CLEMENTE GLOBAL GROWTH FUND INC, N-30D, 1998-08-26

CLEMENTE GLOBAL GROWTH FUND INC
N-30D, 1998-08-26

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Clemente Global Growth Fund, Inc.
LETTER TO SHAREHOLDERS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

August 19, 1998

Dear Shareholder:

A roller coaster second quarter ended on an upswing in June, led by strong
rallies in the United States and Europe. Asia remained under the spell of a debt
and currency crisis which is pushing its economies toward a deep recession,
while Japan's economic and financial troubles intensified, and the yen
threatened the region with yet another bout of currency turmoil. Russia's debt
and economic woes added to the uncertainty already gripping emerging capital
markets. Although buffeted up and down by global economic and financial forces,
Clemente Global Growth (CLM) finished the quarter up 4.12% compared to a 0.98%
increase in the FT World Index, bringing the first half gains to 18.39% for the
Fund and 14.77% for the FT World Index. With the price of CLM rising 7.8% in the
quarter, and 27.8% since the end of 1997, the discount of price to NAV fell from
- -18.15% at the start of the year to -11.63% at the end of June 1998.

GLOBAL EQUITY MARKETS HAD TO COPE WITH BOTH OLD AND NEW RISKS

Volatility and high levels of risk characterized global equity markets in the
second quarter 1998. Europe and the United States were seemingly immune, moving
higher in response to favorable economic fundamentals and abundant liquidity,
but choppy markets betrayed a strong undercurrent of caution, the product of
high valuations, an on-going Asian crisis, and the sudden prospect of an
implosion in Russia.

Old risks plagued investors in April and May, largely in the form of renewed
turmoil in Asia/Pacific markets. Social and political unrest intensified in
Indonesia, ending the long-standing tenure of Mr. Suharto, and, while Japanese
policymakers fiddled, Asian economies slid into an abyss. A new concern surfaced
in June. Russia's debt and currency crisis rattled investors, particularly in
emerging markets, and capital flows continued to favor Europe and the United
States. Established equity markets had their own worries, as noted above, but
they salvaged the quarter on a late surge helped by positive earnings surprises,
steady interest rates, and abundant liquidity.

The European story is by now familiar. High valuations were offset by solid
economic growth, low and falling inflation, bond rallies, and strong corporate
earnings. Longer term developments also played a part: European companies
continued to restructure, merge, and buy back shares, while European savers and
institutional investors cultivated their new-found love-affair with stocks.
Finland and Belgium led the way, and all established European markets, other
than Denmark and Norway, surpassed the 13.20% gains of the Dow Jones Industrial
Average.

The second quarter was a period of almost relentless decline in Asia's Pacific
Rim. By quarter-end, the gains achieved in the first quarter were gone, and new
lows were being established in the region's stock

<PAGE>

Clemente Global Growth Fund, Inc.
LETTER TO SHAREHOLDERS - CONTINUED
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- --------------------------------------------------------------------------------

exchanges. Not a single market turned in a positive performance either in the
second quarter or in the first half of 1998. Hardest hit were Indonesia,
Thailand, Malaysia, South Korea and Singapore.

In the Western Hemisphere, the US alone turned in a positive second quarter
performance, and was joined only by Canada in the first half's circle of
winners. Investors in Latin America feared that debt and currency crises would
spread to the region, and that the Latin economies would experience an Asian-
induced drag on their economic growth. Weak commodity prices did not help, nor
did Mexico's economic imbalances and Brazil's closely contested Presidential
election. Even in the US, gains were hard to come by, and were generally earned
during the last two weeks of the quarter.

The CLM portfolio continued to pare its holdings in Japan and in the emerging
markets of Asia and Latin America, while adding to Europe and, in a more modest
way, to the United States.

RISKS MULTIPLY AND VOLATILITY REFUSES TO SUBSIDE

Exaggerated swings in equity prices can be expected as nervous investors
confront a succession of risks in global capital markets, including some
disturbingly familiar scenarios: a deepening economic and financial crisis in
Japan, recession and continued currency vulnerability in Asia, a foreign debt
and currency crisis in Russia, economic weakness in China and pressure to
devalue the renminbi and the Hong Kong dollar.

Still, it is not time to run to the hills. World economic growth will slow in
1998 and 1999, but there is little risk of a global recession. Inflation remains
subdued, liquidity abundant, and short-term interest rates relatively steady in
the established markets. US monetary policy will probably be on hold for the
rest of 1998, given a slowing economy and worries about shocks from Asia and
Russia, while European interest rates aren't likely to rise until late in the
year, and then only modestly for the purpose of EMU convergence.

Patterns of economic growth, inflation and interest rates favor established
equity markets, particularly in Europe. The US faces some serious threats to
profits in its high growth sectors, and these could prompt stock market
corrections of 10-20% that will envelop all regions, but Europe, with its sound
fundamentals and promising earnings picture, may be able to shrug aside such
influences, after a time, and resume its upward climb. Japan is not ready for a
sustained recovery; policies put in place to deal with economic weakness and
financial reform are generally inadequate, and the next efforts may not be
forthcoming until late fall. Asia's Pacific Rim offers tantalizing value, but
continued high short-term risk, and our very selective emerging market picks
will be largely limited to Europe and Latin America. The key in both emerging
and established markets lies in stock selection that focuses on sound financials
and steady earnings prospects.

<PAGE>

Proxy choices face CLM shareholders in late September. In making your decision,
we simply ask that you weigh in the balance the performance the Fund has
produced of late, and that you carefully consider the perpetual buyback option
offered by the Directors of the Fund. This option promises not only to narrow
significantly the discount of price to NAV, but also to maintain the closed-end
structure that will serve us well when we are ready to capture the value that
lies in the ruins of Asia's devastated capital markets.

As always, we thank you for your support.

Cordially yours,

/s/ Thomas G. Prapas /s/ Young J. Zoh /s/ E. Matthew Brown
---------------- ------------ ----------------
Thomas Prapas Young Zoh E. Matthew Brown

<PAGE>

Clemente Global Growth Fund, Inc.
SCHEDULE OF INVESTMENTS (UNAUDITED) JUNE 30, 1998
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- ------------------------------------------------------------------------------------------------

SHARES/PRINCIPAL
AMOUNT VALUE
---------------- -----
<S> <C> <C> <C>
COMMON STOCK -- 97.2%

BRAZIL -- 3.3%
Telesp Celular S.A. PFD-B-* Telecommunications
Services................... 6,000 $ 498,007

Telecommunicacoes
Brasileiras S.A. ADR Telecommunications
Services................... 6,000 1,411,020
Uniao De Bancos Brasileiras
S.A. GDR Banking...................... 25,000 737,500
-----------
2,646,527
-----------

CANADA -- 1.7%

Power Corporation of Canada
Ltd. Diversified Financial
Services................... 29,700 1,393,570
-----------

FINLAND -- 4.4%
Nokia Corp. ADR Telecommunications
Equipment.................. 26,000 1,886,625
Sampo Insurance Co. Ltd. Insurance.................... 35,000 1,658,623
-----------
3,545,248
-----------

FRANCE -- 4.4%
Alcatel Alsthom Compagnie Telecommunications
Equipment.................. 10,500 2,137,849
AXA-UAP Insurance.................... 12,000 1,349,646
-----------
3,487,495
-----------

GERMANY -- 9.3%
Bayerische Vereinsbank AG Banking...................... 21,000 1,780,026
Porsche AG -- Preferred
Shares Autos........................ 990 2,852,030
SAP AG Computer Services............ 4,600 2,790,535
-----------
7,422,591
-----------

GREECE -- 1.4%
Ergo Bank SA Banking...................... 13,000 1,111,032
-----------

IRELAND -- 1.9%
Bank of Ireland Banking...................... 74,730 1,527,137
-----------

ITALY -- 4.3%
Banca Commerciale Italiana Banking...................... 375,000 2,244,873
Telecom Italia SpA Telecommunications
Services................... 163,000 1,190,898
-----------
3,435,771
-----------

4 SEE NOTES TO FINANCIAL STATEMENTS
</TABLE>

<PAGE>

Clemente Global Growth Fund, Inc.
SCHEDULE OF INVESTMENTS (UNAUDITED) - CONTINUED JUNE 30, 1998
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- ------------------------------------------------------------------------------------------------

SHARES/PRINCIPAL
AMOUNT VALUE
---------------- -----
<S> <C> <C> <C>
JAPAN -- 4.8%
Honda Motor Co., Ltd.* Autos........................ 50,000 $ 1,779,731
Sony Corp. Electronics.................. 12,700 1,093,526
TDK Corp. Electronics.................. 13,000 960,118
-----------
3,833,375
-----------

KOREA -- 1.2%
Samsung Electro-Mechanics Electronics.................. 30,000 928,623
-----------

MEXICO -- 1.0%
Grupo Financiero Banorte SA
de CV* Banking...................... 680,000 756,729
-----------

NETHERLANDS -- 5.5%
Baan Co., N.V.* Computer Services............ 23,000 826,508
Koninklijke Ahold N.V. Retail....................... 45,000 1,444,534
Oce-Van Der Grinten N.V. Electrical Equipment......... 48,664 2,071,704
-----------
4,342,746
-----------

PORTUGAL -- 1.2%
Cimpor Cimentos De Portugal Construction Materials....... 28,000 983,759
-----------

SPAIN -- 5.6%
Acs Actividades De
Construccion y Servicios
SA Building/Heavy
Construction............... 54,000 1,624,338
Argentaria Corp. BC Banking...................... 28,476 639,868
Vallehermoso S.A. Real Estate.................. 59,000 2,173,623
-----------
4,437,829
-----------

SWEDEN -- 1.8%
Astra AB ADR Pharmaceutical............... 72,000 1,476,000
-----------

SWITZERLAND -- 5.2%
Alusuisse-Lonza Holding AG Multi-Industry............... 1,200 1,522,142
Union Bank Swiss Bearer Banking...................... 560 1,041,132
Zurich
Versicherungsgesellschaft Insurance.................... 2,500 1,595,454
-----------
4,158,728
-----------

UNITED KINGDOM -- 4.8%
BAA PLC Business/Public Services..... 92,954 1,003,457
General Electric Company
PLC Electrical Equipment
Manufacturer............... 125,000 1,077,225
Lloyds TSB GRP Banking...................... 70,000 979,326
Orange PLC* Telecommunications
Services................... 71,000 752,243
-----------
3,812,251
-----------

SEE NOTES TO FINANCIAL STATEMENTS 5
</TABLE>

<PAGE>

SHARES/PRINCIPAL
AMOUNT VALUE
---------------- -----
<S> <C> <C> <C>
UNITED STATES -- 36.2%
Air Products and Chemicals,
Inc. Chemicals.................... 33,000 $ 1,320,000
Airtouch Communications,
Inc.* Telecommunications
Services................... 50,000 2,921,875
Baxter International, Inc. Medical Products............. 27,000 1,452,938
Cisco Systems, Inc.* Computer Services............ 33,000 3,038,063
Dresser Industries, Inc. Energy & Equipment
Services................... 27,000 1,189,688
Harris Corp.* Office Automation &
Equipment.................. 32,800 1,465,750
Health Management Assoc.,
Inc.* Healthcare................... 75,000 2,507,812
Home Depot, Inc. Retail....................... 31,500 2,616,469
Illinois Tool Works, Inc.* Machinery/Manufacturing...... 27,600 1,840,575
Intel Corp. Semiconductors............... 14,500 1,074,812
Network Associates* Computer Services............ 22,500 1,077,188
Pepsico, Inc. Food & Beverages............. 18,500 761,969
Protective Life Corp. Insurance.................... 36,400 1,335,425
Sungard Data Systems, Inc.* Computer Services............ 60,000 2,302,500
Suntrust Banks, Inc.* Banking...................... 20,000 1,626,250
Worldcom, Inc.* Telecommunications
Services................... 48,400 2,344,376
-----------
28,875,690
-----------
TOTAL COMMON STOCK (COST $51,260,053)............. 78,175,101
-----------

TIME DEPOSIT -- 2.0%
First National Bank of Chicago
5.00% 07/01/98 (Cost $1,559,000)......................... 1,559,000 1,559,000
-----------

TOTAL INVESTMENTS (Cost $52,819,053)** -- 100%.............. $79,734,101
===========
</TABLE>

ADR American Depository Receipts
GDR Global Depository Receipts
* Non-Income Producing Security
** Summary of Total Investments:
COST VALUE
----------- -----------
Common Stock...................... $51,260,053 $78,175,101
Short-Term Instruments............ 1,559,000 1,559,000
----------- -----------
Total Investments................. $52,819,053 $79,734,101
=========== ===========

<TABLE>
<S> <C>
6 SEE NOTES TO FINANCIAL STATEMENTS
</TABLE>

<PAGE>

Clemente Global Growth Fund, Inc.
STATEMENT OF ASSETS AMD LIABILITIES (UNAUDITED) JUNE 30, 1998
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

ASSETS
Investments at value (Cost $52,819,053)............................ $79,734,101
Cash............................................................... 1,474,052
Receivable for securities sold..................................... 1,065,736
Dividends receivable............................................... 157,459
Accrued interest receivable........................................ 227
Other assets....................................................... 4,500
-----------
Total Assets................................................ 82,436,075
-----------

LIABILITIES
Payable for investments securities purchased....................... 1,559,000
Investment adviser fee payable..................................... 32,242
Administrative service fee payable................................. 9,672
Accrued expenses.................................................. 376,072
-----------
Total Liabilities........................................... 1,976,986
-----------
NET ASSETS......................................................... $80,459,089
===========

Net assets consist of:
Common stock, $0.01 par (authorized 25,000,000 shares and
6,010,000 shares issued, 5,892,400 shares outstanding
of common stock).............................................. $ 58,924
Paid-in Capital.................................................. 53,505,305
Cost of 117,600 shares held in treasury.......................... (850,032)
Accumulated net investment loss.................................. (128,990)
Accumulated net realized gain.................................... 958,956
Net unrealized appreciation of investments and translation
of net assets denominated in foreign currencies............... 26,914,926
-----------
Net Assets......................................................... $80,459,089
===========
Net Asset Value Per Share
($80,459,089 divided by 5,892,400 shares of common stock)........ $ 13.65
===========

SEE NOTES TO FINANCIAL STATEMENTS 7

<PAGE>

Clemente Global Growth Fund, Inc.
STATEMENT OF OPERATIONS (UNAUDITED) JUNE 30, 1998
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- --------------------------------------------------------------------------------

INVESTMENT INCOME
Dividends (net of foreign taxes withheld $33,687)............... $ 462,418
Interest........................................................ 47,622
-----------
Total income............................................... 510,040
-----------

EXPENSES
Investment advisory fee......................................... 185,662
Custodian fees and expenses..................................... 85,041
Administrative services fee..................................... 55,698
Legal fee....................................................... 105,145
Directors' fees and expenses.................................... 28,961
Audit fee....................................................... 26,310
Registration expenses........................................... 22,500
Printing........................................................ 16,730
Transfer agency services........................................ 7,031
Insurance expense............................................... 1,694
Miscellaneous................................................... 101,769
-----------
Total operating expenses................................... 636,541
-----------
Net investment loss............................................... (126,501)
-----------

REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND
FOREIGN CURRENCY TRANSACTIONS
Net realized gain (loss) on:
Investment transactions......................................... 977,463
Foreign currency transactions................................... (18,507)
Net change in unrealized appreciation (depreciation) on:
Investment transactions......................................... 11,679,257
Translation of other assets and liabilities denominated in
foreign currency............................................. (3,372)
-----------
Net realized and unrealized gain on investments and foreign
currency transactions........................................... 12,634,841
-----------

NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.............. $12,508,340
===========

8 SEE NOTES TO FINANCIAL STATEMENTS

<PAGE>

Clemente Global Growth Fund, Inc.
STATEMENT OF CHANGES IN NET ASSETS
- -------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------

SIX MONTHS
ENDED YEAR ENDED
JUNE 30, DECEMBER 31,
1998 1997
----------- ------------
(UNAUDITED)
<S> <C> <C>
Operations:

Net investment loss....................................... $ (126,501) $ (314,475)

Net realized gain (loss) on:

Investment transactions................................ 977,463 7,014,674

Foreign currency transactions.......................... (18,507) (222,666)

Net change in unrealized appreciation (depreciation) on:

Investment transactions................................ 11,679,257 7,164,743

Translation of other assets and liabilities
denominated in foreign currency...................... (3,372) (1,078)
----------- -----------

Net increase in net assets resulting from operations........ 12,508,340 13,641,198
----------- -----------

Distribution to shareholders from:

Net realized gain on investments.......................... -- (5,210,714)
----------- -----------

Total increase (decrease) in net assets..................... 12,508,340 8,430,484
----------- -----------

NET ASSETS:

Beginning of period....................................... 67,950,749 59,520,265
----------- -----------

End of period............................................. $80,459,089 $67,950,749
=========== ===========

SEE NOTES TO FINANCIAL STATEMENTS 9
</TABLE>

<PAGE>

Clemente Global Growth Fund, Inc.
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout each period)
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------

SIX MONTHS
ENDED FOR THE YEAR ENDED DECEMBER 31,
JUNE 30, -----------------------------------------------------------
1998 1997 1996 1995 1994 1993
----------- ------- ------- ------- ------- -------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE
Net asset value, beginning of period... $ 11.53 $ 10.10 $ 10.65 $ 10.73 $ 12.36 $ 9.43
-------- ------- ------- ------- ------- -------
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss)........... (0.02) (0.05) (0.03) -- (0.03) 0.02
Net realized and unrealized gains
(losses) on investments, foreign
currency holdings and other assets
and liabilities denominated in
foreign currencies................... 2.14 2.36 0.41 0.42 (0.64) 3.56
-------- ------- ------- ------- ------- -------
Net increase (decrease) from investment
operations........................... 2.12 2.31 0.38 0.42 (0.67) 3.58
-------- ------- ------- ------- ------- -------
LESS DIVIDENDS AND DISTRIBUTIONS
Distribution from net investment
income............................. -- -- -- -- -- --
Distribution from net realized
capital and currency gains......... -- (0.88) (0.93) (0.50) (0.96) (0.65)
-------- ------- ------- ------- ------- -------
TOTAL DIVIDENDS AND DISTRIBUTIONS...... -- (0.88) (0.93) (0.50) (0.96) (0.65)
-------- ------- ------- ------- ------- -------
Increase (decrease) in net asset
value................................ 2.12 1.43 (0.55) (0.08) (1.63) 2.93
-------- ------- ------- ------- ------- -------
Net asset value, end of period......... $ 13.65 $ 11.53 $ 10.10 $ 10.65 $ 10.73 $ 12.36
======== ======= ======= ======= ======= =======
PER SHARE MARKET VALUE, END OF
PERIOD............................... $12 1/16 $9 7/16 $ 7 1/2 $ 8 3/8 $ 8 1/2 $11 1/4
======== ======= ======= ======= ======= =======
TOTAL INVESTMENT RETURN*............... 27.81%*** 37.62% 0.64% 4.59% (15.91)% 53.55%
======== ======= ======= ======= ======= =======
RATIOS/SUPPLEMENTAL DATA
Net assets, end of year (in 000's)..... $ 80,459 $67,951 $59,520 $62,781 $63,216 $72,830
Ratios to average net assets:
Operating expenses................... 1.71%** 1.74% 1.53% 1.58% 1.75% 1.68%
Net investment income (loss)......... (0.34)%** (0.46)% (0.25)% (0.02)% (0.25)% 0.16%
Portfolio turnover..................... 57.44% 81.56% 120.66% 84.98% 81.73% 125.31%
</TABLE>

- ------------------

* Total investment return is calculated assuming a purchase of common stock at
the current market price on the first day and a sale at the current market
price on the last day of each period reported. Dividends and distributions,
if any, are assumed, for purposes of this calculation, to be reinvested at
prices obtained under the Fund's dividend reinvestment plan. Total investment
return does not reflect brokerage commissions or sales charges.

** Annualized.

*** Non-annualized.

10 SEE NOTES TO FINANCIAL STATEMENTS

<PAGE>

Clemente Global Growth Fund, Inc.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) JUNE 30, 1998
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- --------------------------------------------------------------------------------

NOTE 1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES -- Clemente Global
Growth Fund, Inc. (the "Fund") was incorporated in Maryland on May 1, 1987, as a
closed-end, diversified management investment company. The Fund had no
operations until June 30, 1987, other than the sale of 10,000 shares of common
stock for $100,000 to Clemente Capital, Inc. (the "Investment Adviser") on June
9, 1987.

The following is a summary of significant accounting policies followed by the
Fund in the preparation of its financial statements.

The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts and disclosures in the financial statements. Actual
results could differ from those estimates.

SECURITY VALUATION: Portfolio securities traded on stock exchanges or on the
NASDAQ National Market System are valued at the last sale price as of the close
of business on the primary exchange on the day the securities are being valued,
or if no sales prices are reported, at the mean between closing bid and asked
prices. Other over-the-counter portfolio securities are valued at the most
recent bid prices obtained from one or more dealers that make markets in the
securities. Short-term obligations, maturing within 60 days of the valuation
date, are to be valued at amortized cost, which approximates market value.
Securities for which market quotations are not readily available are valued at
their fair value as determined in good faith by the Board of Directors.

SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are
recorded on the trade date. Realized gains and losses on sales of investments
are calculated on the identified cost basis. Dividend income is recorded on the
ex-dividend date. Interest income is accrued as earned. Non-U.S. withholding tax
is recorded as a reduction of income.

FOREIGN CURRENCY TRANSLATION: The books and records of the Fund are maintained
in United States dollars.

Foreign currency amounts are translated as follows into U.S. dollars at the
foreign exchange rates obtained from an independent investment data service
which reports the exchange rates as of the close of the respective non-U.S.
market:

(i) market value of investment securities and other assets and liabilities
at the exchange rate on the valuation date.

(ii) purchases and sales of investment securities, income and expenses at
the exchange rate prevailing on the respective date of such
transactions.

The Fund does not isolate that portion of the results of operations resulting
from changes in foreign exchange rates on investments from the fluctuations
arising from changes in market prices of securities held. Such fluctuations are
included with the net realized and unrealized gain or loss from investments.

Reported net realized foreign exchange gains or losses arise from sales and
maturities of short-term securities, currency gains and losses realized between
the trade and settlement dates on securities transactions, the difference
between the amounts of dividends, interest and foreign withholding taxes
recorded on the Fund's books, and the U.S. dollar equivalent of the amounts
actually received or paid. Net unrealized foreign exchange gains and losses
arise from changes in the value of the assets and

<PAGE>

Clemente Global Growth Fund, Inc.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) - CONTINUED JUNE 30, 1998
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

liabilities other than investments in securities at the end of the period,
resulting from changes in the foreign exchange rate.

TAXES: No provision for Federal income tax is required since it is the policy of
the Fund to comply with the provisions of the Internal Revenue Code applicable
to regulated investment companies and to distribute all of its taxable income,
including any net realized gains, in an amount sufficient to relieve the Fund of
any Federal income tax liability. The Fund intends to comply with the
requirements of the Internal Revenue Code as long as qualification is determined
by the Board of Directors to be in the best interests of the shareholders.

DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS: The Fund records dividends and
distributions to its shareholders on the ex-dividend date.

The amounts of dividends from net investment income and of distributions from
net realized gains are determined in accordance with Federal income tax
regulations which may differ from generally accepted accounting principles.
These "book/tax" differences are either considered temporary or permanent in
nature. To the extent these differences are permanent in nature, such amounts
are reclassified within the composition of net assets based on their Federal
tax-basis treatment; temporary differences do not require reclassification. At
December 31, 1997, $222,666 of net realized foreign currency loss was
reclassified to net investment loss and the total net investment loss of
$534,652 was reclassified to capital. Net foreign currency losses incurred after
October 31 ("Post October" losses) within the taxable year are deemed to arise
on the first business day of the Fund's next taxable year. The Fund incurred and
will elect to defer net foreign currency losses of $2,489 during fiscal 1997.
Dividends and distributions to shareholders which exceed net investment income
and net realized gains for financial reporting purposes but not for tax purposes
are reported as dividends in excess of net investment income or distributions in
excess of net realized gains. To the extent they exceed net investment income
and net realized gains for tax purposes, they are reported as distributions of
capital.

OPTION ACCOUNTING PRINCIPLES: When the Fund purchases a call or put option, the
premium paid is recorded as an investment which is subsequently marked-to-market
to reflect the current market value. If a purchased option expires, the Fund
will realize a loss to the extent of the premium paid. If the Fund enters into a
closing sale transaction, a gain or loss is realized for the difference between
the proceeds from the sale and the cost of the option. If a put option is
exercised, the cost of the security or currency sold upon exercise will be
increased by the premium originally paid. If a call option is exercised, the
cost of the security purchased upon exercise will be increased by the premium
originally paid.

NOTE 2. INVESTMENT ADVISORY AND ADMINISTRATION AGREEMENTS -- The Fund pays to
the Investment Adviser as compensation for the services provided by the
Investment Adviser under the Investment Advisory Agreement, a monthly fee
comprised of a basic fee of 1% (on an annualized basis) of the month-end net
assets of the Fund (the "Basic Fee") that is subject to adjustment as described
below based on the investment performance of the Fund in relation to the
investment record of the FT-Actuaries World Index (the "FT-Actuaries Index").

Adjustments to the Basic Fee are made by comparison of the Fund's investment
performance for the applicable performance period with the investment record of
the FT-Actuaries Index for the same period. The applicable performance period is
a rolling 36-month period whereby the most recent calendar month is substituted
for the earliest month as time passes. The Basic Fee for each month may be
increased to a

<PAGE>

maximum of 1.50% (on an annualized basis) or decreased to a minimum of 0.50% (on
an annualized basis) depending on the extent by which the Fund's performance
varies from the FT-Actuaries Index over the performance period as set forth
below.

The following table illustrates the full range of permitted increases or
decreases of the Basic Fee on an annualized basis:

PERCENTAGE POINT
DIFFERENCE BETWEEN ADJUSTMENT
PERFORMANCE OF FUND TO BASIC FEE AS
AND % CHANGE IN BASIC FEE ADJUSTED MONTHLY
FT-ACTUARIES INDEX FEE (ANNUALIZED) (ANNUALIZED) FEE RATE
- ------------------- ----- ------------ ------------ ------------
+10% or greater 1% +.50 % 1.50 % 1/12 x 1.50%
+9 1 +.40 1.40 1/12 x 1.40
+8 1 +.30 1.30 1/12 x 1.30
+7 1 +.25 1.25 1/12 x 1.25
+6 1 +.20 1.20 1/12 x 1.20
+5 1 +.15 1.15 1/12 x 1.15
+4 1 +.10 1.10 1/12 x 1.10
+3 1 +.075 1.075 1/12 x 1.075
+2 1 +.05 1.05 1/12 x 1.05
+1 1 +.025 1.025 1/12 x 1.025
0 1 .00 1.00 1/12 x 1.00
-1 1 -.025 .975 1/12 x.975
-2 1 -.05 .95 1/12 x.95
-3 1 -.075 .925 1/12 x.925
-4 1 -.10 .90 1/12 x.90
-5 1 -.15 .85 1/12 x.85
-6 1 -.20 .80 1/12 x.80
-7 1 -.25 .75 1/12 x.75
-8 1 -.30 .70 1/12 x.70
-9 1 -.40 .60 1/12 x.60
-10 or greater 1 -.50 .50 1/12 x.50

In calculating the investment performance of the Fund as compared with the
investment record of the FT-Actuaries Index, dividends and other distributions
of the Fund and dividends and other distributions reported with respect to
component securities of the FT-Actuaries Index during the performance period
will be treated as having been reinvested. Also, the withholding taxes paid or
accrued by the Fund are added back in calculating the Fund's performance in
order to be comparative with the FT-Actuaries Index.

Pursuant to a U.S. Advisory Agreement (the "New Agreement") among the Fund, the
Investment Adviser and Wilmington Trust Company, an indirect affiliate of the
Investment Adviser ("Wilmington Trust"), dated May 29, 1997, Wilmington Trust
manages the U.S. portion of the Fund's portfolio subject to the supervision of
the Board of Directors. Under the terms of the New Agreement, the Investment
Adviser has agreed to pay Wilmington Trust a monthly fee at the rate of 25% of
the net fees payable to the Investment Adviser. The fee paid to Wilmington Trust
by the Investment Adviser amounted to $39,288 for the six months ended June 30,
1998.

<PAGE>

The Fund incurred $185,662 in investment advisory fees for the six months ended
June 30, 1998, which represents a 50% reduction from the Basic Fee.

Pursuant to an Administration and Accounting Services Agreement (the
"Administration and Accounting Services Agreement") with the Fund dated January
20, 1998, PFPC Inc. ("PFPC" or "the Administrator") serves as the Fund's
administrator and accounting agent. Under the Administration and Accounting
Services Agreement, PFPC generally assists in all aspects of the Fund's
operations, other than providing investment advice, subject to the overall
authority of the Fund's Board of Directors. PFPC determines the Fund's weekly
and monthly net asset value, prepares such figures for publication, maintains
certain of the Fund's books and records that are not maintained by the
Investment Adviser, custodian or transfer agent, and assists in the preparation
of financial information for the Fund's income tax returns, proxy statements,
quarterly and annual shareholder reports. Prior to January 20, 1998, Rodney
Square Management Corp., a wholly owned subsidiary of Wilmington Trust Company
and an indirect affiliate of the Investment Adviser, served as the Fund's
administrator and accounting agent providing the same services as listed above.

PFPC provides administrative and accounting assistance to the Fund. Under the
Administration Agreement, the Fund has agreed to pay a monthly fee at the annual
rate of 0.15% of the Fund's average weekly net assets subject to a minimum fee
of $65,000 per annum. For the six months ended June 30, 1998, the Administrator
earned fees in the amount of $55,698.

Certain directors and officers of the Fund are also directors and officers of
the Investment Adviser or Wilmington Trust Company. Each unaffiliated director
receives an annual fee of $8,000 plus $500 for every meeting attended, together
with a reimbursement of out-of-pocket expenses. The Fund incurred fees totaling
$105,145 for the six months ended June 30, 1998, for legal services to a law
firm of which the Fund's Secretary is a partner.

NOTE 3. PORTFOLIO SECURITIES -- Purchases and sales of securities, other than
short-term investments, for the six months ended June 30, 1998 were $21,118,619
and $23,713,126, respectively.

For Federal income tax purposes, the cost of securities owned at June 30, 1998,
was $52,819,053 and the net unrealized appreciation of investments was
$26,915,048. Net unrealized appreciation was composed of gross appreciation of
$27,873,699 for those investments having an excess of value over cost, and gross
depreciation of $958,651 for those investments having an excess of cost over
value.

NOTE 4. CAPITAL STOCK -- There are 25 million shares of $.01 par value common
stock authorized. Of the 5,892,400 shares outstanding at June 30, 1998, the
Investment Adviser owned 10,000 shares.

NOTE 5. OTHER MATTERS -- The Fund, in its ordinary course of business, invests
in companies and emerging markets which may entail additional risks due to the
potential political and economic instability of certain countries, the risks of
restriction of repatriation, expropriation, nationalization or confiscatory
taxation and the relative price volatility and liquidity of such emerging
markets.

<PAGE>

DIRECTORS AND OFFICERS
LILIA C. CLEMENTE, Chairman and Director
LEOPOLDO M. CLEMENTE, JR., President and Director
ADRIAN C. CASSIDY, Director
ROBERT J. CHRISTIAN, Director
THOMAS H. LENAGH, Director
+SAM NAKAGAMA, Director
+G. PETER SCHIEFERDECKER, Director
BARON J.G.A. SIRTEMA VAN GROVESTINS, Director
WILLIAM H. BOHNETT, Secretary
THOMAS J. PRAPAS, Treasurer
MARIA DISTEFANO, Assistant Secretary
- ---------------
+Members of Audit Committee

- -------------------------------------------------------------------------------

EXECUTIVE OFFICES --
152 W. 57th Street, New York, NY 10019
(For latest net asset value and market data,
please call 212-765-0700 or access our web
site at http://www.clementecapital.com.
For shareholder inquiries, please call
1-800-937-5449.)

INVESTMENT ADVISERS --
Clemente Capital, Inc.
Wilmington Trust Company

ADMINISTRATOR --
PFPC Inc.

TRANSFER AGENT AND REGISTRAR --
American Stock Transfer & Trust Company

CUSTODIAN --
Brown Brothers Harriman & Co.

LEGAL COUNSEL --
Fulbright & Jaworski L.L.P.

INDEPENDENT ACCOUNTANTS --
PricewaterhouseCoopers LLP

<PAGE>

SUMMARY OF GENERAL INFORMATION
- ------------------------------

THE FUND

Clemente Global Growth Fund, Inc. is a closed-end investment company whose
shares trade on the New York Stock Exchange. The Fund seeks long-term capital
appreciation primarily through investment in equity securities of companies
located throughout the world. The Fund is managed by Clemente Capital, Inc. and
Wilmington Trust Company.

SHAREHOLDER INFORMATION

Daily market prices for the Fund's shares are published in the New York Stock
Exchange Composite Transactions section of most newspapers under the designation
"ClemGlb". The Fund's New York Stock Exchange trading symbol is CLM. Net asset
value (NAV) and market price information about Clemente Global Growth Fund, Inc.
shares are published each Monday in The Wall Street Journal, The New York Times
and other newspapers. For general information visit us at our web site
http://www.clementecapital.com. For shareholder account inquiries call
1-800-937-5449.

DIVIDEND REINVESTMENT PLAN

Through its voluntary Dividend Reinvestment Plan, shareholders of Clemente
Global Growth Fund, Inc. may elect to receive dividends and capital gains
distributions in the form of additional shares of the Fund.

This report is transmitted to the shareholders of Clemente Global Growth Fund,
Inc. for their information. This is not a prospectus, circular or representation
intended for use in the purchase of shares of the Fund or any securities
mentioned in this report.

Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940 that the Fund may purchase at market prices from time to
time shares of its common stock in the open market.

[LOGO]

Clemente Global
Growth Fund, Inc.

SEMIANNUAL REPORT
-----------------
JUNE 30, 1998