China Southern Inks Agreement For Future Membership In SkyTeam; 1st Airline In China Set To Join Global Airline Alliance

GUANGZHOU, China - August 28, 2004 - China Southern Airlines (NYSE: ZNH) (HKSE:
1055) - www.csair.com/en - the largest airline in The People¡¯s Republic of China is pleased to announce that today it has signed an agreement for future membership in SkyTeam.

China¡¯s largest airline is now the first carrier in the nation set to join an airline alliance. Mr.Yan Zhiqing, Chairman of China Southern Airlines, separately signed the agreement with the SkyTeam representatives Mr.Yang-Ho Cho, Chairman and CEO, Korean Air and Mr. Jean-Cyril Spinetta, Chairman and CEO of Air France. Attending the signing ceremony here in Guangzhou were CAAC Minister Yang Yuanyuan, Guangdong Governor Mr. Huang Huahua, the State-owned Assets Supervision and Administration Commission Chairman Mr. Zhao Xizi and China Southern Airlines Vice Chairman Mr. Liu Mingqi.

The SkyTeam Alliance was founded in June 2000 by Aerom¨¦xico, Air France, Delta Air Lines and Korean Air. In 2001, CSA Czech Airlines and Alitalia joined the alliance. Since then, the SkyTeam alliance has expanded customer service with flights to 121 countries with 517 destinations, offering more than 8,300 flights per day with annual passenger traffic of more than 218 Million passengers.

¡°This agreement signing event is an important step forward into the future for China Southern Airlines to adapt itself to the need of reforms and opening to the international community, as it will strengthen the airline¡¯s international cooperation and global competitiveness,¡± said Mr. Yan Zhiqing, Chairman, China Southern Airlines. He added that, ¡°after joining Sky Team, the all-new Baiyun International Airport will be the first hub airport in China for SkyTeam. This new hub base will - at the same time - bring about new opportunities and growth for China Southern Airlines.¡±

Before this agreement signing, SkyTeam members had already established close relationships with China Southern Airlines. ¡°As early as 1997, China Southern Airlines inked the ever first code-share pact in the Chinese aviation industry with the world¡¯s #1 passenger carrier Delta Air Lines. Delta has placed its code on China Southern flights from Los Angeles to Guangzhou for years,¡± explained Mr. Lu Kun, Vice President, China Southern Airlines.

Mr. Li added that, ¡°In January this year, China Southern and Air France jointly launched Guangzhou-Paris service under a code-share arrangement and in August we began code-sharing with Korean Air on each other¡¯s Incheon ¨C Shenyang routes. KLM Royal Dutch Airlines, which is poised to join SkyTeam this year, also has an important relationship with China Southern in both passenger and cargo services from Amsterdam to Beijing and numerous cities throughout China.¡±

¡°As a strategic partner for the alliance, China Southern will help us provide greater
access to the country and region for customers of all the SkyTeam carriers,¡± said Mr.Yang-Ho Cho, Chairman and CEO, Korean Air.

¡°With China Southern¡¯s entrance, the SkyTeam alliance will offer passengers new access to China, greatly facilitating the member airlines¡¯ flights arrangement. The airline alliance is just aimed at providing passengers with more choices and greater convenience,¡± added Mr. Jean-Cyril Spinetta, Chairman and CEO of Air France.

After joining SkyTeam, China Southern Airlines¡¯ route network through its new hub base at the all-new Baiyun International Airport will be greatly enhanced and will offer its partner airlines¡¯ passengers with more destinations and convenience, one-stop check-in as well as effortless transit connections from one SkyTeam code-share flight to another.

As a member of SkyTeam, China Southern Airlines will jointly cooperate with its partner airlines in sharing mutual facilities and joint purchases, joint frequent flyer program mileage as well as joint use of airport lounges around the globe.

¡°China Southern Airlines will begin to adjust its extensive network in China and
throughout the world to complement our new alliance members as well as enhance its operations and service levels as we look forward to official membership in SkyTeam in an appropriate time,¡± added Mr. Li.

The SkyTeam Alliance is one of the world¡¯s leading global airline alliances, partnering Aerom¨¦xico, Air France, Alitalia, CSA Czech Airlines, Delta Air Lines and Korean Air. Through one of the world¡¯s most extensive hub networks, SkyTeam offers its 218 Million annual passengers a worldwide system of more than 8,300 flights per day covering all major destinations. Later this year, Continental Airlines, KLM Royal Dutch Airlines and Northwest Airlines are slated to join the SkyTeam Alliance. Visit SkyTeam on the web at www.skyteam.com.

The largest airline in The People¡¯s Republic of China for the past 25 years, China Southern Airlines - www.csair.com/en - connects more than 80 cities around the globe. Major business and vacation destinations served in China include: Beijing, Chengdu, Guangzhou, Guilin, Hong Kong, Kunming, Shanghai, Shenzhen and Wuhan and as well as international service, including: Amsterdam, Bangkok, Fukuoka, Hanoi, Ho Chi Minh City, Islamabad, Kuala Lumpur, Jakarta, Los Angeles, Manila, Melbourne, Moscow, Osaka, Paris, Penang, Phnom Penh, Seoul, Singapore, Sydney and Tokyo.

For China Southern Airlines reservations and information, please contact your local travel agent.