Press Release

China Airlines and Northwest Airlines to Cooperate
on Frequent Flyer Programs and VIP Lounges

May 11, 2007, Taipei, Taiwan ¡V China Airlines and Northwest Airlines today signed contracts to cooperate on mileage programs and VIP lounges beginning on August 1, 2007. From that date, members of CAL¡¦s Dynasty Frequent Flyer Program can accumulate mileage in their accounts when traveling on Northwest flights. At the same time, members of Northwest¡¦s WorldPerks Program can enjoy the same benefits when traveling on China Airlines. The accumulated mileage can be redeemed for free tickets, upgrades and other perks.

The frequent-flyer cooperation covers all routes directly operated by China Airlines and Northwest Airlines. At the same time, the two carriers will also cooperate on VIP lounges. Beginning in August, Dynasty Flyer Program Paragon, Emerald and Gold card members and First and Dynasty Class passengers can use the Northwest VIP lounges in 19 airports, and WorldClub members can use the China Airlines VIP lounges in 10 airports worldwide.

The cooperation contracts were signed by Mr. Brian Chou, Senior Vice President, Marketing of China Airlines, Mr. Scott Shih, Senior Vice President, Services of China Airlines and Mr. Nathaniel Pieper, Vice President, Alliances of Northwest Airlines. The signing ceremony was held on May 11.

Northwest Airlines is the 5th largest airline in the world. Northwest Airlines operates approximately 1,400 daily departures, with hubs in Detroit, Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam. Northwest is a member of SkyTeam, and Northwest and its travel partners serve more than 900 cities in more than 160 countries on six continents.

China Airlines is the largest airline in Taiwan. With more than 800 weekly flights, it carries more than 9.7 million passengers each year and flies to 67 destinations in 25 countries. There are more than 1.6 million members in CAL¡¦s Dynasty Flyer Program. With 15,000 miles, members of Dynasty Flyer can obtain seat upgrades on regional flights, and with 35,000 miles, they can earn a free regional ticket. There are more than 30 million members in the Northwest Airlines WorldPerks Program, and its members can earn a free ticket on domestic flights with only 25,000 miles. In addition to Northwest, China Airlines has frequent flyer cooperations with Air China, China Eastern Airlines, China Southern Airlines and Delta Air Lines. China Airlines also has VIP lounge cooperation with Delta Air Lines and Alitalia.