[SCUDDER NEW ASIA FUND LOGO]
SCUDDER NEW ASIA FUND, INC.
Annual Report
December 31, 1999
A closed-end investment company seeking long-term capital appreciation through
investment primarily in the equity securities of Asian companies.
<PAGE>
SCUDDER NEW ASIA FUND, INC.
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Investment objective and policies
o long-term capital appreciation through investment primarily in the equity
securities of Asian companies
Investment characteristics
o a closed-end investment company investing in a broad spectrum of Asian
companies and industries
o a vehicle for international diversification through participation in Asian
stock markets
General Information
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Executive Offices
Scudder New Asia Fund, Inc.
345 Park Avenue
New York, NY 10154
For Fund Information: 1-800-349-4281
Transfer Agent, Registrar and Dividend
Reinvestment Plan Agent
For Account Information: 1-800-426-5523
EquiServe
P.O. Box 8200
Boston, MA 02266-8200
Custodian
Brown Brothers Harriman & Co.
Legal Counsel
Dechert Price & Rhoads
Independent Accountants
PricewaterhouseCoopers LLP
New York Stock Exchange Symbol -- SAF
Contents
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In Brief ............................................................... 3
Letter to Stockholders ................................................. 3
Other Information ...................................................... 6
Investment Summary ..................................................... 7
Portfolio Summary ...................................................... 8
Investment Portfolio ................................................... 9
Financial Statements ................................................... 14
Financial Highlights ................................................... 17
Notes to Financial Statements .......................................... 18
Report of Independent Accountants ...................................... 21
Tax Information ........................................................ 22
Dividend Reinvestment and Cash
Purchase Plan ....................................................... 23
Stockholder Meeting Results ............................................ 25
Directors and Officers ................................................. 26
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This report is sent to the stockholders of Scudder New Asia Fund, Inc. for their
information. It is not a prospectus, circular, or representation intended for
use in the purchase or sale of shares of the fund or of any securities mentioned
in the report.
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2
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Scudder New Asia Fund, Inc.
In Brief
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o The Asian stock markets rose sharply in 1999 on the strength of widespread
corporate restructuring and a recovery in the region's economies.
o Using a bottom-up investment discipline, management has found opportunities
in technology, telecommunications, and cyclicals.
Letter to Stockholders
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Dear Stockholders:
The Asian markets closed 1999 on a positive note as the region's economies
continued to recover from the financial crisis of 1997-98. Riding a wave of
benign liquidity conditions and increased global demand -- particularly for
electronic products and semiconductors -- the Asian economies experienced a
sharp rise in exports. The resulting increase in manufacturing production led to
inventory building and increased hiring, which, in turn, spurred solid growth in
private consumption. Tame inflation trends and stable exchange rates further
boosted the recovery by allowing the local governments to keep interest rates
relatively low. Stock market sentiment has soared as a result, with investors
encouraged by the prospects for a sharp rise in corporate earnings and 5-6% real
GDP growth in the Asia Region over the next two years.
Fund Performance
In this environment, the fund's NYSE share price rose 112.75% to end the
period at $19.8125. The fund's net asset value rose 105.72% for the twelve-month
period, beating the 62.70% return of the fund's unmanaged benchmark, which is
comprised of 75% MSCI All Country Asia Free Index and 25% MSCI Japan Index. The
fund also outperformed the index over the month and quarter ended December 31,
1999, returning 12.00% and 32.95% respectively versus 7.56% and 20.29% for the
index. The fund's discount to NAV stood at 17.76% as of the end of the period.
A combination of strong individual stock selection and overweighted positions
in the region's best- performing markets led to the fund's outperformance
relative to its benchmark. For instance, we benefited in the third quarter from
our overweight position in Japan and India, as well as our strong stockpicking
within those markets. Aside from smaller markets such as Thailand and the
Philippines, superior stock selection also had a positive impact on our
positions across the rest of Asia, countering the negative impact of broader
third quarter weakness in the emerging markets. In the fourth quarter,
performance was helped by our successful stockpicking within Japan, Korea,
Taiwan, and Hong Kong. Our focus on the technology and telecommunications
services sectors was critical in a period in which these sectors generally
provided outstanding performance across all of the global markets. The fund has
been positioned in techs and telecoms for some time, and we continue to believe
in the positive fundamental outlook of our individual holdings despite their
recent surge.
Fund Strategy
We continue to use in-depth, bottom-up research and on-the-ground experience
to find the companies that have seized the initiative to improve their
competitive positions. We utilize a careful stock selection process that focuses
on fast-growing companies with superior management teams, dominant market
positions, clear competitive advantages, high-or-improving returns on
3
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Scudder New Asia Fund, Inc.
Letter to Stockholders
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equity, strong balance sheets, and catalysts for positive change. We expect that
as the recovery deepens, the difference among these companies and others whose
share prices have simply rebounded in line with the improvement in the
macroeconomic outlook will become increasingly differentiated.
The fund is heavily weighted in the electronics sector. Our outlook is
positive on the global demand for personal computers, semiconductor-related
products, and telecommunications equipment, and many companies in Northern Asia
appear to be well positioned to cater to that demand. We believe that Korea's
Samsung Electronics -- the world's largest DRAM manufacturer -- and Taiwan
Semiconductor -- the largest chipmaker -- are two of the best in this industry.
We also continue to favor contract manufacturers such as Taiwan's Compal
Electronics, Asustek, and Hon Hai Precision, in addition to JIT Holdings and
Natsteel Electronics in Singapore.
We are also finding some attractive opportunities in the telecommunications
sector. The fund currently holds 16% of net assets in telecom stocks, including
almost 15% in our top holdings in Korea and Japan. During the period, we
benefited from large gains in NTT, NTT Mobile Communications Network, and DDI in
Japan, and SK Telecom, Korea Telecom, and Dacom in Korea. We remain positive on
this sector for two reasons. First, telecom companies are benefiting from the
adoption of new wireless data technologies and applications that will enhance
existing voice based earnings. Second, we believe that investment in this sector
will allow us to capitalize on the region's rising consumption. In general,
economic recoveries in the emerging markets tend to translate into increased
demand for telecom services. So far, this trend has remained intact in Asia,
where penetration and consumer adoption continues to rise. As a result, we
believe that telecom will remain one of the premiere growth businesses in the
region going forward.
From a country standpoint, we remain bullish on the prospects for further
gains in the Korean equity market despite the tremendous gains it has produced
over the past two years. The country has a strong industrial base, a
considerable presence in the global technology sector, and a reform-oriented
government. We believe that Korea, which was previously hampered by poor
business practices and structures, will prosper as its aggressive structural and
business reforms continue to impact the economy.
We are also intrigued by the opportunities available in India. The country
has a robust technology industry -- and therefore a strong export base -- as
well as a new, business-oriented government. Foreign direct investment is
soaring, and both inflation and interest rates are tame. We brought our position
to an overweight level over the second half of the year in order to take
advantage of the country's unique investment opportunities.
Investment Outlook
Despite the strong performance of the Asian equity markets in 1999, we remain
positive on the outlook for the region in 2000. Although some stock markets have
soared and valuations appear rich relative to historical levels, we believe that
investment fundamentals continue to point to significant potential in these
markets in the years ahead. The key driver, in our view, will be more
enlightened management practices, which should result in more efficient resource
allocation and improved returns to shareholders. These structural changes should
lead to higher quality earnings, which in turn should facilitate higher
multiples over the medium to longer term.
Improving macroeconomic fundamentals should also provide a stronger base for
growth and overall demand across the region, and the combination of a stronger
Japanese economy, domestic structural reform, and improving consumer confidence
should lead to upside surprises in both macroeconomic and corporate
4
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Scudder New Asia Fund, Inc.
Letter to Stockholders
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earnings growth in the coming year. This should result in a greater flow of
capital into the region, thereby helping companies to establish a stronger
foundation for the future. We anticipate that this virtuous cycle will go a long
way to reestablishing the Asian economic "miracle" -- this time on more orthodox
and prudent Western financial terms -- and lay the groundwork for more sustained
economic growth in the years ahead.
Respectfully,
/s/Nicholas Bratt /s/Daniel Pierce
Nicholas Bratt Daniel Pierce
President Chairman of the Board
and Director
5
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Scudder New Asia Fund, Inc.
Other Information
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Investment Manager
The investment manager of Scudder New Asia Fund, Inc. is Scudder Kemper
Investments Inc. (the "Manager"), one of the most experienced investment
management firms in the world. Established in 1919, the firm manages investments
for institutional and corporate clients, retirement and pension plans, insurance
companies, mutual fund investors, and individuals. The Manager has offices
throughout the United States and has subsidiaries in the United Kingdom,
Switzerland, Hong Kong, and Japan.
The Manager has been a leader in international investment management for over
40 years. It manages Scudder International Fund, which was originally
incorporated in Canada in 1953 as the first foreign investment company
registered with the United States Securities and Exchange Commission. The
Manager's clients that invest primarily in foreign securities include thirty
open-end investment companies as well as portfolios for institutional investors.
The Manager also manages the assets of other closed-end investment companies
which invest primarily in foreign securities, including: The Argentina Fund,
Inc., The Brazil Fund, Inc., The Korea Fund, Inc., and Scudder Global High
Income Fund, Inc.
A Team Approach to Investing
Scudder New Asia Fund, Inc. is managed by a team of Scudder Kemper investment
professionals who each play an important role in the fund's management process.
Team members work together to develop investment strategies and select
securities for the fund's portfolio. They are supported by the Manager's large
staff of economists, research analysts, traders, and other investment
specialists who work in the Manager's offices across the United States and
abroad. The Manager believes the team approach benefits fund investors by
bringing together many disciplines and leveraging its extensive resources.
Lead Portfolio Manager Tien-Yu Sieh assumed responsibility for the fund's
day-to-day management and investment strategies in 1999. Mr. Sieh joined the
Manager in 1996, and has seven years of experience in the investment industry.
Portfolio Manager Theresa Gusman joined the Manager in 1995 and the fund team in
1996. Ms. Gusman has 16 years of investment industry experience. Portfolio
Manager Elizabeth J. Allan joined the Manager and the fund in 1987. Ms. Allan
has 17 years of Pacific Basin research and investment management experience.
Nicholas Bratt, Portfolio Manager, has been a member of the fund's team since
1987 and helps set the fund's general investment strategies. Mr. Bratt has over
23 years of experience in worldwide investing, including 22 years of experience
as a portfolio manager, and has been with the Manager since 1976.
Dividend Reinvestment Plan
The fund's Dividend Reinvestment and Cash Purchase Plan offers you a
convenient way to have your dividends and capital gain distributions reinvested
in shares of the fund. You may obtain more detailed information by requesting a
copy of the Plan from the Plan Agent. All correspondence (including
notifications) should be directed to: Scudder New Asia Fund Dividend
Reinvestment and Cash Purchase Plan, c/o EquiServe, P.O. Box 8200, Boston, MA
02266-8200, (800) 426-5523.
Net Asset Value
The fund's NAV is published every weekday in The Wall Street Journal under
the heading "Closed End Funds." The fund's NAV is also published in The New York
Times and Barron's.
As a service to overseas stockholders, the fund's NAV is listed daily in The
Financial Times ("FT"). For your information the NAV of the fund and other
Scudder managed closed-end funds can be found in the "FT Managed Funds Service"
section under the heading "other offshore funds" below the Scudder Kemper
Investments, Inc. banner.
6
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Scudder New Asia Fund, Inc.
Investment Summary as of December 31, 1999
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Historical
Information
Total Return(%)
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Market Value Net Asset Value(a)
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Average Average
Cumulative Annual Cumulative Annual
---------------------- ------------------------
Quarterly 36.05 -- 32.51 --
One Year 112.75 112.75 105.72 105.72
Three Year 67.59 18.78 66.81 18.60
Five Year 46.61 7.95 67.69 10.89
Ten Year 140.04 9.15 183.21 10.97
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Per Share Information and Returns(a)
Yearly periods ended December 31
THE ORIGINAL DOCUMENT CONTAINS A BAR CHART HERE
1990 -2.77
1991 12.54
1992 1.94
1993 73.32
1994 -11.67
1995 -2.96
1996 2.46
1997 -21.89
1998 3.81
1999 105.72
<TABLE>
<CAPTION>
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
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<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value ... $13.44 $14.94 $14.73 $25.06 $17.44 $15.29 $15.26 $11.28 $11.71 $24.09
Income Dividends .. $ .08 $ .08 $ .08 $ .32 $ .23 $ -- $ .02 $ .18 $ -- $ --
Capital Gains
Distributions ..... $ 2.11 $ .11 $ .43 $ .08 $ 4.20 $ 1.67 $ .33 $ .39 $ -- $ --
Total Return(%) ... -2.77 12.54 1.94 73.32 -11.67 -2.96 2.46 -21.89 3.81 105.72
</TABLE>
(a) Total investment returns reflect changes in net asset value per share during
each period and assume that dividends and capital gains distributions, if
any, were reinvested. These percentages are not an indication of the
performance of a shareholder's investment in the Fund based on market.
Past results are not necessarily indicative of future performance of the
Fund.
7
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Scudder New Asia Fund, Inc.
Portfolio Summary as of December 31, 1999
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Diversification
A GRAPH IN THE FORM OF A PIE CHART APPEARS HERE, ILLUSTRATING THE EXACT DATA
POINTS IN THE TABLE BELOW.
Common Stocks 98%
Cash Equivalents 1%
Other 1%
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100%
----
Geographical breakdown of the Fund's equity securities
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A GRAPH IN THE FORM OF A PIE CHART APPEARS HERE, ILLUSTRATING THE EXACT DATA
POINTS IN THE TABLE BELOW.
Japan 37%
Korea 16%
Taiwan 13%
Hong Kong 13%
India 11%
Singapore 4%
Thailand 1%
Malaysia 1%
United Kingdom 1%
Other 3%
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100%
----
Sector breakdown of the Fund's equity securities
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A GRAPH IN THE FORM OF A PIE CHART APPEARS HERE, ILLUSTRATING THE EXACT DATA
POINTS IN THE TABLE BELOW.
Technology 35%
Communication 16%
Financial 15%
Manufacturing 12%
Consumer Discretionary 6%
Consumer Staples 5%
Health 3%
Service Industries 2%
Metals and Minerals 1%
Other 5%
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100%
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Ten Largest Equity Holdings (25% of Portfolio)
<TABLE>
<CAPTION>
<S> <C>
1. Samsung Electronics Co., Ltd. 6. DDI Corp.
Electronics manufacturer Long distance telephone and cellular
operator
2. Kyocera Corp.
Leading ceramic package manufacturer 7. Nippon Telegraph & Telephone Corp.
Telecommunication services
3. SK Telecom Co., Ltd.
Provider of mobile telecommunication 8. NTT Mobile Communications
services Network, Inc.
Provider of various
4. Sony Corp. telecommunication services and
Manufacturer of consumer electronic equipment
products
9. Korea Telecom Corp.
5. Infosys Technologies Ltd. Telecommunication services
Financial and industrial software
developer 10. Korea Data Systems Co., Ltd.
Manufacturer of computer monitors
</TABLE>
8
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<TABLE>
<CAPTION>
Scudder New Asia Fund, Inc.
Investment Portfolio as of December 31, 1999
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Principal
Amount ($) Value ($)
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REPURCHASE AGREEMENTS 1.1%
United States
<S> <C> <C>
Donaldson, Lufkin & Jenrette, 2.25%, to be repurchased at $2,232,420 on 1/3/2000**
(Cost $2,232,000) ................................................................................. 2,232,000 2,232,000
------------
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Units
------------
LIMITED PARTNERSHIP 0.3%
Japan 0.3%
JAFCO No. 6 Investment Enterprise Partnership (Venture capital company)
(Cost $599,205) (b) ............................................................................... 1 547,236
------------
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Shares
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CONVERTIBLE PREFERRED STOCKS 0.3%
Thailand 0.3%
Siam Commercial Bank Public Company Ltd., 5.250% (Provider of financial services)
(Cost $306,181) ................................................................................... 435,800 534,225
------------
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COMMON STOCKS 98.3%
China 0.8%
Shanghai Petrochemical Co., Ltd. "H" (Manufacturer of petrochemical and petroleum
products) ......................................................................................... 9,979,000 1,566,139
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Hong Kong 13.3%
Cheung Kong Holdings Ltd. (Real estate company) ..................................................... 276,000 3,497,266
China Telecom (Hong Kong) Ltd.* (Provider of cellular telecommunication services) ................... 516,000 3,219,399
Dah Sing Financial Group (Provider of banking services and property investment) ..................... 390,000 1,555,284
Giordano International Ltd. (Retailer of casual apparel) ............................................ 2,020,000 2,078,858
Henderson Investment Ltd. (Property developer) ...................................................... 1,275,000 1,320,351
Hengan International Group Co. Ltd."H" (Manufacturer and seller of personal
hygiene products) ................................................................................. 2,684,000 733,711
Hutchison Whampoa, Ltd. (Diversified investment holding company) .................................... 209,000 3,038,142
i-Cable Communications Ltd. (ADR)* (Operator of cable television systems) ........................... 13,232 331,627
Li & Fung Ltd. (Exporter of consumer products) ...................................................... 1,488,000 3,732,682
New World China Land Ltd.* (Property development) ................................................... 3,688 1,364
The accompanying notes are an integral part of the financial statements.
9
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Scudder New Asia Fund, Inc.
Investment Portfolio
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Shares Value ($)
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New World Infrastructure Ltd.* (Investment in and operation of infrastructure
projects) ......................................................................................... 859,800 1,100,535
Quality Healthcare Asia Ltd.* (Provider of medical coverage services) ............................... 2,370,000 914,646
SmarTone Telecommunications Holdings Ltd. (Cellular communication services) ......................... 331,000 1,596,771
TCL International Holdings Ltd.* (Manufacturer of electronic products) .............................. 3,800,000 2,639,738
Timeless Software Ltd.* (Provider of computer software services) .................................... 1,454,148 837,115
Yue Yuen Industrial Holdings Ltd. (Manufacturer and marketer of athletic and
outdoor footwear) ................................................................................. 627,000 1,492,185
------------
28,089,674
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India 10.5%
Aptech Ltd. (Provider of professional education services) ........................................... 369 14,989
Global Tele-Systems Limited* (Manufacturer of telecommunication products
and services) ..................................................................................... 114,600 2,523,834
Hero Honda Motors Ltd. (Manufacturer of motorized two wheelers) ..................................... 66,416 1,723,762
Hindalco Industries Ltd.* (Manufacturer of aluminum) ................................................ 78,200 1,447,149
Hindustan Lever Ltd. (Manufacturer of consumer products) ............................................ 400 20,690
ICICI Banking Corp. (Provider of banking services) .................................................. 100 161
ICICI Ltd. (ADR)* (Venture capital firm) ............................................................ 122,800 1,703,850
Infosys Technologies Ltd. (Financial and industrial software developer) ............................. 15,600 5,205,828
NIIT Ltd. (Designer and distributor of computer software) ........................................... 40,800 3,109,757
Ranbaxy Laboratories, Ltd. (Manufacturer and distributor of pharmaceutical
products) ......................................................................................... 86,000 1,824,782
Satyam Computer Services, Ltd. (Provider of software services) ...................................... 64,300 3,250,476
TVS Suzuki Ltd. (Manufacturer of motorcycles and mopeds) ............................................ 108,000 1,338,207
------------
22,163,485
------------
Indonesia 0.8%
PT Indo-Rama Synthetics Tbk* (Producer of polyester yarn, fiber and fabric) ......................... 2,968,500 690,349
PT Indofood Sukses Makmur Tbk* (Manufacturer of food products) ...................................... 312,500 391,324
PT Indonesia Satellite Corp. (ADR) (International telecommunication services) ....................... 31,900 689,838
------------
1,771,511
------------
Japan 36.9%
Advantest Corp. (Producer of measuring instruments and semiconductor
testing devices) .................................................................................. 8,600 2,272,016
Aiful Corp. (Consumer financing firm) ............................................................... 6,000 733,855
Asahi Glass Co., Ltd. (Manufacturer of glass products) .............................................. 163,000 1,261,575
Benesse Corp. (Provider of educational services) .................................................... 10,000 2,407,045
The accompanying notes are an integral part of the financial statements.
10
<PAGE>
Scudder New Asia Fund, Inc.
Investment Portfolio
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Shares Value ($)
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Chugai Pharmaceutical Co., Ltd. (Pharmaceutical company) ............................................ 138,000 1,492,074
DDI Corp. (Long distance telephone and cellular operator) ........................................... 338 4,630,137
Fanuc Ltd. (Manufacturer of numerically controlled equipment for machine tools) ..................... 15,800 2,011,331
Fuji Bank, Ltd. (Provider of commercial banking services) ........................................... 144,000 1,399,139
Fujisawa Pharmaceutical Co. Ltd. (Manufacturer of marketer of antibiotics) .......................... 71,000 1,722,896
Gunze, Ltd. (Leading manufacturer of underwear and sportswear) ...................................... 622,000 1,655,421
Internet Initiative Japan Inc. (ADR)* (Provider of Internet services) ............................... 28,200 2,740,688
Japan Securities Finance Co., Ltd.* (Provider of securities related financing services) ............. 134,000 753,914
Kyocera Corp. (Leading ceramic package manufacturer) ................................................ 24,800 6,430,528
Makino Milling Machine Co., Ltd. (Manufacturer and retailer of machining centers,
electrodischargers and milling machines) .......................................................... 133,000 866,712
Megachips Corp. (Manufacturer and marketer of various types of LSI's) ............................... 45,000 2,879,648
Murata Manufacturing Co., Ltd. (Manufacturer of ceramic applied
electronic computers) ............................................................................. 11,000 2,583,170
NEC Corp. (Manufacturer of telecommunication and computer equipment) ................................ 157,000 3,740,656
NTT Mobile Communications Network, Inc. (Provider of various telecommunication
services and equipment) ........................................................................... 114 4,383,757
Nikko Securities Co., Ltd. (Securities broker and dealer) ........................................... 158,000 1,998,963
Nintendo Co., Ltd. (Manufacturer of game equipment) ................................................. 14,100 2,342,642
Nippon Telegraph & Telephone Corp. (Telecommunication services) ..................................... 266 4,554,795
Nissan Motor Co., Ltd.* (Manufacturer of motor vehicles) ............................................ 227,000 892,896
Rohm Company Ltd. (Maker of linear ICs and semiconductors) .......................................... 5,900 2,424,658
Ryohin Keikaku Co., Ltd. (Wholesaler and retailer of clothing, household goods
and foodstuffs) ................................................................................... 8,500 1,705,822
Sakura Bank, Ltd. (Provider of banking services) .................................................... 355,000 2,056,360
Sharp Corp. (Manufacturer of consumer and industrial electronics) ................................... 104,000 2,661,057
Sony Corp. (Manufacturer of consumer electronic products) ........................................... 18,600 5,514,481
TDK Corp. (Manufacturer of magnetic tapes and floppy discs) ......................................... 14,000 1,932,877
THK Co., Ltd. (Manufacturer of linear motion systems for industrial machinery) ...................... 38,200 1,543,699
Taiyo Yuden Co., Ltd. (Manufactures and markets electronic components) .............................. 39,000 2,312,524
Tokyo Electron Ltd. (Manufacturer of semiconductor production equipment) ............................ 19,000 2,602,740
Yamanouchi Pharmaceutical Co., Ltd. (Leading manufacturer of ethical drugs) ......................... 35,000 1,222,603
--------------
77,730,679
--------------
Korea 16.3%
Dacom Corp.* (Provider of domestic long-distance and Internet services) ............................. 2,990 1,540,423
Honam Petrochemical Corp., Ltd. (Chemical Manufacturer) ............................................. 82,240 1,151,577
Housing & Commercial Bank (Provider of banking services) ............................................ 59,110 1,874,029
Kookmin Bank (Commercial bank) ...................................................................... 95,450 1,496,266
Korea Data Systems Co., Ltd.* (Manufacturer of computer monitors) ................................... 356,217 4,078,222
The accompanying notes are an integral part of the financial statements.
11
<PAGE>
Scudder New Asia Fund, Inc.
Investment Portfolio
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Shares Value ($)
- -----------------------------------------------------------------------------------------------------------------------------------
Korea Telecom Corp. (ADR) (Telecommunication services) .............................................. 55,562 4,153,260
Pohang Iron & Steel Co., Ltd. (Steel producer) (c) .................................................. 7,740 928,732
SK Telecom Co., Ltd. (Provider of mobile telecommunication services) ................................ 1,630 5,842,448
Samsung Corp., Ltd. (Trading company) ............................................................... 70,300 1,052,488
Samsung Electro-Mechanics Co. (Manufacturer of precision and electronic parts) ...................... 22,290 1,482,074
Samsung Electronics Co. (Electronics manufacturer) .................................................. 35,630 8,346,614
Samsung Securities Co., Ltd. (Provider of brokerage, investment and underwriting
services) ......................................................................................... 63,781 1,932,247
Shinhan Bank (GDR)* (Provider of banking services) .................................................. 27,243 516,255
--------------
34,394,635
--------------
Malaysia 1.1%
Unisem (M) Berhad (Manufacturer of semiconductors) .................................................. 347,000 2,228,135
--------------
Philippines 0.6%
International Container Terminal Services, Inc.* (Containerized cargo handling firm) ................ 13,933,437 1,261,961
--------------
Singapore 3.6%
Allgreen Properties Ltd.* (Real estate development) ................................................. 377,000 344,065
Chartered Semiconductor (ADR)* (Provider of wafer fabrication services to
semiconductor suppliers) .......................................................................... 21,500 1,569,500
JIT Holdings Ltd. (Manufacturer and distributor of electronic products) ............................. 1,045,000 3,639,147
Keppel Land Ltd. (Property investment and development) .............................................. 438,000 717,947
NatSteel Electronics Ltd. (Manufacturer of telecommunication and network
products) ......................................................................................... 246,000 1,299,790
--------------
7,570,449
--------------
Taiwan 12.7%
ASE Test Ltd.* (Provider of testing services to semiconductor manufacturers) ........................ 67,800 1,652,625
Acer Inc. (Manufacturer of desktop and portable personal computers) ................................. 490,000 1,475,386
Acer Peripherals, Inc. (Developer and distributor of computer peripheral products) .................. 504,279 2,088,777
Asustek Computer Inc. (Manufacturer of computer motherboards) ....................................... 156,086 1,646,152
Bank Sinopac (Provider of commercial banking services) .............................................. 1,722,778 1,015,498
China Development Industrial Bank Inc. (Leading venture capital firm and
investment bank) .................................................................................. 304,000 484,308
Compal Electronics Inc. (Manufacturer and marketer of notebook computers and
color monitors) ................................................................................... 400,799 1,347,277
Compeq Manufacturing Co., Ltd. (Manufacturer of multi-layer and double-sided
printed circuit boards) ........................................................................... 229,000 1,247,698
Far East Textile Ltd. (Manufacturer of natural and synthetic textile products) ...................... 1,071,770 2,561,184
The accompanying notes are an integral part of the financial statements.
12
<PAGE>
Scudder New Asia Fund, Inc.
Investment Portfolio
- -----------------------------------------------------------------------------------------------------------------------------------
Shares Value ($)
- -----------------------------------------------------------------------------------------------------------------------------------
Formosa Plastics Corp. (Manufacturer of plastics materials) ......................................... 924,250 1,840,549
Hon Hai Precision Industry Co., Ltd. (Manufacturer of electronic connectors and
cable assemblies) ................................................................................. 284,480 2,121,023
President Chain Store Corp. (Operator of convenience stores) ........................................ 429,000 1,893,150
Siliconware Corp. (Testing and packaging of integrated circuits) .................................... 827,323 1,180,949
Siliconware Precision Industries Co. (Manufacturer of packaging for integrated
circuits) ......................................................................................... 648,210 1,652,274
Taiwan Semiconductor Manufacturing Co. (Manufacturer of integrated circuits) ........................ 635,910 3,383,686
United Microelectronics Corp., Ltd.* (Manufacturer of integrated circuits) .......................... 243,000 867,166
Yageo Corp. (Manufacturer of resistors and related equipment) ....................................... 211,000 249,422
--------------
26,707,124
--------------
Thailand 0.8%
BEC World Public Co., Ltd. (foreign) (Entertainment and television broadcasting) (b) ................ 173,300 1,228,456
Siam Commercial Bank, Warrants, (expire 5/10/2002)* ................................................. 901,800 420,560
--------------
1,649,016
--------------
United Kingdom 0.9%
Standard Chartered PLC (International banking group) ................................................ 124,031 1,972,688
--------------
Total Common Stocks (Cost $115,979,908) ............................................................. 207,105,496
--------------
- -----------------------------------------------------------------------------------------------------------------------------------
Total Investment Portfolio -- 100.0% (Cost $119,117,294) (a) ........................................ 210,418,957
============
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* Non-income producing security
** Repurchase agreements are fully collateralized by U.S. Treasury or
Government agency securities.
(a) The cost for federal income tax purposes was $120,240,178. At December 31,
1999, net unrealized appreciation for all securities based on tax cost was
$90,178,779. This consisted of aggregate gross unrealized appreciation for
all securities in which there was an excess of value over tax cost of
$95,128,012 and aggregate gross unrealized depreciation for all securities
in which there was an excess of tax cost over value of $4,949,233.
(b) Securities valued in good faith by the Valuation Committee of the Board of
Directors at fair value amounted to $1,775,692 (0.84% of net assets). Their
values have been estimated by the Board of Directors in the absence of
readily ascertainable market values. However, because of the inherent
uncertainty of valuation, those estimated values may differ significantly
from the values that would have been used had a ready market for the
securities existed, and the difference could be material. The cost of these
securities at December 31, 1999 aggregated $1,648,403. These securities may
also have certain restrictions as to resale.
(c) Security that has met the foreign-ownership limitation, and valued at a
premium in good faith by the Valuation Committee of the Board of
Directors. The cost of the security at December 31, 1999 was $264,139. The
aggregate premium ($76,684) over the local share price ($852,048) for the
security valued by the Valuation Committee was approximately 0.04% of the
Fund's net assets at December 31, 1999.
The accompanying notes are an integral part of the financial statements.
13
<PAGE>
<TABLE>
<CAPTION>
Scudder New Asia Fund, Inc.
Financial Statements
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
Statement of Assets and Liabilities
December 31, 1999
- -------------------------------------------------------------------------------------------------
ASSETS
<S> <C>
Investments in securities, at value (cost $119,117,294) ........................ $ 210,418,957
Cash ........................................................................... 963
Foreign currency, at value (cost $3,101,953) ................................... 3,110,616
Dividends receivable ........................................................... 60,134
Interest receivable ............................................................ 139
Foreign taxes recoverable ...................................................... 196,255
Other assets ................................................................... 1,697
-------------
Total assets ................................................................... 213,788,761
-------------
LIABILITIES
Accrued management fee ......................................................... 198,412
Other accrued expenses and payables ............................................ 176,799
Deferred foreign taxes ......................................................... 1,302,006
-------------
Total liabilities .............................................................. 1,677,217
-------------
Net assets, at value ........................................................... $ 212,111,544
=============
NET ASSETS
Net assets consist of:
Accumulated net investment loss ................................................ (542,993)
Net unrealized appreciation (depreciation) on:
Investments (net of deferred foreign taxes of $1,302,006) .................. 89,999,657
Foreign currency related transactions ...................................... 8,663
Accumulated net realized gain (loss) ........................................... 4,622,325
Paid-in capital ................................................................ 118,023,892
-------------
Net assets, at value ........................................................... $ 212,111,544
=============
Net asset value per share ($212,111,544 B 8,804,757 shares of common stock
issued and outstanding, 50,000,000 shares authorized, $.01 par value) ...... $24.09
------
The accompanying notes are an integral part of the financial statements.
14
<PAGE>
Scudder New Asia Fund, Inc.
Financial Statements
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
Statement of Operations
Year Ended December 31, 1999
- -------------------------------------------------------------------------------------------------
Investment Income
Dividends (net of foreign taxes withheld of $145,526) .......................... $ 1,261,762
Interest ....................................................................... 499,430
-------------
Total income ................................................................... 1,761,192
-------------
Expenses:
Management fee ................................................................. 1,704,298
Custodian and accounting fees .................................................. 391,048
Directors' fees and expenses ................................................... 147,410
Reports to shareholders ........................................................ 78,673
Auditing ....................................................................... 86,997
Services to shareholders ....................................................... 39,922
Legal .......................................................................... 12,693
Other .......................................................................... 41,439
-------------
2,502,480
-------------
Net investment income (loss) ................................................... (741,288)
-------------
Realized and unrealized gain (loss) on investment transactions
Net realized gain (loss) from:
Investments (net of foreign taxes of $301,030) ................................. 30,717,326
Foreign currency related transactions .......................................... (655,816)
-------------
30,061,510
-------------
Net unrealized appreciation (depreciation) during the period on:
Investments (net of deferred foreign taxes of $1,127,634) ...................... 79,319,760
Foreign currency related transactions .......................................... 377,561
-------------
79,697,321
-------------
Net gain (loss) on investment transactions ..................................... 109,758,831
-------------
Net increase (decrease) in net assets resulting from operations ................ $ 109,017,543
=============
</TABLE>
The accompanying notes are an integral part of the financial statements.
15
<PAGE>
<TABLE>
<CAPTION>
Scudder New Asia Fund, Inc.
Financial Statements
- -------------------------------------------------------------------------------------------------------
Statements of Changes in Net Assets
- -------------------------------------------------------------------------------------------------------
Years Ended December 31,
Increase (Decrease) in Net Assets 1999 1998
- -------------------------------------------------------------------------------------------------------
Operations:
<S> <C> <C>
Net investment income (loss) ........................................ $ (741,288) $ 303,154
Net realized gain (loss) on investment transactions ................. 30,061,510 (18,078,128)
Net unrealized appreciation (depreciation) on investment transactions
during the period ................................................ 79,697,321 21,623,470
------------- -------------
Net increase (decrease) in net assets resulting from operations ..... 109,017,543 3,848,496
------------- -------------
Reinvestment of prior year distributions ............................ -- 379,337
------------- -------------
Increase (decrease) in net assets ................................... 109,017,543 4,227,833
Net assets at beginning of period ................................... 103,094,001 98,866,168
------------- -------------
Net assets at end of period (including accumulated net investment
loss of $542,993 and undistributed net investment income of
$311,835) ......................................................... $ 212,111,544 $ 103,094,001
============= =============
Other Information
Shares outstanding at beginning of period ........................... 8,804,757 8,764,601
Shares issued to shareholders in reinvestment of distributions ...... -- 40,156
------------- -------------
Shares outstanding at end of period ................................. 8,804,757 8,804,757
============= =============
</TABLE>
The accompanying notes are an integral part of the financial statements.
16
<PAGE>
<TABLE>
<CAPTION>
Scudder New Asia Fund, Inc.
Financial Highlights
- ------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------
The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the financial
statements and market price data.
- ------------------------------------------------------------------------------------------------------------------------
Years Ended December 31,
1999 1998 1997 1996 1995
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance
Net asset value, beginning of period ....................... $ 11.71 $ 11.28 $ 15.26 $ 15.29 $ 17.44
------- ------- ------- ------- -------
Income (loss) from investment operations:
Net investment income (loss) (a) ........................... (.08) .03 (.05) (.04) (.01)
Net realized and unrealized gain (loss) on investment
transactions ............................................. 12.46 .40 (3.36) .36 (.47)
------- ------- ------ ------- ------
Total from investment operations ........................... 12.38 .43 (3.41) .32 (.48)
------- ------- ------ ------- ------
Less distributions from:
Net investment income ...................................... -- -- (.18) (.02) --
Net realized gains on investment transactions .............. -- -- -- (.33) (1.51)
In excess of net realized gains on investment transactions . -- -- (.39) -- (.16)
------- ------- ------ ------- ------
Total distributions ........................................ -- -- (.57) (.35) (1.67)
------- ------- ------ ------ ------
Net asset value, end of period ............................. $ 24.09 $ 11.71 $ 11.28 $ 15.26 $ 15.29
======= ======= ====== ======= ======
Market value, end of period ................................ $ 19.81 $ 9.31 $ 9.69 $ 12.50 $ 14.50
======= ======= ====== ======= ======
Total Return
Per share market value (%) ................................. 112.75 (3.87) (18.05) (11.56) (.66)
Per share net asset value (%) (b) .......................... 105.72 3.81 (21.89) 2.46 (2.96)
Ratios to Average Net Assets and Supplemental Data
Net assets, end of period ($ millions) ..................... 212 103 99 133 133
Ratio of expenses (%) ...................................... 1.77 1.94 1.90 1.87 1.74
Ratio of net investment income (loss) (%) .................. (.52) .31 (.31) (.27) (.07)
Portfolio turnover rate (%) ................................ 92 99 117 89 58
</TABLE>
(a) Based on monthly average shares outstanding during the period.
(b) Total investment returns reflect changes in net asset value per share
during each period and assume that dividends and capital gains
distributions, if any, were reinvested. These percentages are not an
indication of the performance of a shareholder's investment in the Fund
based on market price.
17
<PAGE>
Scudder New Asia Fund, Inc.
Notes to Financial Statements
- --------------------------------------------------------------------------------
A. Significant Accounting Policies
-------------------------------
Scudder New Asia Fund, Inc. (the "Fund") is registered under the Investment
Company Act of 1940, as amended (the "1940 Act"), as a closed-end, diversified
management investment company.
The Fund's financial statements are prepared in accordance with generally
accepted accounting principles which require the use of management estimates.
The policies described below are followed consistently by the Fund in the
preparation of its financial statements.
Security Valuation. Investments are stated at value determined as of the close
of regular trading on the New York Stock Exchange. Securities which are traded
on U.S. or foreign stock exchanges are valued at the most recent sale price
reported on the exchange on which the security is traded most extensively. If no
sale occurred, the security is then valued at the calculated mean between the
most recent bid and asked quotations. If there are no such bid and asked
quotations, the most recent bid quotation is used. Securities quoted on the
Nasdaq Stock Market ("Nasdaq"), for which there have been sales, are valued at
the most recent sale price reported. If there are no such sales, the value is
the most recent bid quotation. Securities which are not quoted on Nasdaq but are
traded in another over-the-counter market are valued at the most recent sale
price, or if no sale occurred, at the calculated mean between the most recent
bid and asked quotations on such market. If there are no such bid and asked
quotations, the most recent bid quotation shall be used.
Portfolio debt securities purchased with an original maturity greater than sixty
days are valued by pricing agents approved by the officers of the Fund, whose
quotations reflect broker/dealer-supplied valuations and electronic data
processing techniques. If the pricing agents are unable to provide such
quotations, the most recent bid quotation supplied by a bona fide market maker
shall be used. Money market instruments purchased with an original maturity of
sixty days or less are valued at amortized cost.
All other securities are valued at their fair value as determined in good faith
by the Valuation Committee of the Board of Directors.
Foreign Currency Translations. The books and records of the Fund are maintained
in U.S. dollars. Investment securities and other assets and liabilities
denominated in a foreign currency are translated into U.S. dollars at the
prevailing exchange rates at period end. Purchases and sales of investment
securities, income and expenses are translated into U.S. dollars at the
prevailing exchange rates on the respective dates of the transactions.
Net realized and unrealized gains and losses on foreign currency transactions
represent net gains and losses between trade and settlement dates on securities
transactions, the disposition of forward foreign currency exchange contracts and
foreign currencies, and the difference between the amount of net investment
income accrued and the U.S. dollar amount actually received. That portion of
both realized and unrealized gains and losses on investments that results from
fluctuations in foreign currency exchange rates is not separately disclosed but
is included with net realized and unrealized gains and losses on investment
securities.
Repurchase Agreements. The Fund may enter into repurchase agreements with
certain banks and broker/dealers whereby the Fund, through its custodian or
sub-custodian bank, receives delivery of the underlying securities, the amount
of which at the time of purchase and each subsequent business day is required to
be maintained at such a level that the market value is equal to at least the
principal amount of the repurchase price plus accrued interest.
18
<PAGE>
Scudder New Asia Fund, Inc.
Notes to Financial Statements
- --------------------------------------------------------------------------------
Forward Foreign Currency Exchange Contracts. A forward foreign currency exchange
contract (forward contract) is a commitment to purchase or sell a foreign
currency at the settlement date at a negotiated rate. During the period, the
Fund utilized forward contracts as a hedge against changes in the exchange rates
relating to foreign currency denominated assets.
Forward contracts are valued at the prevailing forward exchange rate of the
underlying currencies and unrealized gain/loss is recorded daily. Sales and
purchases of forward contracts having the same settlement date and broker are
offset and any gain (loss) is realized on the date of offset; otherwise, gain
(loss) is realized on settlement date. Realized and unrealized gains and losses
which represent the difference between the value of a forward contract to buy
and a forward contract to sell are included in net realized and unrealized gain
(loss) from foreign currency related transactions.
Certain risks may arise upon entering into forward contracts from the potential
inability of counterparties to meet the terms of their contracts. Additionally,
when utilizing forward contracts to hedge, the Fund gives up the opportunity to
profit from favorable exchange rate movements during the term of the contract.
Taxes. The Fund's policy is to comply with the requirements of the Internal
Revenue Code, as amended, which are applicable to regulated investment companies
and to distribute all of its taxable income to its shareholders. Accordingly,
the Fund paid no federal income taxes and no federal income tax provision was
required.
Net realized and unrealized gains of the Fund derived in India are subject to
certain non-U.S. taxes. Additionally, principal amounts of cash and securities
invested in Malaysia are also subject to certain non-U.S. taxes.
Distribution of Income and Gains. Distributions of net investment income, if
any, are made annually. Net realized gains from investment transactions, in
excess of available capital loss carryforwards, would be taxable to the Fund if
not distributed, and, therefore, will be distributed to shareholders at least
annually.
The timing and characterization of certain income and capital gains
distributions are determined annually in accordance with federal tax regulations
which may differ from generally accepted accounting principles. As a result, net
investment income (loss) and net realized gain (loss) on investment transactions
for a reporting period may differ significantly from distributions during such
period. These differences relate primarily to investments in passive foreign
investment companies, foreign denominated investments and certain securities
sold at a loss. Accordingly, the Fund may periodically make reclassifications
among certain of its capital accounts without impacting the net asset value of
the Fund.
Investment Transactions and Investment Income. Investment transactions are
accounted for on the trade date. Interest income is recorded on the accrual
basis. Dividend income is recorded on the ex-dividend date. Certain dividends
from foreign securities may be recorded subsequent to the ex-dividend date as
soon as the Fund is informed of such dividends. Realized gains and losses from
investment transactions are recorded on an identified cost basis.
B. Purchases and Sales of Securities
---------------------------------
During the year ended December 31, 1999, purchases and sales of investment
securities (excluding short-term investments) aggregated $128,114,300 and
$132,527,633, respectively.
19
<PAGE>
Scudder New Asia Fund, Inc.
Notes to Financial Statements
- --------------------------------------------------------------------------------
C. Related Parties
---------------
Under the Investment Management Agreement (the "Agreement") with Scudder Kemper
Investments, Inc. (the "Manager"), the Manager directs the investments of the
Fund in accordance with its investment objectives, policies and restrictions.
The Manager determines the securities, instruments, and other contracts relating
to investments to be purchased, sold or entered into by the Fund. In addition to
portfolio management services, the Manager shall provide certain administrative
services in accordance with the Agreement. The management fee payable under the
Agreement is equal to an annual rate of 1.25% of the first $75,000,000 of
average weekly net assets of the Fund, 1.15% of the next $125,000,000 and 1.10%
of the excess over $200,000,000, payable monthly. For the year ended December
31, 1999, the fee pursuant to the Agreement amounted to $1,704,298, which is
equivalent to an annual effective rate of 1.2% of the Fund's average weekly net
assets.
Scudder Fund Accounting Corporation ("SFAC"), a subsidiary of the Manager, is
responsible for determining the daily net asset value per share and maintaining
the portfolio and general accounting records of the Fund. For the year ended
December 31, 1999, the amount charged to the Fund by SFAC aggregated $112,606,
of which $32,008 is unpaid at December 31, 1999.
Scudder Service Corporation ("SSC"), a subsidiary of the Manager, provides
shareholder communications services for the Fund. For the year ended December
31, 1999 the amount charged by SSC aggregated $15,000, of which $566 is unpaid
at December 31, 1999.
The Fund pays each Director not affiliated with the Manager an annual retainer,
plus specified amounts for attended board and committee meetings. For the year
ended December 31, 1999, Directors' fees and expenses aggregated $147,410.
D. Investing in Foreign Markets
----------------------------
Investing in foreign markets may involve special risks and considerations not
typically associated with investing in the United States. These risks include
revaluation of currencies and future adverse political and economic
developments. Moreover, securities issued in these markets may be less liquid,
subject to government ownership controls, delayed settlements, and their prices
more volatile than those of securities of comparable U.S. companies.
Foreign investment in the securities markets of several foreign countries is
restricted or controlled in varying degrees. These restrictions may limit
investment in certain foreign countries. In addition, the repatriation of both
investment income and capital from some foreign countries may be subject to
restrictions.
E. Line of Credit
--------------
The Fund and several Scudder Funds (the "Participants") share in a $1 billion
revolving credit facility for temporary or emergency purposes. The Participants
are charged an annual commitment fee which is allocated among each of the
Participants. Interest is calculated based on the market rates at the time of
the borrowing. The Fund may borrow up to a maximum of 5 percent of its net
assets under the agreement.
20
<PAGE>
Scudder New Asia Fund, Inc.
Report of Independent Accountants
- --------------------------------------------------------------------------------
To the Board of Directors and Shareholders of Scudder New Asia Fund, Inc.:
In our opinion, the accompanying statement of assets and liabilities, including
the investment portfolio, 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 Scudder New Asia Fund, Inc. (the
"Fund") at December 31, 1999, the results of its operations, the changes in its
net assets, and the financial highlights for the periods indicated therein, in
conformity with accounting principles generally accepted in the United States.
These financial statements and financial highlights (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 auditing standards generally accepted in the United States 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 December 31, 1999 by correspondence with the custodian, provide
a reasonable basis for the opinion expressed above.
Boston, Massachusetts PricewaterhouseCoopers LLP
February 23, 2000
21
<PAGE>
Scudder New Asia Fund, Inc.
Tax Information
- --------------------------------------------------------------------------------
By now shareholders for whom year end tax reporting is required by the IRS
should have received their Form 1099-DIV and tax information letter from the
Fund.
Pursuant to Section 852 of the Internal Revenue Code, the Fund designates
$5,680,000 on capital gain dividends for its year ended December 31, 1999, of
which 100% represents 20% rate gains.
Due to the nature of its investments, the Fund pays a variety of foreign taxes
throughout the year. As in prior years, the Fund intends to make an election
under section 853 of the Internal Revenue Code. This election will allow
shareholders to treat their proportionate share of foreign taxes paid by the
Fund as having been paid directly by them. Additionally, shareholders will be
required to report their proportionate share of such taxes paid as gross income
(in addition to other amounts of reportable distributions paid by the Fund).
The Fund paid foreign taxes of $446,556 and earned $446,556 of foreign source
income during the year ended December 31, 1999. Pursuant to section 853 of the
Internal Revenue Code, the Fund designates $0.0507 per share as foreign taxes
paid and $0.0507 per share as income earned from foreign sources for the year
ended December 31, 1999. The following table provides a breakdown by country of
ordinary income dividends and foreign taxes paid by the Fund in 1999:
1999 Foreign tax Credit Tables
------------------------------
Country Foreign Income Foreign Taxes
------- -------------- -------------
China -- --
Hong Kong -- --
Indonesia .89% .89%
India 77.60% 77.60%
Japan 4.42% 4.42%
Korea 3.06% 3.06%
Malaysia 1.88% 1.88%
Philippines .29% .29%
Singapore .47% .47%
Taiwan 10.92% 10.92%
Thailand .47% .47%
United Kingdom -- --
United States -- --
-------- ---------
100.00% 100.00%
-------- ---------
Please consult a tax adviser if you have questions about federal or state income
tax laws, or on how to prepare your tax returns. If you have specific questions
about your account, please call (800) 426-5523.
22
<PAGE>
Scudder New Asia Fund, Inc.
Dividend Reinvestment and Cash Purchase Plan
- --------------------------------------------------------------------------------
The Plan
The fund's Dividend Reinvestment and Cash Purchase Plan (the "Plan") offers
you an automatic way to reinvest your dividends and capital gains distributions
in shares of the fund. The Plan also provides for cash investments in fund
shares of $100 to $3,000 semiannually through EquiServe, the Plan Agent. Note
that the fund's share price for purposes of the Plan is calculated net of
due-bills, if applicable.
Automatic Participation
Each stockholder of record is automatically a participant in the Plan unless
the stockholder has instructed the Plan Agent in writing otherwise. Such a
notice must be received by the Plan Agent not less than 10 days prior to the
record date for a dividend or distribution in order to be effective with respect
to that dividend or distribution. A notice which is not received by that time
will be effective only with respect to subsequent dividends and distributions.
Stockholders who do not participate in the Plan will receive all
distributions in cash paid by check in dollars mailed directly to the
stockholder by EquiServe, as dividend paying agent.
Shares Held by a Nominee
If your shares are held in the name of a brokerage firm, bank, or other
nominee as the stockholder of record, please consult your nominee (or any
successor nominee) to determine whether it is participating in the Plan on your
behalf. Many nominees are generally authorized to receive cash dividends unless
they are specifically instructed by a client to reinvest. If you would like your
nominee to participate in the Plan on your behalf, you should give your nominee
instructions to that effect as soon as possible.
Pricing of Dividends and Distributions
If the market price per share on the payment date for the dividend or
distribution (the "Valuation Date") equals or exceeds net asset value per share
on that date, the fund will issue new shares to participants at the greater of
the following on the Valuation Date: (a) net asset value, or (b) 95% of the
market price. The Valuation Date will be the dividend or distribution payment
date or, if that date is not a New York Stock Exchange trading date, the next
preceding trading date. If the net asset value exceeds the market price of fund
shares at such time, participants in the Plan are considered to have elected to
receive shares of stock from the fund, valued at market price, on the Valuation
Date. In either case, for federal income tax purposes, the stockholder receives
a distribution equal to the market value on Valuation Date of new shares issued.
State and local taxes may also apply. If the fund should declare an income
dividend or net capital gains distribution payable only in cash, the Plan Agent
will, as agent for the participants, buy fund shares in the open market, on the
New York Stock Exchange or elsewhere, for the participants' account on, or
shortly after, the payment date.
Voluntary Cash Purchases
Participants in the Plan have the option of making additional cash payments
to the Plan Agent, semiannually, in any amount from $100 to $3,000, for
investment in the fund's shares. The Plan Agent will use all such monies
received from participants to purchase fund shares in the open market on or
about February 15 and August 15. Any voluntary cash payments received more than
30 days prior to these dates will be returned by the Plan Agent, and interest
will not be paid on any uninvested cash payments. To avoid unnecessary cash
accumulations, and also to allow ample time for receipt and processing by the
Plan Agent, it is suggested that participants send their
23
<PAGE>
Scudder New Asia Fund, Inc.
Dividend Reinvestment and Cash Purchase Plan
- --------------------------------------------------------------------------------
voluntary cash payments to be received by the Plan Agent approximately ten days
before February 15, or August 15, as the case may be. A participant may withdraw
a voluntary cash payment by written notice, if the notice is received by the
Plan Agent notless than 48 hours before such payment is to be invested.
Participant Plan Accounts
The Plan Agent maintains all participant accounts in the Plan and furnishes
written confirmation of all transactions in the account, including information
needed by participants for personal and tax records. Shares in the account of
each plan participant will be held by the Plan Agent in non-certificated form in
the name of the participant, and each participant will be able to vote those
shares purchased pursuant to the Plan at a stockholder meeting or by proxy.
No Service Fee to Reinvest
There is no service fee charged to participants for reinvesting dividends or
distributions from net realized capital gains. The Plan Agent's fees for the
handling of the reinvestment of dividends and capital gains distributions will
be paid by the fund. There will be no brokerage commissions with respect to
shares issued directly by the fund as a result of dividends or capital gains
distributions payable either in stock or in cash. However, participants will pay
a pro rata share of brokerage commissions incurred with respect to the Plan
Agent's open market purchases in connection with the reinvestment of any
dividends or capital gains distributions payable only in cash.
Costs for Cash Purchases
With respect to purchases of fund shares from voluntary cash payments, the
Plan Agent will charge $0.75 for each such purchase for a participant. Each
participant will pay a pro rata share of brokerage commissions incurred with
respect to the Plan Agent's open market purchases of fund shares in connection
with voluntary cash payments made by the participant.
Brokerage charges for purchasing small amounts of stock for individual
accounts through the Plan are expected to be less than the usual brokerage
charges for such transactions, because the Plan Agent will be purchasing stock
for all participants in blocks and prorating the lower commission thus
attainable.
Amendment or Termination
The fund and the Plan Agent each reserve the right to terminate the Plan.
Notice of the termination will be sent to the participants of the Plan at least
30 days before the record date for a dividend or distribution. The Plan also may
be amended by the fund or the Plan Agent, but (except when necessary or
appropriate to comply with applicable law, rules or policies of a regulatory
authority) only by giving at least 30 days' written notice to participants in
the Plan.
A participant may terminate his account under the Plan by written notice to
the Plan Agent. If the written notice is received 10 days before the record day
of any distribution, it will be effective immediately. If received after that
date, it will be effective as soon as possible after the reinvestment of the
dividend or distribution.
If a participant elects to sell his shares before the Plan is terminated, the
Plan Agent will deduct a $2.50 fee plus brokerage commissions from the sale
transaction.
Plan Agent Address and Telephone Number
You may obtain more detailed information by requesting a copy of the Plan
from the Plan Agent. All correspondence (including notifications) should be
directed to: Scudder New Asia fund Dividend Reinvestment and Cash Purchase Plan,
c/o EquiServe, P.O. Box 8200, Boston, MA 02266-8200, (800) 426-5523.
24
<PAGE>
Scudder New Asia Fund, Inc.
Stockholder Meeting Results
- --------------------------------------------------------------------------------
The Annual Meeting of Stockholders of Scudder New Asia Fund (the "Fund") was
held on October 20, 1999, at the office of Scudder Kemper Investments, Inc., 345
Park Avenue, New York, NY 10154. At the Meeting the following matters were voted
upon by the stockholders and the resulting votes are presented below.
1. To elect four Directors of the Fund to hold office for a term of three
years or until their respective successors shall have been duly elected and
qualified.
<TABLE>
<CAPTION>
Number of Votes:
----------------
Director (Class II) For Withheld Broker Non-Votes*
-------- --- -------- -----------------
<S> <C> <C> <C>
Hugh T. Patrick 6,763,251 199,158 0
William H. Leurs 6,737,282 225,127 0
Kesop Yun 6,862,431 99,978 0
Director (Class I)
--------
Kenneth C. Froewiss 6,752,837 209,572 0
</TABLE>
2. To ratify or reject the action taken by the Board of Directors in selecting
PricewaterhouseCoopers LLP as the Fund's independent accountants for the
fiscal year ending December 31, 1999.
Number of Votes:
----------------
For Against Abstain Broker Non-Votes*
--- ------- ------- -----------------
6,877,715 29,088 55,607 0
- --------------------------------------------------------------------------------
* Broker non-votes are proxies received by the Fund from brokers or nominees
when the broker or nominee neither has received instructions from the
beneficial owner or other persons entitled to vote nor has discretionary
power to vote on a particular matter.
25
<PAGE>
Scudder New Asia Fund, Inc.
Directors and Officers
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
DANIEL PIERCE* ELIZABETH J. ALLAN*
Chairman of the Board and Director Vice President
NICHOLAS BRATT* BRUCE H. GOLDFARB*
President Vice President and Assistant Secretary
SHERYLE J. BOLTON THERESA GUSMAN*
Director Vice President
ROBERT J. CALLANDER JUDITH A. HANNAWAY*
Director Vice President
KENNETH C. FROEWISS ANN M. McCREARY*
Director Vice President
WILLIAM H. LUERS TIEN YU SIEH
Director Vice President
WILSON NOLEN JOHN R. HEBBLE*
Honorary Director Treasurer
HUGH T. PATRICK JOHN MILLETTE*
Director Vice President and Secretary
KATHRYN L. QUIRK* CAROLINE PEARSON*
Director, Vice President and Assistant Secretary Assistant Secretary
KESOP YUN * Scudder Kemper Investments, Inc.
Director
WILLIAM H. GLEYSTEEN, JR.
Honorary Director
JAMES W. MORLEY
Honorary Director
ROBERT G. STONE, JR.
Honorary Director
</TABLE>
26
