<PAGE>
T. Rowe Price
--------------------------------------------------------------------------------
Semiannual Report
Latin America Fund
--------------------------------------------------------------------------------
April 30, 2000
--------------------------------------------------------------------------------
REPORT HIGHLIGHTS
================================================================================
LATIN AMERICA FUND
------------------
* Most of the larger Latin American economies rebounded early in 2000,
led by Mexico.
* Stocks rose in the major markets during the six months ended April 30,
be nefiting from strong gains early in 2000.
* The fund's six-month return surpassed its market index and average
compet itor, aided by positions in Mexico and Brazil.
* We increased holdings in telecommunications and media, where
valuations a re attractive and growth prospects exciting.
* Despite the recovery, the region's outlook remains uncertain because
of local problems and reliance on international credit markets.
================================================================================
UPDATES AVAILABLE
-----------------
For updates on T. Rowe Price funds following the end of each calendar
quarter, please see our Web site at www.troweprice.com.
================================================================================
FELLOW SHAREHOLDERS
-------------------
The Latin American market continued its longtime roller-coaster pattern
over the past six months -- this time on the upswing. Mexico's consumer-led
recovery proved exceptionally strong, with Brazil and Chile also showing strong
rebounds. Among the larger regional economies, only Argentina continued to
disappoint. As a result, most stock markets, and your fund, reported solid gains
over the period.
<PAGE>
******************************************************************
PERFORMANCE COMPARISON
----------------------
Periods Ended 4/30/00 6 Months 12 Months
--------------------- -------- ---------
Latin America Fund 27.16% 18.73%
MSCI EMF Latin America Index 26.84 14.10
Lipper Latin America Funds Average 25.73 17.12
******************************************************************
For the six months ended April 30, 2000, your fund posted a total return of
27.16%, surpassing both its regional MSCI index and the Lipper average. Over the
past year, fund returns were more moderate, reflecting the region's difficult
economic climate in 1999. Returns were in double digits, however, and the fund
outperformed its benchmarks for the 12-month period. Both country and sector
allocations contributed to gains, especially our decisions to overweight two of
the region's stronger economies, Mexico and Brazil, while limiting exposure to
less economically healthy countries. The fund also profited from increased
positions in media and telecommunications companies and from holdings of Mexican
banks.
MARKET AND PORTFOLIO REVIEW
---------------------------
Many of the key Latin American economies picked up nicely over the first
four months of 2000. We expect regional GDP growth in excess of 4% for the
current year, a strong rebound from near zero in 1999. Recent data suggest a
booming economy in Mexico, led by a sudden and larger-than-expected recovery in
consumer spending. The Brazilian economy also surprised on the upside. Its
fiscal austerity program is coming through well ahead of expectations, and the
devaluation in January 1999 appears to be improving exports. Chile is enjoying a
sharp export-led recovery, helped by rising copper prices and a weaker currency.
Rather less encouraging, the Argentine economy remains subdued, with consumers
weighed down by another round of tax increases. Many analysts worry that by
continuing to peg its currency to the U.S. dollar, Argentina lacks the
flexibility to deal with the rapidly changing currency environment that prevails
elsewhere in the region.
<PAGE>
**********************************************************
MARKET PERFORMANCE
------------------
(In U.S. Dollar Terms)
Periods Ended 4/30/00 6 Months 12 Months
--------------------- -------- --------
Argentina 1.88% -4.18%
Brazil (Free) 34.39 27.09
Chile 12.01 4.31
Mexico 21.04 16.37
Peru 8.90 2.39
Venezuela -0.72 -5.10
Source: RIMESOnline, using MSCI indices.
**********************************************************
As ever, the key constraint to sustainable growth is the acute shortage of
capital and, therefore, the constant need to seek financing in the international
credit markets. On average, countries in the region now carry current account
deficits in excess of 3% of GDP for the current year, and Brazil alone faces
financing requirements of around $70 billion. For this reason, with the arguable
exception of Mexico, the region remains highly vulnerable to external market
conditions and a sudden reversal in sentiment among foreign investors.
***************************************************
T. ROWE PRICE BECOMES SOLE OWNER OF INTERNATIONAL INVESTMENT MANAGER
As an international investor, you may be
aware that the T. Rowe Price international
and global stock and bond funds have always
been managed by Rowe Price-Fleming
International, Inc., a joint venture formed
in 1979 between T. Rowe Price Associates and
London-based Robert Fleming Holdings,
Limited.
On April 11, 2000, T. Rowe Price announced an
agreement to purchase the 50% of the joint
venture owned by Flemings, thus becoming the
sole owner of the management company. In due
course, the name of Rowe Price-Fleming
International will be changed to reflect its
new status.
<PAGE>
The change in ownership structure will not
affect the investment approach or operations
of our international funds. We expect Rowe
Price-Fleming's leadership and professional
staff to remain in place, together with the
substantial resources and expertise built up
over the past 20 years. Likewise, there will
be no change in the offices in London, Hong
Kong, Tokyo, Singapore, Buenos Aires, Paris,
and Baltimore.
Under the U.S. securities laws, the
assignment of the funds' investment
management contract to a new entity is
subject to shareholder approval. Accordingly,
after the purchase is concluded later this
year, we will set a date for a shareholder
meeting and send you a proxy with voting
information.
The formation of Rowe Price-Fleming 20 years
ago opened the way for T. Rowe Price to
expand the investment services offered to
shareholders and clients. As an integral part
of T. Rowe Price, this very successful
international investment manager will provide
significant opportunities to enhance those
services.
***************************************************
More than 80% of your portfolio is invested in Mexico and Brazil. We are
underweighted in all other countries, particularly in Chile, where we believe
growth is already priced into the dominant industries. At the sector level, we
have large positions in telecommunications and media, where valuations still
look attractive and growth prospects are exciting. Cellular growth rates across
the region are explosive. In Brazil, for example, the number of cellular
subscribers doubled over the 12 months through March 2000, and data transmission
and Internet usage is growing exponentially. To counterbalance, we are heavily
underweighted in the region's more cyclical areas, such as forest products and
mining, where we find long-term growth prospects much less interesting.
*****************************
Cellular growth rates across
the region are explosive.
*****************************
<PAGE>
MEXICO's long road to recovery from the 1994 peso devaluation was confirmed
by Moody's recent upgrade of the government's debt to investment-grade status.
Supported by the vibrant U.S. economy and the success of the North American Free
Trade Agreement, export performance has come through strongly, and dependence on
short-term capital flows to finance the current account deficit is greatly
reduced. Wages have been rising ahead of inflation, unemployment has fallen to
record lows, and consumers have responded with an unexpectedly sharp bounce in
retail sales. Mexico's export base remains heavily dependent on the U.S.
marketplace, making it vulnerable to a slowdown north of the border. The Mexican
economy is also galloping ahead somewhat faster than monetary authorities would
wish, and the last thing the market would want to see is evidence of an
overheating economy in the runup to presidential elections in July.
Nevertheless, with its banking sector continuing down the road toward
recapitalization and restructuring, and with its finances in good shape, Mexico
represents our largest weighting versus the index.
We added steadily to the Mexican banks BANAMEX and BANCOMER. New bankruptcy
legislation was recently passed, replacing antiquated laws dating from the 1940s
that had allowed businesses to delay payments to creditors for years with no
interest rate penalty. Other new legislation shortens the foreclosure process on
collateralized assets. These laws address weaknesses in the financial system
that made lending risks unacceptably high, and we expect banks to resume lending
for the first time since 1994. Banamex is now fully provisioned against past-due
loans and well positioned to benefit from the improved legal environment.
Following a friendly bid and injection of capital from the Spanish bank BBVA,
Bancomer's balance sheet will also be fully provisioned, although Banamex is now
considering a takeover of Bancomer, in which case an interesting bidding war may
develop. We also increased our exposure to telecoms and media by adding to
holdings in Mexico's largest broadcaster, TELEVISA, which is raising its
advertising rates aggressively, and IUSACELL, Mexico's second cellular player
after TELMEX, which remains the fund's largest position.
BRAZIL's fiscal improvement continued to surprise the skeptics. For the 12
months ended in February, the deficit collapsed to just 3.6% of GDP compared
with 14% in the wake of last year's currency devaluation. As long as interest
rates continue to fall, analysts think the deficit could shrink to 2% by 2001.
However, investors were given yet another reminder of Brazil's indomitable
ability to disappoint when various lawsuits were launched against the
government, demanding compe nsation for the negative real interest rates earned
on savings and severance funds during the hyperinflationary years of the late
1980s and early 1990s. If the Supreme Court rules in favor of the workers, total
claims against the government from similar cases could run into tens of billions
of dollars. The Supreme Court has already scuttled other key public sector
reforms, including voting down government attempts to tax Social Security
payouts to retired public servants.
<PAGE>
***************************************************
[Geographic Diversification, pie chart showing percentages of fund assets
per country as follows; Argentina, 5%; Brazil, 37%; Chile, 3%; Mexico, 46%;
Peru, 2%; Venezuela, 2%; Other & Reserves, 5%]
***************************************************
Brazil's exports have been recovering well, albeit from a low base.
Manufacturing exports have been leading the way, with the biggest contribution
from aircraft sales, cars, and electronic goods. Last year, Brazil attracted
more direct foreign investment than any other emerging economy, outstripping
even China, and we regard this surge, along with an apparently successful and
noninflationary devaluation, as a key long-term positive. On the other hand, the
current account deficit and overall financing requirements are still
uncomfortably high. Moreover, as the economy recovers, large direct investment
inflows will translate into higher dividends paid to foreigners, and for this
reason we anticipate continuing pressure on the current account, despite rising
exports. For the time being, the economy remains hostage to external capital
market conditions.
We added to government-controlled oil and gas company PETROBRAS. Energy,
including electricity generation, is one of the last major sectors in Brazil to
be deregulated. As part of that process, the government is planning to sell down
its voting stake in Petrobras to 51% later this year. Eve n though full
deregulation of oil and gas prices could be delayed until 2002, we see
considerable upside as new management introduces more shareholder-friendly
systems and cost controls and takes advantage of the nation's huge oil reserves
and exploration potential. We also added to TELESP CELULAR, Sao Paulo's leading
cellular company, which is controlled by Portugal Telecom. The company added
another 220,000 customers in the first quarter of 2000 and is ambitiously
targeting 10% client penetration of wireless Internet services by year-end.
CHILE's economy is also enjoying faster-than-expected cyclical growth.
Since the second half of the 1980s, prudent macroeconomic policymaking,
underpinned by stringent financial sector regulation, prudent fiscal management,
and privatization and liberalization across a broad range of key sectors, has
formed the basis for superior growth compared with the rest of the region. The
recent economic pickup has been aided by a gradual and controlled 20% currency
depreciation against the dollar over the past couple of years, by cyclical
inventory adjustment, and by copper price recovery.
ARGENTINA is the only one of the region's larger economies where tangible
economic pickup has yet to materialize. President de la Rua began his mandate
with impressive vigor, first by attacking the widening government deficit with a
series of spending cuts and tax increases, and then by pushing through key labor
reform aimed at replacing the nation's antiquated and inflexible labor laws.
Despite this, tax receipts are lower than expected, a reflection of tepid
economic growth, a consumer worn down by repeated tax increases, and widespread
tax evasion.
<PAGE>
External financing requirements are, as ever, uncomfortably high. The
government alone needs around $17 billion of fresh funds this year, and the risk
is that if economic recovery does not come through quickly, greater borrowing
may be needed. Weak agricultural commodity prices have hurt exports, and, unlike
in Mexico and to some extent Brazil, it is difficult to see manufacturing
exports becoming a vibrant source of recovery. Underlying Argentina's lack of
manufacturing comp etitiveness is its currency policy, which many believe allows
insufficient flexibility to adjust to successful devaluations by its neighbors.
As any visitor will confirm, Argentina is an expensive country. Among portfolio
changes, we sold most of our holding in TELEFONICA DE ARGENTINA following parent
company Telefonica de Espana's bid, and replaced it with Argentina's other
telecom player, TELECOM ARGENTINA, which is controlled by France Telecom and
Telecom Italia.
***************************************************
INDUSTRY DIVERSIFICATION
------------------------
Percent of Net Assets
10/31/99 4/30/00
-------- -------
Services 53.9% 56.1%
Finance 13.0 14.5
Energy 11.3 11.0
Consumer Goods 14.4 10.1
Materials 5.6 4.4
Reserves 1.3 3.1
Other Assets Less Liabilities 0.5 0.8
Total 100.0% 100.0%
***************************************************
Less than 4% of the portfolio is invested in the region's smaller
economies, where we find the outlook generally worrisome. PERU is probably the
healthiest of a sick bunch: GDP there re covered strongly in the first quarter,
boosted by a jump in government expendi tures prior to elections. President
Fujimori now faces international condemnat ion for clear electoral
irregularities in the first round of presidential elections. VENEZUELA and
COLOMBIA both face a series of formidable and intractable barriers to economic
recovery. The Venezuelan economy remains stagnant, despite continued higher oil
prices, and we are concerned about the deterioration in the fiscal accounts in
the light of President Chavez's heavily populist instincts. The Colombian
guerrilla insurgency is hurting that country. ECUADOR, which defaulted on its
Brady and Euro bond payments last year, is facing spiraling inflationary
pressures despite switching its currency last April to the dollar. The IMF
recently approved standby credits on condition of the government's commitment to
tackle its yawning deficit.
<PAGE>
OUTLOOK
-------
Following a sharp contraction in emerging markets risk premiums worldwide
in the second half of last year, the larger Latin American countries have been
enjoying significant recovery. The reform process is moving ahead in a number of
areas, with bankruptcy and foreclosure legislation in Mexico, labor legislation
in Argentina, and painful fiscal restructuring in Brazil and Argentina. Exports,
even outside Mexico, have been showing signs of strength, helped by a pickup in
commodity prices.
Outside Mexico, however, external financing requirements are a continuing
constraint. Much of the region is far too dependent on the constant and ongoing
willingness of the international credit markets to bridge the financing gap, and
until this falls to more sustainable levels, the outlook for the region will
continue to be uncertain. This, in turn, will depend on improved competitiveness
and a prolonged pickup in noncommodity exports from the very low levels that
prevail outside Mexico. Only then will we see a sustainable recovery in regional
growth rates from the disappointing levels witnessed in the second half of the
1990s.
Respectfully submitted,
/s/
Martin G. Wade
Chairman
/s/
John R. Ford
President
May 18, 2000
<PAGE>
***************************************************
NEW PRESIDENT OF T. ROWE PRICE INTERNATIONAL FUNDS
After more than 20 years as president of T. Rowe
Price International Funds, Inc., Martin G. Wade
has passed the baton to his colleague, John R.
Ford. John Ford has been associated with T. Rowe
Price's international investment management arm
since 1984. He currently serves on the Investment
Advisory Committees of all the T. Rowe Price
international equity funds.
Mr. Wade was instrumental in the launching of T.
Rowe Price's first foreign stock offering, the
International Stock Fund, in 1980, and played a
key role thereafter in the company's increasing
presence as an international asset manager. He
remains associated with the International Funds as
chairman and is also a member of the Board of
Directors of T. Rowe Price Associates.
================================================================================
T. Rowe Price LatinAmerica Fund
--------------------------------------------------------------------------------
PORTFOLIO HIGHLIGHTS
--------------------
TWENTY-FIVE LARGEST HOLDINGS
----------------------------
Percent of
Net Assets
4/30/00
----------
Telefonos de Mexico (Telmex), Mexico 17.1%
Telebras, Brazil 12.3
Petrol Brasileiros (Petrobras), Brazil 7.6
Grupo Televisa, Mexico 4.8
Grupo Financiero Banamex, Mexico 3.7
Banco Itau, Brazil 3.2
Femsa, Mexico 3.0
Grupo Iusacell, Mexico 2.8
Cemex, Mexico 2.8
Pao de Acucar, Brazil 2.7
<PAGE>
Grupo Financiero Bancomer, Mexico 2.6
Telecom Argentina, Argentina 2.3
Compania Anonima Nacional Telefonos de Venezuela (CANTV), Venezuela 2.3
Coca-Cola Femsa, Mexico 2.0
Cia Energetica Minas Gerais, Brazil 1.8
Brahma, Brazil 1.8
Companhia Vale do Rio Doce, Brazil 1.7
Embratel Participacoes, Brazil 1.6
Enersis, Chile 1.5
Grupo Elektra, Mexico 1.4
Grupo Modelo, Mexico 1.4
Wal-Mart de Mexico, Mexico 1.2
Telefonica del Peru, Peru 1.2
Kimberly-Clark de Mexico, Mexico 1.2
Unibanco, Brazil 1.1
Total 85.1%
Note: Table excludes reserves.
================================================================================
T. Rowe Price Latin America Fund
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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.
MSCI EMF Latin Lipper Latin America Latin America
Date America Index Funds Average Fund
---- ------------- ------------- -------------
12/29/93 10,000 10,000 10,000
4/94 9,737 9,032 8,780
4/95 8,479 7,344 6,840
4/96 9,740 8,479 7,929
4/97 12,982 10,977 10,259
4/98 13,816 11,753 11,507
4/99 11,824 8,864 9,112
4/00 13,491 10,304 10,820
<PAGE>
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 4/30/00 1 Year 3 Year 5 Years Inception Date
--------------------- ------ ------ ------- --------- ---------
Latin America Fund 18.73% 1.79% 9.61% 1.25% 12/29/93
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 Latin America Fund
--------------------------------------------------------------------------------
Unaudited For a share outstanding throughout each period
FINANCIAL HIGHLIGHTS
-------------------- 6 Months Year
Ended Ended
4/30/00 10/31/99 10/31/98 10/31/97 10/31/96 10/31/95
------- -------- -------- -------- -------- --------
NET ASSET VALUE
---------------
Beginning of period $ 8.03 $ 7.22 $ 9.60 $ 8.14 $ 6.49 $ 10.32
--------------------------------------------------------------------------------
Investment activities
Net investment
income (loss) 0.06 0.09 0.16 0.13 0.10 0.05
Net realized and
unrealized gain (loss) 2.12 0.86 (2.45) 1.44 1.60 (3.92)
--------------------------------------------------------------------------------
Total from
investment activities 2.18 0.95 (2.29) 1.57 1.70 (3.87)
--------------------------------------------------------------------------------
Distributions
Net investment income (0.04) (0.14) (0.12) (0.11) (0.06) --
Net realized gain -- -- -- (0.03) -- --
--------------------------------------------------------------------------------
Total distributions (0.04) (0.14) (0.12) (0.14) (0.06) --
--------------------------------------------------------------------------------
Redemption fees added
to paid-in-capital -- -- 0.03 0.03 0.01 0.04
--------------------------------------------------------------------------------
<PAGE>
NET ASSET VALUE
---------------
END OF PERIOD $ 10.17 $ 8.03 $ 7.22 $ 9.60 $ 8.14 $ 6.49
--------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
------------------------
Total return* 27.16% 13.57% (23.93)% 19.94% 26.52% (37.11)%
--------------------------------------------------------------------------------
Ratio of total expenses
to average net assets 1.44%+ 1.62% 1.53% 1.47% 1.66% 1.82%
--------------------------------------------------------------------------------
Ratio of net investment
income (loss) to average
net assets 1.18%+ 1.05% 1.35% 1.30% 1.29% 0.76%
--------------------------------------------------------------------------------
Portfolio turnover rate 25.1%+ 43.2% 19.0% 32.7% 22.0% 18.9%
--------------------------------------------------------------------------------
Net assets,
end of period
(in thousands) $247,384 $200,385 $204,761 $398,066 $213,691 $148,600
--------------------------------------------------------------------------------
* 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 and payment of no redemption or account fees.
+ Annualized
The accompanying notes are an integral part of these financial statements.
================================================================================
T. Rowe Price Latin America Fund
--------------------------------------------------------------------------------
Unaudited April 30, 2000
STATEMENT OF NET ASSETS
-----------------------
ARGENTINA 5.3%
---------------
COMMON STOCKS 5.3%
Banco de Galicia y Buenos Aires (Class B) ADR (USD) 60,168 $ 1,040
--------------------------------------------------------------------------------
Banco Frances del Rio de la Plata ADR (USD) 97,868 1,933
--------------------------------------------------------------------------------
Banco Rio de la Plata (Class B) ADR (USD) 116,380 1,615
--------------------------------------------------------------------------------
<PAGE>
PC Holdings 1,385,733 2,108
--------------------------------------------------------------------------------
Telecom Argentina (Class B) ADR (USD) 206,040 5,756
--------------------------------------------------------------------------------
Telefonica de Argentina (Class B) ADR (USD) 19,937 700
--------------------------------------------------------------------------------
Total Argentina (Cost $16,120) 13,152
----------
BRAZIL 36.7%
-----------
COMMON STOCKS 22.2
Companhia Vale do Rio Doce ADR (USD) 167,000 4,165
--------------------------------------------------------------------------------
Embratel Participacoes ADR (USD) 173,500 3,904
--------------------------------------------------------------------------------
Pao de Acucar GDR (USD) 234,432 6,681
--------------------------------------------------------------------------------
Tele Centro Sul Participacoes ADR (USD) 27,488 1,752
--------------------------------------------------------------------------------
Tele Norte Leste Participacoes ADR (USD) 101,185 1,802
--------------------------------------------------------------------------------
Telebras ADR (USD) 257,286 30,408
--------------------------------------------------------------------------------
Telesp-Telecomunicacoes de Sao Paulo ADR (USD) 88,302 2,230
--------------------------------------------------------------------------------
Telesp Celular ADR(USD) 29,000 1,280
--------------------------------------------------------------------------------
Unibanco GDR (USD) 113,000 2,818
--------------------------------------------------------------------------------
55,040
----------
PREFERRED STOCKS 14.5%
Banco Itau 106,371,000 7,954
--------------------------------------------------------------------------------
Brahma 6,107,482 4,431
--------------------------------------------------------------------------------
Cia Energetica Minas Gerais 299,776,141 4,566
--------------------------------------------------------------------------------
Petrol Brasileiros 79,105,711 18,844
--------------------------------------------------------------------------------
35,795
----------
Total Brazil (Cost $83,357) 90,835
----------
<PAGE>
CHILE 3.4%
----------
COMMON STOCKS 3.4%
Banco Santiago ADR (USD) 98,258 $ 1,941
--------------------------------------------------------------------------------
Compania Cervecerias Unidas ADS (USD) 7,176 160
--------------------------------------------------------------------------------
Compania de Telecomunicaciones de Chile
(Class A) ADR (USD) 44,950 831
--------------------------------------------------------------------------------
Embotelladora Andina ADR (USD) 145,018 1,686
--------------------------------------------------------------------------------
Enersis ADS (USD) 202,723 3,776
--------------------------------------------------------------------------------
Total Chile (Cost $11,083) 8,394
----------
MEXICO 46.3%
------------
COMMON STOCKS 46.3%
Cemex ADR (USD) 40,030 876
--------------------------------------------------------------------------------
Cemex (Represents 2 Class A and 1 Class B shares) 1,398,746 6,057
--------------------------------------------------------------------------------
Coca-Cola Femsa (Class L) ADR (USD) 270,300 5,017
--------------------------------------------------------------------------------
Control Commercial Mexicana, Units
(Each unit consists of 3 Class B
and 1 Class C shares) 2,078,700 2,187
--------------------------------------------------------------------------------
Femsa UBD
(Represents 1 Class B and
4 Series D shares) 1,890,710 7,484
--------------------------------------------------------------------------------
Grupo Elektra, Participating Certificates
(Represents 1 Class L and
and 2 Class B shares) 3,644,690 3,563
--------------------------------------------------------------------------------
Grupo Financiero Banamex * 2,541,000 9,181
--------------------------------------------------------------------------------
Grupo Financiero Bancomer * 14,257,000 6,363
--------------------------------------------------------------------------------
Grupo Iusacell ADR (USD) * 436,800 6,962
--------------------------------------------------------------------------------
Grupo Modelo (Class C) 1,586,480 3,372
--------------------------------------------------------------------------------
Grupo Sanborns * 786,300 1,354
--------------------------------------------------------------------------------
Grupo Televisa ADR (USD) * 187,200 11,876
--------------------------------------------------------------------------------
<PAGE>
Kimberly-Clark de Mexico (Class A) 890,041 $ 2,866
--------------------------------------------------------------------------------
Organizacion Soriana 530,500 2,114
--------------------------------------------------------------------------------
Telefonos de Mexico (Class L) ADR (USD) 720,776 42,391
--------------------------------------------------------------------------------
Wal-Mart de Mexico ADR (USD) * 129,293 3,026
--------------------------------------------------------------------------------
Total Mexico (Cost $76,929) 114,689
----------
PERU 1.5%
---------
COMMON STOCKS 1.5%
Credicorp ADR (USD) 75,790 800
--------------------------------------------------------------------------------
Telefonica del Peru (Class B) ADR (USD) 192,168 2,907
--------------------------------------------------------------------------------
Total Peru (Cost $4,196) 3,707
----------
VENEZUELA 2.3%
--------------
COMMON STOCKS 2.3%
Compania Anonima Nacional Telefonos de Venezuela
(Class D) ADR (USD) 193,364 5,607
--------------------------------------------------------------------------------
Total Venezuela (Cost $6,592) 5,607
----------
UNITED STATES 0.6%
------------------
COMMON STOCKS 0.6%
IMPSAT Fiber Networks * 10,800 169
--------------------------------------------------------------------------------
StarMedia Network * 60,000 1,307
--------------------------------------------------------------------------------
Total United States (Cost 1,944) 1,476
----------
SHORT-TERM INVESTMENTS 3.1%
---------------------------
MONEY MARKET FUNDS 3.1%
Reserve Investment Fund, 6.18% # 7,661,810 7,662
--------------------------------------------------------------------------------
Total Short-Term Investments (Cost $7,662) 7,662
----------
<PAGE>
TOTAL INVESTMENTS IN SECURITIES
99.2% of Net Assets (Cost $207,883) $ 245,522
Other Assets Less Liabilities 1,862
----------
NET ASSETS $ 247,384
----------
NET ASSETS CONSIST OF:
----------------------
Accumulated net investment income - net of distributions $ 1,356
Accumulated net realized gain/loss - net of distributions (54,386)
Net unrealized gain (loss) 37,625
Paid-in-capital applicable to 24,329,238 shares of $0.01 par
value capital stock outstanding; 2,000,000,000 shares of
the Corporation authorized 262,789
----------
NET ASSETS $ 247,384
----------
NET ASSET VALUE PER SHARE $ 10.17
----------
* Non-income producing
# Seven-day yield
ADR American depository receipt
ADS American depository share
GDR Global depository receipt
USD U.S. dollar
================================================================================
T. Rowe Price Latin America Fund
--------------------------------------------------------------------------------
Unaudited
STATEMENT OF OPERATIONS
-----------------------
In thousands 6 Months
Ended
4/30/00
-------
INVESTMENT INCOME (LOSS)
------------------------
INCOME
Dividend (net of foreign taxes of $382) $ 3,146
Interest 303
Securities lending 28
-------
Total income 3,477
-------
<PAGE>
EXPENSES
Investment management 1,415
Shareholder servicing 337
Custody and accounting 101
Prospectus and shareholder reports 25
Registration 11
Legal and audit 9
Directors 3
Miscellaneous 11
-------
Total expenses 1,912
-------
Net investment income (loss) 1,565
-------
REALIZED AND UNREALIZED GAIN (LOSS)
-----------------------------------
NET REALIZED GAIN (LOSS)
Securities (5,858)
Foreign currency transactions (102)
Net realized gain (loss) (5,960)
-------
CHANGE IN NET UNREALIZED GAIN OR LOSS
Securities 58,298
Other assets and liabilities
denominated in foreign currencies 21
-------
Change in net unrealized gain or loss 58,319
-------
NET REALIZED AND UNREALIZED GAIN (LOSS) 52,359
-------
INCREASE (DECREASE) IN NET
ASSETS FROM OPERATIONS $ 53,924
-------
The accompanying notes are an integral part of these financial statements.
================================================================================
<PAGE>
T. Rowe Price Latin America Fund
--------------------------------------------------------------------------------
Unaudited
STATEMENT OF CHANGES IN NET ASSETS
----------------------------------
6 Months Year
Ended Ended
4/30/00 10/31/99
------- --------
INCREASE (DECREASE) IN NET ASSETS
---------------------------------
Operations
Net investment income (loss) $ 1,565 $ 2,112
Net realized gain (loss) (5,960) (35,160)
Change in net unrealized gain or loss 58,319 54,790
----------------------
Increase (decrease) in net assets from operations 53,924 21,742
----------------------
Distributions to shareholders
Net investment income (998) (3,788)
----------------------
Capital share transactions *
Shares sold 86,821 114,750
Distributions reinvested 946 3,608
Shares redeemed (93,840) (140,909)
Redemption fees received 146 221
----------------------
Increase (decrease) in net assets from capital
share transactions (5,927) (22,330)
----------------------
NET ASSETS
----------
Increase (decrease) during period 46,999 (4,376)
Beginning of period 200,385 204,761
----------------------
END OF PERIOD $ 247,384 $ 200,385
----------------------
*Share information
Shares sold 8,047 14,781
Distributions reinvested 96 546
Shares redeemed (8,766) (18,729)
----------------------
Increase (decrease) in shares outstanding (623) (3,402)
The accompanying notes are an integral part of these financial statements.
================================================================================
<PAGE>
T. Rowe Price Latin America Fund
--------------------------------------------------------------------------------
Unaudited April 30, 2000
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 Latin America Fund (the fund), a
nondiversified, open-end management investment company, is one of the portfolios
established by the corporation and commenced operations on December 29, 1993.
The fund seeks long-term growth of capital by investing primarily in the common
stocks of companies located, or with primary operations, in Latin America. 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.
<PAGE>
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.
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 April 30, 2000, 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.
OTHER Purchases and sales of portfolio securities, other than short-term
securities, aggregated $30,794,000 and $42,094,000 respectively, for the six
months ended April 30, 2000.
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. As of October 31, 1999, the fund has capital loss carryforwards
for federal income tax purposes of $48,426,000, of which $14,499,000 expires in
2004 and $33,927,000 expires in 2007. The fund intends to retain gains realized
in future periods that may be offset by available capital loss carryforwards.
At April 30, 2000, the cost of investments for federal income tax purposes
was substantially the same as for financial reporting and totaled $207,883,000.
Net unrealized gain aggregated $37,639,000 at period end, of which $51,362,000
related to appreciated investments and $13,723,000 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.
<PAGE>
NOTE 5 - RELATED PARTY TRANSACTIONS
The fund is managed by Rowe Price-Fleming International, Inc. (the
manager), which is owned by subsidiaries of T. Rowe Price Associates, Inc.
(Price Associates) and Robert Fleming Holdings Limited (Fleming). Price
Associates has entered into an agreement with Fleming to purchase Fleming's
interest in the manager.
The investment management agreement between the fund and the manager
provides for an annual investment management fee, of which $229,000 was payable
at April 30, 2000. The fee is computed daily and paid monthly, and consists of
an individual fund fee equal to 0.75% 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 April 30, 2000, and for the six months then ended,
the effective annual group fee rates 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 $312,000 for the six months
ended April 30, 2000, of which $74,000 was payable at period-end.
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 0.2% of the outstanding shares of the fund at April 30, 2000.
For the six months then ended, the fund was allocated $1,000 of Spectrum
expenses.
<PAGE>
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 six months ended April 30, 2000, totaled
$297,000 and are reflected as interest income in the accompanying Statement of
Operations.
During the six months ended April 30, 2000, the fund, in the ordinary
course of business, placed security purchase and sale orders aggregating
$6,705,000 with certain affiliates of the manager and paid commissions of
$18,000 related thereto.
================================================================================
T. ROWE PRICE SHAREHOLDER SERVICES
----------------------------------
INVESTMENT SERVICES AND INFORMATION
-----------------------------------
KNOWLEDGEABLE SERVICE REPRESENTATIVES
-------------------------------------
BY PHONE 1-800-225-5132 Available Monday through Friday from 8
a.m. to 10 p.m. ET and weekends from 8:30 a.m. to 5 p.m. ET.
IN PERSON Available in T. Rowe Price Investor Centers.
ACCOUNT SERVICES
----------------
CHECKING Available on most fixed income funds ($500 minimum).
AUTOMATIC INVESTING From your bank account or paycheck.
AUTOMATIC WITHDRAWAL Scheduled, automatic redemptions.
DISTRIBUTION OPTIONS Reinvest all, some, or none of your
distributions.
AUTOMATED 24-HOUR SERVICES Including Tele*AccessRegistration Mark
and the T. Rowe Price Web site on the Internet. Address:
www.troweprice.com
<PAGE>
BROKERAGE SERVICES*
-------------------
INDIVIDUAL INVESTMENTS Stocks, bonds, options, precious metals,
and other securities at a savings over full-service commission
rates. **
INVESTMENT INFORMATION
----------------------
COMBINED STATEMENT Overview of all your accounts with T. Rowe
Price.
SHAREHOLDER REPORTS Fund managers' reviews of their strategies
and results.
T. ROWE PRICE REPORT Quarterly investment newsletter discussing
markets and financial strategies.
PERFORMANCE UPDATE Quarterly review of all T. Rowe Price fund
results.
INSIGHTS Educational reports on investment strategies and
financial markets.
INVESTMENT GUIDES Asset Mix Worksheet, College Planning Kit,
Diversifying Overseas: A Guide to International Investing,
Personal Strategy Planner, Retirees Financial Guide, and
Retirement Planning Kit.
* T. Rowe Price Brokerage is a division of T. Rowe Price
Investment Services, Inc., Member NASD/SIPC.
** Based on a September 1999 survey for representative-assisted
stock trades. Services vary by firm, and commissions may
vary depending on size of order.
======================================================================
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
<PAGE>
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.
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. F97-051 4/30/00
