CONFIRMATION AGREEMENT


1.   According to Section 5 of the Agreement for Jewellery  Assembling signed by
     China  Jewellery  Import & Export Co. and Hang Fung  Jewellery Co., Ltd. on
     November 18, 1994,  "Party B undertakes  and warrants  that it will provide
     sufficient  material  for Party A to  assemble  so that  Party A can get at
     least HK$2  million of  assembling  fees in 1992 and at least HK$4  million
     within  the  following  year.  From  the  third  year  onwards,  the  total
     assembling fees Party A earns will increase by 10% every year."

     China Jewellery  Import & Export Co. hereby confirms that it will not claim
     any of the above-mentioned  guaranteed assembling fees from Hang Fung until
     further agreement between both parties.

2.   Regarding the following three agreements signed by China Jewellery Import &
     Export Co. and Hang Fung Jewellery Co., Ltd. on November 18, 1994:-

     (1)  Agreement for Jewellery Assembling

     (2)  Sales Agency Agreement

     (3)  Sales Cooperation Agreement

     China  Jewellery  Import & Export Co. hereby confirms that it will bear all
     the tax liabilities arisen from the execution of these agreements.

3.   According  to Section 5(2) of the Sales  Agency  Agreement  signed by China
     Jewellery Import & Export Co. and Hang Fung Jewellery Co., Ltd. on November
     18, 1994,  it is stated that "For Party B's products  appointed  Party A to
     sell,  Party B will pay the  following  agency  fees to  Party  A:  Fashion
     jewellery - 15% of sales revenue;  silver and karat-gold jewellery - 10% of
     sales revenue; fine gold jewellery - RMB1.00 per gram"

     Both parties agree to amend this clause as follows:-

     "For Party B's  jewellery  products and its  assembled  jewellery  products
     which are approved to sell in the domestic  market and which are  appointed
     to Party A to sell,  Party B will pay the following agency fees to Party A:
     Fashion  jewellery - 15% of sales  income  received by Party A on behalf of
     Party B; karat gold jewellery - 10% of sales income  received by Party A on
     behalf of Party B; fine gold jewellery - RMB1.00 per gram of gold, on sales
     income received by Party A on behalf of Party B."

This Confirmation Agreement will be effective from October 1, 1992.


Signed by


China Jewellery Import  Export Co.
Hang Fung Jewellery Co., Ltd.