Corporate mission

The corporate mission of China Telecom is: Sharing the very best of this information age.

"Sharing" is the solemn promise of our corporation to its customers, employees, shareholders and the public, reflecting not only the important position of China Telecom in creating

information civilization but also China Telecom's strong social responsibility for harmonic coexistence and win-win result with sectors of which interests are relating to China Telecom. "Sharing the very best of this information age" stresses China Telecom's basic value positioning in devoting its efforts to serving its customers, employees, shareholders and the public.

"Information civilization" is the higher phase of civilization and progress of the social civilization of the human beings and also the goal for that we are struggling. The information civilization is the ideal state in which transfer and application of information at any time, any place and at any will so as to create wealth. The telecom networks we are operating are infrastructures for development, transfer and utilization of information, while the telecom services we are providing are means for development, transfer and utilization of information. Therefore, China Telecom should inescapably be a leading force for creating information civilization, helping people eliminate time and space obstacles so as to realize development, transfer and utilization of information

and consequently promoting economy and culture development and improving the quality of people's lives.

"Keeping pace with the world" is the promise China Telecom makes for the information civilization quality. Our thinking concept, operation and management, business and service, network technology and so on should not only take the leading positions domestically, but also maintain synchronous development with the world advanced. By so doing, can we provide our customers, employees, shareholders and the public with world first-class information services.

Strategic objective

China Telecom's strategic objective is to build China Telecom up to a world-class telecom group.

A world-class telecom enterprise mainly demonstrates large scale, superior value and strong capability. Large-scale means that the business income or stock price grows continuously and steadily and stands in the forefront in the same industry. Superior value means that such rates as the net profit index, return rate to the invested capital and the percentage of the free cash flow account for in the revenue up to the average level of world-class telecom enterprises. Strong capability means that the competitiveness in sales, operation and management, resource utilization and innovation practice up to the leading level of world-class telecom enterprises, thus, having such competitive advantages in customer superior, operation outstanding, resource effective

and innovation in the lead.

Core concept of value

China Telecom's core concept of value is: Comprehensive Innovation,Pragmatic Execution, People-centered Approach, Value-added Cooperation.

All-aspect Innovation

Innovation is the inevitable choice for complying with the external environment and the major means to realize sustainable development.

Innovation may enable an enterprise to utilize more advanced technologies and raise productiveness greatly, reduce operation costs so as to be cost effective. Innovation may

enable an enterprise to explore new business fields, provide customers with new products and services so as to take a leading position in the market place. Innovation may enable

an enterprise to achieve differential advantages in operation and management as well as operation methodology so as to take a leading position in management.

Keeping pace with the times, actively and steadily push forward all-aspect innovation.

We should, through entire-personnel but not individual, omni-directional but not partial, profound but not temporary and surface innovation, quicken the establishment of a new

"market oriented, customer centered and effectiveness objected" operation mode and gradually perfect the modernized enterprise system so as to strengthen the core competitiveness of our corporation and enhance its operation achievements. All-aspect innovation is not to completely negate the past. Such famous remarks as "People's posts and telecommunications serve the people", "Scientific clairaudient and clairvoyant" and "Fast, accurate, safe and convenient" are valuable treasures of our enterprise, which we should bear in mind and we will further develop them while in carrying forward them. Concept innovation is the prerequisite for all-aspect innovation. Only emancipating the thinking, can we transit our concept so as to establish our all-aspect

innovation conscientiousness, guide and encourage the broad masses of employees to continuously explore and progress. We respect innovation enthusiasm from our employees, encourage them to enjoy innovation achievements and to correctly deal with failures in innovation as well. We should establish a studying-type enterprise in which continuous innovation is always undertaken and employees are encouraged to study for their whole lives. We should deal with the relations among reform, development and stability, seek for sustainable development and long-time stability

of our corporation through active and initiative all-aspect innovation.

Pragmatic execution

Nationwide networking, combined operation, scaled economy and serving the public are the basic features of the telecom industry. "Pragmatic" means that on the bases of these features, the external environment and the conditions of its own, a telecom enterprise continuously develops, refines and summarizes the developing laws of the telecom industry in practice and uses the laws to guide its operation practice. "Execution" means that starting from practice, make operation decisions according to the developing laws of the enterprise and conscientiously implement the decisions without any reservation. Pragmatic execution is our tradition. Based on correct identification of the basic features of our enterprise and doing actual things in our operation, we have created a lot of miracles in China's and even in world's telecom history. Pragmatic execution is the cultural gene of a successful enterprise and is our valuable spiritual treasure. It needs us

to carry forward and develop. We should devote our efforts to achieving better results through whole-hearted and pursue outstanding results in solid operation.

People-centered approach

People-centered approach means that externally to consider the customer is the first factor and internally the employee. We should continuously enhance satisfaction of the customer and the employee so as to make China Telecom to become a long-life outstanding enterprise that is satisfied by people. This approach requires us to actually consider the customer as the center in every aspect of our work and to bear in mind the "Customer First, Service Foremost" philosophy and to provide high-quality service that wins customers' satisfaction. This requires that a management mechanism should be established: there is a stage on which things can be done, there is a motive force when work is undertaken, there is a standard when anything is valuated, there is a space for

development and there are protective measures for interests of the employees. We should, by studying and training, to enhance employees' quality, create an open, fair and transparent environment as well as a space and an assurance mechanism for employees' career so as to build up a professional working force over that the management is in good order and encouragement

is effective. We should enable our employees and corporation to grow together in serving the public.

Value-added cooperation

Creating value is our bounden duty. Only by continuously creating value, an enterprise can develop and grow, its employees can realize their self-actuation. Joint creation requires the harmonious combination of the internal team cooperation and the establishment of the industry value chain with external sectors. In the process to add value, we should pay special attention to our own core capability and display our own strong points as practicable as possible, and based on this, we should broadly carry out cooperation so as to get win-win results. From jointly creating value to sharing value is the sole way to maximize the value. To enable the value creation to be a continuous process, we should share value results with other value creators. Only by doing so, they can devote themselves in the next-round value creation with greater enthusiasm and energy. From joint creating to sharing, from joint creating again to sharing again..., only through this kind of moving in circles, can we realize value maximization, can we share the very best of this information age with our customers, shareholders, employees and the public.

Service philosophy

China Telecom's service philosophy: Customer First, Service Foremost

The customer is the basis on that we can survive. "First"means that we respect the customer. We consider our clients as our food and clothe providers, without them, we will have nothing. That is why we call our clients as "customers". Keeping "Service Foremost" is the necessary demand to consider "Customer First". Keeping "Service Foremost" requires us to take everything into consideration from the customer's point of view and do our best to provide services for customers. We should consider customers' satisfaction as the major criterion to evaluate our services. We should whole-heartedly meet requirements from customers and devote our efforts to winning customers' satisfaction. We should reflect the "Customer First, Service Foremost"

philosophy in the whole process of the operation and management of our enterprise:

Initiative service: We should think about what the customer thinks about, be anxious about what the customer is anxious about and take a leading step in the market place.

Entire-staff service: The fore-end service is the demonstration and the rear-end service is the support and the network service is the foundation. We should combine the "internal service chain" and the "external service chain" closely.

Differentiated service: we should carefully break down the market and meticulously design our service scenarios so as to continuously put forth a variety of service products that meet requirements from customers and provide customers with tailored services.

Highly-efficient service: Based on our management over customers, we should perfect our sales channels, optimize our business engineering and improve our service means

so as to meet requirements from customers with highefficiency and create high effectiveness for our corporation.

High-quality service: Enhancing our service quality and let thoghtful care move our customers, we try our best to realize optimized service with optimized costs. Service will be no end. We meticulously pursue customers' satisfaction.