REPORT ON GAIN (LOSS) FOREIGN EXCHANGE RATE (REVISED)

Sino - Thai Engineering and Construction Public Company Limited Report on Gain (Loss) Foreign Exchange Rate For the Year Ended December 31, 1998 and 1997 (000 Baht) Gain(Loss) on Foreign Exchange Consolidated The Company Only (Year Ended) Jan-Dec Jan-Dec Jan-Dec Jan-Dec 1998 1997 1998 1997 _ Realized 9,581 (56,085) 1,926 (4,978) - Unrealized 1,015,349(2,038,520 952,939(1,912,371 (000 Baht) Gain(Loss) on Foreign Exchange Consolidated The Company Only July 2, 97-Dec 31,98July 2, 97-Dec 31,98 _ Realized (46,504) (3,052) _ Unrealized (1,023,171) (959,432) 1. Accounting Practice to record gain (loss) on foreign exchange The company and its subsidiaires recorded the whole amount of gain (loss) on foreign exchange in the statement of income. 2. Policy to manage foreign exchange risk. The company have income from construction mostly in Thai Baht curreny. In case, the company has to import materials and equipment and pay in foreign currencies, the company has policy to hedge on foreign currencies by buying forward to cover our exposure. For current US$ loan, the company also plans to fix forward rate at the satisfactory level of spot rate plus reasonable premium. However, timing of hedging deal has to match with loan payment schedule. In order to protect foreign exchange loss in the future, the company has encouraged our customers to pay the company in foreign currencies for the portion of material or equipment that need to import. This policy is also implemented at our subsidiaries. 3. Information on foreign currencies loan For the Company, Loan Reference rate Maturity Conditions and term US$ 8 mil. SIBOR + 1% 1 month Roll over monthly Short term loan (Monthly) US$ 80 mil. SIBOR + 1% Oct.16,1999Lenders have put option Syndication loan (semi-annual) on Oct.16, 1998 US$ 5 mil. SIBOR + 1% Nov.12,1999Lenders have put option Bilateral loan (monthly) on Nov.12, 1998 The lenders for the syndication loan of US$ 80 million and the bilateral loan of US$ 5.0 million exercised put option according to the loan agreement as mentioned above. The company is in the process of loan restructuring with the lenders. Best regards. Dr. Udomsak Chakreyavanich Director Sino - Thai Engineering and Construction Public Company Limited. February 22, 1999 The Board of Director Sino-Thai Engineering and Construction Public Company Limited 29th-30th Floor, Sino-Thai Tower Sukhumvit Soi 21, Asoke Road Bangkok 10110, Thailand Dear Sirs, The Recording of the Loss on Foreign Currency Exchange We have made a review of the loss on foreign currency exchange shown in the financial statements of Sino-Thai Engineering and Construction Public Company Limited for the year ended December 31, 1998, as requested in letter dated February 19, 1999. The loss on foreign currency exchange agrees with the Company's accounting records and has been computed in conformity with the Company's accounting policy. Yours faithfully, (Nirand Lilamethwat) Certified Public Accountant