<PAGE>
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T. Rowe Price
- --------------------------------------------------------------------------------
Annual Report
NEW ASIA FUND
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October 31, 1999
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REPORT HIGHLIGHTS
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NEW ASIA FUND
- ------------------
* Asian markets continued to rebound during the past six months, though
investors became more selective as global interest rates turned up.
* Fund performance was strong both in absolute terms and relative to our
benchmarks for the 6- and 12-month periods ended October 31.
* We continued to reduce exposure to Hong Kong, still our largest
market, and increased investments in Taiwan, South Korea, and India.
* A wide gulf is developing between countries that have reformed their
economies and are globally competitive and those that have resisted
reforms.
UPDATES AVAILABLE
For updates on each fund following the end of every calendar quarter, please see
our Web site at www.troweprice.com.
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FELLOW SHAREHOLDERS
================================================================================
Asian markets staged an impressive rebound during the 12 months ended
October 31, though gains in the second half of the year were more muted and
investors more discriminating. Rising interest rates and lingering fundamental
concerns caused investors to favor higher quality, less cyclical companies
during the past six months. This new environment benefited your fund and
contributed to a gratifying 48.73% gain for the fiscal year.
Stocks of heavily indebted financial and property companies posted the most
dramatic gains early in the period, bolstered by lower global interest rates.
This liquidity-fueled rally lost some steam when recovering economies turned
central bankers around the world from rate-cutters to rate-hikers. The U.S.
Federal Reserve raised key short-term lending rates twice, and several Asian
central banks were obliged to follow suit, notably Hong Kong's. The strongest
performing markets of the first half, particularly the smaller and less liquid
markets such as Thailand, ceded ground to larger markets in the second half.
<PAGE>
================================================================================
PERFORMANCE COMPARISON
----------------------
Periods Ended 10/31/99 6 Months 12 Months
---------------------- -------- ---------
New Asia Fund 18.62% 48.73%
MSCI All Country Far East
Free Ex-Japan 5.63 52.06
Lipper Pacific Ex-Japan
Funds Average 10.60 48.33
================================================================================
Performance was strong in both relative and absolute terms in the past
year, as shown in the table, but results versus the benchmarks were much better
in the second half. Your fund's low exposure to financial and property stocks
and relatively high exposure to technology and secular growth areas like media
and consumer goods, especially in India, drove performance in both periods. The
fund's 18.62% gain in the past six months, combined with lackluster performance
for the Morgan Stanley Capital International benchmark, enabled us to pull
nearly even with the index for the full year.
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THE SECTOR FACTOR IN INTERNATIONAL INVESTING
- --------------------------------------------
Computer chips made in Ireland. Hollywood animation--from India. Internet
venture capitalists from Japan. Companies today have growth opportunities, labor
pools, competitive threats, acquisition targets, and potential suitors all over
the world.
International investing is no longer just a matter of having local
expertise in global markets. Today's investor needs to be aware of global
industry trends in addition to local realities. For the past 20 years, T. Rowe
Price and its international investing arm, Rowe Price-Fleming International,
have participated in the evolution of this new global marketplace and have
evolved with it. Rowe Price-Fleming's international sector team works in concert
with our regional portfolio managers, looking at cross-border trends that can
create opportunities and risks in industries such as technology,
pharmaceuticals, and financial services.
Nowhere is this global sector imperative more evident than in
telecommunications. Telecom firms need global scale to compete, and their
fortunes are no longer exclusively tied to local or even regional factors. Hence
Deutsche Telekom's unsuccessful bid for Telecom Italia, and the bid by Germany's
Mannesmann for U.K. wireless phone company Orange.
<PAGE>
The chart below shows that global sector factors are growing increasingly
important to the direction of stock prices. In the case of Telecom Italia, the
chart shows that the correlation of its stock price to the global telecom sector
(blue bar) rose significantly in 1997-98. (Data from the two years is averaged
together.) The gray bar shows that during this period the stock's correlation to
the Italian market declined. The examples of ING Groep and Societe Generale show
that while their stock prices became modestly more correlated to their local
markets, they became even more correlated to other global financial concerns.
"We have sharpened our understanding of global trends that drive stock
prices in the longer term, because we've got to be totally on top of the
competitive forces affecting returns at different companies," said John Ford,
chief investment officer at Rowe Price-Fleming. "For example, what is the
relative attractiveness of a Denso in Japan compared with another auto
components company such as Valeo in France? We've got to be aware of
cross-border valuations and industry trends." Of course, local factors still
dominate the outlook for some companies. The task for the informed international
investor is to appreciate both the global and the local influences. Rowe
Price-Fleming International, with its experienced team of investment
professionals worldwide, is as well positioned as ever to find the best
investment opportunities for you.
Influence of Globalaztion on Stocks Chart is shown here.
================================================================================
Despite recent increases, nominal interest rates remained at historically
low levels in much of the region, and we sensed a lack of commitment to painful
reforms at many troubled companies, especially in the smaller economies such as
Thailand and Indonesia. Wrenching political change in Indonesia and the
uncertainties of political succession for the Mahathir dynasty in Malaysia
compounded this inaction. As long as necessary structural reforms are not
implemented both at the country and company level in Southeast Asia, we will
maintain a cautious view on that region. In contrast, the countries of north
Asia N South Korea, Taiwan, and Hong Kong N as well as India are moving steadily
ahead. They now have many well-positioned companies in areas such as technology,
services, and domestic consumption, areas we believe offer Asia the best chance
to realize its vast economic potential.
PORTFOLIO REVIEW
- ----------------
Our overall strategy is still to invest in solid franchises around the
region. This strategy works very well during periods of high volatility, when
the performance of financial stocks generally suffers, such as over the past six
months.
<PAGE>
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MARKET PERFORMANCE
------------------
(IN U.S. DOLLAR TERMS)
Periods Ended 10/31/99 6 Months 12 Months
---------------------- -------- ---------
China Free 12.76% 18.28%
Hong Kong -0.54 27.24
India 39.23 63.96
Malaysia 35.84 184.38
Philippines -18.23 19.00
Singapore 22.92 90.23
Korea 18.89 164.90
Taiwan 12.01 29.07
Thailand -12.76 27.98
Source: RIMES Online, using MSCI indices.
================================================================================
The major change in country allocation has been the gradual reduction in
the long-dominant Hong Kong portion of the portfolio, now at 25% of net assets
versus 38% six months ago and 45% at the height of the Asian crisis last year.
Hong Kong remains our largest single market, as shown in the chart on the
following page. We viewed Hong Kong as a safe haven within Asia, but since last
fall have steadily moved investments into new opportunities related to
restructuring, technology, outsourcing, and the resurgence of consumer spending.
Cheung Kong Holdings, a major property development and investment group, remains
our second-largest investment, but Hutchison Whampoa has fallen from first to
third. The latter began mainly as a property holding company but has
successfully built major regional franchises in mobile telecommunications and in
the operation of vast commercial ports.
In China, we added steadily to China Telecom, the mainland's largest
provider of cellular phone services, which is now our fifth largest holding.
China Telecom embodies the kinds of trends we are trying to capitalize on in
Asia, with cellular growing at a much faster pace than traditional fixed-line
telephone service.
Exposure to Taiwan grew to 19% from 13% six months ago. We added to
positions in Taiwan Semiconductor Manufacturing and United Microelectronics,
which dominate the global wafer fabrication industry and should continue to
benefit from the worldwide outsourcing trend that started in the U.S. and is
spreading to Japan and Europe. Taiwanese companies are bottom-line oriented, and
the country's highly efficient component manufacturers are major participants in
the global technology boom. Other major holdings include Hon Hai Precision
Industry, Asustek Computer, and Winbond Electronics.
[A pie chart showing Hong Kong 25%; Taiwan 19%; South Korea 19%; India 15%;
Singapore 7%; China 3%; United Kingdom 2%; Other and Reserves 10% 1 HSBC
Holdings, a banking conglomerate formerly based in Hong Kong, recently moved its
domicile to the U.K."] ]
<PAGE>
In South Korea, after many years of worker sacrifice, consumers have
finally come into their own and have begun to drive the economy. We added
Housing & Commercial Bank, a major consumer bank, as well as companies such as
South Korea Telecom, the dominant operator in the fast-growing area of mobile
telecommunications, and increased our exposure to Korea Telecom, which has
strong Internet and mobile phone businesses. (Cellular penetration has now
exceeded fixed-line penetration in South Korea.) The fund's weighting in South
Korea has increased dramatically to 19% from 3% a year ago and 17% six months
ago. Samsung Electronics, a world leader in memory chips that also has strong
telecom equipment and consumer electronics businesses, has grown into the fund's
largest holding, even as we have taken profits after strong performance.
India was the other key area of portfolio activity, and our exposure grew
to 15% from 11% last October and 14% six months ago. The Indian market has been
very strong of late, due to convincing signs of an economic recovery, muted
inflation, and the election of a government with a clear majority in parliament.
Some of the companies we added earlier in the year had very strong performances.
These included Cipla and Ranbaxy Laboratories in pharmaceuticals, the
latter of which announced a landmark licensing agreement with Germany's Bayer
AG. Ranbaxy is one of the leading makers of branded generic drugs in the world.
Others included Pentafour Software, which specializes in animation and other
multimedia services and has produced recent films such as Sinbad: Beyond the
Veil of Mists and the animated version of The King and I, and Zee Telefilms,
which is highly profitable and the country's most dominant media company with
interests in both programming and cable distribution.
In Singapore, where our weighting also increased slightly, we added Delgro
Corporation, which will operate the city's first privatized mass rail transport
system, and GES International, which runs an Internet-based distribution and
inventory management system in Asia for some of the world's largest high-tech
companies. We also began to build a position in Chartered Semiconductor
Manufacturing, an up-and- coming wafer fabrication company, which, like our
Taiwanese holdings, benefits from increased outsourcing of manufacturing.
OUTLOOK
- -------
Differences in the commitment to, and progress of, structural reforms at
the country and company level have led to a widening gulf between the economic
performance of north Asia and India and that of Southeast Asia. Although most
Asian economies are clearly recovering after last year's crisis, growth remains
patchy from sector to sector, especially in Southeast Asia, where credit growth
is anemic. The consumer boom, so obvious in South Korea, has been much less
evident in Southeast Asia. The global strength of technology has been a major
positive for exports of both manufactured products from north Asia and
technology-related services from India. Although these industries remain
vulnerable to a slowdown in the U.S. economy, we believe that the broader trend
favoring globally competitive Asian firms remains intact. The increasing
importance of technology, however, will continue to increase the gap between the
tech haves and have-nots that we discussed.
<PAGE>
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INDUSTRY DIVERSIFICATION
- ------------------------
Percent of Net Assets
4/30/99 10/31/99
------- --------
Services 22.0% 25.3%
Finance 25.4 22.7
Consumer Goods 18.2 17.8
Capital Equipment 10.9 16.9
Multi-industry 8.0 5.8
Energy 9.7 3.1
All Other -- 1.2
Reserves 5.8 7.2
- -------- --- ---
Total 100.0% 100.0%
================================================================================
In addition, Southeast Asia faces a period of difficult political
transitions. Although Indonesia now has its first democratically elected
government, the country faces the daunting task of creating the necessary
governmental institutions in the midst of deep divisions along ethnic,
religious, and regional lines. It could be profoundly destabilizing for the
region if Indonesia were to fracture into several island states. Malaysia also
faces a difficult political journey, and policy risk remains high. In
geopolitical terms, the destabilization of Indonesia increases the likelihood
that India will play a larger role in the balance of power in Asia. This could
have significant positive economic implications in terms of trade and investment
for the world's largest democracy.
Our core beliefs in structuring the portfolio remain the same, however. We
continue to believe this environment will create interesting investment
opportunities as companies restructure and industries consolidate, sometimes
across national borders. Ultimately the real impetus for Asian companies to
restructure will be heightened competition, both from revitalized domestic
companies and from new entrants, both domestic and foreign. Deregulation is
picking up, particularly in Korea and India, and progress in this area remains a
strong possibility in the region's largest economy, China. We continue to
believe that only the best, the leanest, and most innovative companies will
survive and prosper in this competitive environment.
Respectfully submitted,
Martin G. Wade
President
November 15, 1999
================================================================================
<PAGE>
T. ROWE PRICE NEW ASIA FUND
- ---------------------------
PORTFOLIO HIGHLIGHTS
- --------------------
TWENTY-FIVE LARGEST HOLDINGS
- ----------------------------
Percent of
Net Assets
10/31/99
- --------------------------------------------------------------
Samsung Electronics, South Korea 7.7%
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Cheung Kong Holdings, Hong Kong 6.4
- --------------------------------------------------------------
Hutchison Whampoa, Hong Kong 5.8
- --------------------------------------------------------------
Taiwan Semiconductor Manufacturing, Taiwan 3.5
- --------------------------------------------------------------
China Telecom, China 3.1
- --------------------------------------------------------------
Zee Telefilms, India 3.0
- --------------------------------------------------------------
Korea Telecom, South Korea 2.8
- --------------------------------------------------------------
Korea Electric Power, South Korea 2.5
- --------------------------------------------------------------
Cable & Wireless, Hong Kong 2.2
- --------------------------------------------------------------
HSBC Holdings, United Kingdom 2.0
- --------------------------------------------------------------
Hon Hai Precision Industry, Taiwan 2.0
- --------------------------------------------------------------
Ranbaxy Laboratories, India 2.0
- --------------------------------------------------------------
United Overseas Bank, Singapore 1.9
- --------------------------------------------------------------
United Microelectronics, Taiwan 1.9
- --------------------------------------------------------------
Dao Heng Bank Group, Hong Kong 1.5
- --------------------------------------------------------------
Asustek Computer, Taiwan 1.5
- --------------------------------------------------------------
Mahanagar Telephone, India 1.4
- --------------------------------------------------------------
Far East Textile, Taiwan 1.4
- --------------------------------------------------------------
Industrial Credit & Investment, India 1.4
- --------------------------------------------------------------
Singapore Telecommunications, Singapore 1.4
- --------------------------------------------------------------
Winbond Electronics, Taiwan 1.4
- --------------------------------------------------------------
Cipla, India 1.1
- --------------------------------------------------------------
Compal Electronics, Taiwan 1.1
- --------------------------------------------------------------
Housing & Commerical Bank, South Korea 1.1
- --------------------------------------------------------------
Powerchip Semiconductors, Taiwan 1.0
- --------------------------------------------------------------
Total 61.1%
Note: Table excludes reserves.
================================================================================
<PAGE>
T. ROWE PRICE NEW ASIA FUND
- ---------------------------
PERFORMANCE COMPARISON
- ----------------------
This chart shows the value of a hypothetical $10,000 investment in the fund
over the past 10 fiscal year periods or since inception (for funds lacking
10-year records). The result is compared with benchmarks, which may include a
broad-based market index and a peer group average or index. Market indexes do
not include expenses, which are deducted from fund returns as well as mutual
fund averages and indexes.
[SEC chart shown here]
AVERAGE ANNUAL COMPOUND TOTAL RETURN
- ------------------------------------
This table shows how the fund would have performed each year if its actual
(or cumulative) returns for the periods shown had been earned at a constant
rate.
Since Inception
Periods Ended 10/31/99 1 Year 3 Years 5 Years Inception Date
- ---------------------- ------ ------- ------- --------- ----
New Asia Fund 48.73% -4.64% -3.37% 6.96% 9/28/90
Investment return and principal value represent past performance and will
vary. Shares may be worth more or less at redemption than at original purchase.
================================================================================
T. ROWE PRICE NEW ASIA FUND
- ---------------------------
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
- ----------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------
Year
Ended
10/31/99 10/31/98 10/31/97 10/31/96 10/31/95
-------- -------- -------- -------- --------
NET ASSET VALUE
Beginning of period $ 4.93 $ 5.95 $ 8.64 $ 8.12 $ 10.07
- ------------------------------------------------------------------------------
Investment activities
Net investment income 0.05 0.13 0.09 0.06 0.08
Net realized and
unrealized gain (loss) 2.31 (1.07) (2.71) 0.55 (1.07)
- ------------------------------------------------------------------------------
Total from
investment activities 2.36 (0.94) (2.62) 0.61 (0.99)
- ------------------------------------------------------------------------------
Distributions
Net investment income (0.09) (0.08) (0.06) (0.09) (0.07)
Net realized gain - - (0.01) - (0.89)
- ------------------------------------------------------------------------------
Total distributions (0.09) (0.08) (0.07) (0.09) (0.96)
<PAGE>
- ------------------------------------------------------------------------------
NET ASSET VALUE
End of period $ 7.20 $ 4.93 $ 5.95 $ 8.64 $ 8.12
Ratios/Supplemental=Data======================================================
Total return** 48.73% (15.97)% (30.61)% 7.58% (9.70)%
- ------------------------------------------------------------------------------
Ratio of total expenses
to average net assets 1.21% 1.29% 1.10% 1.11% 1.15%
- ------------------------------------------------------------------------------
Ratio of net investment
income to average
net assets 0.87% 2.33% 0.76% 0.66% 0.97%
- ------------------------------------------------------------------------------
Portfolio turnover rate 69.9% 68.1% 41.8% 42.0% 63.7%
- ------------------------------------------------------------------------------
Net assets,end of period
(in millions) $ 996 $ 633 $ 877 $ 2,041 $ 1,909
- ------------------------------------------------------------------------------
** Total return reflects the rate that an investor would have earned on
an investment in the fund during each period, assuming reinvestment of
all distributions.
The accompanying notes are an integral part of these financial statements.
================================================================================
T. ROWE PRICE NEW ASIA FUND
- --------------------------- OCTOBER 31, 1999
PORTFOLIO OF INVESTMENTS
- ------------------------
Shares Value
In thousands
CHINA 3.1%
Common Stocks 3.1%
China Telecom (HKD) 9,100,000 $ 31,101
- --------------------------------------------------------------------------
Total China (Cost $20,417) 31,101
- --------------------------------------------------------------------------
HONG KONG 24.5%
Common Stocks 24.5%
Cathay Pacific Airways 1,478,000 2,997
- --------------------------------------------------------------------------
Cheung Kong Holdings 7,030,000 64,024
- --------------------------------------------------------------------------
Dah Sing Financial 1,303,400 5,235
- --------------------------------------------------------------------------
Dao Heng Bank Group 3,366,260 15,296
- --------------------------------------------------------------------------
Esprit Holdings 8,737,988 8,211
- --------------------------------------------------------------------------
Great Eagle Holdings 1,008,000 1,246
- --------------------------------------------------------------------------
Henderson Land Development 1,693,000 7,693
- --------------------------------------------------------------------------
HKR International 11,581,344 8,796
- --------------------------------------------------------------------------
Hong Kong and China Gas 5,128,170 6,799
- --------------------------------------------------------------------------
Cable & Wireless 9,418,777 21,521
- --------------------------------------------------------------------------
Hutchison Whampoa 5,770,000 57,934
- --------------------------------------------------------------------------
Legend Holdings 3,158,000 3,394
- --------------------------------------------------------------------------
Li & Fung 4,648,000 7,928
- --------------------------------------------------------------------------
New World China Land 10,090,830 4,676
- --------------------------------------------------------------------------
Sa Sa International Holdings 20,491,000 3,376
- --------------------------------------------------------------------------
Sino Land 18,469,000 8,440
- --------------------------------------------------------------------------
South China Morning Post 8,292,000 6,138
- --------------------------------------------------------------------------
Varitronix International 368,000 793
- --------------------------------------------------------------------------
Yanzhou Coal Mining 15,912,000 5,274
- --------------------------------------------------------------------------
Yue Yuen Industrial 1,859,000 4,714
- --------------------------------------------------------------------------
Total Hong Kong (Cost $201,636) 244,485
- --------------------------------------------------------------------------
INDIA 15.2%
Common Stocks 15.2%
Britannia Industries 445,500 8,523
- --------------------------------------------------------------------------
Cipla 381,000 11,356
- --------------------------------------------------------------------------
Global Telephone Systems 657,000 8,111
- --------------------------------------------------------------------------
HCL Infosystems 354,000 3,551
- --------------------------------------------------------------------------
Hindustan Lever 156,700 8,392
- --------------------------------------------------------------------------
Housing Development Finance * 1,535,800 9,340
- --------------------------------------------------------------------------
ICICI Limited ADR (USD) * 149,304 $ 1,642
- --------------------------------------------------------------------------
ITC 604,500 9,810
- --------------------------------------------------------------------------
Industrial Credit & Investment 7,759,000 14,120
- --------------------------------------------------------------------------
Mahanagar Telephone 3,637,000 14,360
- --------------------------------------------------------------------------
<PAGE>
McDowell 1,790,800 5,941
- --------------------------------------------------------------------------
Pentafour Software 498,000 6,964
- --------------------------------------------------------------------------
Ranbaxy Laboratories 979,500 19,766
- --------------------------------------------------------------------------
State Bank of India 50 0
- --------------------------------------------------------------------------
Zee Telefilms 290,000 29,680
- --------------------------------------------------------------------------
Total India (Cost $111,766) 151,556
- --------------------------------------------------------------------------
PHILIPPINES 0.9%
Common Stocks 0.9%
La Tondena Distillers 4,084,800 3,769
- --------------------------------------------------------------------------
San Miguel (Class B) 3,545,405 5,128
- --------------------------------------------------------------------------
Total Philippines (Cost $12,856) 8,897
- --------------------------------------------------------------------------
SINGAPORE 6.8%
Common Stocks 6.8%
Chartered Semiconductor Manufacturing 551,000 1,126
- --------------------------------------------------------------------------
DBS Group Holdings 661,821 7,480
- --------------------------------------------------------------------------
Delgro 1,518,000 5,248
- --------------------------------------------------------------------------
GES International 5,301,000 4,621
- --------------------------------------------------------------------------
Pacific Century 1,096,000 6,326
- --------------------------------------------------------------------------
Sembawang Maritime 228,000 850
- --------------------------------------------------------------------------
Singapore Press 545,719 9,351
- --------------------------------------------------------------------------
Singapore Telecommunications 7,329,000 13,924
- --------------------------------------------------------------------------
United Overseas Bank 2,489,000 18,855
- --------------------------------------------------------------------------
Total Singapore (Cost $63,106) 67,781
- --------------------------------------------------------------------------
SOUTH KOREA 19.3%
Common Stocks 19.3%
Hana Bank 1,037,719 9,516
- --------------------------------------------------------------------------
Housing & Commercial Bank 398,000 10,518
- --------------------------------------------------------------------------
Korea Electric Power ADR(USD) 352,000 5,544
- --------------------------------------------------------------------------
Korea Electric Power 646,540 18,919
- --------------------------------------------------------------------------
Korea Telecom ADR(USD) * 279,000 9,835
- --------------------------------------------------------------------------
<PAGE>
Korea Telecom 272,600 $ 18,340
- --------------------------------------------------------------------------
Korean Air Lines 192,000 2,513
- --------------------------------------------------------------------------
LG Chemicals 224,000 6,779
- --------------------------------------------------------------------------
LG Information & Communications 115,305 8,459
- --------------------------------------------------------------------------
Mirae 1,670,900 8,971
- --------------------------------------------------------------------------
Samsung 382,000 6,051
- --------------------------------------------------------------------------
Samsung Electronics 460,762 76,826
- --------------------------------------------------------------------------
Shinhan Bank 567,000 6,003
- --------------------------------------------------------------------------
South Korea Telecom 3,264 3,769
- --------------------------------------------------------------------------
Total South Korea (Cost $110,772) 192,043
- --------------------------------------------------------------------------
TAIWAN 19.4%
Common Stocks 19.4%
Acer Peripherals * 1,872,000 4,987
- --------------------------------------------------------------------------
Asustek Computer * 641,677 6,736
- --------------------------------------------------------------------------
Asustek Computer GDR (USD) * 557,967 7,881
- --------------------------------------------------------------------------
Asustek Computer GDR (144a) (USD) 1,511 21
- --------------------------------------------------------------------------
Compal Electronics 3,376,977 11,338
- --------------------------------------------------------------------------
D-Link 355,700 594
- --------------------------------------------------------------------------
Far East Textile 10,366,502 14,184
- --------------------------------------------------------------------------
Hon Hai Precision Industry * 1,885,800 12,901
- --------------------------------------------------------------------------
Hon Hai Precision Industry ADR(USD) * 434,051 7,042
- --------------------------------------------------------------------------
Mosel Vitelic (USD) * 607,000 6,571
- --------------------------------------------------------------------------
Pacific Electric Wire * 9,696,000 4,677
- --------------------------------------------------------------------------
Powerchip semiconductors GDR(USD) 541,000 6,465
- --------------------------------------------------------------------------
Powerchip semiconductors * 2,690,000 3,901
- --------------------------------------------------------------------------
President Chain Store 3,081,824 8,696
- --------------------------------------------------------------------------
Ritek (USD) * 415,000 5,551
- --------------------------------------------------------------------------
Siliconware Precision Industries * 4,827,120 8,674
- --------------------------------------------------------------------------
<PAGE>
Systex * 2,542,000 8,054
- --------------------------------------------------------------------------
Taiwan Semiconductor Manufacturing * 7,895,519 35,097
- --------------------------------------------------------------------------
United Microelectronics * 7,203,200 18,735
- --------------------------------------------------------------------------
Winbond Electronics GDR (144a) (USD) * 559,300 10,193
- --------------------------------------------------------------------------
Winbond Electronics * 1,947,000 3,560
- --------------------------------------------------------------------------
Yageo 6,466,740 6,952
- --------------------------------------------------------------------------
Total Taiwan (Cost $136,360) 192,810
- --------------------------------------------------------------------------
THAILAND 1.5%
Common Stocks 1.5%
Bangkok Bank * 2,852,800 $ 6,651
- --------------------------------------------------------------------------
Telecomasia 10,558,000 8,136
- --------------------------------------------------------------------------
Total Thailand (Cost $15,956) 14,787
- --------------------------------------------------------------------------
UNITED KINGDOM 2.0%
Common Stocks 2.0%
HSBC Holdings (HKD) 1,685,234 20,283
- --------------------------------------------------------------------------
Total United Kingdom (Cost $15,466) 20,283
- --------------------------------------------------------------------------
VIETNAM 0.0%
Common Stocks 0.0%
Lazard Vietnam Fund Limited (USD) * 152,800 77
- --------------------------------------------------------------------------
Total Vietnam (Cost $310) 77
- --------------------------------------------------------------------------
SHORT TERM INVESTMENTS 5.1%
Money Market Funds 5.1%
Reserve Investment Fund, 5.51% # 50,420,258 50,420
Total Short-Term Investments (Cost $50,420) 50,420
Total Investments in Securities
97.8% of Net Assets (Cost $739,065) $ 974,240
Other Assets Less Liabilities 21,589
NET ASSETS $ 995,829
================================================================================
* Non-income producing
# Seven-day yield
144a Security was purchased pursuant to Rule 144a under the Securities Act of
1933 and may not be resold subject to that rule except to qualified
institutional buyers -- total of such securities at period-end
amounts to 1.0% of net assets.
ADR American depository receipt
GDR Global depository receipt
HKD Hong Kong dollar
USD U.S. dollar
The accompanying notes are an integral part of these financial statements.
================================================================================
<PAGE>
T. ROWE PRICE NEW ASIA FUND
- --------------------------- OCTOBER 31, 1999
STATEMENT OF ASSETS AND LIABILITIES
- ----------------------------------- In thousands
ASSETS
Investments in securities, at value (cost $739,065) $ 974,240
Securities lending collateral 57,090
Other assets 51,255
Total assets 1,082,585
Liabilities
Obligation to return securities lending collateral 57,090
Other liabilities 24,622
Deferred foreign tax liability 5,044
Total liabilities 86,756
NET ASSETS $ 995,829
Net Assets Consist of:
Accumulated net investment income - net of distributions $ 4,883
Accumulated net realized gain/loss - net of distributions ( 357,034)
Net unrealized gain (loss) 230,130
Paid-in-capital applicable to 138,230,509 shares of
$0.01 par value capital stock outstanding;
2,000,000,000 shares of the Corporation authorized 1,117,850
NET ASSETS $ 995,829
NET ASSET VALUE PER SHARE $ 7.20
The accompanying notes are an integral part of these financial statements.
================================================================================
<PAGE>
T. ROWE PRICE NEW ASIA FUND
- ---------------------------
STATEMENT OF OPERATIONS
- ----------------------- In thousands
Year
Ended
10/31/99
Investment=Income=======================================================
Income
Dividend (net of foreign taxes of $766) $ 13,911
Interest 2,450
- ------------------------------------------------------------------------
Total income 16,361
- ------------------------------------------------------------------------
Expenses
Investment management 6,444
Shareholder servicing 2,361
Custody and accounting 320
Prospectus and shareholder reports 244
Legal and audit 34
Registration 33
Directors 6
Miscellaneous 72
- ------------------------------------------------------------------------
Total expenses 9,514
- ------------------------------------------------------------------------
Net investment income 6,847
- ------------------------------------------------------------------------
Realized=and=Unrealized=Gain=(Loss)=====================================
Net realized gain (loss)
Securities (net of foreign taxes of $972) 18,374
Foreign currency transactions (669)
- ------------------------------------------------------------------------
Net realized gain (loss) 17,705
- ------------------------------------------------------------------------
Change in net unrealized gain or loss
Securities (net of deferred foreign taxes of $5,044) 285,244
Other assets and liabilities
denominated in foreign currencies (58)
- ------------------------------------------------------------------------
Change in net unrealized gain or loss 285,186
- ------------------------------------------------------------------------
Net realized and unrealized gain (loss) 302,891
- ------------------------------------------------------------------------
INCREASE (DECREASE) IN NET
========================================================================
ASSETS FROM OPERATIONS $ 309,738
========================================================================
The accompanying notes are an integral part of these financial statements.
================================================================================
<PAGE>
T. ROWE PRICE NEW ASIA FUND
- ---------------------------
STATEMENT OF CHANGES IN NET ASSETS
- ---------------------------------- In thousands
Year
Ended
10/31/99 10/31/98
==Increase=(Decrease)=in=Net=Assets=============================================
Operations
Net investment income $ 6,847 $ 16,335
Net realized gain (loss) 17,705 (373,437)
Change in net unrealized gain or loss 285,186 227,523
- --------------------------------------------------------------------------------
Increase (decrease) in net assets from operations 309,738 (129,579)
- --------------------------------------------------------------------------------
Distributions to shareholders
Net investment income (11,370) (11,046)
- --------------------------------------------------------------------------------
Capital share transactions *
Shares sold 934,309 490,917
Distributions reinvested 10,841 10,444
Shares redeemed (880,525) (604,687)
- --------------------------------------------------------------------------------
Increase (decrease) in net assets from capital
share transactions 64,625 (103,326)
- --------------------------------------------------------------------------------
==Net=Assets====================================================================
Increase (decrease) during period 362,993 (243,951)
Beginning of period 632,836 876,787
- --------------------------------------------------------------------------------
================================================================================
End of period $ 995,829 $ 632,836
================================================================================
*Share information
Shares sold 150,881 95,986
Distributions reinvested 2,217 1,852
Shares redeemed (143,305) (116,741)
- --------------------------------------------------------------------------------
Increase (decrease) in shares outstanding 9,793 (18,903)
The accompanying notes are an integral part of these financial statements.
================================================================================
<PAGE>
T. ROWE PRICE NEW ASIA FUND
- --------------------------- October 31, 1999
NOTES TO FINANCIAL STATEMENTS
- -----------------------------
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES
- ----------------------------------------
T. Rowe Price International Funds, Inc. (the corporation) is registered
under the Investment Company Act of 1940. The New Asia Fund (the fund), a
diversified, open-end management investment company, is one of the portfolios
established by the corporation and commenced operations on September 28, 1990.
The accompanying financial statements are prepared in accordance with
generally accepted accounting principles for the investment company industry;
these principles may require the use of estimates by fund management.
Valuation Equity securities are valued at the last quoted sales price at
the time the valuations are made. A security which is listed or traded on more
than one exchange is valued at the quotation on the exchange determined to be
the primary market for such security.
Investments in mutual funds are valued at the closing net asset value per
share of the mutual fund on the day of valuation.
For purposes of determining the fund's net asset value per share, the U.S.
dollar value of all assets and liabilities initially expressed in foreign
currencies is determined by using the mean of the bid and offer prices of such
currencies against U.S. dollars quoted by a major bank.
Assets and liabilities for which the above valuation procedures are
inappropriate or are deemed not to reflect fair value are stated at fair value
as determined in good faith by or under the supervision of the officers of the
fund, as authorized by the Board of Directors.
Currency Translation Assets and liabilities are translated into U.S.
dollars at the prevailing exchange rate at the end of the reporting period.
Purchases and sales of securities and income and expenses are translated into
U.S. dollars at the prevailing exchange rate on the dates of such transactions.
The effect of changes in foreign exchange rates on realized and unrealized
security gains and losses is reflected as a component of such gains and losses.
Other Income and expenses are recorded on the accrual basis. Investment
transactions are accounted for on the trade date. Realized gains and losses are
reported on the identified cost basis. Dividend income and distributions to
shareholders are recorded by the fund on the ex-dividend date. Income and
capital gain distributions are determined in accordance with federal income tax
regulations and may differ from those determined in accordance with generally
accepted accounting principles. Credits earned on daily uninvested cash balances
at the custodian are used to reduce the fund's custody charges.
<PAGE>
================================================================================
NOTE 2 - INVESTMENT TRANSACTIONS
================================================================================
Consistent with its investment objective, the fund engages in the following
practices to manage exposure to certain risks or enhance performance. The
investment objective, policies, program, and risk factors of the fund are
described more fully in the fund's prospectus and Statement of Additional
Information.
Emerging Markets At October 31, 1999, the fund held investments in
securities of companies located in emerging markets. Future economic or
political developments could adversely affect the liquidity or value, or both,
of such securities.
Securities Lending The fund lends its securities to approved brokers to
earn additional income and receives cash and U.S. government securities as
collateral against the loans. Cash collateral received is invested in a money
market pooled account by the fund's lending agent. Collateral is maintained over
the life of the loan in an amount not less than 100% of the value of loaned
securities. Although risk is mitigated by the collateral, the fund could
experience a delay in recovering its securities and a possible loss of income or
value if the borrower fails to return them. At October 31, 1999, the value of
loaned securities was $59,915,000; aggregate collateral consisted of $57,090,000
in the securities lending collateral pool and U.S. Government securities valued
at $4,875,000.
Other Purchases and sales of portfolio securities, other than short-term
securities, aggregated $581,295,000 and $514,904,000, respectively, for the year
ended October 31, 1999.
================================================================================
NOTE 3 - FEDERAL INCOME TAXES
================================================================================
No provision for federal income taxes is required since the fund intends to
continue to qualify as a regulated investment company and distribute all of its
taxable income. The fund utilized capital loss carryforwards of $18,396,000 in
1999. As of October 31, 1999, the fund had capital loss carryforwards for
federal income tax purposes of $355,216,000, all of which expire in 2006. The
fund intends to retain gains realized in future periods that may be offset by
available capital loss carryforwards.
In order for the fund's capital accounts and distributions to shareholders
to reflect the tax character of certain transactions, the following
reclassifications were made during the year ended October 31, 1999. The results
of operations and net assets were not affected by the increases/(decreases) to
these accounts.
================================================================================
Undistributed net investment income $(1,064,000)
Undistributed net realized gain 1,128,000
Paid-in-capital (64,000)
================================================================================
<PAGE>
At October 31, 1999, the cost of investments for federal income tax
purposes was substantially the same as for financial reporting and totaled
$739,065,000. Net unrealized gain aggregated $235,175,000 at period-end, of
which $269,407,000 related to appreciated investments and $34,232,000 to
depreciated investments.
================================================================================
NOTE 4 - FOREIGN TAXES
================================================================================
The fund is subject to foreign income taxes imposed by certain countries in
which it invests. Foreign income taxes are accrued by the fund and withheld from
dividend and interest income.
Gains realized upon disposition of Indian securities held by the fund are
subject to capital gains tax in India. The tax on realized gains is paid prior
to repatriation of sales proceeds. A deferred tax liability is accrued on net
unrealized gains and totaled $5,044,000 at October 31, 1999.
================================================================================
NOTE 5 - RELATED PARTY TRANSACTIONS
================================================================================
The fund is managed by Rowe Price-Fleming International, Inc. (the
manager), which is owned by T. Rowe Price Associates, Inc. (Price Associates),
Robert Fleming Holdings Limited, and Jardine Fleming Holdings Limited under a
joint venture agreement.
The investment management agreement between the fund and the manager
provides for an annual investment management fee, of which $677,000 was payable
at October 31, 1999. The fee is computed daily and paid monthly, and consists of
an individual fund fee equal to 0.50% of average daily net assets and a group
fee. The group fee is based on the combined assets of certain mutual funds
sponsored by the manager or Price Associates (the group). The group fee rate
ranges from 0.48% for the first $1 billion of assets to 0.295% for assets in
excess of $120 billion. At October 31, 1999, and for the year then ended, the
effective annual group fee rate was 0.32%. The fund pays a pro-rata share of the
group fee based on the ratio of its net assets to those of the group.
In addition, the fund has entered into agreements with Price Associates and
two wholly owned subsidiaries of Price Associates, pursuant to which the fund
receives certain other services. Price Associates computes the daily share price
and maintains the financial records of the fund. T. Rowe Price Services, Inc. is
the fund's transfer and dividend disbursing agent and provides shareholder and
administrative services to the fund. T. Rowe Price Retirement Plan Services,
Inc. provides subaccounting and recordkeeping services for certain retirement
accounts invested in the fund. The fund incurred expenses pursuant to these
related party agreements totaling approximately $1,995,000 for the year ended
October 31, 1999, of which $233,000 was payable at period-end.
<PAGE>
Additionally, the fund is one of several T. Rowe Price-sponsored mutual
funds (underlying funds) in which the T. Rowe Price Spectrum Funds (Spectrum)
may invest. Spectrum does not invest in the underlying funds for the purpose of
exercising management or control. Expenses associated with the operation of
Spectrum are borne by each underlying fund to the extent of estimated savings to
it and in proportion to the average daily value of its shares owned by Spectrum,
pursuant to special servicing agreements between and among Spectrum, the
underlying funds, T. Rowe Price, and, in the case of T. Rowe Price Spectrum
International, Rowe Price-Fleming International. Spectrum International Fund
held approximately 0.1% of the outstanding shares of the fund at October 31,
1999. For the year then ended, the fund was allocated $5,000 of Spectrum
expenses, $1,000 of which was payable at period-end.
The fund may invest in the Reserve Investment Fund and Government Reserve
Investment Fund (collectively, the Reserve Funds), open-end management
investment companies managed by T. Rowe Price Associates, Inc. The Reserve Funds
are offered as cash management options only to mutual funds and other accounts
managed by T. Rowe Price and its affiliates and are not available to the public.
The Reserve Funds pay no investment management fees. Distributions from the
Reserve Funds to the fund for the year ended October 31, 1999, totaled
$1,723,000 and are reflected as interest income in the accompanying Statement of
Operations.
During the year ended October 31, 1999, the fund, in the ordinary course of
business, placed security purchase and sale orders aggregating $64,117,000 with
certain affiliates of the manager and paid commissions of $222,000 related
thereto.
================================================================================
T. ROWE PRICE NEW ASIA FUND
- ---------------------------
REPORT OF INDEPENDENT ACCOUNTANTS
- ---------------------------------
TO THE BOARD OF DIRECTORS OF T. ROWE PRICE INTERNATIONAL FUNDS, INC. AND
SHAREHOLDERS OF NEW ASIA FUND
In our opinion, the accompanying statement of assets and liabilities,
including the portfolio of investments, and the related statements of operations
and of changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of New Asia Fund (one of the
portfolios comprising T. Rowe Price International Funds, Inc., hereafter
referred to as the "Fund") at October 31, 1999, and the results of its
operations, the changes in its net assets and the financial highlights for each
of the fiscal periods presented, in conformity with generally accepted
accounting principles. These financial statements and financial highlights
<PAGE>
(hereafter referred to as "financial statements") are the responsibility of the
Fund's management; our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our audits of these
financial statements in accordance with generally accepted auditing standards
which require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits, which included
confirmation of securities at October 31, 1999 by correspondence with the
custodian, provide a reasonable basis for the opinion expressed above.
PricewaterhouseCoopers LLP
Baltimore, Maryland
November 17, 1999
TAX INFORMATION (UNAUDITED) FOR THE TAX YEAR ENDED 10/31/99
We are providing this information as required by the Internal Revenue Code.
The amounts shown may differ from those elsewhere in this report because of
differences between tax and financial reporting requirements.
The fund will pass through foreign source income of $7,540,000 and foreign
taxes paid of $1,758,000.
================================================================================
FOR FUND AND ACCOUNT INFORMATION
OR TO CONDUCT TRANSACTIONS,
24 HOURS, 7 DAYS A WEEK
By touch-tone telephone
TELE*ACCESS 1-800-638-2587
By Account Access on the Internet
WWW.TROWEPRICE.COM/ACCESS
FOR ASSISTANCE
WITH YOUR EXISTING
FUND ACCOUNT, CALL:
Shareholder Service Center
1-800-225-5132
TO OPEN A BROKERAGE ACCOUNT
OR OBTAIN INFORMATION, CALL:
1-800-638-5660
INTERNET ADDRESS:
www.troweprice.com
PLAN ACCOUNT LINES FOR RETIREMENT
PLAN PARTICIPANTS:
The appropriate 800 number appears
on your retirement account statement.
<PAGE>
T. Rowe Price Associates
100 East Pratt Street
Baltimore, Maryland 21202
This report is authorized for
distribution only to shareholders
and to others who have received
a copy of the prospectus appropriate
to the fund or funds covered in this
report.
WALK-IN INVESTOR CENTERS:
For directions, call 1-800-225-5132
or visit our Web site
BALTIMORE AREA
Downtown
101 East Lombard Street
Owings Mills
Three Financial Center
4515 Painters Mill Road
BOSTON AREA
386 Washington Street
Wellesley
COLORADO SPRINGS
4410 ArrowsWest Drive
LOS ANGELES AREA
Warner Center
21800 Oxnard Street, Suite 270
Woodland Hills
TAMPA
4200 West Cypress Street
10th Floor
WASHINGTON, D.C.
900 17th Street N.W.
Farragut Square
T. Rowe Price Investment Services, Inc., Distributor. F39-050 10/31/99
================================================================================
