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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-QSB

(Mark One)

[X]       QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2006

[  ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from _________________ to _________________

Commission file number 000-26119

 

CHINA WORLD TRADE CORPORATION

(Exact name of small business issuer as specified in its charter)

Nevada	87-0629754
(State or other jurisdiction of	(IRS Employer Identification No.)
incorporation or organization)

3rd Floor, Goldlion Digital Network Center

138 Tiyu Road East, Tianhe

Guangzhou, PRC

(Address of principal executive offices)

(011-8620) 2886 - 0608

(Issuer's telephone number)

(Former name, address and fiscal year, if changed since last report)

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY

PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Check whether the registrant filed all documents and reports required to be filed by Section l2, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court. Yes [ ] No [ ]

APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: As at March 31, 2006, there were 33,668,923 shares of Common Stock, $.001 par value, outstanding.

Transitional Small Business Disclosure Format (Check one): Yes [ ] No [X]

INDEX TO FORM 10-QSB
	Page No.
PART I
Item 1. Financial Statements
Unaudited Condensed Consolidated Balance Sheet	3
- As of March 31, 2006
Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income	4
- Three-Month Period Ended March 31, 2006 and 2005
Unaudited Condensed Consolidated Statements of Cash Flows	5
- Three-Month Period Ended March 31, 2006 and 2005
Notes to Unaudited Condensed Consolidated Financial Statements	6-12
Item 2. Management’s Discussion and Analysis of Financial Condition And Results of Operations	13
Item 3. Controls and Procedures	19
PART II
Item 1. Legal Proceedings	20
Item 2. Changes in Securities	21
Item 3. Defaults Upon Senior Securities	21
Item 4. Submission of Matters to a Vote of Security Holders	21
Item 5. Other Information	21
Item 6. Exhibits	21

2

PART I -- FINANCIAL INFORMATION

Item 1. Financial Statements.

CHINA WORLD TRADE CORPORATION Condensed Consolidated Balance Sheet March 31, 2006
	Unaudited
ASSETS	US$
Current assets
Cash and cash equivalents	$	2,999,854
Pledged bank deposit		412,484
Accounts receivables, net		4,360,373
Marketable securities -available-for-sale		412,500
Prepaid expenses		382,937
Other current assets		831,907
Loans receivables		99,647
Rental and other deposits		2,439,608
Due from related parties		614,381
Due from related companies		128,292
Total current assets		12,681,983
Property, plant and equipment, net		1,145,621
Property use rights, net		1,562,909
Goodwill		11,279,314
Total assets	$	26,669,827
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable	$	2,835,985
Accrued expenses		424,209
Due to a shareholder		580,870
Due to related parties - other		28,264
Due to related companies		21,560
Income tax payable		1,446,202
Other taxes payable - penalties		1,026,680
Deferred income		104,425
Note payable		3,921,060
Hire purchase creditor - current portion		30,902
Other current liabilities		1,351,662
Total current liabilities		11,771,819
Hire purchase creditor - non-current portion		105,581
Total liabilities		11,877,400
Minority interest		2,171,735
Commitments and contingencies
Shareholders' equity
Preferred stock, par value of US$0.001 each; 10,000,000 shares authorized, none issued or outstanding		-
Common stock, par value of US$0.001 each; 50,000,000 shares authorized, 33,668,923 shares issued and outstanding		33,669
Additional paid-in capital		31,014,949
Statutory reserves		177,694
Accumulated other comprehensive income
- unrealized loss on available-for-sale securities		(150,000	)
- foreign currency translation adjustment		23,990
Accumulated deficit		(18,479,610	)
Total shareholders’ equity		12,620,692
Total liabilities and shareholders’ equity	$	26,669,827
The accompanying notes are an integral part of the condensed consolidated financial statements.

3

CHINA WORLD TRADE CORPORATION Condensed Consolidated Statements of Operations and Comprehensive Income
	Three-month period ended March 31,
	2006			2005
	US$			US$
	Unaudited			Unaudited
Operating revenues
Club and business centre		152,615			335,379
Business traveling services		1,121,480			1,014,825
Business value-added services		634,120			291,681
Rental		3,461			184,416
Trading and others		-			86,889
		1,911,676			1,913,190
Operating costs and expenses
Club and business centre		7,706			128,515
Business traveling services		169,381			37,000
Business value-added services		299			678
Rental		-			98,762
Trading and others		-			86,763
		177,386			351,718
Other expenses
Impairment, depreciation and amortization		148,261			62,328
Selling, general and administrative expenses		2,000,976			1,513,997
		2,149,237			1,576,325
Loss from operations		(414,947	)		(14,853	)
Non-operating income (expense)
Other income		42,635			18,445
Interest income		11,937			-
Interest expense		(54,197	)		(39,169	)
Realized gain on disposal of available-for-sale securities		46,000			-
Loss before income tax and minority interests		(368,572	)		(35,577	)
Income tax expense		(46,022	)		(28,110	)
Loss before minority interests		(414,594	)		(63,687	)
Minority interests		14,806			(113,314	)
Net income/(loss)	$	(399,788	)	$	(177,001	)
Other comprehensive income (loss):
Unrealized holding gain (loss) arising during the period		(855,250	)		760,000
Less: reclassification adjustments for gains or losses		(46,000	)		-
Included in net profit (loss)
Comprehensive income (loss)		(1,301,038	)		582,999
Loss per share of common stock		(0.01	)		(0.01	)
Weighted average number of common stock outstanding		33,668,923			30,889,997
The accompanying notes are an integral part of the condensed consolidated financial statements.

4

CHINA WORLD TRADE CORPORATION Condensed Consolidated Statements of Cash Flows
	Three-month period ended March 31,
	2006			2005
	Unaudited			Unaudited
	US$			US$
Cash flows from operating activities:
Net income loss		(399,788	)		(177,001	)
Adjustments to reconcile net loss to net cash used in operating activities:
Minority interest		(14,806	)		113,314
Amortization on intangible asset		-			90,000
Depreciation and amortization		74,378			62,328
Impairment loss on property, plant and equipment		8,519			-
Impairment loss on current assets		65,004			-
(Decrease) increase in deferred income		98,344			158,171
Provision for bad debts due from related companies		-			-
Stock issued for services		-			75,000
Realized gain on available-for-sale securities		(46,000	)		-
Available for sale securities received as income		(375,000	)		(450,000	)
Changes in working capital:		-			-
Trade and other receivables		-			(261,872	)
Accounts receivables		(983,030	)		-
Other current assets		(406,578	)		-
Loans receivable		311,299			-
Due from related parties		(198	)		-
Due from related companies		(24,602	)		-
Rental and other deposits		21,879			(196,553	)
Prepayments		(151,510	)		(14,091	)
Inventories		-			119,875
Hire purchase creditor		86,482			-
Trade and other payables		-			28,412
Account payables		(234,907	)		-
Accrued expenses		(219,835	)		-
Other current liabilities		50,673			-
Due to related parties		618			-
Due to related companies		(56,018	)		-
Income tax payable		23,895			20,441
Net cash used in operating activities		(2,171,181	)		(431,976	)
Cash flows from investing activities:					-
Acquisition of property, plant and equipment		(228,167	)		(182,536	)
Proceeds from disposal of available-for-sale securities		146,000			24,163
Net cash used in investing activities		(82,167	)		(158,373	)
Cash flows from financing activities:					-
Advance from a shareholder		443,739			621,960
Proceeds from new bank loan		1,852,469			-
Repayment of amount borrowed		(277,870	)		(11,129	)
Net cash provided by financing activities		2,018,338			610,831
Net increase (decrease) in cash and cash equivalents		(235,010	)		20,482
Cash and cash equivalents at beginning of year		3,234,864			1,824,268
Cash and cash equivalents at end of year		2,999,854			1,844,750
-
Analysis of balances of cash and cash equivalents
Cash and bank balances		2,999,854			1,844,750
Supplemental disclosure information:					-
Interest paid		54,197			30,886
Income tax paid		46,022			7,670
Non-cash operating, investing and financing activities:
Consideration for disposal of intangible assets		-			1,320,000
The accompanying notes are an integral part of the condensed consolidated financial statements.

5

NOTES TO FINANCIAL STATEMENTS

1.            BASIS OF PRESENTATION

UNAUDITED INTERIM FINANCIAL STATEMENTS

The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-QSB and Regulation S-B. As permitted by Form 10-QSB instructions, we have not disclosed the detailed information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. Accordingly, the unaudited interim condensed consolidated financial statements should be read in conjunction with the financial statements for the year ended December 31, 2005, which is included in the Company’s Annual Report on Form 10-KSB filed with the Securities and Exchange Commission on April 18, 2006. In the opinion of management, all adjustments considered necessary for a fair presentation, consisting solely of normal recurring adjustments, have been made. Operating results for the three months ended March 31, 2006 are not necessarily indicative of the results that may be expected for the year ending December 31, 2006.

New Accounting Pronouncement

In December 2004, the FASB issued SFAS No. 123R, “Share-Based Payments (revised 2004).” This statement eliminates the option to apply the intrinsic value measurement provisions of APB Board Opinion No. 25, “Accounting for Stock Issued to Employees,” to stock compensation awards issued to employees. Rather, the Statement requires companies to measure the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. That cost will be recognized over the period during which an employee is required to provide services in exchange for the award - the requisite service period (usually the vesting period). In March 2005, the SEC staff expressed their views with respect to SFAS No. 123R in Staff Accounting Bulletin No. 107, “Share-Based Share Payment,” (SAB 107). SAB 107 provides guidance on valuing options.

Historically, for SFAS No. 123 pro forma disclosure was required for stock-based compensation to employees. We had recognized compensation expense for stock option awards issued to employees on a straight-line basis over the vesting period in the pro forma disclosure. This policy differs from the policy required to be applied to awards granted after the adoption of SFAS No. 123R, which requires that compensation expense be recognized for awards over the requisite service period of the award or to an employee’s eligible retirement date, if earlier. We will continue to recognize compensation expense over the applicable vesting periods for awards granted prior to adoption of SFAS No. 123R, but for all awards granted after December 31, 2005, compensation expense will be recognized over the requisite service period of the award or over a period ending with an employee’s eligible retirement date, if earlier.

Prior to the adoption of SFAS No. 123R, we had not reported any tax benefits resulting from the exercise of stock options, as we have incurred net operating losses since inception.

2.            GOING CONCERN CONSIDERATIONS

Though the Company has a positive net working capital of US$910,164 as of March 31, 2006, the Company had net loss of US$399,788 and US$177,001 for the three-month periods ended March 31, 2006 and 2005. Continuation of the Company as a going concern is dependent upon obtaining additional working capital through additional equity funding and attaining profitable operations in the future. Management has developed a strategy, which they believe can be accomplished and will enable the Company to operate in the future. The inability of the Company to secure additional funding and attain profitable operations in the near term could adversely impact the Company's business, financial position and prospects.

6

3.AMOUNT DUE FROM/TO RELATED PARTIES

(a) Due from related parties
	As of March 31, 2006
	US$
Huang Zehua		245,761
Chen Dexiong		368,620
Classified as current assets		614,381

(a) Due from related parties
	As of March 31, 2006
	US$
WTC Link International Limited		112,715
Chinamax International Limited		52
Guangdong WTC Link Information Service Limited		15,525
Classified as current assets		128,292
The amounts due from related parties and related companies as of March 31, 2006 represented unsecured advances which are interest-free and repayable on demand.

(c)   Due to related parties

	As of March 31, 2006
	US$
Ms. Suo Hong Xia		27,170
Mr. Ringo Leung		1,094
Classified as current liabilities		28,264

(d)   Due to related companies

7

	As of March 31, 2006
	US$
Guangzhou Goldlion City Properties Co., Ltd.		1,429
Beijing Wanlong Economic Consultancy Corporation Ltd.		13,894
Guangzhou City International Exhibition Co.		4,631
Guangdong Huahao Industries Group Limited		1,606
Classified as current liabilities		21,560

The amounts due to related parties as of March 31, 2006 represented unsecured advances which were interest-free and repayable on demand.

(e)Due to a shareholder

	As of March 31, 2006
	US$
Mr. William Tsang		580,870

The amount due to a shareholder represents unsecured advances which are interest-free and repayable on demand.

4. SHORT-TERM BANK LOAN

The outstanding loan balances of US$3,921,060 as of March 31, 2006 bear interest at 7.254% and are repayable within one year.

8

5. RELATED PARTY TRANSACTIONS

(a) Names and relationship of related parties

	Existing relationships with the Company
Beijing Wanlong Economic Consultancy Corporation Ltd.	PRC partner of a subsidiary
Bernard Chan	An ex-officer and a shareholder of the Company
Chan Chi Ming	A director, shareholder and officer of the Company
Chen De Xiong	A shareholder and director of a subsidiary
Chen Zeliang	A shareholder and director of the Company
Chinamax International Ltd.	An ex-shareholder of a former subsidiary
Glory River Corporation	A company which an officer of the Company is a director
Goldlion Holding Ltd.	A company controlled by close family members of a director
Guangdong Huahao Industries Group Co. Ltd.	A shareholder of a subsidiary
Guangzhou City International Exhibition Co.	PRC partner of a subsidiary
Guangzhou Cyber Strategy Limited	A company in which a director of the Company has beneficial interest
Guangzhou Goldlion City Properties Co., Ltd.	A company controlled by close family members of a director
Guangzhou Goldlion Environmental Technology Co., Ltd.	A company controlled by close family members of a director
Guangzhou Sanranxin Travel Ltd	A company in which a director of the Company has beneficial interest
Ho Chi Kin	An independent director of the Company
Huang Ze Hua	A shareholder and director of a subsidiary
John Hui	A director, shareholder and ex-officer of the Company
Luo Chao Ming	A director and shareholder of the Company
Ringo Leung	A former director of the Company
Suo Hong Xia	A shareholder and director of a subsidiary
William Tsang	A director, shareholder and officer of the Company

9

(b)Summary of related party transactions

	Three-month period ended March 31, 2006		Three-month period ended March 31, 2005
	US$		US$
Consultancy fee expenses to
Beijing Wanlong Economic Consultancy Corporation Ltd.		4,631		4,531
Bernard Chan		12,821		19,230
Chen Dexiong		1,482		-
Guangzhou City International Exhibition Co.		4,631		4,531
Glory River Corporation		13,462		-
Huang Zehua		926		-
Suo Hongxia		463		-
Director fee to
Ho Chi Kin		1,000		1,500
William Tsang		37,500		32,041
Chan Chi Ming		19,266		19,225
John Hui		-		37,500
Luo Chao Ming		4,869		4,720
Chen Zeliang		3,705		3,624
Rent and related expenses to
Guangzhou Goldlion City Properties Co., Ltd.		53,750		81,799
Guangzhou Goldlion Environmental Technology Co., Ltd.		43,207		20,562
Personal guarantee granted from
Mr. William Tsang		19,231		19,231
Intangible asset sold to
Mr. William Tsang		-		1,320,000
Traveling expenses to
Guangzhou Sanranxin Travel Ltd.		-		4,139
Sponsorship expenses to
Goldlion Holdings Ltd.		-		2,247
Rental compensation income from
Guangzhou Goldlion City Properties Co., Ltd.		-		3,854

10

6. AVAILABLE-FOR-SALE SECURITIES

Available-for-sale securities represent equity securities of which the aggregate cost, gross unrealized gains and losses and fair value are as follows:

	As of March 31, 2006
	Cost		Gross unrealized loss		Fair value
	US$		US$		US$
Available-for-sale:
Equity securities
Current assets		562,500		(150,000)		412,500

7. STOCK-BASED COMPENSATION

The Company records compensation expense for stock-based employee compensation plans using the intrinsic value method in which the compensation expense, if any, is measured as the excess of the market price of the stock over the exercise price of the award on the measurement date.

On December 31, 2003, the Board of Directors adopted a stock option plan ("The 2003 Plan"). The 2003 Plan allows the Board of Directors to grant stock options to various employees of the Company. 1,000,000 stock options were granted in accordance with the terms of the 2003 Plan on December 31, 2003 to certain officers and directors at an exercise price of US$0.673 per share. On February 20, 2004, the Company cancelled 95,000 options due to resignation and job reposting accordingly. The stock options will vest and become exercisable according to the following schedule:

On April 30, 2004:                                                  25%

On December 30, 2004:25%

Each quarter thereafter:6.25% (until fully vested)

	Date of grant
Expected dividend yield	None
Risk-free interest rate	2.1%
Expected stock price volatility	224%
Expected life of options	3 years

The weighted average fair value per option granted at the date of grant was US$0.62. For purposes of pro forma disclosure, the estimated fair value of the options is amortized on a straight line basis to expense over the options’ vesting periods, i.e., 3 years as prescribed under The 2003 Plan.

11

Total stock options outstanding at March 31, 2006 was__Nil__ of which __None_ of these options were vested. The Company recorded non-cash stock option expense to employees of $_Nil__ for the first quarter of 2006 as required by SFAS 123R.

The following table provides certain information with respect to the above-referenced stock options outstanding and exercisable at March 31, 2006:

Exercise Prices	Stock Options Outstanding And Exercisable	Weighted Average Remaining Contractual Life - Years
$0.67	Nil	Nilyears

There have been no modifications of outstanding stock option rewards.

8.BUSINESS SEGMENT INFORMATION

	Three-month period ended March 31,		Three-month period ended March 31,
	2006		2005
	US$		US$
Operating revenues
Club and business centre		152,615		335,379
Business traveling services		1,121,480		1,014,825
Business value-added services		634,120		291,681
Rental		3,461		184,416
Trading and others		-		86,889
		1,911,676		1,913,190

	US$			US$
Profit (Loss) from operations
Club and business centre		(98,569	)		(91,403	)
Business traveling services		23,427			306,623
Business value-added services		449,714			230,869
Rental		(226,447	)		(14,571	)
Trading and others			-		(59,585	)
		148,125			371,933
Corporate expenses		(563,072	)		(386,786	)
Consolidated operating loss		(414,947	)		(14,853	)
Realized gain on available-for-sale securities
Other income		42,635			18,445
Interest income		11,937			-
Interest expense		(54,197	)		(39,169	)
Realized gain on available-for-sale securities		46,000			-
Net loss before income taxes and minority interest		(368,572	)		(35,577	)

9.CONTINGENCIES

Prior to the completion of acquisition by the Company, GNGCM had been paying Mainland China income tax at a basis of calculation which was not in accordance with the standard basis of calculation as stipulated by the Mainland China tax law. The shortfall of the underpaid tax liabilities, related surcharges and penalty up to the date of acquisition by the Company has already been fully provided in the consolidated financial statements. However, GNGCM would potentially be liable to further surcharge for late payment and penalty, additional to the amount being provided, for the period since the date of acquisition by the Company and up to the balance sheet date. A shareholder of GNGCM has undertaken to indemnify the Company against such shortfall and additional tax-related liabilities. As of March 31, 2006, the estimated further surcharges and penalties for which GNGCM was potentially liable amounted to US$9,470,714 and US$430,364 respectively. The estimated further penalties were based on the highest charge rate of the range from 50% to 500%.

12

Item 2. Management's discussion and analysis of financial conditions and results of operation

PRELIMINARY NOTE REGARDING FORWARD LOOKING STATEMENTS

 This report contains certain forward-looking statements about our operations. The reader should understand that several factors govern whether any forward looking statement contained herein will be or can be achieved. Any one of those factors could cause actual results to differ materially from those projected herein. These forward looking statements include plans and objectives of management for future operations, including plans and objectives relating to the products and the future economic performance of the company. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions, future business decisions, and the time and money required to successfully complete development projects, all of which are difficult or impossible to predict accurately and many of which are beyond the control of the company. Although the company believes that the assumptions underlying the forward looking statements contained herein are reasonable, any of those assumptions could prove inaccurate and, therefore, there can be no assurance that the results contemplated in any of the forward looking statements contained herein will be realized. Based on actual experience and business development, the company may alter its marketing, capital expenditure plans or other budgets, which may in turn affect the company's results of operations. In light of the significant uncertainties inherent in the forward - looking statements included therein, the inclusion of any such statement should not be regarded as a representation by the company or any other person that the objectives or plans of the company will be achieved.

OVERVIEW

 We were incorporated in the State of Nevada in 1998 to engage in any lawful corporate undertaking. Since June 2002,, our business objective has been to open and operate business clubs in the major cities of China in association with the World Trade Center Association in order to position ourselves as the platform to facilitate trade between China and the world market. We currently operate two clubs, one in Guangzhou and the other in Beijing, PRC. We have grown through acquisitions and internal growth and our business objectives have expanded as set forth in the following paragraphs.

Our growth and development as a business enterprise has been marked by a number of significant corporate events. Pursuant to a Share Exchange Agreement, dated as of August 10, 2000, between Virtual Edge Limited ("Virtual Edge") and Main Edge International Limited ("Main Edge"), Main Edge transferred all of the issued and outstanding shares of the capital stock of Virtual Edge to the Company in exchange for 1,961,175 shares of our pre-split common stock, representing approximately 75% of our outstanding shares of the common stock. Accordingly, we controlled the operations of Virtual Edge, and Main Edge became our majority stockholder. We then undertook an 8-for-1 forward split that was effective on the 15th day of September 2000, which resulted in Main Edge owning 15,689,400 shares of our common stock. Then, five major developments occurred. These were: (i) the consummation of two private placement financings by Powertronic Holdings Limited ("Powertronic") in September 2002 and December 2002 in which it acquired shares of our common stock, (ii) an acquisition of all the issued and outstanding shares of General Business Network (Holdings) Ltd. in December 2002, (iii) a 1-for-30 reverse stock split that was effective on September 1, 2002, (iv) the assignment of the rights of the after tax rental income of certain premises from Mr. Tsang for a five year period in December 2003, and (v) the exercise of warrants for the shares of our common stock by Mr. Tsang and Powertronic in March 2004 and in July 2004, and the further exercise additional warrants in December 2004. As a result of these transactions, Mr. Chi Hung Tsang became the new major shareholder and owns over 12,600,000 shares of our common stock and Powertronic owns over 5,500,000 shares. Mr. Chi Hung Tsang is currently President and Chairman of our Board of Directors.

China World Trade Corporation ("China World Trade") has recently established its businesses into three distinct divisions, namely the club and business center; business travel services; and business value-added services. The Club and Business Center division is devoted to the building of the World Trade brand in China. Its objective is to open and operate business clubs in the major cities of China in association with the World Trade Center Association, in order to position the company as the platform to facilitate trade between China and the world market. China World Trade currently operates the Guangzhou World Trade Center Club, consisting of over 4,000 square meters, and The Beijing World Trade Center Club, which is located at 2nd Floor, Office Tower II, Landmark Towers Beijing, 8 North Dongsanhuan Road, Beijing PRC, and consisting of 730 square meters. In addition, since the acquisition of CEO Clubs China Limited ("CEO Clubs") in May 2004, CEO Clubs will complement China World Trade's offerings by targeting higher profile leadership from larger companies than those normally associated with China World Trade. The CEO Clubs family, of which each family member operates independently of each other, has thirteen chapters in the US and China. It focuses on recruiting CEO's of companies with annual sales exceeding $2 million as members. The average member of our affiliated CEO Clubs family has $20 million in annual sales.

13

Since the completion of the acquisition of a majority stake of Guangdong New Generation Commercial Management Limited (the “New Generation Group” or “New Generation”) in August 2004, the Business Travel Services division has provided the necessary platform for China World Trade Corporation to focus on the high growth, travel related businesses. New Generation aims to be the pioneer and to become one of the market leaders in the travel agency businesses through the operations of its seven subsidiaries in Southern China in ticketing sales for international and domestic flights as well as inbound business travel. Being a major consolidator of hotel accommodations and airline tickets in China, New Generation has already acquired the necessary licenses to operate as a ticketing and travel agent in the PRC. These licenses include 26 licenses as a ticketing agent for international and domestic flights for both cargo and passengers issued by the Civil Aviation Administration of China and the International Air Transport Association and three licenses as a domestic and international travel agent issued by the Administrative Bureau of Tourism of China. In addition, New Generation is also an authorized/licensed insurance agent in China to provide, in particular, accidental and life insurances. New Generation is believed to contribute a solid revenue base to the Company.

The Business Value-Added Services division concentrates on value-added services of merchant related businesses as well as on consultancy services. WTC Link International Limited and other subsidiaries of China World Trade, leverage the network and database of the Business Clubs and New Generation to provide business related services to its clients. In addition, this division also provides consultancy services to China World Trade's members and clients in the financial services areas (may we state here “corporate strategy and business development areas”) including mergers and acquisitions, corporate restructuring and financing.

RESULTS OF OPERATIONS

The following table shows the selected unaudited condensed consolidated income statement data of the Company and its subsidiaries for the three-month period ended March 31, 2006 and March 31, 2005. The data should be read in conjunction with the unaudited Condensed Consolidated Financial Statements of the Company for the three-month period ended March 31, 2006 and March 31, 2005 and related notes thereto. 

	Three months						Three months
	ended						ended
	March 31,			% of			March 31,			% of
	2006			Revenues			2005			Revenues
(In US$ thousands except per share data)
Operating revenues
Club and business center		153			7.9			335			17.5
Business traveling services		1,122			58.7			1,015			53.1
Business value-added services		634			33.2			292			15.3
Others		3			0.2			271			14.1
Total Operating Revenues		1,912			100.0			1,913			100.0
Gross Profit
Club and business center		145			7.6			207			10.8
Business traveling services		952			49.8			978			51.1
Business value-added services		634			33.1			291			15.2
Others		3			0.2			85			4.5
Total Gross Profit		1,734			90.7			1,561			81.6
Selling, general and administrative expenses		(2,001	)		(104.7	)		(1,514	)		(79.1	)
Impairment loss and depreciation		(148	)		(7.7	)		(62	)		(3.2	)
Loss from operations		(415	)		(21.7	)		(15	)		(0.7	)
Non-operating income (expenses)
Other income net of expenses		43			2.2			18			0.9
Interest expense net of interest income		(42	)		(2.2	)		(39	)		(2.0	)
Realized gain on available-for-sale securities		46			2.4			-			-
Income/(Loss) before income taxes and minority interest		(368	)		(19.3	)		(36	)		(1.8	)
Income taxes		(46	)		(2.4	)		(28	)		(1.5	)
Net income/(loss) before minority interest		(414	)		(21.7	)		(64	)		(3.3	)
Minority interest		15			0.8			(113	)		(5.9	)
Net Profit/(loss)		(399	)		(20.9	)		(177	)		(9.2	)
Other comprehensive income		(902	)		(47.2	)		760			39.7
Comprehensive Income		(1,301	)		(68.1	)		583			30.5
Loss per share of common stock
- Basic	$	(0.01	)				$	(0.01	)

14

THREE-MONTH PERIOD ENDED MARCH 31, 2006 COMPARED TO THREE-MONTH PERIOD ENDED MARCH 31, 2005

Operating Revenue

We have provided club and business center services through our subsidiary Guangzhou World Trade Center Club located in Guangzhou Province, the PRC since June 2002, and business value-added services and other business (trading) through a subsidiary of General Business Network (Holdings) Limited since March 2003. We have commenced our operation in the business travel business since our acquisition of New Generation in August 2004. Consolidated operating revenue for the three-month period ended March 31, 2006 was $1,912,000, compared to $1,913,000 for the same corresponding period in year 2005, a slightly decrease of $1,000 or 0.001%. The decrease was mainly due from the slow down on club and business center service and the decrease in rental income. This decrease was partially offset by the increase in business traveling services and business value-added services.

Our mix of operating revenues will continue to shift since our acquisition of travel business and development of our business value-added services. We will continue to utilize the World Trade Center Clubs in various major cities in China to provide the necessary platform for the growth of our businesses. We believe that our revenue will continue to improve steadily under normal business circumstances.

Of the $1,912,000 revenue in the three-month period ended March 31, 2006, approximately $153,000 (7.9%) was generated from providing club related services by our Guangzhou World Trade Center Club and Beijing World Trade Center Club; $1,122,000 (58.7%) was generated from business travel services; and $634,000 (33.2%) was generated from business value-added services. The continuous development of our business traveling services and our business value-added services will contribute positively to our operating revenue.

For the three-month period ended March 31, 2006, New Generation, our business traveling services arm, sold a total of over 315,000 tickets, which translates to a total value of air-ticket fare of approximately $39.8 million. As compared to the corresponding period in year 2005, tickets sold by New Generation increased by 29,000 tickets (or 10.1%) from approximately 286,000 tickets, with the value of air-ticket fare increasing by $8.0 million (or 25.2%) from $31.8 million.

Consolidated gross profit increased by $173,000 or 11.1% for the three-month period ended March 31, 2006 over the same corresponding period in year 2005. The increase was predominantly driven by our business value-added services resulting from providing various consultancy services to our members. This increase was offset by the decrease in gross profit of our club and business center and business traveling services resulting from a lower profit margin. As a percentage of total operating revenues, the consolidated gross profit margin of 90.7% for the three-month period ended March 31, 2006 increased from 81.6% for the same corresponding period in 2005. Our profit margin was driven by a mix shift from lower margin business travel services to higher margin business valued-added services. 

Of the $1,734,000 total gross profit for the 3-month period ended March 31, 2006, approximately gross profit of $145,000 (or 8.4%) was generated from providing club and business center services, approximately $952,000 (or 54.9%) from business travel services, approximately gross profit of $634,000 (or 36.5%) from providing business value-added services and the remaining $3,000 (or 0.2%) from rental income. As compared to the same corresponding period in year 2005, the club and business center services represented a 13.3% (or $207,000) of the total gross profit; 62.7% (or $978,000) was generated from the business travel business, 18.6% (or $291,000) from the business value-added services; and the remaining 5.4% (or $85,000) from other (rental and cattle hide trading) businesses. The shift in segmental distribution was primarily due to the increase in gross profit in the business travel services, resulting from the acquisition of the New Generation Group. We foresee that this segment mix will continue to change and balance out in years 2006 upon further development in the business value-added services and the expected opening of other world trade center clubs.

15

Selling, General and Administrative Expenses

Selling, general and administrative expenses increased by approximately $487,000 or 32.2% to $2,001,000 for the three-month period ended March 31, 2006 from $1,514,000 for the same corresponding period in 2005. The increase was mainly due to (1) the increase in director and staff related costs predominantly resulting from our business traveling services operation in the amount of approximately $120,000; (2) the increase in various advertising expenses in the amount of approximately $120,000; and (3) the increase in share disposal expenses resulting from selling the shares we received as compensation for providing consulting services in the amount of approximately $140,000. We believe the selling, general and administrative will continue to increase steadily as our businesses continue to grow.

Impairment Loss and Depreciation

Total impairment loss and depreciation were approximately $148,000 for the three-month period ended March 31, 2006, as compared to the same corresponding period in year 2005, an increase of $86,000 or 137.9% from $62,000. The increase was mainly due to the increase in depreciation of our fixed asset from the business traveling services in 2006 and impairment of current assets in 2006 of $65,000 that did not exist in 2005. Under normal circumstances, we will review the impairment of our assets at the year end or at the anniversary of such assets.

Other Income and Realized Gain

The other income and realized gain increased by approximately $71,000 for the three-month period ended March 31, 2006, as compared to the same corresponding period in 2005. The increase was primarily the result of the gain on disposal of securities during the reporting period which we received as compensation for our consultancy services rendered.

Interest Expenses, Net

Net Interest expenses were increased approximately in the amount of $15,000 to $54,000 for the three-month period ended March 31, 2006, as compared to the same corresponding period in year 2004. The majority of the increase was due to the additional interest expenses incurred by the business traveling operations of New Generation in relation to additional bank loan in the amount of RMB21,750,000 (approximately equals US$2.68 million), in which bank loan as of March 31, 2006 amounts to RMB31,750,000 (approximately US$3.92 million)

Income Taxes

The Group is subject to income taxes on an equity basis on income arising in or derived from the tax jurisdiction in which it is domiciled and operates. The Hong Kong subsidiaries incurred losses for taxation purposes for the period and thus Hong Kong Profits Tax has not been provided. Several of our PRC subsidiaries are subject to PRC Enterprise Income Taxes (“EIT”) on an entity basis on income arising in and derived from the PRC. The applicable EIT rate is 33%.

Income taxes were $46,000 for the three-month period end March 31, 2006, as compared to $28,000 for the same corresponding period in year 2005, an increase of $18,000 (or 64.3%). The increase of income taxes was the result of the increase in our travel business’s operation revenue and net income during the reporting period.

16

Net Income /Comprehensive income

Net loss was approximately $399,000 for the three-month period ended March 31, 2006, as compared to the net loss in the amount of $177,000 for the same corresponding period in year 2005, an increase of approximately $222,000. The increase in net loss was the result of the lower profit margin from the business traveling service and the increase in selling, general and administrative expenses. The management believes that our operations will continue to improve and we do not foresee a trend of losses.

In addition, we recorded an unrealized loss on short-term investments (fair value adjustment) which is classified as other comprehensive income (loss) in the amount of approximately $901,000 for the three-month period ended March 31, 2006, as compared to an unrealized gain of $760,000 for the same corresponding period in year 2005. This decrease was the result of the unrealized decrease in fair market value of the common stocks we received as compensation for our consultancy services rendered. Management believes that this unrealized gain (or loss) will fluctuate from quarter to quarter if we continue to hold these shares. We intend and plan to offload these shares as soon as possible and within a period of 12 months upon receiving them from our client members.

The accounting loss or net comprehensive loss, after taking the unrealized loss on the available-for-sale securities into consideration, for the three-month period ended March 31, 2006 in the amount of approximately $1,301,000, as compared to a net comprehensive income of $583,000 for the same corresponding period in year 2005. Again, this unrealized gain (or loss) will vary from quarter to quarter if we continue to hold on to these shares.

Liquidity and Capital Resources

As of March 31, 2006, cash and cash equivalents totaled $2,999,854, as compared to March 31, 2005 of $1,844,750, an increase of approximately $1.16 million. This increase in cash position was the result of a combination of net cash provided by financing activities in the amount of approximately $2,018,000, which was mainly contributed by the proceeds from new bank loan., offsetting by net cash used in operating activities of approximately $2,171,000 and net cash used in investing activities of approximately $82,000. The increase in net cash provided by financing activities was mainly due to an inception of new loan of $1,852,000 from a bank. The net cash used in investing activities was contributed by the acquisition of additional equipment in the total amount of $228,000, offset by the proceeds from the disposal of available-for-sale shares amounting to $146,000. Net cash used in operating activities could be explained by the change in net working capital. This change in net working capital was due to the increase in trade and other receivables of approximately $1,390,000. The increase in trade and other receivables was primarily due to the increase in trade receivables resulting from the increase in operating revenues of our business traveling service division.

During the reporting period of the three-month ended March 31, 2006, there was not any new shares issued and our total issued and outstanding shares of our common stock remained at 33,668,923 as of March 31, 2006.

We have not committed to any individual material capital expenditures related projects and we will primarily rely on the Cornell Capital’s Standby Equity Distribution Agreement financing, provided that it is declared effective by the Commission, as the external source of liquidity to fund our potential capital related projects. On the other hand, we rely on our internal sources of liquidity generated from our business travel services and business value-added services to fund immaterial capital projects. In the event that we are unable to draw down capital funding from Cornell Capital’s $30.0 million committed source of capital or unable to fund project from our internally generated sources, we will seek other external sources of opportunities in a combination of debt and/or equity financings from potential investors or existing shareholders of the Company, although we have not committed any other external source besides Cornell Capital.

We believe that the level of financial resources is a significant factor for our future development and accordingly may choose at any time to raise capital through private debt or equity financing to strengthen our financial position, facilitate growth and provide us with additional flexibility to take advantage of business opportunities. However, other than the offering contemplated by the Standby Equity Distribution Agreement financing provided by Cornell Capital Partners, LP, we do not have any immediate plan to pursue a public offering of our common stock.

17

OTHER SIGNIFICANT EVENTS

Nonel

CRITICAL ACCOUNTING POLICIES

In presenting our financial statements in conformity with generally accepted accounting principles, we are required to make estimates and assumptions that affect the amounts reported therein. Several of the estimates and assumptions we are required to make relate to matters that are inherently uncertain as they pertain to future events. However, events that are outside of our control cannot be predicted and, as such, they cannot be contemplated in evaluating such estimates and assumptions. If there is a significant unfavorable change to current conditions, it could result in a material adverse impact to our consolidated results of operations, financial position and liquidity. We believe that the estimates and assumptions we used when preparing our financial statements were the most appropriate at that time. Presented below are those accounting policies that we believe require subjective and complex judgments that could potentially affect reported results. However, the majority of our businesses operate in environments where we pay a fee for a service performed, and therefore the results of the majority of our recurring operations are recorded in our financial statements using accounting policies that are not particularly subjective, nor complex.

Valuation of long-lived assets

We review our long-lived assets for impairment, including property, plant and equipment, and identifiable intangibles with definite lives, whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. To determine recoverability of our long-lived assets, we evaluate the probability that future undiscounted net cash flows will be greater than the carrying amount of our assets. Impairment is measured based on the difference between the carrying amount of our assets and their estimated fair value.

Allowance for Doubtful Accounts

We perform ongoing credit evaluations of our customers and adjust credit limits based upon customer payment history and current creditworthiness. We continuously monitor collections and payments from our customers and maintain a provision for estimated credit losses based upon our historical experience and any specific customer collection issues that have been identified. While such credit losses have historically been within our expectations and the provisions established, we cannot guarantee that we will continue to experience credit loss rates similar to those we have experienced in the past. Measurement of such losses requires consideration of historical loss experience, including the need to adjust for current conditions, and judgments about the probable effects of relevant observable data, including present economic conditions such as delinquency rates and financial health of specific customers.

Goodwill on consolidation

Our long-lived assets include goodwill. SFAS No. 142 “Goodwill and Other Intangible Assets” requires that goodwill be tested for impairment at the reporting unit level (operating segment or one level below an operating segment) on an annual basis and between annual tests in certain circumstances. Application of the goodwill impairment test requires judgment, including the identification of reporting units, assigning assets and liabilities to reporting units, assigning goodwill to reporting units, and determining the fair value of each reporting unit. Significant judgments required to estimate the fair value of reporting units include estimating future cash flows, determining appropriate discount rates and other assumptions. Changes in these estimates and assumptions could materially affect the determination of fair value for each reporting unit.

18

Item 3. Controls and Procedures.

Quarterly Evaluation of Controls

As of the end of the period covered by this quarterly report on Form 10-QSB, we evaluated the effectiveness of the design and operation of (i) our disclosure controls and procedures ("Disclosure Controls"), and (ii) our internal control over financial reporting ("Internal Controls"). This evaluation ("Evaluation") was performed by our President and Chief Executive Officer, Chi Ming Chan ("CEO") and Man Ha, our Chief Financial Officer ("CFO"). In this section, we present the conclusions of our CEO and CFO based on and as of the date of the Evaluation, (i) with respect to the effectiveness of our Disclosure Controls, and (ii) with respect to any change in our Internal Controls that occurred during the most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect our Internal Controls.

CEO and CFO Certifications

Attached to this annual report, as Exhibits 31.1 and 31.2, are certain certifications of the CEO and CFO, which are required in accordance with the Exchange Act and the Commission's rules implementing such section (the "Rule 13a-14(a)/15d-14(a) Certifications"). This section of the annual report contains the information concerning the Evaluation referred to in the Rule 13a-14(a)/15d-14(a) Certifications. This information should be read in conjunction with the Rule 13a-14(a)/15d-14(a) Certifications for a more complete understanding of the topic presented.

Disclosure Controls and Internal Controls

Disclosure Controls are procedures designed with the objective of ensuring that information required to be disclosed in our reports filed with the Commission under the Exchange Act, such as this annual report, is recorded, processed, summarized and reported within the time period specified in the Commission's rules and forms. Disclosure Controls are also designed with the objective of ensuring that material information relating to the Company is made known to the CEO and the CFO by others, particularly during the period in which the applicable report is being prepared. Internal Controls, on the other hand, are procedures which are designed with the objective of providing reasonable assurance that (i) our transactions are properly authorized, (ii) the Company's assets are safeguarded against unauthorized or improper use, and (iii) our transactions are properly recorded and reported, all to permit the preparation of complete and accurate financial statements in conformity with accounting principals generally accepted in the United States.

Limitations on the Effectiveness of Controls

Our management does not expect that our Disclosure Controls or our Internal Controls will prevent all error and all fraud. A control system, no matter how well developed and operated, can provide only reasonable, but not absolute assurance that the objectives of the control system are met. Further, the design of the control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances so of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision -making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of a system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated objectives under all potential future conditions. Over time, control may become inadequate because of changes in conditions, or because the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

Scope of the Evaluation

The CEO and CFO's evaluation of our Disclosure Controls and Internal Controls included a review of the controls' (i) objectives, (ii) design, (iii) implementation, and (iv) the effect of the controls on the information generated for use in this annual report. In the course of the Evaluation, the CEO and CFO sought to identify data errors, control problems, acts of fraud, and they sought to confirm that appropriate corrective action, including process improvements, was being undertaken. This type of evaluation is done on a quarterly basis so that the conclusions concerning the effectiveness of our controls can be reported in our quarterly reports on Form 10-QSB and annual reports on Form 10-KSB. The overall goals of these various evaluation activities are to monitor our Disclosure Controls and our Internal Controls, and to make modifications if and as necessary. Our external auditors also review Internal Controls in connection with their audit and review activities. Our intent in this regard is that the Disclosure Controls and the Internal Controls will be maintained as dynamic systems that change (including improvements and corrections) as conditions warrant.

19

Among other matters, we sought in our Evaluation to determine whether there were any significant deficiencies or material weaknesses in our Internal Controls, which are reasonably likely to adversely affect our ability to record, process, summarize and report financial information, or whether we had identified any acts of fraud, whether or not material, involving management or other employees who have a significant role in our Internal Controls. This information was important for both the Evaluation, generally, and because the Rule 13a-14(a)/15d-14(a) Certifications, Item 5, require that the CEO and CFO disclose that information to our Board (audit committee), and to our independent auditors, and to report on related matters in this section of the annual report. In the professional auditing literature, "significant deficiencies" are referred to as "reportable conditions". These are control issues that could have significant adverse affect on the ability to record, process, summarize and report financial data in the financial statements. A "material weakness" is defined in the auditing literature as a particularly serious reportable condition where the internal control does not reduce, to a relatively low level, the risk that misstatement cause by error or fraud may occur in amounts that would be material in relation to the financial statements and not be detected within a timely period by employee in the normal course of performing their assigned functions. We also sought to deal with other controls matters in the Evaluation, and in each case, if a problem was identified; we considered what revisions, improvements and/or corrections to make in accordance with our ongoing procedures.

Conclusions

Based upon the Evaluation, our disclosure controls and procedures are designed to provide reasonable assurance of achieving our objectives. Our CEO and CFO have concluded that our disclosure controls and procedures are effective at that reasonable assurance level to ensure that material information relating to we are made known to management, including the CEO and CFO, particularly during the period when our periodic reports are being prepared, and that our Internal Controls are effective at that assurance level to provide reasonable assurance that our financial statements are fairly presented inconformity with accounting principals generally accepted in the United States. Additionally, there has been no change in our Internal Controls that occurred during our most recent fiscal quarter that has materially affected, or is reasonably likely to affect, our Internal Controls.

PART II -- OTHER INFORMATION

Item 1. Legal Proceedings.

We are not aware of any pending or threatened legal proceedings, other than as set forth below, in which we are involved. In addition, we are not aware of any pending or threatened legal proceedings in which entities affiliated with our officers, directors or beneficial owners are involved.

On December 10, 2004, Kenneth P. Silverman, Esq., as Trustee for the Estate of Chief Executive Officers Clubs, Inc. (the “Trustee”), filed a Complaint against CEO Clubs China Limited, China World Trade Corporation, Simon Guo and J.P. Li (the “Complaint”), which commenced an Adversary Proceeding relating to a Chapter 7 bankruptcy case pending in the U.S. Bankruptcy Court for the Southern District of New York, captioned as In Re: Chief Executive Officers Clubs, Inc., Debtor. The Complaint alleges, among other things, that certain assets of the Chief Executive Officers Clubs, Inc. bankruptcy estate were transferred to our Company in violation of Section 549 of the Bankruptcy Code. It requests that the Bankruptcy Court order, among other things, a return of such assets by our Company and/or seeks a judgment against us in the amount of not less than $480,000.

As previously disclosed, on May 7, 2004, the Company acquired 51% of the outstanding capital stock of CEO Clubs China Limited, a Hong Kong corporation (“CEO Clubs China”), through one of its wholly-owned subsidiaries, for a total consideration of cash and shares of common stock amounting to US$480,000. CEO Clubs China is an authorized chapter to operate under the “CEO Clubs” trademarks in the Greater China region, including the Peoples’ Republic of China, Hong Kong and Taiwan.

We have engaged counsel who is admitted to practice before the U.S. District Court for the Southern District of New York, and we are vigorously defending the Adversary Proceeding. We filed a Motion To Dismiss which was heard on March 22, 2005, and the judge ruled in favor of the Trustee by refusing to dismiss the case at this preliminary stage of the proceedings. Other than the disposition of our motion, the case is in the proceeding slowly in the discovery phase Notwithstanding the decision on our motion to dismiss, our primary defense is that we purchased the stock of CEO Clubs China, and did not acquire any assets of the Chief Executive Officers Clubs, Inc. bankruptcy estate. We believe that this defense will be meritorious should the matter ever come to trial.

20

Item 2. Changes in Securities.

None

Item 3. Defaults Upon Senior Securities

None

Item 4. Submission of Matters to a Vote of Security Holders.

None

Item 5. Other Information.

None

Item 6. Exhibits and Reports on Form 8-K.

(a) Exhibits:

3.1	Articles of incorporation are hereby incorporated by reference from our registration statement on Form 10-SB, filed with the Commission on September 9, 1999, SEC File No. 000-26119.
31.1	Rule 13a-14(a)/15d-14(a) Certifications of Chi Ming Chan, Vice Chairman and CEO
31.2	Rule 13a-14(a)/15d-14(a) Certifications of Man Ha, Chief Financial Officer
32.1	Section 1350 Certifications of Chi Ming Chan, Vice Chairman and CEO
32.2	Section 1350 Certifications of Man Ha, Chief Financial Officer

(b) Reports on Form 8-K;

   (1) On January 11, 2006, the Company filed a Form 8-K in order to report the new appointment of a president and vice-chairman and the election of new directors.

(2)	On February 21, 2006, the Company filed a Form 8-K regarding the changes of certifying accountants.
(3)	On March 1, 2006, the Company filed a Form 8-K in order to report the new appointment of their Chief Financial Officer.
(4)	On March 20, 2006, the Company filed an amendment to the current report on Form 8-K/A regarding the changes of certifying accountants.
(5)	On March 30, 2006, the Company filed a Form 8-K to report changes in its certifying accountants.

21

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	China World Trade Corporation (Registrant)
Date: May 15, 2006	By:	/s/ Chi Ming Chan
		Chi Ming Chan Chief Executive Officer

Date: May 15, 2006	By:	/s/ Man Ha
		Man Ha Chief Financial Officer

22

EX-31.1

Exhibit 31.1

RULE 13a-14(a)/15d-14(a) CERTIFICATIONS

I, Chi Ming Chan, certify that:

1.   I have reviewed this Quarterly Report on Form 10-QSB for the quarterly period ended March 31, 2006 of China World Trade Corporation (the "Registrant").

2.   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statement made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects, the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4.   The Registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15d-15(e) and 15d-15(e)) for the Registrant and have:

(a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidates subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)   Evaluated the effectiveness of the Registrant's disclosure controls and procedures, and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(c)   Disclosed in this report any change in the Registrant's internal control over financial reporting that occurred during the Registrant's fourth fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting; and

5.   The Registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant's auditors and the audit committee of Registrant's board of directors (or persons performing the equivalent functions):

(a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize and report financial information; and

(b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal control over financial reporting.

	China World Trade Corporation (Registrant)
Date: May 15, 2006	By:	/s/ Chi Ming Chan
		Chi Ming Chan Chief Executive Officer

EX-31.2

Exhibit 31.2

RULE 13a-14(a)/15d-14(a) CERTIFICATIONS

I, Man Ha, certify that:

1.   I have reviewed this Quarterly Report on Form 10-QSB for the quarterly period ended March 31, 2006 of China World Trade Corporation (the "Registrant").

2.   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statement made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects, the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4.   The Registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15d-15(e) and 15d-15(e)) for the Registrant and have:

(a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidates subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)   Evaluated the effectiveness of the Registrant's disclosure controls and procedures, and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(c)   Disclosed in this report any change in the Registrant's internal control over financial reporting that occurred during the Registrant's fourth fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting; and

5.   The Registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant's auditors and the audit committee of Registrant's board of directors (or persons performing the equivalent functions):

(a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize and report financial information; and

(b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal control over financial reporting.

	China World Trade Corporation (Registrant)
Date: May 15, 2006	By:	/s/ Man Ha
		Man Ha Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of China World Trade Corporation (the "Company") on Form 10-QSB for the period ended March 31, 2006 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, John H.W. Hui, Chief Executive Officer of the Company, certifies, pursuant to 18 U.S.C. 1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that, based on my knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

	China World Trade Corporation (Registrant)
Date: May 15, 2006	By:	/s/ Chi Ming Chan
		Chi Ming Chan Chief Executive Officer

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of China World Trade Corporation (the "Company") on Form 10-QSB for the period ended March 31, 2006 filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Bernard Chan, Chief Financial Officer of the Company, certifies, pursuant to 18 U.S.C. 1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that, based on my knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

	China World Trade Corporation (Registrant)
Date: May 15, 2006	By:	/s/ Man Ha
		Man Ha Chief Financial Officer