Zungui Haixi's Special Committee Provides Update

Zungui Haixi Corporation (TSX VENTURE:ZUN) (the "Company"), a China-based
manufacturer of sportswear and casual footwear, today announced that the Board
of Directors of Zungui Haixi Corporation (the "Company") on August 28, 2011
appointed a committee of independent directors (the "Special Committee") to
conduct an independent investigation into the issues pertaining to the current
financial statements identified during the course of the audit work for the
fiscal year ended June 30, 2011 conducted by the Company's independent auditor,
Ernst & Young LLP ("EY"). The investigation is also intended to address any
issues that arise as to prior period financial statements.


The Special Committee, composed of Patrick Ryan (Chair), Margaret Cornish and
Elliott Wahle, has been given full authority and broad powers in connection with
the investigation and related matters, including ongoing communications and
cooperation with the Ontario Securities Commission, TSX Venture Exchange and
other regulatory authorities. 


As reported on August 22, 2011, EY has suspended procedures with respect to the
audit of the Company's financial statements for the year ended June 30, 2011 and
recommended that that the issues it raised be addressed by an independent
investigation. The concerns raised by EY relate in part to inconsistencies in
bank documents and the inability to obtain bank confirmations in a manner
acceptable to the auditors. The bank balances are one of the largest items on
the balance sheet. In addition, EY identified issues as to incorrect VAT
invoices supporting purchases from certain of the Company's suppliers. 


The Special Committee has retained Stikeman Elliott LLP as Canadian counsel and
King and Wood as Chinese counsel. Stikeman Elliott has retained KPMG Forensic.
These professional advisors have been selected to advise and to assist the
Special Committee in the independent investigation it has been mandated to
undertake by the Board. King and Wood has been in contact with the Company's
bank in China, the Agricultural Bank of China, which is reviewing the documents
in question.  


The Special Committee has had a number of discussions and other communications
with Yanda Cai, CEO and a director of the Company and whose family are the
Company's principal shareholders, over the course of the last four weeks,
seeking their cooperation and assistance. It is not clear whether such
cooperation or the funding necessary for the Special Committee to undertake its
investigation will be forthcoming and the Special Committee is considering
alternative courses of action. The Board resolution appointing the Special
Committee, which was unanimously passed by all of the directors, calls for full
cooperation from all members of the Board and Management.  


The Special Committee has been advised that Ontario Securities Commission Staff
has an ongoing investigation in relation to the Company.


The Special Committee is not able at this time to provide guidance as to the
expected timing of its work but will assess that continually and make further
announcements as appropriate.


About Zungui Haixi 

Zungui Haixi Corporation, through its wholly owned subsidiaries, is engaged in
the manufacture and sale of athletic footwear, apparel and accessories, and also
casual footwear, in the People's Republic of China. Both product lines are
marketed under the ZUNGUI brand. Zungui Haixi distributes its products to
consumers throughout China through an extensive network of retail outlets which
exclusively carry ZUNGUI branded products. There are 62,080,400 common shares
issued and outstanding. The corporate website is www.zunguihaixi.com. 


Caution Regarding Forward-Looking Statements 

Certain statements in this press release contain forward-looking information
that involve risk and uncertainties. Statements other than statements of
historical fact contained in this press release may be forward-looking
statements within the meaning of certain securities laws, including, without
limitation, statements involving management's expectations, intentions and
beliefs concerning the domestic PRC sportswear industry, the competitive
landscape in this industry and the general economy, statements regarding the
future financial position or results of the Company, business strategies,
proposed acquisitions, growth opportunities, budgets, litigation, projected
costs and plans and objectives of or involving the Company. Such statements
should be considered forward-looking statements, Wherever possible, words such
as "may", "would", "could", "will", "anticipate", "believe", "plan", "expect",
"intend", "estimate", "aim", "endeavour", "project", "continue" and similar
expressions have been used to identify forward-looking statements. 


These forward-looking statements reflect management's current beliefs and
business judgement with respect to future events and are based on information
currently available to management. Forward-looking statements involve
significant known and unknown risks, uncertainties and assumptions, and you
should not place undue reliance on these forward-looking statements. Although
management believes its current beliefs and assumptions are reasonable, many
factors could cause Zungui's actual results, performance or achievements to be
materially different from any future results, performance or achievements that
may be expressed or implied by such forward-looking statements, including,
without limitation, those listed in the "Risk Factors" section of the Company's
other filings with Canadian securities regulatory authorities at www.sedar.com.
Should one or more of these risks or uncertainties materialize, or should
assumptions underlying the forward-looking statements prove incorrect, actual
results, performance or achievements could vary materially from those expressed
or implied by the forward-looking statements contained in this press release.
The forward-looking statements contained in this press release are expressly
qualified in their entirety by this cautionary statement. These forward-looking
statements are made as of and speak as of the date of this press release and the
Company does not intend to, or assume any obligation to, update or revise these
forward-looking statements to reflect new information, events, results or
circumstances or otherwise after the date on which such statement is made as to
reflect the occurrence of unanticipated events, except as required by law,
including securities laws.