10:13     CHINA EAST AIR<00670> - Announcement (1)                            

    The Stock Exchange of Hong Kong Limited takes no                          
    responsibility for the contents of this announcement, makes no            
    representation as to its accuracy or completeness and                     
    expressly disclaims any liability whatsoever for any loss                 
    howsoever arising from or in reliance upon the whole or any               
    part of the contents of this announcement.                                
                                                                              
                                                                              
    *CHINA EASTERN AIRLINES CORPORATION LIMITED                               
    (A joint stock limited company incorporated in the People's               
    Republic of China with limited liability)                                 
    (Stock code: 670)                                                         
                                                                              
    PURCHASE OF FIFTEEN A320 SERIES AIRCRAFT                                  
                                                                              
                                                                              
    The Company entered into the Aircraft Purchase Agreement of               
    21st April, 2005 with Airbus SAS to purchase fifteen A320                 
    series aircraft from Airbus SAS.                                          
                                                                              
    AIRCRAFT PURCHASE AGREEMENT                                               
                                                                              
    The Company entered into the Aircraft Purchase Agreement of               
    21st April, 2005 with Airbus SAS to purchase the Aircraft from            
    Airbus SAS in accordance with the terms and conditions thereof.           
                                                                              
    To the best of the Directors' knowledge, information and                  
    belief having made all reasonable enquiry, Airbus SAS and its             
    ultimate beneficial owner(s) are third parties independent of             
    the Company and connected persons (as defined in the Listing              
    Rules) of the Company, and are not connected persons of the               
    Company.                                                                  
                                                                              
    Aircraft to be acquired :       The Aircraft (i.e. fifteen brand          
    new A320 series aircraft, comprising eleven A321 and four A320            
    aircraft (with engines))                                                  
                                                                              
    The total asset value of the Aircraft (as determined                      
    based on the relevant 2000 price catalog of Airbus SAS)                   
    amounts in aggregate to approximately RMB6,900 million                    
    (approximately HK$6,509 million). The Company has not                     
    conducted any independent valuation on the Aircraft.                      
                                                                              
    Consideration and       :       The aggregate consideration for the       
    Aircraft to be                                                            
      payment terms         purchased by the Company pursuant to              
    the Aircraft Purchase Agreement, which was determined as a                
    matter of commercial decision after arm's length negotiations,            
    is less than the total asset value of the Aircraft as stated              
    above. The consideration is payable by cash in United States              
    dollars in instalments, and is being funded principally by way            
    of financing arrangements with banking institutions or out of             
    internal resources according to the Company's financial                   
    situation at the relevant time.                                           
                                                                              
    Delivery        :       The Aircraft are expected to be delivered to the  
    Company in stages from September 2006 to October 2008.                    
                                                                              
    GENERAL                                                                   
                                                                              
    The Company and :       The Company is principally engaged in             
    the business of                                                           
      Airbus SAS            civil aviation.                                   
                                                                              
                    Airbus SAS, to the Directors' knowledge, is               
    principally engaged in the business of manufacturing and                  
    selling aircraft.                                                         
                                                                              
    Reasons for entering    :       The Aircraft being acquired from          
    Airbus SAS will be                                                        
      into the Transaction          introduced to the Company's fleet,        
    principally to cater                                                      
      and benefits          for the expected rapid growth in                  
    domestic aviation market                                                  
      expected to accrue            serving short to middle range             
    passenger routes. The                                                     
      to the Company                Company also believes that the            
    Company's acquisition of the Aircraft will further improve its            
    aviation network and enhance the Company's competitiveness in             
    this market segment. By utilising these advanced Aircraft, the            
    Company will be able to provide safer, more efficient and                 
    better quality services to domestic and international                     
    passengers.                                                               
                                                                              
    As mentioned above, the consideration is being                            
    funded principally by way of financing arrangements with                  
    banking institutions or out of internal resources according to            
    the Company's financial situation at the relevant time. The               
    Transaction may therefore result in an increase in the                    
    Company's short-term debt-to-equity ratio, but is not expected            
    to impact on the Company's cash-flow position or its business             
    operations. It is anticipated that the Transaction would                  
    result in an increase in the Company's fixed assets, with                 
    liabilities to be settled by bank loans  as may required upon             
    delivery of each aircraft.