Long-term investments

	March 31, 2017			December 31, 2016
	US$(’000)			US$(’000)
	(Unaudited)
Equity method investments:
Investment in equity method investees		713			709
Advance to equity method investees		75			75
Impairment on equity method investments		(788	)		(784	)
Total equity method investments		-			-
Cost method investments:
Investment in cost method investees		1,501			1,492
Impairment on cost method investments		(153	)		(152	)
Total cost method investments		1,348			1,340

Total long-term investments		1,348			1,340

Equity method investments

As of

March

31,

2017,

the Company beneficially owned

23.18%

and

25.5%

equity interest in Shenzhen Mingshan and Zhao Shang Ke Hubei, respectively. The Company accounts for its investments in these companies under equity method of accounting. Based on the facts of the significant decline in level of business activities from

2015,

insufficient amount of working capital and the lack of commitment from majority shareholders, these

two

investment affiliates had become dormant and the possibility of the business recovery is remote. As a result, the Company reduced the carrying value of these investments to

zero

as of the end of

2015.

Cost method investments

As of

March

31,

2017,

the Company beneficially owned a

19%

equity interest in ChinaNet Chuang Tou and Guohua Shiji, respectively, a

10%

equity interest in Chuangshi Meiwei and Beijing Saturday, respectively, and a

15%

equity interest in ChinaNet Korea. The Company accounts for its investments in these companies under cost method of accounting. As the business plan of ChinaNet Korea and Chuangshi Meiwei were not implemented smoothly and based on the facts of the significant decline in level of business activities, insufficient amount of working capital and the lack of commitment from majority shareholders, the possibility of the business recovery of these

two

companies is remote. As a result, the Company reduced the carrying value of these investments to

zero

as of the end of

2016.

The following table summarizes the movement of the investments in cost method investees for the

three

months ended

March

31,

2017:

	Beijing Saturday		Guohua Shiji		ChinaNet Chuang Tou		Total
	US$(’000)		US$(’000)		US$(’000)		US$(’000)

Balance as of December 31, 2016		16		27		1,297		1,340
Exchange translation adjustment		-		-		8		8
Balance as of March 31, 2017 (unaudited)		16		27		1,305		1,348