making can be faulty, and that
      breakdowns can occur because of simple error or mistake. Additionally, controls
      can be circumvented by the individual acts of some persons, by collusion of
      two
      or more people, or by management override of the control. The design of a system
      of controls also is based in part upon certain assumptions about the likelihood
      of future events, and there can be no assurance that any design will succeed
      in
      achieving its stated objectives under all potential future conditions. Over
      time, control may become inadequate because of changes in conditions, or because
      the degree of compliance with the policies or procedures may deteriorate.
      Because of the inherent limitations in a cost-effective control system,
      misstatements due to error or fraud may occur and not be detected.





*Scope
      of the Evaluation* .
      The CEO
      and CFO's evaluation of our Disclosure Controls included a review of the
      controls' (i) objectives, (ii) design, (iii) implementation, and (iv) the effect
      of the controls on the information generated for use in this quarterly report.
      In the course of the Evaluation, the CEO and CFO sought to identify data errors,
      control problems, acts of fraud, and they sought to confirm that appropriate
      corrective action, including process improvements, was being undertaken. This
      type of evaluation is done on a quarterly basis so that the conclusions
      concerning the effectiveness of our controls can be reported in our quarterly
      reports on Form 10-QSB and annual reports on Form 10-KSB. The overall goals
      of
      these various evaluation activities are to monitor our Disclosure Controls,
      and
      to make modifications if and as necessary. Our intent in this regard is that
      the
      Disclosure Controls will be maintained as dynamic systems that change (including
      improvements and corrections) as conditions warrant.





*Conclusions.* Based
      upon the Evaluation, our disclosure controls and procedures are designed to
      provide reasonable assurance of achieving our objectives. Our CEO and CFO have
      concluded that our disclosure controls and procedures are effective at that
      reasonable assurance level to ensure that material information relating to
      the
      Company is made known to management, including the CEO and CFO, particularly
      during the period when our periodic reports are being prepared, and that our
      Internal Controls are effective at that assurance level to provide reasonable
      assurance that our financial statements are fairly presented inconformity with
      accounting principals generally accepted in the United States. Additionally,
      there has been no change in our Internal Controls that occurred during our
      most
      recent fiscal quarter or fiscal year that has materially affected, or is
      reasonably likely to affect, our Internal Controls.




76
 *Table
          of Contents*




**PART
      III**





**Item
      9****.****Directors
      and Executive Officers of the Registrant**





**Directors
      and Executive Officers**





Our
      Bylaws provide that we shall have that number of directors determined by the
      majority vote of the board of directors. Currently we have seven directors.
      Each
      director will serve until our next annual shareholder meeting. Directors are
      elected for one-year terms. Our Board of Directors elects our officers at the
      regular annual meeting of the Board of Directors following the annual meeting
      of
      shareholders. Vacancies may be filled by a majority vote of the remaining
      directors then in office. Our directors and executive officers are as follows:





***Name***
            ***Age***
            ***Position***William
                Chi Hung Tsang
            45
            Chairman,
                Director and PresidentZeliang
                Chen
            41
            Vice
                Chairman and DirectorJohn
                H.W. Hui
            48
            Vice
                Chairman, and DirectorChi
                Ming Chan
            45
            Chief
                Executive Officer and DirectorChao
                Ming Luo
            56
            DirectorMan
                Ha
            44
            Chief
                Financial OfficerYe
                Xin Long
            61
            Independent
                DirectorHamid
                R. Seyedin
            55
            Independent
                Director





**Backgrounds
      of Directors**





*Executive
      Directors*





Mr.
      William Chi Hung Tsang, aged 45, is the President and Chairman of the Board
      of
      Directors of China World Trade Corporation. Mr. Tsang has more than 15 years
      of
      experience in leatherwear manufacturing and property investment. Prior to
      joining the Company, he was an executive director with a listed company for
      over
      10 years. He is a member of the Beijing Municipal Committee of the Chinese
      People’s Political Consultative Conference; committee member of Chinese General
      Chamber of Commerce, Hong Kong; vice chairman of Hong Kong United Youth
      Association Limited; chief president of New Territories Commercial &
Industrial General Association Ltd.; and vice chairman of both Hong Kong Chamber
      of Commerce in China - Guangdong and Guangzhou Federation of Industry &
Commerce. He is also an honorary president of North-East Overseas Chinese
      Friendship Association U.S.A., and an honorable citizen of Guangzhou.





Mr.
      Zeliang Chen, aged 41, is the Vice Chairman and Director of the Company. Mr.
      Chen graduated with honors from Renmin University of China with a Bachelor
      of
      Law. He is the founder of Guangdong Hua Hao Group of Companies and is a
      committee member of the Private Enterprise Council of Guangdong Province. Mr.
      Chen now is a Chief Executive Officer and Chairman of Guangdong New Generation
      Travel Service Co., Ltd., Director of Guangdong Huahao Industries Group of
      Companies, Director and Vice Chairman of China World Trade Corporation.





Mr.
      John
      H.W. Hui, aged 48, is the Vice Chairman of the Board of Directors. Mr Hui served
      as Chief Executive Officer of the Company until January 5, 2006. . Mr. Hui
      has
      over 10 years experience in China trade and investment. He is responsible for
      the overall corporate development of the Company. Mr. Hui is also the President
      of Beijing World Trade Center Club and Guangzhou World Trade Center Club. He
      has
      excellent relationships with the China partners and the principals of the World
      Trade Center Association in New York and other WTCs around the world. Mr. Hui
      is
      a current member of the Canada Business Council Beijing, and American Chamber
      of
      Commerce, Guangdong.




77
 *Table
          of Contents*





Mr.
      Chi
      Ming Chan, aged 45, is a Director and was appointed as Chief Executive Officer
      of the Company on January 5, 2006. Mr. Chan is responsible for the strategic
      planning, corporate development and project implementation of the Company.
      Before joining us, Mr. Chan was a Corporate Development Strategist for Renren
      Holding Ltd., a publicly listed company on the Hong Kong Stock Exchange. Mr.
      Chan founded Asian Information Resources (Holding) Ltd. in 1995, which
      eventually listed on the Hong Kong Stock Exchange in 1999. A specialist in
      Chinese law and China affairs, Mr. Chan is an expert in networking, Internet
      technology, database technology and management of technical resources. He
      developed an electronic database system for the Law-on-Line project of the
      University of Hong Kong and has provided technical consultancy to this project
      since 1991. He has also developed the Dongguan Network, which has become a
      successful model for other cities in China. He was appointed by the Asian
      Development Bank (ADB) as a consultant for the TA Project No. 2702 - Study
      on
      PRC Legal Information System and the Electronic Data Expert for the TA project
      No. 3000. Mr. Chan holds a Master of Law degree from Lancaster University,
      the
      United Kingdom, a Master of Philosophy degree in Physics and Bachelor Degree
      in
      Physics both from the Chinese University of Hong Kong.





Mr.
      Chao
      Ming Luo, aged 56 is a Director of the Company. Mr. Luo has long-term
      collaborative relations with Hong Kong business circles and associations. He
      was
      employed at the Xinhua News Agency Hong Kong from 1983 to 1996; he then joined
      the Xinhua News Agency Hong Kong Branch Guangzhou Representative Office in
      1996
      before joining the Company. He is the Chief Council Member of Guangdong Overseas
      Friendship Association, and Council Member of Guangzhou Overseas Friendship
      Association. Mr. Luo worked as the Electric Design Technician in Guangzhou
      Design Institute and the Assistant of Electric Technology Specialty, Electric
      Engineering Department in Guangdong University of Technology.





*Independent
      Directors and Members of Audit Committee*





Mr.
      Ye
      Xin Long, aged 61, is an Independent Director of the Company. Mr. Ye has over
      35
      years of experience doing business in China and investing in Chinese
      enterprises. He has an excellent relationship with the Beijing Municipal
      Government and the Guangzhou Municipal Government.





Mr.
      Hamid
      R. Seyedin, aged 55, is an Independent Director and a member of the audit
      committee of the Company. Mr. Seyedin is the CEO of First Washington Group
      and
      President of the American Chamber of Commerce in Guangdong. Under his leadership
      since 2003, the American Chamber of Commerce in Guangdong has grown by more
      than
      83% in membership and 300% in revenues. In 1991, former U.S. President George
      Bush recognized him in writing for his involvement with the passage of the
      Fast
      Track Procedures for the North American Free Trade Agreement (NAFTA). Appointed
      by three governors of the State of Maryland to four terms of office, he served
      as the Chairman of Montgomery College and State Chairman of the Maryland
      Association of Community Colleges representing all seventeen colleges in the
      State. He served on the Board of Directors of the Kennedy Institute, by
      appointment of Cardinal James A. Hickey (then Archbishop of Washington). He
      was
      a recipient of an award in business from the U.S. Department of Commerce. He
      received recognition from the U.S. Senate Sergeant At Arms for his service
      to
      the U.S. Senate Deliberations. Finally, he served two terms on the Maryland
      Advisory Committee of the U.S. Civil Rights Commission.




*Officers*





Mr.
      Man
      Ha, aged 44, was appointed as Chief Financial Officer on February 28, 2006.
      He
      has over 20 years of experience in the areas of auditing, transaction advisory
      services and commercial fields. In the past, he was executive director, group
      financial controller and company secretary of several publicly traded companies
      that were listed on the Hong Kong Stock Exchange. Mr. Ha holds a Masters Degree
      in Professional Accounting from the Open University of Hong Kong. He is also
      a
      fellow member of The Association of Chartered Certified Accountants and The
      Hong
      Kong Institute of Certified Public Accountants.





There
      are
      no familial relationships between our officers and directors.




78
 *Table
          of Contents*





**Code
      of Ethics**





The
      Company has adopted a Code of Ethics that applies to the Company’s principal
      chief executive officer, principal financial officer, principal accounting
      officer or controller, or persons performing similar functions, as well as
      other
      employees (the "Code of Ethics"), a copy of which is attached as Exhibit 14.1
      to
      our Form 10-KSB for the fiscal year ended December 31, 2005, and is incorporated
      herein by reference. The Code of Ethics is designed with the intent to deter
      wrongdoing, and to promote the following:





·
            Honest
                and ethical conduct, including the ethical handling of actual or
                apparent
                conflicts of interest between personal and professional relationships





·
            Full,
                fair, accurate, timely and understandable disclosure in reports and
                documents that a small business issuer files with, or submits to,
                the
                Commission and in other public communications made by the small business
                issuer





·
            Compliance
                with applicable governmental laws, rules and regulations





·
            The
                prompt internal reporting of violations of the code to an appropriate
                person or persons identified in the code





·
            Accountability
                for adherence to the code








**Section
      16(a) Beneficial Ownership Reporting Compliance**





Under
      Section 16(a) of the Exchange Act, all executive officers, directors, and each
      person who is the beneficial owner of more than 10% of the common stock of
      a
      company that files reports pursuant to Section 12 of the Exchange Act, are
      required to report the ownership of such common stock, options, and stock
      appreciation rights (other than certain cash-only rights) and any changes in
      that ownership with the Commission. Specific due dates for these reports have
      been established, and the Company is required to report, in this Form 10-KSB,
      any failure to comply therewith during the fiscal year ended December 2006.
      The
      Company believes that all of these filing requirements were satisfied by its
      executive officers, directors and by the beneficial owners of more than 10%
      of
      the Company’s common stock. In making this statement, the Company has relied
      solely on copies of any reporting forms received by it, and upon any written
      representations received from reporting persons that no Form 5 (Annual Statement
      of Changes in Beneficial Ownership) was required to be filed under applicable
      rules of the Commission.





**Item
      10****.
      Executive Compensation**




Compensation
      Discussion and Analysis





We
      maintain a peer-based executive compensation program comprised of fixed and
      performance variable elements. The design and operation of the program reflect
      the following objectives:





-
            Recruiting
                and retaining talented leadership.


-
            Implementing
                measurable performance targets.


-
            Correlating
                compensation directly with shareowner
                value.


-
            Emphasizing
                performance based compensation, progressively weighted with seniority
                level.


-
            Adherence
                to high ethical, safety and leadership
                standards.




79
 *Table
          of Contents*




Designing
      a Competitive Compensation Package





Recruitment
      and retention of leadership to manage our Company requires a competitive
      compensation package. Our Board of Directors emphasizes (i) fixed compensation
      elements of base salary that compare with our compensation peer group of
      companies, and (ii) variable compensation contingent on above-target
      performance. The compensation peer group consists of those companies in the
      Guangdong region that we deem to compete with our Company for executive talent.
      Individual compensation will vary depending on factors such as performance,
      job
      scope, abilities, tenure and retention risk.





Fixed
      Compensation





The
      principal element of fixed compensation not directly linked to performance
      targets is based salary. We target the value of fixed compensation generally
      at
      the median of our compensation peer group to facilitate a competitive
      recruitment and retention strategy.





Incentive
      Compensation





Our
      incentive compensation programs are linked directly to earnings growth, cash
      flow, and total shareowner return. Annual bonuses are tied to the current year’s
      performance of our company. Restrictive stock awards are tied to an individual’s
      success in exceeding targeted results set by management.





Employment
      Agreements





Our
      executives do not have the typical employment agreements that specify
      compensation or length of employment. These matters are left to the discretion
      of the Board of Directors and the employee. At present, there are no employment
      contracts with any of our executives.








No
      compensation in excess of $100,000 was awarded to, earned by, or paid to any
      executive officer of China World Trade during the years 2006, 2005 and 2004,
      except as described below. The following table and the accompanying notes
      provide summary information for each of the last three fiscal years concerning
      cash and non-cash compensation paid or accrued by our chief executive officer
      and other executive officers earning in excess of $100,000 for the past three
      years.




SUMMARY
      COMPENSATION TABLE





Name
                of officer
            Year
            Salary
            Bonus
            StockAwards
            Option
                Awards
            Non-Equity
                Incentive Plan Compen-sation
            Nonquali-
              fied
                Deferred Compen-
              sation
            All
              OtherCompen-
                sation
            TotalJohn
                Hui, Director
            2006
            -
            -
            -
            -
            -
            -
            -
            -John
                Hui, CEO
            2005
            150,000
            -
            55,823
            -
            -
            -
            -
            205,823John
                Hui, CEO
            2004
            57,692
            -
            206,347
            -
            -
            -
            -
            264,039William
                Chi Hung Tsang, Chairman & Director
            2006
            150,000
            -
            -
            
            
            -
            -
            150,000William
                Chi Hung Tsang, Chairman & Director
            2005
            150,000
            12,500
            198,480
            
            -
            -
            -
            360,980William
                Chi Hung Tsang, Chairman & Director
            2004
            57,692
            
            733,680
            -
            -
            -
            -
            791,372C.
                M. Chan, CEO & Director
            2006
            77,062
            -
            -
            -
            -
            -
            -
            77,062C.
                M. Chan, Director
            2005
            76,982
            15,215
            53,755
            -
            -
            -
            -
            145,952C.M.
                Chan, Director
            2004
            -
            -
            198,705
            -
            -
            -
            -
            198,705





80
 *Table
          of Contents*




Compensation
      of Directors





In
      2001,
      China World Trade committed itself to compensate each of its Board of Directors
      with 2,000 shares of its common stock per annum. Board members typically meet
      on
      a bi-monthly basis.





2006
      Non-Qualified Stock Compensation Plan





The
      following table sets forth information about our 2006 Non-Qualified Stock
      Compensation Plans adopted by our Board of Directors and filed with the
      Commission as Exhibit 10.1 to our Registration Statement on Form S-8 on June
      8,
      2006 and December 21, 2006.





Shares
                remaining available for future issuance
            Shares
                issuable upon exercise of options to be granted in the future
            Weighted
                average exercise price of outstanding options5,700,000
            -
            -





Pursuant
      to the 2006 plans, we registered a total of 6,500,000 shares of common stock.
      The Compensation Committee of the Board of Directors will issue common stock
      and
      award options to employees, directors, officers, consultants, advisors and
      other
      persons associated with our company. The 2006 plans are intended to provide
      a
      method whereby our company may be stimulated by the personal involvement of
      our
      employees, directors, officers, consultants, advisors and other persons in
      our
      business and reward such involvement, thereby advancing the interests of our
      company and all of its shareholders.





As
      at
      December 31, 2006, a total of 800,000 shares of common stock were issued to
      consultants pursuant to our 2006 Non-Qualified Stock Compensation Plans, leaving
      a balance of 5,700,000 to be issued in the future.





**Item
                11****.**
            **Security
                Ownership of Certain Beneficial Owners and Management and Related
                Stockholder Matters**





The
      following table sets forth the number of shares of common stock beneficially
      owned as of December 31, 2006 by (i) those persons or groups known to us who
      will beneficially own more than 5% of our common stock; (ii) each Director
      and
      director nominee; (iii) each executive officer whose compensation exceeded
      $100,000 in the fiscal year ended December 31, 2005; and, (iv) all directors
      and
      executive officers as a group. The information is determined in accordance
      with
      Rule 13d-3 promulgated under the Exchange Act based upon information furnished
      by persons listed or contained in filings made by them with the Securities
      and
      Exchange Commission and upon information provided by such persons directly
      to
      us. Except as indicated below, the stockholders listed possess sole voting
      and
      investment power with respect to their shares.





Name/Address
            Number
                of Shares
            Percentage
              Ownership(1)William
                Chi Hung Tsang
              Room
                1217, The Metropolis Tower, 10 Metropolis Drive, Hunghom, Hong Kong
            21,787,675
            49.7%Powertronic
                Holdings Limited
              9
                Des Voeus Road West, 12thFloor,
                Hong Kong
            5,233,415
            11.9%Grand
                Perfection Limited (2)
              15thFloor,
                Rihang Hotel, 198 Linhe Road West, Guangzhou, PRC
            1,368,619
            3.1%Chi
                Ming Chan
              138
                Tiyu Road East, 3rdFloor,
                Goldlion Digital Network Center, Guangzhou, PRC
            35,837
            **Chao
                Ming Luo
              138
                Tiyu Road East, 3rdFloor,
                Goldlion Digital Network Center, Guangzhou, PRC
            17,918
            **John
                Hui
              7040
                Granville Avenue, Suite 403, Richmond B.C. Canada
            92,536
            **All
                Officers and Directors as a Group (5 persons)
            23,302,585
            53.1%





**
      Less
      than 1%




(1)Based
      on 43,865,923 shares outstanding as of December 31, 2006.


(2)
      Grand
      Perfection Limited is controlled by Zeliang Chen, a Director of the
      Registrant.




81
 *Table
          of Contents*





**Item
      12****.
      Certain Relationships and Related Transactions**




We
      entered into a acquisition agreement (the “Acquisition Agreement”) dated
      November 19, 2003, with Mr. William Chi Hung Tsang (“Mr. Tsang”), the owner of
      the 21st to 23rd Floor of Goldlion Digital Network Center, 138 Tiyu Road,
      Tianhe, Guangzhou 510620, the PRC (the “Premises”). Mr. Tsang assigned to us the
      rents and other consideration (the “Rental Income Right”) valued at $1,800,000.
      Mr. Tsang was issued 3,000,000 shares of our common stock and warrants to
      purchase an additional 6,000,000 shares of our common stock (the “Warrants”) for
      $1,800,000 ($0.60 per share). The Warrants may be exercised between December
      5,
      2003 and December 1, 2005 at an exercise price of $0.75 per share. To date,
      Mr.
      Tsang has exercised the warrants to purchase up to 1,500,000 shares of our
      common stock and Mr. Tsang continues to hold a warrant to purchase up to
      4,500,000 shares of our common stock until December 1, 2005.




The
      value
      of the Rental Income Right was determined by using the present value of the
      5-year rental income rights of the Premises, or $1,831,795. This present value
      was based on the then actual rental income of the Premises, or $556,569. We
      then
      assumed the following percentages: (a) annual growth rate on the rental income
      of 3.0%, (b) rent free period and vacancy loss of 10%, and (c) business tax
      rate
      of 5.5%. We discounted back to November 2003 using a ten percent discount
      rate.




By
      a
      Settlement Agreement dated December 5, 2003, we converted $456,661.73 that
      was
      previously advanced by Mr. Tsang into 761,103 shares of common stock. In the
      quarter ended December 31, 2003, a personal guarantee was granted from Mr.
      Tsang
      in the amount of $19,231. As a result of these transactions, Mr. Tsang will
      beneficially own 71.82% of our shares of common stock, assuming exercise of
      all
      of his warrants.




We
      entered into a relationship with respect to rent and related expenses with
      Guangzhou Goldlion City Properties Co., Ltd. and Guangzhou Cyber Strategy
      Limited in the approximate amount of $96,154, and Dimension Marketing Limited
      in
      the amount of $80,645. These amounts have been classified as current
      liabilities. The amounts due to related parties represent unsecured advances
      which are interest-free and repayable on demand.




On
      December 30, 2004, General Business Network (Holdings) Limited, a wholly-owned
      subsidiary of our company, and Guangzhou Goldlion Environmental Technology
      Company Ltd., an affiliate of William Chi Hung Tsang, our Chairman, entered
      into
      an Agreement for Purchase and Sale of the premises known as the 20 th Floor of
      the Goldlion Digital Network Centre, Nos. 136 and 138 Ti Yu Dong Road, Tianhe
      District, Guangzhou PRC, pursuant to which Goldlion agreed to purchase the
      premises from General Business Network for $2,456,521.70 in cash. The closing
      occurred on May 31, 2005, and Goldlion paid the purchase price for the premises
      to General Business Network.





On
      March
      29, 2005, our board of directors approved the sale of the after-tax rental
      income rights of 21 st and
      23 rd   Floor,
      Goldlion Digital Network Center, 138 Tiyu Road East, Tianhe, Guangzhou to our
      Chairman, Mr. Chi Hung Tsang at the book value of $1,320,000. As a result,
      a
      cash balance due from Mr. Tsang in the amount of $377,504 as of March 31, 2005
      was subsequently paid off on April 28, 2005. The total consideration of
      $1,320,000 would be used to provide additional working capital for our group
      of
      companies.





O n
      September 25, 2006, the Company together with its wholly owned subsidiary,
      Rainbow Wish Limited (“Rainbow Wish”), entered into a Share Exchange Agreement
      (the “Agreement”) with CWT International Excursion Investment Limited, a company
      organized and existing under the laws of the British Virgin Islands (“CWT
      Excursion”), and Chi Hung Tsang, the Chairman of the Company and holder of sixty
      percent (60%) of the capital stock of CWT Excursion, and also a citizen and
      resident of the People’s Republic of China. Pursuant to the terms of the
      Agreement, the Company will issue 9,000,000 shares of its common stock (the
      “CWTD Shares”) to Mr. Tsang in exchange for 25 common shares of CWT Excursion
      owned by him (the “CWT Excursion Shares”) to Rainbow Wish, presenting a 25%
      equity interest in CWT Excursion. Pursuant to the Agreement, Mr. Tsang has
      also
      agreed to grant Rainbow Wish the option to purchase an additional 35% of the
      capital stock of CWT Excursion within twelve months of the date hereof, at
      a
      price that will be agreed upon by both parties at the time of exercise of said
      option in a separate agreement.





The
      amounts due to related parties represent unsecured advances which are
      interest-free and repayable on demand.




82
 *Table
          of Contents*





**Item
      13****.****Exhibits
      and Reports on Form 8-K**





(a)  Exhibits .
      The
      exhibit list required by Item 13 of Form 10-KSB is provided in the " Index
      to Exhibits "
      located
      herein, immediately following Item 15.





(b)  Reports
      on Form 8-K Filed in Fiscal Year 2006





(1)
            On
                January 11, 2006, the Company filed a Form 8-K in order to report
                the new
                appointment of a president and vice-chairman and the election of
                new
                directors.





(2)
            On
                February 21, 2006, the Company filed a Form 8-K regarding the changes
                of
                certifying accountants.(3)
            On
                March 1, 2006, the Company filed a Form 8-K in order to report the
                new
                appointment of their Chief Financial Officer.





(4)
            On
                March 20, 2006, the Company filed an amendment to the current report
                on
                Form 8-K/A regarding the changes of certifying
                accountants.





(5)
            On
                March 30, 2006, the Company filed a Form 8-K regarding the changes
                of
                certifying accountants.




(6)
            On
                September 25, 2006, the Company entered into a Share Exchange Agreement
                (the “Agreement”) with Rainbow Wish Limited, a company organized and
                existing under the laws of the British Virgin Islands and a wholly
                owned
                subsidiary of the Registrant (“Rainbow Wish”), CWT International Excursion
                Investment Limited, a company organized and existing under the laws
                of the
                British Virgin Islands (“CWT Excursion”), and Chi Hung Tsang, the Chairman
                of the Company and holder of sixty percent (60%) of the capital stock
                of
                CWT Excursion, and also a citizen and resident of the People’s Republic of
                China (“Tsang”). Pursuant to the terms of the Agreement, the Company
                intends to issue 9,000,000 shares of common stock (the “CWTD Shares”) to
                Tsang in exchange for the transfer by Tsang of twenty-five (25) common
                shares of CWT Excursion (the “CWT Excursion Shares”) to Rainbow Wish,
                representing a 25% equity interest in CWT Excursion. A copy of the
                Agreement is attached hereto as Exhibit 10 and is incorporated by
                reference herein.




(7)
            On
                September 29, 2006, China Chance Enterprises Limited,(“China Chance”), a
                wholly owned subsidiary of the Company, entered into a Sale and Purchase
                Agreement (the “Agreement”) with Wisdom Plus Limited, a limited liability
                company organized and existing under the laws of the British Virgin
                Islands (“Wisdom Plus”), pursuant to which China Chance agreed to sell and
                Wisdom Plus agreed to purchase, all of the outstanding registered
                shares
                (the “Shares”) of Rejoice Success Limited, the Company’s indirect wholly
                owned subsidiary holding 60% of the outstanding capital stock of
                General
                Business Network (Holdings) Ltd. which indirectly holds owns 51%
                of the
                outstanding capital stock of Guangdong New Generation Commercial
                Management Ltd (“New Generation”)., The purchase price for the Shares was
                $4.0 million, payable in installments in accordance with the schedule
                set
                forth in the Agreement.




(8)
            On
                October 24, 2006, the Company filed a Form 8-K regarding the completion
                of
                an acquisition on CWT Excursion.





(9)
            On
                November 6, 2006, the Company filed a Form 8-K regarding the completion
                of
                the disposal of 60% of our equity investment in New Generation through
                the
                sale of all of our shares of Rejoice Success
                Limited.





83
 *Table
          of Contents*





**Item
      14****.****Principal
      Accountant Fees and Services**





**Fees
      Billed For Audit and Non-Audit Services**





The
      following table represents the aggregate fees billed for professional audit
      services rendered to accounting firm of Child, Van Wagoner & Bradshaw, PLLC,
      our current independent auditor, and all fees billed for other services rendered
      by Child, Van Wagoner & Bradshaw, PLLC during those periods.





Year
                Ended December 31
            
            2006
            
            2005Audit
                Fees(1)
            
            
            102,313
            
            
            84,096Audit-Related
                Fees ()(2)
            
            
            -
            
            
            -Tax
                Fees(3)
            
            
            3,077
            
            
            3,095All
                Other Fees(4)
            
            
            -
            
            
            -Total
                Accounting Fees and Services
            
            
            105,390
            
            
            87,191





(1)
            *Audit
                Fees*.
                These are fees for professional services for the audit of the Company's
                annual financial statements, and for the review of the financial
                statements included in the Company's filings on Form 10-QSB, and
                for
                services that are normally provided in connection with statutory
                and
                regulatory filings or engagements.





(2)
            *Audit-Related
                Fees*.
                These are fees for the assurance and related services reasonably
                related
                to the performance of the audit or the review of the Company's financial
                statements.





(3)
            *Tax
                Fees*.
                These are fees for professional services with respect to tax compliance,
                tax advice, and tax planning.





(4)
            *All
                Other Fees*.
                These are fees for permissible work that does not fall within any
                of the
                other fee categories, i.e., Audit Fees, Audit-Related Fees, or Tax
                Fees.





**Pre-Approval
      Policy For Audit and Non-Audit Services**





The
      Company does not have a standing audit committee, and the full Board performs
      all functions of an audit committee, including the pre-approval of all audit
      and
      non-audit services before the Company engages an accountant. All of the services
      rendered to the Company by accounting firm of Child, Van Wagoner & Bradshaw
      PLLC after March 2006 were pre-approved by the Board of Directors of the
      Company.





The
      Company is presently working with its legal counsel to establish formal
      pre-approval policies and procedures for future engagements of the Company's
      accountants. The new policies and procedures will be detailed as to the
      particular service, will require that the Board or an audit committee thereof
      be
      informed of each service, and will prohibit the delegation of pre-approval
      responsibilities to management. It is currently anticipated that the Company's
      new policy will provide (i) for an annual pre-approval, by the Board or audit
      committee, of all audit, audit-related and non-audit services proposed to be
      rendered by the independent auditor for the fiscal year, as specifically
      described in the auditor's engagement letter, and (ii) that additional
      engagements of the auditor, which were not approved in the annual pre-approval
      process, and engagements that are anticipated to exceed previously approved
      thresholds, will be presented on a case-by-case basis, by the President or
      Controller, for pre-approval by the Board or audit committee, before management
      engages the auditors for any such purposes. The new policy and procedures may
      authorize the Board or audit committee to delegate, to one or more of its
      members, the authority to pre-approve certain permitted services, *provided
      that* the
      estimated fee for any such service does not exceed a specified dollar amount
      (to
      be determined). All pre-approvals shall be contingent on a finding, by the
      Board, audit committee, or delegate, as the case may be, that the provision
      of
      the proposed services is compatible with the maintenance of the auditor's
      independence in the conduct of its auditing functions. In no event shall any
      non-audit related service be approved that would result in the independent
      auditor no longer being considered independent under the applicable rules and
      regulations of the Securities and Exchange Commission.




84
 *Table
          of Contents*




**INDEX
      TO EXHIBITS**





The
      following exhibits are filed as part of this report:





Exhibit
                Number
            Description14.1
            Code
                of Ethics, incorporated by reference from Exhibit 14.1 to our Annual
                Report on Form 10-KSB for the fiscal year ended December 31, 2005.31.1
            Rule
                13a-14(a)/15d-14(a) Certifications of Chi Ming
                Chan, CEO *31.2
            Rule
                13a-14(a)/15d-14(a) Certifications of Man Ha,
                Principal Financial Officer *32
            Statement
                Required By 18 U.S.C. Section 1350, As Adopted Pursuant To Section
                906 of
                TheSarbanes-Oxley
                Act of 2002*.




*
      Filed
      herewith.





85
 *Table
          of Contents*





**SIGNATURES**





In
      accordance with the Section 13 or 15(d) of the Exchange Act, the registrant
      caused this report to be signed on its behalf by the undersigned, thereunto
      duly
      authorized.





Date:
      April 16, 2007





**CHINA
                WORLD TRADE CORPORATION**By:
            /s/
                Chi Ming ChanChi
                Ming Chan, Chief Executive Officer





In
      accordance with the Exchange Act, this report has been signed below by the
      following persons on behalf of the registrant and in the capacities and on
      the
      dates indicated.





Signature
            Title
            Date/s/
                Chi Ming Chan
            Chief
                Executive Officer
            April
                16, 2007Chi
                Ming Chan
            Director/s/
                Man Ha
            Chief
                Financial Officer
            April
                16, 2007Man
                Ha




Pursuant
      to the requirements of the Exchange Act, this report has been signed by the
      following persons in the capacities and on the date indicated.





**Signature**
            **Title**
            **Date**/s/
                William C.H. Tsang
            Chairman
                and Director
            April
                16, 2007William
                C.H. Tsang/s/
                Zeliang Chen
            Vice
                Chairman and Director
            April
                16, 2007Zeliang
                Chen/s/
                Chi Ming Chan
            Chief
                Executive Officer
            April
                16, 2007Chi
                Ming Chan
            And
                Director/s/
                Chao Ming Luo
            Director
            April
                16, 2007Chao
                Ming Luo/s/
                Man Ha
            Chief
                Financial Officer
            April
                16, 2007Man
                Ha





86