Management is committed to enhancing the financial return on the Company's $21.4 million of assets, primarily invested in its nearly completed permanent manufacturing facility ("the Facility") located in Delta, British Columbia and patents. Assets have grown 40% from the first quarter 1998 level of $15.2 million.

Directors' and officers' fees, consulting fees, legal costs, general expenses, insurance, and repair and maintenance costs have increased as the Company moves towards the commercial production of its products.

Mr. Lawry Trevor-Deutsch Appointed Director of IHI
The President of the Company is very pleased to announce the appointment of Mr. Lawry Trevor-Deutsch, President of Strathmere Associates International Ltd., as a Director of the Company. Mr. Trevor-Deutsch, a Canadian citizen, who holds a Master of Science degree from Carleton University and a joint MBA from McGill University and the University of Manchester, is a business development consultant with 17 years of experience, specializing in strategic planning, technology development and government relations. Based in Ottawa, Mr. Trevor-Deutsch is associated with consulting firms across Canada and has served on the Boards of Directors of a number of professional and not-for-profit associations.

Among his current development projects, Mr. Trevor-Deutsch is under contract with the World Bank in Washington, D.C., assisting with the Bank's recent international distance learning initiative and is a consultant for the North Slave Metis Alliance in the Northwest Territories, assisting the Alliance with the development of a diamond cutting/polishing facility in Yellowknife. He has considerable international experience, having worked in Europe, Africa, Taiwan and the Caribbean. Mr. Trevor-Deutsch is frequently an invited speaker to conferences, colleges and international delegations and maintains Secret-level security clearance with the Canadian Government. "Lawry, with his vast international strategic planning experience, will be a valuable addition to our Board," said Roger A. Rached.

Factory Progress
"The completion of our Factory in Delta, British Columbia has been subject to delays outside of the control of the Company, and I believe that our shareholders should have a detailed explanation as to the reasons for these delays," said Roger A. Rached, President. In July 1998 the Company contracted with C.I.P. International Roofing and Waterproofing ("CIP") for the provision of the waterproof membranes on the Factory roof and later, after erection of the Office, for its roof. The internal and external painting of the Factory and Office together with associated sheet metal and caulking were added to that contract for a total value of approximately $416,000. The participation of two distinguished firms, I.C.I. and Si-Plast, named in the contract was a consideration for advancing $250,000 for the contract to proceed. With this participation, the Company was willing to accommodate some delays but in November, upon the advice of the Company's independent consultant that CIP was not performing, the Company demanded that CIP perform its contractual obligation, CIP abandoned the site in mid-December. At that time the Company discovered that CIP had not paid any of its indebtedness to its suppliers, estimated at $260,000. By that time winter had arrived but the Company succeeded in completing the work to the Company's standard enabling the electrical and mechanical sub-trades to work. Ensuring that no water penetrated the electrical vault was a challenge, requiring the removal of a defective membrane during inclement weather installed previously by CIP. The Company expects to have the bulk of the work completed by the end of June, 1999. The Company is suing CIP for breach of contract and damages. As a result of the delays by CIP, the Company's entire production timeline was affected. Electrical and mechanical work was not able to begin according to schedule and some investors postponed their commitment to purchase shares because of the delays. "We are completing the work that CIP should have done last year, and I am pleased to report that, according to our independent construction management consultant, we will have the electrical and mechanical work completed by the end of June," said Mr. Rached. Assuming that the investors who have agreed to purchase treasury shares fulfil their commitments by the end of June, the Factory will be open at the end of the year for the new millennium and will start receiving downpayments for projects in early November, 1999.

"The Builder's Lien Act, in my opinion, allows for the indiscriminate filing of claims by subcontractors. We will be seeking to have liens removed in a systematic manner, but wish to ensure that as little capital as possible is tied up in the courts while there is a determination by the courts of the merits of such claims," said Roger A. Rached. "In the future this type of work will be done in the factory itself, eliminating the headaches developers experience with unreliable sub-trades."

International Hi-Tech Industries Inc. is a company whose principal business is the development and commercialization of a new building system in Canada, and internationally through its subsidiary, IHI International Holdings Ltd.

ON BEHALF OF THE BOARD OF DIRECTORS
"ROGER A. RACHED"
ROGER A. RACHED, PRESIDENT