<PAGE>
Templeton Emerging
Markets Fund, Inc.
- --------------------------------------------------------------------------------
Your Fund's Objective
The Templeton Emerging Markets Fund, Inc. seeks long-term capital appreciation
by investing primarily in emerging country equity securities.
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July 17, 1995
Dear Shareholder:
This update for the quarter ended May 31, 1995, includes your Fund's long-term
performance, a listing of its investments, and a brief discussion by Dr. Mark
Mobius on an emerging markets topic. Please keep in mind that this summary is
one of four reports you will receive during the Fund's fiscal year.
Next quarter, you will receive the annual report, which is more comprehensive.
It will include a discussion of the financial markets and a summary of the
Fund's performance and investment direction during the fiscal period.
The portfolio manager's outlook and the Fund's financial statements and
investment portfolio will also be included.
If you have any questions regarding this report, you may call the Franklin
Templeton Fund Information Department, toll free, at 1-800/342-5236.
- --------------------------------------------------------------------------------
Templeton Emerging Markets Fund
Cumulative Total Returns*
Periods ended May 31, 1995
Since
Inception
1-Year 5-Year (2/26/87)
Based on change
in net asset value 6.95% 208.31% 482.55%
Based on change
in market price 1.16% 233.74% 451.77%
*Cumulative total return represents the change in value of an investment over
the specified periods. These calculations assume reinvestment of all
distributions and capital gains at net asset value or at market price on the
reinvestment date. Past performance is not predictive of future results.
Investing in developing markets involves special considerations, which may
include risks related to market and currency volatility, adverse social and
political developments, and the relatively small size and lesser liquidity of
these markets. While short-term volatility can be disconcerting, declines of as
much as 40% to 50% are not unusual in emerging markets. For example, the Hong
Kong market has increased 1000% in the last 15 years, but has suffered nine
declines of more than 20% during that time.
- --------------------------------------------------------------------------------
1
<PAGE>
A Closer Look
at the Philippines
by Dr. Mark Mobius
Almost everything people had to say about the Philippines was negative when we
started investing there for our emerging markets fund in 1987. The talk then was
of power outages, natural disasters, poor telephone services, and political
instability. For example, when I told my Philippine friends that I was going to
invest in the Philippine Long Distance Telephone Company (PLDT), that nation's
main provider of telephone services, they expressed horror that we would invest
in what was then an inefficient and bureaucratic organization which kept
applicants for telephone installations waiting for many years. At that time, the
standard joke about PLDT was: "About 10% of the Philippine people have
telephones and of that 10%, 90% are still waiting for a dial tone."
All this and more was keeping the country's economic development well behind its
Southeast Asian neighbors, despite its strong natural resource base and well-
educated, English-speaking business class eager to do business with the outside
world. But there has been a transformation, and this country, which for so long
had been heavily dependent on costly foreign borrowings and foreign aid to cover
chronic balance of payment deficits, now wins praise from many multilateral
financial organizations for its astute monetary policy. The Philippines seems to
be rightly taking its place with the other Asian "tigers."
Since taking office in 1992, President Fidel V. Ramos has given the country
strong democratic leadership, much-needed political stability and a set of pro-
business economic reforms that have turned it into one of the world's most
exciting emerging markets. At last, the Philippines is starting to reach its
vast potential, and with its fully convertible currency and stable exchange
rates, the potential investment outlook for its many strong companies looks
solid for the years ahead.
Although Philippine GNP was shrinking in real terms in 1991, in 1995 the economy
appears to be on target to exceed 5% growth for the second consecutive year.
Within five years, inflation has
2
<PAGE>
[MAP OF THE PHILIPPINES APPEARS HERE]
fallen from about 18% to below 10%, and local banks' nominal lending rates
have declined from 24% to about 16%. The latter is especially important for
earnings growth, because it means companies can borrow money for expansion
more cheaply and can devote less of their cash flow to interest payments.
This more favorable business climate has brought unemployment down from 11%
to 8% since 1991.
The world has noticed this good news, and has poured private capital into the
Philippines in record amounts. The July 1992 Brady Agreement restructuring the
country's external commercial debt service ratios, which were by far the highest
of the developing Pacific Rim nations, was a key turning point. By early 1993,
the government was able to resume sovereign borrowing in international capital
markets. Key companies like PLDT and the Philippine National Bank then launched
corporate borrowing programs in the Euromarkets in 1994. Since 1993, well over
$1.4 billion of Philippine sovereign and corporate international bonds have been
issued. In the process, the local equity market has also turned into a hotbed of
activity. 1995 could be the second straight year in which Philippine companies
collectively raised about $1 billion via initial public offerings, global
depository receipts and rights issues. Although a substantial, domestic
shareholder class is emerging, foreign investors have grown confident enough to
let their capital play a major role in fueling the market's growth. In terms of
both market capitalization and daily trading volume, the Philippine Stock
Exchange is now comparable to, or even slightly bigger than, its counterpart in
neighboring Indonesia, where the population and overall economy are much larger.
The establishment of the Philippine Stock Exchange (PSE) in March 1994
through the unifica-
3
<PAGE>
tion of the Manila and Makati exchanges was a major achievement. These two
exchanges had been fierce rivals, and a great deal of persuasion and gentle arm-
twisting was necessary to bring them together. The merger was many years in the
making, requiring extensive negotiations between brokers determined to defend
their traditional turfs. In the past, the lack of computer links and harmonized
operations were hindrances that added considerably to foreign investors' cost of
doing business. Now there is a computerized "one market, two floors" system that
is far more efficient than its predecessor.
This fall, the PPS expects to install a depository system with advanced
technology that should meet "T+3" standards for a three-day settlement period.
It will shorten the time needed for payment and delivery of securities, and is
exactly the kind of thing that I have long recommended to emerging market
securities regulators world-wide. The challenge, now, for the Philippines is to
reach the next level of capital market development in Asia. I believe it can
happen. Remember that since 1983, market capitalization has risen from $22.7
billion to $205 billion in Malaysia and from $1.5 billion to $127.9 billion in
Thailand.
Privatization is presenting many opportunities in the Philippines, as it is in
other emerging markets. Last summer, the Ramos government raised $373 million by
selling one billion shares in Petron, its giant oil refinery and distribution
company, to investors at home and abroad. It was the largest equity offering in
Philippine history, and put another stock on the market in the same league as
traditional heavyweights like PLDT and San Miguel Corp., the food and beverage
industry leader. Now there are plans to sell sizable pieces of government
holdings in such firms as the Philippine National Bank, the Development Bank of
the Philippines, National Steel Corp., National Power Corp. and Philippine
National Oil Company. Since other private companies will probably be lining up
to do initial public offerings in Manila, there should be many more securities
to choose from soon, just as there are many more now than there were a few years
ago when we began buying there.
4
<PAGE>
There is, however, one big obstacle to this country's economic goals: physical
infrastructure. The roads, airports, electric power and other facilities the
Ramos administration inherited were grossly inadequate, suffering from years of
official neglect and heavy use by a fast-growing population. The government
didn't have enough money to meet reconstruction needs, and has, wisely, I
believe, rewritten its investment and regulatory codes to help attract private
foreign capital for the top priority area of power generation. Its track record
in this regard is impressive, with 35 contracts signed with private power
developers, which should increase the present installed capacity by about 75% by
the end of the decade. Every effort is now being made to attract investors into
the Philippines for private tollroads, ports, railroads, mass transit systems
and telecommunications projects. Given the current lack of a local, long-term
debt market, this won't be easy. But the government, realizing its need to
attract $50 billion in new private infrastructure investment over the next ten
years in an effort to reach development goals, is working closely with the World
Bank and others to accomplish this. In the process, we could see many new
opportunities in the Philippines for our shareholders.
When I look at the Philippines, I see a country with sustained economic growth
led by booming foreign investment and strong international demand for its
increasingly competitive export projects. The potential outlook is positive for
increased corporate earnings in this exciting new environment. Industries like
manufacturing, electronics and agroprocessing are all coming alive, but finding
the best investment bargains will be challenging. The market's aggregate P/E is
high, at 18.7 times, but we will continue to seek the best values we can find
for our shareholders.
Sincerely,
/s/ J. Mark Mobius
J. Mark Mobius, Ph.D.
President
Templeton Emerging Markets Fund, Inc.
5
<PAGE>
Templeton Emerging Markets Fund, Inc.
Investment Portfolio, May 31, 1995 (unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES/PRINCIPAL
INDUSTRY IN SHARES VALUE
<C> <S> <C> <C>
- ---------------------------------------------------------------------------------------------
LONG TERM SECURITIES: 81.2%
- ---------------------------------------------------------------------------------------------
Argentina: 0.8%
Ciadea SA Automobiles 4,890 $ 25,429
Comercial de Plata SA Multi-Industry 401,850 976,544
Industrias Petroquimicas Koppers Chemicals 176,191 824,615
Food & Household
Molinos Rio de Plata SA, B Products 12,608 70,608
Transportadora de Gas del Sur SA, B Energy Sources 35,254 76,858
YPF Sociedad Anonima, ADR Energy Sources 23,000 465,750
-----------
2,439,804
- ---------------------------------------------------------------------------------------------
Brazil: 11.9%
Banco Bradesco SA Banking 132,734,752 979,970
Banco Bradesco SA, pfd. Banking 132,142,584 1,115,385
Banco do Brazil SA, pfd. Banking 21,000,000 246,215
Banespa-Banco do Estado de Sao Paulo Banking 41,250,000 252,727
SA, pfd.
Cemig-Cia Energetica de Minas Utilities--Electrical &
Gerais, pfd. Gas 122,441,093 2,799,617
Cia Mesbla SA, pfd. Merchandising 6,825,690 595,697
Copene-Petroquimica do Nordeste SA,
A, pfd. Chemicals 6,292,800 5,242,266
Duratex SA, pfd. Forest Products & Paper 3,287,300 181,155
Eletrobras-Centrais Eletricas Utilities--Electrical & 17,028,977 4,672,414
Brasileiras Gas
SA, B, pfd.
Itausa-Investimentos Itau SA, pfd. Multi-Industry 7,947,346 4,378,703
Mannesmann SA Machinery & Engineering 31,968 8,807
Mannesmann SA, pfd. Machinery & Engineering 2,085,844 597,597
Marcopolo SA, B, pfd. Automobiles 2,248,100 324,519
Petrobras-Petroleo Brasileiro SA,
pfd. Energy Sources 51,584,966 4,803,797
Refripar-Refrigeracao Parana Sa, Appliances & Household
pfd. Durables 92,807,000 148,287
Telebras-Telecomunicacoes
Brasileiras SA Telecommunications 77,991,950 2,371,987
Telebras-Telecomunicacoes Telecommunications 128,676,643 4,438,104
Brasileiras
SA, pfd.
Telerj-Telecomunicacoes do Rio de Telecommunications 858,999 41,648
Janeiro
SA, pfd.
Unibanco-Uniao de Bancos Brasileiros
SA, pfd. Banking 9,150,468 262,162
Vale de Rio Doce, pfd. Metals & Mining 9,292,000 1,402,759
-----------
34,863,816
- ---------------------------------------------------------------------------------------------
Chile: 2.5%
Antofagasta Holdings PLC Metals & Mining 1,585,000 7,367,766
- ---------------------------------------------------------------------------------------------
</TABLE>
6
<PAGE>
Templeton Emerging Markets Fund, Inc.
Investment Portfolio, May 31, 1995 (unaudited) (cont.)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES/PRINCIPAL
INDUSTRY IN SHARES VALUE
<C> <S> <C> <C>
- ----------------------------------------------------------------------------------------------
LONG TERM SECURITIES (CONT.)
- ----------------------------------------------------------------------------------------------
China: 0.4%
Chiwan Wharf Holdings Ltd., B Transportation 428,000 $ 204,724
Utilities--Electrical &
Shandong Huaneng Power Gas 24,000 177,000
Shanghai Chlor-Alkali Chemical Co.
Ltd., B Chemicals 1,088,000 252,416
Shanghai Erfangji Textile Machinery
Co. Ltd., B Machinery & Engineering 276,000 46,920
Shanghai Industrial Sewing Machine
Corp. Machinery & Engineering 190,000 39,140
Shanghai Jinqiao Export Processing
Zone
Development, B Real Estate 108,000 56,160
Shanghai Lian Hua Fibre Corp., B Textiles & Apparel 61,300 19,616
Shanghai Steel Tube Co. Ltd., B Machinery & Engineering 499,400 84,898
Shanghai Tyre & Rubber Co. Ltd., B Industrial Components 173,000 51,900
Shanghai Vacuum Electron Devices Co. Appliances & Household
Ltd., B Durables 525,600 107,222
Shanghai Yaohua Pilkington Glass, B Building Materials &
Components 97,000 95,060
Shenzhen Gintian Industrial Co.
Ltd., B Multi-Industry 54,000 18,500
Shenzhen Properties & Resources
Develop.
(Group) Ltd., B Real Estate 170,000 54,943
-----------
1,208,499
- ----------------------------------------------------------------------------------------------
Czech Republic: 0.1%
Utilities--Electrical &
CEZ, GDS Gas 4,000 170,000
- ----------------------------------------------------------------------------------------------
Greece: 7.4%
Alpha Credit Bank Banking 97,620 5,084,019
Food & Household
Delta Dairy SA, pfd. Products 5,676 101,890
Food & Household
Elais Oleaginous Co. SA Products 28,290 910,383
Ergo Bank SA Banking 134,800 6,220,630
Fourlis Brothers Corp. SA Appliances & Household
Durables 134,030 1,789,805
Hellas Can SA--Container Manufactur- Food & Household
ers Products 12,000 219,746
Food & Household
Hellenic Bottling Co. SA Products 109,572 3,051,129
Intracom SA Electrical & Electronics 6,000 169,046
National Bank of Greece SA Banking 11,940 678,552
Building Materials &
Titan Cement Co., SA Components 91,996 3,546,518
-----------
21,771,718
- ----------------------------------------------------------------------------------------------
Hong Kong: 11.0%
Food & Household
C.P. Pokphand Co. Ltd. Products 909,000 323,161
Cheung Kong Holdings Ltd. Multi-Industry 1,838,000 9,053,017
Dairy Farm Int'l Holdings Ltd., Food & Household
6.50%, conv., pfd. Products 29,000 22,838
Dairy Farm International Holdings
LTd. Multi-Industry 250,342 247,839
Goldlion Holdings Ltd. Textiles & Apparel 500,000 153,517
Hang Lung Development Co. Ltd. Real Estate 3,179,000 5,137,163
Hang Lung Development Co. Ltd., wts. Real Estate 317,900 50,550
Hopewell Holdings Ltd. Construction & Housing 1,411,000 1,194,789
</TABLE>
7
<PAGE>
Templeton Emerging Markets Fund, Inc.
Investment Portfolio, May 31, 1995 (unaudited) (cont.)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES/PRINCIPAL
INDUSTRY IN SHARES VALUE
<C> <S> <C> <C>
- ---------------------------------------------------------------------------------------------
LONG TERM SECURITIES (CONT.)
- ---------------------------------------------------------------------------------------------
Hong Kong (cont.)
HSBC Holdings PLC Banking 323,522 $ 4,203,323
Jardine Matheson Holdings Ltd. (Sin-
gapore) Multi-Industry 114,000 894,900
Jardine Strategic Holdings Ltd.
(Singapore) Multi-Industry 242,500 848,750
Jardine Strategic Holdings Ltd.,
wts. Multi-Industry 12,500 6,313
Building Materials &
K Wah International Holdings Ltd. Components 2,143,796 340,888
Lai Sun Development Co. Ltd. Real Estate 100,000 12,152
New World Development Co. Ltd. Real Estate 1,077,658 3,357,537
Stelux International Holdings Ltd. Multi-Industry 585,133 160,745
Sun Hung Kai Properties Ltd. Real Estate 582,000 4,213,411
Swire Pacific Ltd., B Multi-Industry 500,000 607,604
Tian An China Investments Co. Ltd. Real Estate 3,597,000 567,313
Food & Household
Vitasoy International Holdings Ltd. Products 272,000 107,249
Wheelock & Co. Ltd. Multi-Industry 303,000 536,644
Yaohan Hongkong Corp. Ltd. Merchandising 3,244,000 318,726
-----------
32,358,429
- ---------------------------------------------------------------------------------------------
Hungary: 0.3%
Chinoin Pharmaceutical & Chemical
Works
Co. Ltd. Health & Personal Care 2,000 753,172
Ibusz Leisure & Tourism 800 6,764
-----------
759,936
- ---------------------------------------------------------------------------------------------
India: 0.4%
ATV Project India Ltd. Machinery & Engineering 200,000 230,708
Essar Shipping Ltd. Transportation 59,250 90,501
Garden Silk Mills Ltd. Textiles & Apparel 85,700 136,356
Industrial Credit & Investment Corp.
of India Ltd. Financial Services 200,000 617,343
Appliances & Household
Videocon International Ltd. Durables 90,000 272,076
-----------
1,346,984
- ---------------------------------------------------------------------------------------------
Indonesia: 2.4%
Food & Household
PT Anwar Sierad, fgn. Products 245,500 157,124
PT Astra International, fgn. Multi-Industry 41,100 73,838
Food & Household
PT Charoen Pokphand Indonesia, fgn. Products 500,000 993,712
PT Duta Anggada Realty, fgn. Multi-Industry 440,000 335,953
PT Duta Pertiwi Nusantara Chemicals 409,750 124,222
PT Eratex Djaja, fgn. Textiles & Apparel 283,000 117,572
PT Hadtex Indosyntec, fgn. Textiles & Apparel 953,000 588,536
PT Intan Wijaya Chemical Industry,
fgn. Chemicals 526,000 171,278
PT Jakarta International Hotel &
Development, fgn. Real Estate 100,000 114,530
</TABLE>
8
<PAGE>
Templeton Emerging Markets Fund, Inc.
Investment Portfolio, May 31, 1995 (unaudited) (cont.)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES/PRINCIPAL
INDUSTRY IN SHARES VALUE
<C> <S> <C> <C>
- ----------------------------------------------------------------------------------------------
LONG TERM SECURITIES (CONT.)
- ----------------------------------------------------------------------------------------------
Indonesia (cont.)
Food & Household
PT Japfa Comfeed Indonesia, fgn. Products 539,000 $ 423,647
PT Metrodata Electronic, fgn. Electrical & Electronics 347,000 237,671
PT Multipolar Corp., fgn. Electrical & Electronics 39,000 18,392
PT Polysindo Eka Perkasa, fgn. Textiles & Apparel 6,348,000 2,566,000
PT Pudjiadi Prestige Ltd., fgn. Real Estate 451,500 273,759
PT Unggul Indah Corp., fgn. Chemicals 1,190,200 1,029,030
-----------
7,225,264
- ----------------------------------------------------------------------------------------------
Israel: 0.3%
Bank Hapoalim BM Banking 33,148 49,094
Clal Industries Ltd. Multi-Industry 40,000 248,446
Discount Investment Corp. Multi-Industry 6,000 397,585
The First International Bank of
Israel Banking 977 117,621
-----------
812,746
- ----------------------------------------------------------------------------------------------
Korea (South): 0.8%
Central Investment & Finance Corp. Financial Services 15,976 337,291
Dae Yu Co. Textiles & Apparel 350 7,066
Dae Yu Co. Ltd., new Textiles & Apparel 924 17,923
Daegu Bank Co. Ltd. Banking 43,190 530,009
Daegu Bank Co. Ltd., rts. Banking 9,423 37,302
Daehan Synthetic Fiber Co. Ltd. Textiles & Apparel 2,500 392,558
Hae In Corp. Ltd. Merchandising 4,951 290,717
Hankook Cosmetics Co. Ltd. Health & Personal Care 8,700 306,512
Business & Public
Samseong Publishing Co. Ltd. Services 5,270 109,176
Yuhwa Textiles & Apparel 3,580 184,232
-----------
2,212,786
- ----------------------------------------------------------------------------------------------
Malaysia: 5.9%
Food & Household
Federal Flour Mills Bhd. Products 779,999 2,278,755
Malayawata Steel Bhd., fgn. Metals & Mining 738,000 1,461,327
Malaysian International Shipping
Corp.
Bhd., fgn. Transportation 1,930,666 6,188,785
Oriental Holdings Bhd. Automobiles 988,200 5,172,562
Perlis Plantations Bhd. Multi-Industry 626,879 2,034,909
Perlis Plantations Bhd., fgn. Multi-Industry 50,000 162,305
-----------
17,298,643
- ----------------------------------------------------------------------------------------------
Mexico: 5.1%
Building Materials &
Cemex SA, B Components 268,250 867,996
Cifra SA, C Merchandising 226,000 279,285
DESC SA, A Multi-Industry 138,000 466,732
</TABLE>
9
<PAGE>
Templeton Emerging Markets Fund, Inc.
Investment Portfolio, May 31, 1995 (unaudited) (cont.)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES/PRINCIPAL
INDUSTRY IN SHARES VALUE
<C> <S> <C> <C>
- ----------------------------------------------------------------------------------------------
LONG TERM SECURITIES (CONT.)
- ----------------------------------------------------------------------------------------------
Mexico (cont.)
DESC SA, B Multi-Industry 1,000 $ 3,415
Grupo Financiero Banamex Accival SA,
B Banking 55,000 82,276
Grupo Financiero Banamex Accival SA,
C Banking 261,000 388,741
Grupo Financiero Bancomer SA de CV,
B Banking 1,576,000 340,826
Grupo Financiero Bancomer SA de CV,
L Banking 462,370 96,233
Grupo Financiero Serfin SA, B Banking 152,000 98,120
Grupo Industrial Alfa SA, A Multi-Industry 151,000 1,723,610
Telefonos de Mexico SA, L, ADR Telecommunications 355,700 10,004,063
Transportacion Maritima Mexicana SA
de CV, ADR, A Transportation 15,200 79,800
Tubos de Acero de Mexico SA Metals & Mining 9,334 47,049
Food & Household
Vitro SA Products 208,800 593,467
-----------
15,071,613
- ----------------------------------------------------------------------------------------------
Pakistan: 0.1%
National Development Leasing Corp. Financial Services 110,000 109,328
- ----------------------------------------------------------------------------------------------
Philippines: 10.4%
Keppel Philippine Holdings Inc., B Machinery & Engineering 20,045 10,489
Philex Minning Corp., B Metals & Mining 3,733,339 434,109
Philippine Commercial International
Bank Inc. Banking 387,989 2,782,092
Philippine Long Distance Telephone
Co., ADR Telecommunications 223,753 16,082,247
Philippine National Bank Banking 783,556 9,262,965
Food & Household
RFM Corp. Products 5,962,500 1,617,733
Sime Darby Pilipinas Inc. Industrial Components 576,386 446,811
-----------
30,636,446
- ----------------------------------------------------------------------------------------------
Poland: 0.1%
Bank Slaski SA W Katowicach Banking 5,000 256,684
- ----------------------------------------------------------------------------------------------
Portugal: 5.0%
Banco Chemical Portugal SA Banking 9,800 95,730
Banco Comercial Portugues SA Banking 633,896 8,383,854
Banco Espirito Santo e Comercial de
Lisboa Banking 35,000 567,472
Banco Portugues de Investimento SA Banking 196,860 3,601,501
Banco Totta & Acores SA Banking 34,000 745,284
Espirito Santo Financial Holding SA,
ADR Banking 114,000 1,425,000
-----------
14,818,841
- ----------------------------------------------------------------------------------------------
Singapore: 3.3%
G.P. Batteries International Ltd. Electrical & Electronics 35,000 77,000
Jaya Holdings Ltd. Transportation 919,500 811,906
Jaya Holdings Ltd., ln. stk., 3.5%,
conv., 9/7/97 Transportation 183,900* 108,914
</TABLE>
10
<PAGE>
Templeton Emerging Markets Fund, Inc.
Investment Portfolio, May 31, 1995 (unaudited) (cont.)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES/PRINCIPAL
INDUSTRY IN SHARES VALUE
<C> <S> <C> <C>
- ------------------------------------------------------------------------------------------------------
LONG TERM SECURITIES (CONT.)
- ------------------------------------------------------------------------------------------------------
Singapore (cont.)
Jaya Holdings Ltd., 3.00%, conv. ln. stk.,
8/31/98 Transportation 15,900* $ 17,121
Jaya Holdings Ltd., wts. Transportation 30,051 14,454
Jaya Holdings Ltd., wts. Transportation 36,780 23,763
Food & Household
Prima Ltd. Products 530,000 1,940,416
Singapore Bus Service (1978) Ltd., fgn. Transportation 903,600 6,292,118
TIBS Holdings Ltd. Transportation 134,600 391,335
TIBS Holdings Ltd., wts. Transportation 40,380 29,350
-----------
9,706,377
- ------------------------------------------------------------------------------------------------------
South Africa: 0.3%
Food & Household
Del Monte Royal Foods Ltd. Products 27,825 44,230
Engen Ltd. Energy Sources 45,241 319,616
First National Bank Holdings Ltd. Banking 28,900 184,539
Rembrandt Group Ltd. Multi-Industry 33,400 242,769
-----------
791,154
- ------------------------------------------------------------------------------------------------------
Sri Lanka: 0.1%
Building Materials &
Lanka Ceramic Ltd. Components 162,000 163,290
Lanka Walltile Ltd. Multi-Industry 27,300 30,269
United Motor Lanka Ltd. Automobiles 158,600 76,734
-----------
270,293
- ------------------------------------------------------------------------------------------------------
Thailand: 0.3%
Asia Fibre Public Co. Ltd., fgn. Textiles & Apparel 233,600 231,896
Food & Household
Charoen Pokphand Feedmill Public Co. Ltd. Products 64,000 407,131
Kian Gwan (Thailand) Public Co. Ltd., fgn. Real Estate 26,000 79,011
Padaeng Industry Public Co. Ltd., fgn. Metals & Mining 35,100 49,777
United Standard Terminal Public Co. Ltd., fgn. Transportation 60,000 87,520
-----------
855,335
- ------------------------------------------------------------------------------------------------------
Turkey: 11.8%
Akbank AS Banking 16,831,324 4,688,935
Akbank, new Banking 8,415,662 2,246,781
Building Materials &
Akcimento Ticaret AS Components 552,000 832,966
Alcatel Teletas Endustri Tic AS Telecommunications 152,000 47,638
Appliances & Household
Arcelik AS Durables 24,737,557 7,322,202
Bagfas Bandirma Gubre Fabrikalari AS Chemicals 2,805,790 1,091,050
Appliances & Household
Bekoteknik AS Durables 2,966,250 723,056
Building Materials &
Celik Halat ve Sanayii ve Ticaret AS Components 2,749,000 555,225
Building Materials &
Cimentas Izmir Cimento Fabrikasi AS Components 1,497,250 1,112,293
Building Materials &
Cimsa Cimento Sanayi ve Ticaret AS Components 128,000 653,743
Compagnie Financiere Ottomane SA Banking 37,000 1,423,483
</TABLE>
11
<PAGE>
Templeton Emerging Markets Fund, Inc.
Investment Portfolio, May 31, 1995 (unaudited) (cont.)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES/PRINCIPAL
INDUSTRY IN SHARES VALUE
<C> <S> <C> <C>
- -----------------------------------------------------------------------------------------------
LONG TERM SECURITIES (CONT.)
- -----------------------------------------------------------------------------------------------
Turkey (cont.)
Utilities--Electrical &
Cukurova Elektrik AS Gas 3,810,033 $ 1,304,654
Eregli Demir ve Celik Fabrikalari AS Metals & Mining 19,289,250 2,776,398
Finans Bank AS, br. Banking 25,244,455 3,340,531
Building Materials &
Izocam Ticaret ve Sanayii AS, br. Components 2,786,552 491,649
Kartonsan Forest Products & Paper 95,000 70,575
Koc Holding AS Multi-Industry 646,000 554,893
Koc Yatirim ve Sanayii Mamullesi
Pazarlanca AS Multi-Industry 3,725,532 1,254,097
Marshall Boya ve Vernik Sanayii AS Industrial Components 2,081,520 773,171
Otosan Otomobil Sanayii AS Automobiles 4,215,288 1,272,170
Tekstil Bankasi Tekstilbank AS, br. Banking 1,277,509 90,456
Appliances & Household
Turk Demir Dokum, br. Durables 6,114,820 1,455,065
Turkiye Garanti Bankasi AS Banking 1,390,907 355,194
Vakif Finansal Kiralama AS Financial Services 1,872,600 180,413
------------
34,616,638
- -----------------------------------------------------------------------------------------------
Venezuela: 0.5%
Ceramica Carabobo CA, A, ADR Building Materials &
Components 130,000 85,005
Building Materials &
Consolidada Carabobo, B Components 840,000 75,789
Utilities--Electrical &
Electricidad de Caracas Gas 750,128 673,047
Manufacturera de Aparatos Domesticos Appliances & Household
SA Durables 36,000 63,158
Food & Household
Mavesa SA, ADR Products 61,000 189,574
Siderurgica Venezolana Sivensa Saica
Svs Metals & Mining 1,455,440 399,425
Siderurgica Venezolana Sivensa Saica
SVS, ADR Metals & Mining 21,750 29,845
Siderurgica Venezolana Sivensa Saica
SVS, Venprecar GDS Metals & Mining 1,764 9,473
------------
1,525,316
- -----------------------------------------------------------------------------------------------
SHORT TERM OBLIGATIONS: 19.0%
- -----------------------------------------------------------------------------------------------
U.S. Treasury Bills, 5.46% to 5.63%
with maturities to 7/27/95 56,308,000 56,044,613
- -----------------------------------------------------------------------------------------------
TOTAL INVESTMENTS: 100.2% 294,539,029
OTHER ASSETS, LESS LIABILITIES:
(0.2)% (470,651)
------------
TOTAL NET ASSETS: 100.0% $294,068,378
============
</TABLE>
* Principal amount in currency of country indicated
12
<PAGE>
Templeton Emerging Markets Fund, Inc.
Financial Highlights, May 31, 1995 (unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NET ASSET VALUE
TOTAL NET ASSETS PER SHARE
------------------------ ----------------
<S> <C> <C> <C> <C>
Net Asset Value:
Beginning of period, March 1, 1995 $263,829,664 $ 16.30
Net investment income $ 2,309,599 $ 0.14
Net gain from security and foreign
currency transactions 27,929,115 1.73
----------- -------
Net increase in net asset value 30,238,714 1.87
------------ --------
End of period, May 31, 1995 $294,068,378 $ 18.17
============ ========
</TABLE>
- ---
This report is sent to the shareholders of Templeton Emerging Markets 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 secu-
rities mentioned in the report.
13
<PAGE>
Templeton Emerging Markets Fund, Inc.
- --------------------------------------------------------------------------------
Transfer Agent
Chemical Mellon Shareholders Services
Securities Transfer Services
450 West 33rd Street
New York, NY 10001
800-526-0801
Shareholder Information
Weekly comparative net asset value and market price information about Templeton
Emerging Markets Fund, Inc. shares is published each Monday in The Wall Street
Journal, weekly in Barron's and each Saturday in The New York Times and other
newspapers in a table called "Publicly Traded Funds". Daily market prices for
the Fund's shares are published in the New York Stock Exchange Composite Trans-
actions section of newspapers under the designation "TempltnEFd." The Fund's
New York Stock Exchange trading symbol is EMF. The Fund's shares are also
listed and traded on the Pacific Stock Exchange.
For current information about the net asset value, call 1-800-292-9293.
If any shareholder is not receiving copies of the Reports to Shareholders be-
cause shares are registered in a broker's name or in a custodian's name, he or
she can write and request that his or her name be added to the Fund's mailing
list, by writing Templeton Emerging Markets Fund, Inc., 700 Central Avenue, St.
Petersburg, FL 33701.
14
<PAGE>
Notes
-----
<PAGE>
- --------------------------
TEMPLETON EMERGING
MARKETS FUND, INC.
700 Central Avenue
St. Petersburg,
Florida 33701-3628
Investors should be
aware that the value of
investments made for
the Fund may go up as
well as down and that
the Investment Manager
may make errors in
selecting securities
for the Fund's
portfolio. Like any
investment in
securities, the Fund's
portfolio will be
subject to the risk of
loss from market,
currency, economic,
political, and other
factors. The Fund and
Fund investors are not
protected from such
losses by the
Investment Manager.
Therefore, investors
who cannot accept the
risk of such losses
should not invest in
shares of the Fund.
To ensure the highest
quality of service,
telephone calls to or
from our service
departments may be
monitored, recorded,
and accessed. These
calls can be determined
by the presence of a
regular beeping tone.
- --------------------------
TEMPLETON
EMERGING
MARKETS
FUND, INC.
Third Quarter Report
May 31, 1995
TLEMF Q95 5/95
[LOGO OF FRANKLIN TEMPLETON APPEARS HERE]
