10:35     CHINA WATER<00855> - Unusual volume movement                        

    The Stock Exchange has received a message from China Water Affairs Group  
    Limited which is reproduced as follows:-                                  
                                                                              
    "This statement is made at the request of The Stock Exchange of Hong Kong 
    Limited.                                                                  
                                                                              
    We have noted the increase of trading volume of the shares of the Company 
    and wish to state that we are not aware of any reasons for such           
    fluctuations save for the announcement dated 4th  April 2005 regarding the
    placing of existing shares and subscription for new shares of the Company 
    and also the Company is in discussion with several third parties who are  
    not a connected person of the Company regarding possible investments in   
    city water supply business and sewage treatment business in the PRC.  The 
    discussions are at a preliminary stage and no binding agreement has been  
    made.                                                                     
                                                                              
    We confirm that save as disclosed above, there are no negotiations or     
    agreements relating to intended acquisitions or realisations which are    
    discloseable under rule 13.23, neither is the Board aware of any matter   
    discloseable under the general obligation imposed by rule 13.09, which is 
    or may be of a price-sensitive nature.                                    
                                                                              
    Made by the order of the Board of China Water Affairs Group Limited, the  
    directors of which individually and jointly accept responsibility for the 
    accuracy of this statement.                                               
                                                                              
    By Order of the Board                                                     
    China Water Affairs Group Limited                                         
                                                                              
                                                                              
                                                                              
                                                                              
    Tam Chun Yip                                                              
    Company Secretary                                                         
                                                                              
    Hong Kong, 7th April 2005                                                 
                                                                              
    As at the date hereof, the executive directors of the Company are Mr. Duan
    Chuan Liang, Mr. Tsui Chi Kin, the non-executive directors are Mr. Zhao   
    Hai Hu, Mr. Chiu Shun Pui, Andrew, Mr. Zhou Wen Zhi, and the independent  
    non-executive directors are Mr. Chen Lizhong, Ms Huang Shao Yun and Mr.   
    Chan Chi Shing."