MERRILL LYNCH
DEVELOPING
CAPITAL MARKETS
FUND, INC.
FUND LOGO
Annual Report
June 30, 1998
Investing in emerging market securities involves a number of risk
factors and special considerations, including restrictions on
foreign investments and on repatriation of capital invested in
emerging markets, currency fluctuations, and potential price
volatility and less liquidity of securities traded in emerging
markets. In addition, there may be less publicly available
information about the issuers of securities, and such issuers may
not be subject to accounting, auditing and financial reporting
standards and requirements comparable to those to which US companies
are subject. Therefore, the Fund is designed as a long-term
investment for investors capable of assuming the risks of investing
in emerging markets. The Fund should be considered as a vehicle for
diversification and not as a complete investment program. Please
refer to the prospectus for details.
This report is not authorized for use as an offer of sale or a
solicitation of an offer to buy shares of the Fund unless
accompanied or preceded by the Fund's current prospectus. Past
performance results shown in this report should not be considered a
representation of future performance. Investment return and
principal value of shares will fluctuate so that shares, when
redeemed, may be worth more or less than their original cost.
Statements and other information herein are as dated and are subject
to change.
Merrill Lynch
Developing
Capital Markets
Fund, Inc.
Box 9011
Princeton, NJ
08543-9011
Printed on post-consumer recycled paper
Merrill Lynch Developing Capital Markets Fund, Inc.
Asset Allocation
As a Percentage* of
Net Assets as of
June 30, 1998
BRAZIL 14.3%
PORTUGAL 0.8%
HUNGARY 8.5%
POLAND 8.3%
RUSSIA 0.1%
GREECE 9.0%
TURKEY 7.3%
PAKISTAN 0.0%
INDIA 1.7%
THAILAND 1.2%
CHINA 1.3%
SOUTH KOREA 2.9%
MEXICO 12.0%
VENEZUELA 1.1%
ARGENTINA 1.3%
EGYPT 0.6%
SOUTH AFRICA 6.9%
ISRAEL 3.4%
MALAYSIA 3.1%
INDONESIA 1.3%
HONG KONG 2.7%
TAIWAN 2.0%
[FN]
*Total may not equal 100%.
Merrill Lynch Developing Capital Markets Fund, Inc., June 30, 1998
DEAR SHAREHOLDER
Fiscal Year in Review
During the 12-month period ended June 30, 1998, total returns for
Merrill Lynch Developing Capital Markets Fund, Inc.'s Class A, Class
B, Class C and Class D Shares were -36.00%, -36.68%, -36.69%
and -36.13%, respectively. (Results shown do not reflect sales
charges and would be lower if sales charges were included. Complete
performance information can be found on pages 6--8 of this report to
shareholders.) The unmanaged Morgan Stanley Capital International
Emerging Markets Free Index declined 39.08% during the same period.
Beneficial to performance were the Fund's overweighted positions in
many of the European markets, specifically Greece, Hungary and
Portugal, whose markets rose 37.04%, 24.64% and 42.90%,
respectively. (References to securities markets of all countries in
this letter to shareholders correspond to those countries' market
weightings in the MSCI Emerging Markets Free Index and are for the
12-month period ended June 30, 1998.) Detrimental to the Fund's
performance were its underweighted position in Brady Bonds, which
rose 5.60%, and its overweighted position in Russia, whose market
declined 60.39%. Also hurting the Fund's performance was its
exposure to the Asian markets whose declines were very steep over
the 12-month period ended June 30, 1998.
The year ended June 30, 1998 saw declines in many of the emerging
markets. The steepest declines were in Asia, Latin America and
Russia. Only in Europe and some of the Middle East/African countries
did equity markets appreciate. Numerous powerful forces drove the
declines. One was the recession in Japan and the weakness of its
currency. This triggered concerns of another round of devaluations
throughout Asia and the developing countries in other regions.
Another force was the view, which became widely accepted, that
Asia's economic problems would take more time and capital to solve
than previously expected. In addition, there was growing concern
that while wage pressures in the United States might necessitate
raising interest rates, deflationary pressures from Asia constrained
application of the appropriate US monetary policy. However, the
continuous withdrawal of US investors from emerging markets mutual
funds was possibly the most dominant force. Emerging markets fund
managers, including ourselves, had to sell investments that might
not otherwise have been sold. The resultant capital outflows
worsened liquidity problems in some markets and spread the damage to
remote and fundamentally unrelated markets. Indiscriminate selling
of emerging markets stocks worldwide continues, and is creating many
bargains in the markets in which we invest.
Investment Review and Activities
Asian markets enjoyed a liquidity-driven rally in the first two
months of 1998, but the gains were largely reversed in the weeks
that followed. After the calm brought by the infusion of assets from
the International Monetary Fund (IMF), foreign portfolio investors
and other sources, the depth of political and economic strains soon
became evident. Riots in Indonesia (whose market fell 89.68%)
resulted in President Suharto stepping down and the Indonesian
rupiah approaching new lows against the dollar. Vice President
Habibie was sworn in as interim president, and expressed his
intention to follow through with the IMF austerity program.
Subsequent calls for Habibie's immediate replacement raised the
question of whether the populace in Indonesia and elsewhere would
accept a long period of austerity under any leadership. For example,
in South Korea (whose market fell 68.47%) a democratically elected
president impressed investors with his will to implement IMF-
mandated reforms, but his ability to do so is being hampered by the
powerful chaebols and belligerent unions.
Reports of full-blown recessions and deflation throughout the region
- --including Hong Kong and the People's Republic of China (whose
markets fell 48.39% and 56.74%, respectively), once considered
relatively "safe havens"--confirmed the complexity and interrelated
nature of the problems in these economies. It also became clear that
as asset prices had just started to decline, the worst of the banks'
non-performing loan ratios had yet to be seen and capital
requirements would only grow. Even in Thailand (whose market was
down 72.76%), where the first efforts at recapitalization by two of
the largest banks were successful, it was acknowledged that the
amount of capital raised would not be enough. Coincident with these
problems in north and southeast Asia, nuclear tests were set off in
India (whose market fell 31.92%) to appease the domestic
constituents of the new leadership, and subsequently reciprocated by
Pakistan despite the threat by the United States to both countries
of sanctions.
South Africa, the dominant market in the Middle East/African
regions, declined 32.43%. The South African rand became vulnerable
to currency speculation in light of weak commodity prices, a
deteriorating trade balance and dwindling foreign currency reserves.
The market's strong performance mid-period had been attributed to
steady progress in reducing inflation and a consolidation process
underway among South African companies. The latter was most evident
in the financial services sector, one of the best-performing sectors
in the market, which also benefited from declining interest rates.
Among our holdings in South Africa, First National Bank Holdings,
Ltd., one of the largest banks in South Africa, merged with Rand
Merchant Bank to form FirstRand Limited. In addition to banking, the
combined entity provides life insurance, pension management and
asset management services.
In Turkey, the stock market posted a gain of 23.71%. Despite
improvement on the inflationary front, progress in privatizations
and strong economic growth, political events are still the major
forces on the stock market. The decision of Prime Minister Yilmaz to
step down and allow the forming of an interim government triggered a
rally in the market. The expectation of an orderly transition was
seen to enable continuing efforts to pass legislation on tax and
social security issues.
The Israeli market remained resilient during the year ended June 30,
1998 and appreciated 7.39%. With the economy slowing and real
interest rates still high, a sharp decline in the consumer price
index rate has enabled an easing of nominal interest rates which has
been favorable for stocks, particularly the banks such as our
holdings, Bank Leumi Le-Israel and Bank Hapoalim Ltd.
Emerging Europe, where the portfolio has had overweighted
investments for many years, enjoyed strong returns and again
outperformed other emerging market regions during the 12-month
period. Companies in the region have benefited from their proximity
and access to the more mature and growing markets of Western Europe.
In addition, Greece (whose market was up 37.04%) is likely to
benefit from reforms in the form of lower fiscal deficits and lower
inflation, which would enable economic convergence with the European
Union. Early this year, the Greek government devalued the drachma
and announced various measures including privatizations, banking
reforms and lower inflation targets. The reform agenda has raised
expectations that Greece will meet the convergence criteria, much as
have other Mediterranean countries such as Portugal, whose stock
market continues to perform well, rising 42.90% for the year ended
June 30, 1998.
Merrill Lynch Developing Capital Markets Fund, Inc., June 30, 1998
However, the region was not immune to contagion afflicting other
emerging markets around the world. The Hungarian market (which rose
24.64%) and the Polish market (which fell 2.54%) started to decline
in May as liquidity problems in Russia mounted and speculation on
the ruble rose. In general, Hungarian and Polish business
fundamentals should not be affected by Russia's problems. However,
in the short term, sentiment and capital flows often override stock
and economic fundamentals. The Polish industrial group, Elektrim
Spolka Akcyjna S.A., is one of the portfolio's larger holdings.
Management of the company has demonstrated its value-added ability
by streamlining the company's focus in those sectors that will have
a more significant participation in Polish economic expansion. With
activities in power construction and engineering and in
telecommunications through its stake in a local cellular and
telecommunications licensee, the company is well-positioned to
benefit from increased infrastructure investment and sound economic
growth in Poland.
The problems in Russia during the last 12 months were numerous,
although not extraordinary by Russian standards. Among the issues
were: the bickering between President Yeltsin and the Duma over the
appointment of a Prime Minister; the sharp decline in the reserve
position; an inadequate tax collection system; the prospect of
default on external debt; and delays in the disbursal of IMF funds.
What was different this time was the unfavorable external
environment, rooted in Asia's currency volatility, and deflationary
pressures, which heightened nervousness about the ruble and led to a
sell-off of domestic securities, particularly treasury bills. Thus,
the Russian stock market declined 60.39%, and interest rates rose
sharply.
In Latin America, Brazil was affected in a fundamentally unwarranted
way by Russia's problems and declined 30.55%. Investors focused on
the similarities between Brazil and Russia (their large size, the
importance of commodity exports, the growing trade deficits and the
high level of debt). However, there are important differences that
favor Brazil. These include a longer tradition of capitalism and
more highly developed capital markets; a more broad-based economy; a
larger reserve position; and a more diversified debt exposure. We
believe that some of the best bargains are in Brazilian stocks.
Aside from the general nervousness prevailing in emerging markets,
the weakness of the price of crude oil was a predominant driver of
the Mexican market, which declined 8.42%. Concerns arose that lower
oil export revenues and a growing current account deficit would
trigger further budget cutting by a government known for its fiscal
restraint. Adding to these concerns was a banking scandal involving
several Mexican banks being investigated by the US Customs Service
for drug money laundering.
In Conclusion
We once again would caution our investors that the volatility that
our markets exhibited during the past 12 months is not uncommon. We
have seen that each market may be affected as much by external
developments as by the events that occur within any particular
country. In some instances, the reform process has made remarkable
strides, while in others it is just beginning. The challenges many
of the Asian countries and Russia face are not insurmountable; as we
have seen, countries such as Mexico and Hungary emerged from their
economic crises. Thus, while we caution our shareholders to expect
further volatility, we also urge them to maintain a longer-term
perspective since the reforms being undertaken in these countries
will take time. Additionally, there are presently many new
opportunities and a large number of attractive investments to be
found in emerging markets.
We thank you for your interest in Merrill Lynch Developing Capital
Markets Fund, Inc., and we look forward to discussing economic,
stock market and portfolio developments in our upcoming quarterly
report to shareholders.
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
(Grace Pineda)
Grace Pineda
Senior Vice President and
Portfolio Manager
July 29, 1998
Officers and
Directors
Arthur Zeikel, President and Director
Donald Cecil, Director
Edward H. Meyer, Director
Charles C. Reilly, Director
Richard R. West, Director
Edward D. Zinbarg, Director
Terry K. Glenn, Executive Vice President
Norman R. Harvey, Senior Vice President
Grace Pineda, Senior Vice President
and Portfolio Manager
Donald C. Burke, Vice President
Gerald M. Richard, Treasurer
Barbara G. Fraser, Secretary
Custodian
Brown Brothers Harriman & Co.
40 Water Street
Boston, MA 02119
Transfer Agent
Merrill Lynch Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, FL 32246-6484
(800) 637-3863
Merrill Lynch Developing Capital Markets Fund, Inc., June 30, 1998
PERFORMANCE DATA
About Fund
Performance
Investors are able to purchase shares of the Fund through the
Merrill Lynch Select Pricing SM System, which offers four pricing
alternatives:
* Class A Shares incur a maximum initial sales charge (front-end
load) of 5.25% and bear no ongoing distribution or account
maintenance fees. Class A Shares are available only to eligible
investors.
* Class B Shares are subject to a maximum contingent deferred sales
charge of 4% if redeemed during the first year, decreasing 1% each
year thereafter to 0% after the fourth year. In addition, Class B
Shares are subject to a distribution fee of 0.75% and an account
maintenance fee of 0.25%. These shares automatically convert to
Class D Shares after approximately 8 years. (There is no initial
sales charge for automatic share conversions.)
* Class C Shares are subject to a distribution fee of 0.75% and an
account maintenance fee of 0.25%. In addition, Class C Shares are
subject to a 1% contingent deferred sales charge if redeemed within
one year of purchase.
* Class D Shares incur a maximum initial sales charge of 5.25% and
an account maintenance fee of 0.25% (but no distribution fee).
None of the past results shown should be considered a representation
of future performance. Figures shown in the "Recent Performance
Results" and "Average Annual Total Return" tables assume
reinvestment of all dividends and capital gains distributions at net
asset value on the ex-dividend date. Investment return and principal
value of shares will fluctuate so that shares, when redeemed, may be
worth more or less than their original cost. Dividends paid to each
class of shares will vary because of the different levels of account
maintenance, distribution and transfer agency fees applicable to
each class, which are deducted from the income available to be paid
to shareholders.
Total Return
Based on a
$10,000
Investment
Total Return Based on a $10,000 Investment--Class A Shares
A line graph depicting the growth of an investment in the Fund's
Class A Shares compared to growth of an investment in the Morgan
Stanley Capital International EAFE Index and the Morgan Stanley
Capital International Emerging Markets Free Index. Beginning and
ending values are:
9/01/89** 6/98
ML Developing Capital Markets Fund, Inc.++--
Class A Shares* $ 9,475 $14,868
Morgan Stanley Capital International
EAFE Index++++ $10,000 $16,380
Morgan Stanley Capital International
Emerging Markets Free Index++++++ $10,000 $22,740
A line graph depicting the growth of an investment in the Fund's
Class B Shares compared to growth of an investment in the Morgan
Stanley Capital International EAFE Index and the Morgan Stanley
Capital International Emerging Markets Free Index. Beginning and
ending values are:
7/01/94** 6/98
ML Developing Capital Markets Fund, Inc.++--
Class B Shares* $10,000 $ 8,098
Morgan Stanley Capital International
EAFE Index++++ $10,000 $13,786
Morgan Stanley Capital International
Emerging Markets Free Index++++++ $10,000 $ 7,454
A line graph depicting the growth of an investment in the Fund's
Class C Shares and Class D Shares compared to growth of an
investment in the Morgan Stanley Capital International EAFE Index
and the Morgan Stanley Capital International Emerging Markets Free
Index. Beginning and ending values are:
10/21/94** 6/98
ML Developing Capital Markets Fund, Inc.++--
Class C Shares* $10,000 $ 7,108
ML Developing Capital Markets Fund, Inc.++--
Class D Shares* $ 9,475 $ 6,933
Morgan Stanley Capital International
EAFE Index++++ $10,000 $13,329
Morgan Stanley Capital International
Emerging Markets Free Index++++++ $10,000 $ 6,286
[FN]
*Assuming maximum sales charge, transaction costs and other
operating expenses, including advisory fees.
**Commencement of operations.
++ML Developing Capital Markets Fund, Inc. invests in securities,
principally equities, of issuers in countries having smaller capital
markets.
++++This unmanaged Index measures the total returns of developed
foreign stock markets in Europe, Asia and the Far East.
++++++This unmanaged Index measures the total returns of emerging
foreign stock markets in Europe, Asia and the Far East.
Average Annual
Total Return
% Return Without % Return With
Class A Shares* Sales Charge Sales Charge**
Year Ended 6/30/98 -36.00% -39.36%
Five Years Ended 6/30/98 + 1.82 + 0.73
Inception (9/01/89) through 6/30/98 + 5.27 + 4.63
[FN]
*Maximum sales charge is 5.25%.
**Assuming maximum sales charge.
% Return % Return
Class B Shares* Without CDSC With CDSC**
Year Ended 6/30/98 -36.68% -39.07%
Inception (7/01/94)
through 6/30/98 - 4.88 - 5.07
[FN]
*Maximum contingent deferred sales charge is 4% and is reduced to 0%
after 4 years.
**Assuming payment of applicable contingent deferred sales charge.
% Return % Return
Class C Shares* Without CDSC With CDSC**
Year Ended 6/30/98 -36.69% -37.28%
Inception (10/21/94)
through 6/30/98 - 8.79 - 8.79
[FN]
*Maximum contingent deferred sales charge is 1% and is reduced to 0%
after 1 year.
**Assuming payment of applicable contingent deferred sales charge.
% Return Without % Return With
Class D Shares* Sales Charge Sales Charge**
Year Ended 6/30/98 -36.13% -39.49%
Inception (10/21/94)
through 6/30/98 - 8.05 - 9.38
[FN]
*Maximum sales charge is 5.25%.
**Assuming maximum sales charge.
Merrill Lynch Developing Capital Markets Fund, Inc., June 30, 1998
PERFORMANCE DATA (concluded)
<TABLE>
Recent
Performance
Results*
<CAPTION>
12 Month 3 Month Since Inception
Total Return Total Return Total Return
<S> <C> <C> <C>
ML Developing Capital Markets Fund Class A Shares -36.00% -21.33% +57.37%
ML Developing Capital Markets Fund Class B Shares -36.68 -21.59 -18.11
ML Developing Capital Markets Fund Class C Shares -36.69 -21.59 -28.78
ML Developing Capital Markets Fund Class D Shares -36.13 -21.37 -26.62
<FN>
*Investment results shown do not reflect sales charges; results
shown would be lower if a sales charge was included. Total
investment returns are based on changes in net asset values for the
periods shown, and assume reinvestment of all dividends and capital
gains distributions at net asset value on the ex-dividend date. The
Fund's inception dates are: Class A Shares, 9/01/89; Class B Shares,
7/01/94; and Class C and Class D Shares, 10/21/94.
</TABLE>
<TABLE>
CONSOLIDATED SCHEDULE OF INVESTMENTS (in US dollars)
<CAPTION>
Shares Held/ Value Percent of
AFRICA Industries Face Amount Investments Cost (Note 1a) Net Assets
<S> <S> <C> <S> <C> <C> <C>
South Africa Banking 57,586 Nedcor Ltd. (Ordinary) $ 999,181 $ 1,253,573 0.3%
Beverage 224,196 South African Breweries
Ltd. (d) 5,665,400 4,651,686 1.0
Diversified Holdings 417,298 Billiton PLC (e) 1,556,510 845,958 0.2
291,021 Rembrandt Controlling
Investments Ltd. 1,993,247 1,138,347 0.3
731,014 Sasol Limited 9,016,548 4,270,464 0.9
------------- ------------- ------
12,566,305 6,254,769 1.4
Entertainment 2,888 Sun International
(South Africa) Ltd. 3,660 982 0.0
Foreign Government Republic of South Africa:
Obligations ZAL 11,800,000 12% due 2/28/2005 2,002,454 1,749,519 0.4
ZAL 11,400,000 13% due 8/31/2010 1,948,332 1,711,418 0.4
------------- ------------- ------
3,950,786 3,460,937 0.8
Insurance 5,229,095 FirstRand Limited 5,689,303 8,092,647 1.8
58,750 Liberty Life Association
of Africa Limited 1,902,714 1,155,017 0.3
------------- ------------- ------
7,592,017 9,247,664 2.1
Mining 885,959 Gencor Ltd. 2,174,963 1,378,661 0.3
Newspaper/Publishing 205,409 Nasionale Pers Beperk
(Class N) 2,172,321 1,362,407 0.3
Retail 2,557,894 Pick'n Pay Stores Ltd. 2,915,237 3,132,115 0.7
64,869 Pick'n Pay Stores Ltd.
(N Shares) 112,793 69,503 0.0
------------- ------------- ------
3,028,030 3,201,618 0.7
Total Investments in Africa 38,152,663 30,812,297 6.9
EUROPE
Greece Banking 59,900 Alpha Credit Bank S.A. 4,528,458 4,857,103 1.1
71,530 Alpha Credit Bank S.A.
(Rights)(c) 0 126,985 0.0
97,896 National Bank of Greece S.A. 10,755,420 12,548,376 2.8
------------- ------------- ------
15,283,878 17,532,464 3.9
Beverage 444,282 Hellenic Bottling Co. S.A. 10,260,961 13,729,538 3.1
Metal Fabricating 179,838 Elval S.A. 2,285,815 2,778,745 0.6
Oil--Integrated 569,603 Hellenic Petroleum S.A. 3,568,588 4,653,374 1.1
Telecommunications 110,458 Hellenic Telecommunication
Organization S.A. (GDR)(b) 1,218,089 1,419,382 0.3
Total Investments in Greece 32,617,331 40,113,503 9.0
Hungary Banking 172,068 OTP Bank (GDR)(b) 4,657,325 8,448,539 1.9
Health/Personal Care 93,090 Gedeon Richter Ltd. (GDR)(b) 6,000,195 7,447,200 1.7
29,412 Gedeon Richter Ltd.
(GDR)(b)(d) 1,022,861 2,352,960 0.5
------------- ------------- ------
7,023,056 9,800,160 2.2
Oil & Related 284,648 Mol Magyar Olay-es Gazipari
Reszvenytarsasag (GDR)(b) 7,970,324 7,685,496 1.7
Telecommunications 2,090,503 Magyar TavKozlesi
Reszvenytarsasag (Matav)
(Ordinary) 9,183,228 12,140,748 2.7
Total Investments in Hungary 28,833,933 38,074,943 8.5
Poland Automotive 137,847 Debica S.A. 2,954,273 2,769,204 0.6
Banking 288,000 BIG Bank Gdanski
S.A. (GDR)(b) 6,869,850 5,601,600 1.3
906,804 Wielkopolski Bank
Kredytowy S.A. 6,734,746 7,026,462 1.6
------------- ------------- ------
13,604,596 12,628,062 2.9
Computers 199,722 ComputerLand Poland S.A. 4,529,181 3,582,329 0.8
Electrical Components 1,309,931 Elektrim Spolka Akcyjna S.A. 12,225,250 15,977,061 3.6
Multi-Industry 603,529 ++NFI Piast S.A. Fund 1,873,952 987,262 0.2
497,511 ++NFI Progress S.A. Fund 1,550,828 920,920 0.2
------------- ------------- ------
3,424,780 1,908,182 0.4
Total Investments in Poland 36,738,080 36,864,838 8.3
Portugal Telecommunications 71,393 Portugal Telecom S.A. 2,551,129 3,785,612 0.8
Total Investments in Portugal 2,551,129 3,785,612 0.8
Russia Energy Sources 2,025,000 ++Irkutskenergo 255,918 192,375 0.0
Telecommunications 544,800 ++Bashinformsvyaz 1,455,190 381,360 0.1
169,200 ++Nizhny Novgorod Telephone 879,840 211,500 0.0
------------- ------------- ------
2,335,030 592,860 0.1
Utilities--Electric 2,066,208 ++Bashkirenergo 1,187,599 157,032 0.0
Total Investments in Russia 3,778,547 942,267 0.1
</TABLE>
Merrill Lynch Developing Capital Markets Fund, Inc., June 30, 1998
<TABLE>
CONSOLIDATED SCHEDULE OF INVESTMENTS (continued) (in US dollars)
<CAPTION>
EUROPE Shares Held/ Value Percent of
(concluded) Industries Face Amount Investments Cost (Note 1a) Net Assets
<S> <S> <C> <S> <C> <C> <C>
Turkey Banking 352,580,250 Akbank T.A.S. (Ordinary) $ 11,406,614 $ 11,389,791 2.5%
209,895,400 Yapi ve Kredi Bankasi A.S. 3,019,424 5,361,313 1.2
------------- ------------- ------
14,426,038 16,751,104 3.7
Building Products 24,944,085 Adana Cimento Sanayii
T.A.S. (Class A) 1,062,112 927,603 0.2
203,743,175 Akcansa Cimento A.S. 6,097,210 6,275,614 1.4
------------- ------------- ------
7,159,322 7,203,217 1.6
Household Durables 55,000,000 Arcelik A.S. 2,607,708 2,582,451 0.6
Retail 4,998,100 Migros Turk T.A.S. 4,402,105 4,881,324 1.1
Telecommunications 4,275,100 ++Northern Electric
Telekomunikasyon A.S.
(NETAS) 1,436,438 1,140,155 0.3
Total Investments in Turkey 30,031,611 32,558,251 7.3
Total Investments in Europe 134,550,631 152,339,414 34.0
LATIN
AMERICA
Argentina Banking 142,283 Banco de Galicia y Buenos
Aires S.A. (ADR)(a) 3,952,950 2,578,879 0.6
Oil & Related 580,958 Perez Companc S.A.
(Class B) 3,194,487 2,916,847 0.7
Real Estate 7,310 IRSA Inversiones y
Representaciones S.A.
(GDR)(b) 248,540 212,904 0.0
Total Investments in Argentina 7,395,977 5,708,630 1.3
Brazil Banking 339,634,679 Banco Bradesco S.A.
(Preferred) 2,450,768 2,833,960 0.6
9,564,577 Banco Itau S.A.
(Preferred) 5,187,279 5,458,384 1.2
157,095 Uniao de Bancos Brasileiros
S.A. (Unibanco)
(GDR)(b) 4,543,313 4,634,302 1.0
------------- ------------- ------
12,181,360 12,926,646 2.8
Beverage 4,319,254 Companhia Cervejaria
Brahma S.A. PN (Preferred) 3,170,680 2,689,030 0.6
Foreign Government Republic of Brazil:
Obligations US$ 4,652,442 Floating Rate 'C' Brady
Bonds, 7.25% due
4/15/2014++++ (f) 3,579,218 3,425,360 0.8
US$ 4,984,000 Floating Rate Par 'L'
Brady Bonds, 5.50%
due 4/15/2024++++ 3,596,457 3,501,260 0.8
US$ 3,860,000 Global Bonds, 10.125%
due 5/15/2027 3,477,800 3,323,460 0.7
------------- ------------- ------
10,653,475 10,250,080 2.3
Mining 165,681 Companhia Vale do Rio
Doce S.A. (Preferred) 3,547,724 3,294,996 0.7
Oil & Related 26,101,136 Petroleo Brasileiro
S.A.--Petrobras (Preferred) 6,250,989 4,852,351 1.1
Telecommunications 141,005 Telecomunicacoes Brasileiras
S.A.--Telebras
(ADR)(a) 16,672,618 15,395,983 3.4
66,120,526 Telecomunicacoes
Brasileiras
S.A.--Telebras ON 4,941,186 5,259,912 1.2
4,000,000 ++Telerj Celular PN 'B' 331,299 237,925 0.1
------------- ------------- ------
21,945,103 20,893,820 4.7
Utilities-- 265,598,533 Companhia Energetica de
Electrical Minas Gerais S.A.
(CEMIG) (Preferred) 10,480,730 8,267,659 1.8
129,600 Companhia Paranaense de
Energia S.A.--Copel
(ADR)(a) 2,393,645 1,198,800 0.3
------------- ------------- ------
12,874,375 9,466,459 2.1
Total Investments in Brazil 70,623,706 64,373,382 14.3
Mexico Banking 310,877 ++Grupo Financiero Banorte,
S.A. de C.V. (Class B) 499,336 346,034 0.1
Beverages 110,000 Panamerican Beverages, Inc.
(US Registered Shares)
(Class A) 3,536,552 3,458,125 0.8
Broadcast--Media 291,639 ++Grupo Televisa, S.A. de
C.V. (GDR)(b) 10,338,817 10,972,917 2.4
Building & 346,952 Apasco, S.A. de C.V. 1,891,543 1,832,466 0.4
Construction
Building Products 7,914 Cementos Mexicanos, S.A.
de C.V. (Cemex)(ADR)(a) 60,963 59,007 0.0
263,813 Cementos Mexicanos, S.A.
de C.V. (Cemex)
(Class B)(ADR)(a) 2,784,372 2,325,142 0.5
------------- ------------- ------
2,845,335 2,384,149 0.5
Financial Services-- 340,900 ++Grupo Financiero Banamex
Commercial Accival S.A. 'B'
(Banacci) 871,744 664,042 0.1
Foreign Government United Mexican States:
Obligations US$ 4,169,000 Floating Rate Par,
Brady Bonds, Series W-A,
6.25% due 12/31/2019++++ 3,523,477 3,429,055 0.8
US$ 3,035,000 Global Bonds, 11.50% due
5/15/2026 3,580,444 3,444,725 0.8
------------- ------------- ------
7,103,921 6,873,780 1.6
Health/Personal 2,020,764 Kimberly-Clark de Mexico,
Care S.A. de C.V. (Series A) 6,277,328 7,141,502 1.6
Multi-Industry 2,260,965 Grupo Carso, S.A. de
C.V. 'A' 13,297,336 9,336,799 2.1
149,960 Grupo Carso, S.A. de
C.V. (ADR)(a) 1,630,617 1,210,177 0.3
------------- ------------- ------
14,927,953 10,546,976 2.4
Telecommunications 196,909 Telefonos de Mexico,
S.A. de C.V. (ADR)(a) 9,736,468 9,463,939 2.1
Total Investments in Mexico 58,028,997 53,683,930 12.0
Venezuela Telecommunications 157,057 Compania Anonima Nacional
Telefonos de
Venezuela S.A. (CANTV)
(ADR)(a) 6,144,617 3,926,425 0.9
Textiles 377,824 Sudamtex de Venezuela
S.A.C.A. (ADR)(a)(d) 5,055,422 1,032,101 0.2
Utilities--Electric 144,538 C.A. La Electricidad de
Caracas S.A.I.C.A.--S.A.C.A. 88,171 65,395 0.0
Total Investments in Venezuela 11,288,210 5,023,921 1.1
Total Investments in
Latin America 147,336,890 128,789,863 28.7
MIDDLE
EAST
Egypt Banking 262,738 Commercial International
Bank (Egypt) S.A.E.
(GDR)(b) 2,400,009 2,850,705 0.6
Total Investments in Egypt 2,400,009 2,850,705 0.6
</TABLE>
Merrill Lynch Developing Capital Markets Fund, Inc., June 30, 1998
<TABLE>
CONSOLIDATED SCHEDULE OF INVESTMENTS (continued) (in US dollars)
<CAPTION>
MIDDLE EAST Shares Held/ Value Percent of
(concluded) Industries Face Amount Investments Cost (Note 1a) Net Assets
<S> <S> <C> <S> <C> <C>
Israel Banking 3,487,421 ++Bank Hapoalim Ltd. $ 6,803,899 $ 10,557,854 2.4%
2,202,867 Bank Leumi Le-Israel 3,982,226 4,397,923 1.0
Total Investments in Israel 10,786,125 14,955,777 3.4
Total Investments in the
Middle East 13,186,134 17,806,482 4.0
PACIFIC
BASIN/ASIA
China Automobiles 4,061,774 Qingling Motor Company
(Class H) 1,921,567 1,127,091 0.3
Chemicals 158,323 Beijing Yanhua Petrochemical
Company Ltd.
(Class H)(ADR)(a) 1,734,738 949,938 0.2
Telecommunications 4,876,000 Eastern Communications Co.,
Ltd. (Class B) 3,062,047 2,867,088 0.6
Utilities--Electric 3,440,000 ++Beijing Datang Power
Generation Co., Ltd.
(Class H) 1,609,042 965,656 0.2
Total Investments in China 8,327,394 5,909,773 1.3
Hong Kong Building Products 37,687,589 Anhui Conch Cement Co. Ltd. 11,061,591 5,253,236 1.2
Industrial 33,672,608 Sinocan Holdings Ltd. 12,407,975 1,347,235 0.3
Real Estate 2,068,000 Henderson China Holding Ltd. 3,475,358 807,385 0.2
Telecommunications 8,187,000 City Telecom (H.K.) Ltd. 1,572,682 538,890 0.1
1,014,000 Smartone Telecommunications 2,517,086 2,473,458 0.6
------------- ------------- ------
4,089,768 3,012,348 0.7
Transportation 16,017,000 Sichuan Expressway Co.
(Class H) 1,586,215 1,529,740 0.3
Total Investments in
Hong Kong 32,620,907 11,949,944 2.7
India Banking 2,850 State Bank of India (d) 21,140 14,237 0.0
Building Products 800 Associated Cement Companies Ltd. 30,882 23,073 0.0
108,263 Gujarat Ambujaya Cements
Limited (GDR)(b) 893,254 511,543 0.1
------------- ------------- ------
924,136 534,616 0.1
Chemicals 332 Tata Chemicals Ltd. 1,053 1,125 0.0
Computer Software 85,400 Pentafour Software &
Exports Ltd. 1,627,678 1,277,467 0.3
Energy Sources 2,093 Bombay Suburban Electric
Supply Co. Ltd. 11,659 7,719 0.0
Financial Services 106 Housing Development
Finance Corp. 9,035 7,500 0.0
1,292,128 Industrial Credit & Investment
Corporation of
India Ltd. 3,173,804 2,364,319 0.5
------------- ------------- ------
3,182,839 2,371,819 0.5
Leisure & Tourism 397,833 EIH Ltd. 4,517,574 2,062,524 0.5
Oil Services 400 Hindustan Petroleum
Corporation Ltd. 5,058 3,693 0.0
Telecommunications 281,100 Mahanagar Telephone Nigam Ltd. 2,104,541 1,185,538 0.3
Textiles 983 Reliance Industries Ltd. 3,117 3,351 0.0
Total Investments in India 12,398,795 7,462,089 1.7
Indonesia Building Products 1,602,000 P.T. Semen Gresik 'Foreign' 1,214,202 921,699 0.2
Telecommunications 337,241 P.T. Indonesian Satellite
Corp. (Indosat)(ADR)(a) 8,743,678 3,751,806 0.8
209,517 P.T. Telekomunikasi
Indonesia (ADR)(a) 2,032,439 1,217,818 0.3
------------- ------------- ------
10,776,117 4,969,624 1.1
Total Investments in
Indonesia 11,990,319 5,891,323 1.3
Malaysia Banking 164,000 Malayan Banking BHD 317,072 165,485 0.0
1,656,000 ++Malayan Banking BHD (Class A) 3,419,108 1,631,015 0.4
------------- ------------- ------
3,736,180 1,796,500 0.4
Diversified Holdings 1,409,000 Magnum Corporation BHD 2,464,633 523,805 0.1
Food 539,000 Nestle (Malaysia) BHD 4,152,512 2,446,156 0.6
Multi-Industry 69,000 Hicom Holdings BHD 132,308 17,489 0.0
Natural Gas 721,000 Petronas Gas BHD 3,000,024 1,340,181 0.3
Oil & Related 1,250,500 Petronas Dagangan BHD 3,190,460 990,136 0.2
Telecommunications 2,972,000 Telekom Malaysia BHD 8,952,880 5,022,088 1.1
Tobacco 248,000 Rothmans of Pall Mall
(Malaysia) BHD 2,621,702 1,721,183 0.4
Total Investments in Malaysia 28,250,699 13,857,538 3.1
Pakistan Electrical Components 100 ++Karachi Electric Supply
Corp. Ltd. 66 18 0.0
Total Investments in Pakistan 66 18 0.0
South Korea Electrical Components 72,990 Samsung Display Devices Co. 3,444,756 1,997,902 0.4
Electronics 164,403 Samsung Electronics Co., Ltd. 7,217,608 5,100,093 1.1
Steel 184,570 Pohang Iron & Steel
Company, Ltd. 9,382,187 6,063,596 1.4
Total Investments in
South Korea 20,044,551 13,161,591 2.9
Taiwan Banking 2,906,444 ++Bank Sinopac 3,196,909 1,396,068 0.3
2,653,000 ++E. Sun Commercial Bank 2,045,284 1,428,794 0.3
------------- ------------- ------
5,242,193 2,824,862 0.6
Chemicals 1,472,880 ++Formosa Plastic
Corporation (FPC) 2,733,076 2,015,236 0.5
Electronic Components 466,000 ++Mosel Vitelic Inc. 643,575 427,324 0.1
Steel 2,484,000 China Steel Corporation 1,640,355 1,518,558 0.3
Transportation-- 3,508,750 ++Yang Ming Marine Transport 4,172,207 2,196,097 0.5
Marine
Total Investments in Taiwan 14,431,406 8,982,077 2.0
Thailand Banking 1,586,400 Bangkok Bank Public Co.
Ltd. (Registered Shares) 6,819,788 1,954,806 0.4
1,010,000 Thai Farmers Bank Company
Limited 'Foreign' 3,749,828 891,528 0.2
------------- ------------- ------
10,569,616 2,846,334 0.6
Building Products 1,263,954 ++Siam City Cement Public
Company Limited 'Foreign' 5,222,880 898,545 0.2
Television 418,500 BEC World Public Company
Limited 4,411,452 1,616,481 0.4
Total Investments in Thailand 20,203,948 5,361,360 1.2
Total Investments in the
Pacific Basin/Asia 148,268,085 72,575,713 16.2
</TABLE>
Merrill Lynch Developing Capital Markets Fund, Inc., June 30, 1998
<TABLE>
CONSOLIDATED SCHEDULE OF INVESTMENTS (concluded) (in US dollars)
<CAPTION>
SHORT-TERM Face Value Percent of
SECURITIES Amount Investments Cost (Note 1a) Net Assets
<S> <S> <C> <S> <C> <C> <C>
Commercial US$ 21,488,000 General Motors Acceptance
Paper* Corp., 6.50% due
7/01/1998 $ 21,488,000 $ 21,488,000 4.8%
10,000,000 Lexington Parker Capital
Company, LLC, 5.63%
due 7/01/1998 10,000,000 10,000,000 2.2
Total Investments in
Short-Term Securities 31,488,000 31,488,000 7.0
Total Investments $ 512,982,403 433,811,769 96.8
=============
Other Assets Less Liabilities 14,564,466 3.2
------------- ------
Net Assets $ 448,376,235 100.0%
============= ======
<FN>
*Commercial Paper is traded on a discount basis; the interest rates
shown are the discount rates paid at the time of purchase by the
Fund.
++Non-income producing security.
++++Brady Bonds are securities which have been issued to refinance
commercial bank loans and other debt. The risk associated with these
instruments is the amount of uncollateralized principal or interest
payments since there is a high default of commercial bank loans by
countries issuing these securities.
(a)American Depositary Receipts (ADR).
(b)Global Depositary Receipts (GDR).
(c)The rights may be exercised until 7/24/1998.
(d)The security may be offered and sold to "qualified institutional
buyers" under Rule 144A of the Securities Act of 1933.
(e)Consistent with the general policy of the Securities and Exchange
Commission, the nationality or domicile of an issuer for
determination of foreign issuer status may be (i) the country under
whose laws the issuer is organized, (ii) the country in which the
issuer's securities are principally traded, or (iii) the country in
which the issuer derives a significant proportion (at least 50%) of
its revenue or profits from goods produced or sold, investments
made, or services performed in the country, or in which at least 50%
of the assets of the issuer are situated.
(f)Represents a pay-in-kind security which may pay interest/dividends
in additional face/shares.
See Notes to Consolidated Financial Statements.
</TABLE>
<TABLE>
CONSOLIDATED STATEMENT OF ASSETS AND LIABILITIES
<CAPTION>
As of June 30, 1998
<S> <S> <C> <C>
Assets: Investments, at value (identified cost--$512,982,403) (Note 1a) $ 433,811,769
Cash 387,630
Foreign cash (Note 1c) 10,958,650
Receivables:
Securities sold $ 10,153,225
Dividends 1,430,511
Interest 454,551
Capital shares sold 324,429 12,362,716
--------------
Prepaid expenses and other assets (Note 1f) 34,459
--------------
Total assets 457,555,224
--------------
Liabilities: Payables:
Securities purchased 5,392,123
Capital shares redeemed 2,365,042
Investment adviser (Note 2) 417,265
Distributor (Note 2) 195,038 8,369,468
--------------
Accrued expenses and other liabilities 809,521
--------------
Total liabilities 9,178,989
--------------
Net Assets: Net assets $ 448,376,235
==============
Net Assets Class A Shares of Common Stock, $.10 par value,
Consist of: 100,000,000 shares authorized $ 2,102,625
Class B Shares of Common Stock, $.10 par value,
100,000,000 shares authorized 1,604,453
Class C Shares of Common Stock, $.10 par value,
100,000,000 shares authorized 315,768
Class D Shares of Common Stock, $.10 par value,
100,000,000 shares authorized 304,485
Paid-in capital in excess of par 666,359,516
Accumulated distributions in excess of investment
income--net (Note 1g) (7,790,344)
Accumulated realized capital losses on investments
and foreign currency transactions--net (106,874,053)
Accumulated distributions in excess of realized capital
losses on investments and foreign currency
transactions--net (Note 1g) (28,331,659)
Unrealized depreciation on investments and foreign
currency transactions--net (79,314,556)
--------------
Net assets $ 448,376,235
==============
Net Asset Class A--Based on net assets of $219,421,814 and 21,026,252
Value: shares outstanding $ 10.44
==============
Class B--Based on net assets of $164,929,560 and 16,044,527
shares outstanding $ 10.28
==============
Class C--Based on net assets of $32,339,121 and 3,157,682
shares outstanding $ 10.24
==============
Class D--Based on net assets of $31,685,740 and 3,044,847
shares outstanding $ 10.41
==============
See Notes to Consolidated Financial Statements.
</TABLE>
Merrill Lynch Developing Capital Markets Fund, Inc., June 30, 1998
<TABLE>
CONSOLIDATED STATEMENT OF OPERATIONS
<CAPTION>
For the Year Ended June 30, 1998
<S> <S> <C> <C>
Investment Income Dividends (net of $759,348 foreign withholding tax) $ 15,347,616
(Notes 1d & 1e): Interest and discount earned 1,492,047
--------------
Total income 16,839,663
--------------
Expenses: Investment advisory fees (Note 2) $ 7,818,489
Account maintenance and distribution fees--Class B (Note 2) 2,972,044
Custodian fees 1,826,444
Transfer agent fees--Class A (Note 2) 803,202
Transfer agent fees--Class B (Note 2) 759,647
Foreign capital gains tax expense 667,675
Account maintenance and distribution fees--Class C (Note 2) 562,935
Printing and shareholder reports 184,530
Accounting services (Note 2) 168,374
Transfer agent fees--Class C (Note 2) 148,407
Account maintenance fees--Class D (Note 2) 138,726
Registration fees (Note 1f) 137,933
Transfer agent fees--Class D (Note 2) 119,230
Professional fees 109,926
Dividend fees 72,726
Directors' fees and expenses 36,543
Pricing fees 12,193
Other 18,378
--------------
Total expenses 16,557,402
--------------
Investment income--net 282,261
--------------
Realized & Realized loss from:
Unrealized Investments--net (109,261,635)
Loss on Foreign currency transactions--net (6,889,456) (116,151,091)
Investments & --------------
Foreign Currency Change in unrealized appreciation/depreciation on:
Transactions--Net Investments--net (227,820,935)
(Notes 1b, 1c, Foreign currency transactions--net (106,080) (227,927,015)
1e & 3): -------------- --------------
Net realized and unrealized loss on investments
and foreign currency transactions (344,078,106)
--------------
Net Decrease in Net Assets Resulting from Operations $ (343,795,845)
==============
See Notes to Consolidated Financial Statements.
</TABLE>
<TABLE>
CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS
<CAPTION>
For the Year
Ended June 30,
Increase (Decrease) in Net Assets: 1998 1997
<S> <S> <C> <C>
Operations: Investment income--net $ 282,261 $ 14,459,442
Realized gain (loss) on investments and foreign
currency transactions--net (116,151,091) 42,678,305
Change in unrealized appreciation/depreciation on
investments and foreign currency
transactions--net (227,927,015) 78,481,111
-------------- --------------
Net increase (decrease) in net assets resulting
from operations (343,795,845) 135,618,858
-------------- --------------
Dividends & Investment income--net:
Distributions to Class A (3,476,156) (6,147,015)
Shareholders Class B (1,510,618) (2,959,341)
(Note 1g): Class C (306,010) (523,137)
Class D (421,011) (823,715)
In excess of investment income--net:
Class A (2,738,268) --
Class B (1,189,956) --
Class C (241,052) --
Class D (331,643) --
Realized gain on investments--net:
Class A -- (2,372,022)
Class B -- (2,299,701)
Class C -- (380,478)
Class D -- (369,485)
In excess of realized gain on investments--net:
Class A (14,124,131) --
Class B (10,342,043) --
Class C (1,974,039) --
Class D (1,891,446) --
-------------- --------------
Net decrease in net assets resulting from dividends
and distributions to shareholders (38,546,373) (15,874,894)
-------------- --------------
Capital Share Net increase (decrease) in net assets derived from
Transactions capital share transactions (184,994,706) 146,098,497
(Note 4): -------------- --------------
Net Assets: Total increase (decrease)in net assets (567,336,924) 265,842,461
Beginning of year 1,015,713,159 749,870,698
-------------- --------------
End of year* $ 448,376,235 $1,015,713,159
============== ==============
<FN>
*Undistributed (accumulated distributions
in excess of) investment income--net (Note 1i) $ (7,790,344) $ 5,431,534
============== ==============
See Notes to Consolidated Financial Statements.
</TABLE>
Merrill Lynch Developing Capital Markets Fund, Inc., June 30, 1998
<TABLE>
CONSOLIDATED FINANCIAL HIGHLIGHTS
<CAPTION>
The following per share data and ratios have been derived Class A
from information provided in the financial statements.
For the Year Ended June 30,
Increase (Decrease) in Net Asset Value: 1998++ 1997++ 1996++ 1995 1994
<S> <S> <C> <C> <C> <C> <C>
Per Share Net asset value, beginning of year $ 17.23 $ 15.05 $ 13.35 $ 14.61 $ 11.62
Operating -------- -------- -------- -------- --------
Performance: Investment income--net .08 .36 .23 .24 .11
Realized and unrealized gain (loss) on
investments and foreign currency
transactions--net (6.18) 2.21 1.71 (.40) 3.23
-------- -------- -------- -------- --------
Total from investment operations (6.10) 2.57 1.94 (.16) 3.34
-------- -------- -------- -------- --------
Less dividends and distributions:
Investment income--net (.12) (.28) (.24) (.04) (.07)
In excess of investment income--net (.09) -- -- -- --
Realized gain on investments--net -- (.11) -- (.60) (.28)
In excess of realized gain on
investments--net (.48) -- -- (.46) --
-------- -------- -------- -------- --------
Total dividends and distributions (.69) (.39) (.24) (1.10) (.35)
-------- -------- -------- -------- --------
Net asset value, end of year $ 10.44 $ 17.23 $ 15.05 $ 13.35 $ 14.61
======== ======== ======== ======== ========
Total Investment Based on net asset value per share (36.00%) 17.66% 14.82% (1.67%) 28.73%
Return:** ======== ======== ======== ======== ========
Ratios to Average Expenses 1.63% 1.53% 1.54% 1.62% 1.46%
Net Assets: ======== ======== ======== ======== ========
Investment income--net .53% 2.32% 1.66% 1.56% .63%
======== ======== ======== ======== ========
Supplemental Net assets, end of year (in thousands) $219,422 $471,790 $342,884 $350,081 $401,996
Data: ======== ======== ======== ======== ========
Portfolio turnover 98.16% 86.68% 71.01% 63.37% 66.85%
======== ======== ======== ======== ========
<CAPTION>
Class B
For the
Period
The following per share data and ratios have been derived July 1,
from information provided in the financial statements. For the Year Ended 1994++++ to
June 30, June 30,
Increase (Decrease) in Net Asset Value: 1998++ 1997++ 1996++ 1995
<S> <S> <C> <C> <C> <C>
Per Share Net asset value, beginning of period $ 17.04 $ 14.90 $ 13.24 $ 14.54
Operating -------- -------- -------- --------
Performance: Investment income (loss)--net (.07) .19 .09 .08
Realized and unrealized gain (loss) on
investments and foreign currency transactions--net (6.08) 2.20 1.69 (.32)
-------- -------- -------- --------
Total from investment operations (6.15) 2.39 1.78 (.24)
-------- -------- -------- --------
Less dividends and distributions:
Investment income--net (.07) (.14) (.12) --
In excess of investment income--net (.06) -- -- --
Realized gain on investments--net -- (.11) -- (.60)
In excess of realized gain on investments--net (.48) -- -- (.46)
-------- -------- -------- --------
Total dividends and distributions (.61) (.25) (.12) (1.06)
-------- -------- -------- --------
Net asset value, end of period $ 10.28 $ 17.04 $ 14.90 $ 13.24
======== ======== ======== ========
Total Investment Based on net asset value per share (36.68%) 16.39% 13.63% (2.22%)+++
Return:** ======== ======== ======== ========
Ratios to Average Expenses 2.67% 2.57% 2.56% 2.79%*
Net Assets: ======== ======== ======== ========
Investment income (loss)--net (.53%) 1.22% .65% 1.01%*
======== ======== ======== ========
Supplemental Net assets, end of period (in thousands) $164,929 $398,468 $302,183 $162,774
Data: ======== ======== ======== ========
Portfolio turnover 98.16% 86.68% 71.01% 63.37%
======== ======== ======== ========
<CAPTION>
Class C
For the
Period
The following per share data and ratios have been derived July 1,
from information provided in the financial statements. For the Year Ended 1994++++ to
June 30, June 30,
Increase (Decrease) in Net Asset Value: 1998++ 1997++ 1996++ 1995
<S> <S> <C> <C> <C> <C>
Per Share Net asset value, beginning of period $ 16.99 $ 14.87 $ 13.22 $ 16.71
Operating -------- -------- -------- --------
Performance: Investment income (loss)--net (.07) .18 .09 .08
Realized and unrealized gain (loss) on
investments and foreign currency transactions--net (6.08) 2.20 1.70 (2.50)
-------- -------- -------- --------
Total from investment operations (6.15) 2.38 1.79 (2.42)
-------- -------- -------- --------
Less dividends and distributions:
Investment income--net (.07) (.15) (.14) (.01)
In excess of investment income--net (.05) -- -- --
Realized gain on investments--net -- (.11) -- (.60)
In excess of realized gain on investments--net (.48) -- -- (.46)
-------- -------- -------- --------
Total dividends and distributions (.60) (.26) (.14) (1.07)
-------- -------- -------- --------
Net asset value, end of period $ 10.24 $ 16.99 $ 14.87 $ 13.22
======== ======== ======== ========
Total Investment Based on net asset value per share (36.69%) 16.37% 13.68% (14.97%)+++
Return:** ======== ======== ======== ========
Ratios to Average Expenses 2.68% 2.58% 2.56% 2.96%*
Net Assets: ======== ======== ======== ========
Investment income (loss)--net (.51%) 1.19% 0.67% 1.32%*
======== ======== ======== ========
Supplemental Net assets, end of period (in thousands) $ 32,339 $ 71,769 $ 46,983 $ 18,573
Data: ======== ======== ======== ========
Portfolio turnover 98.16% 86.68% 71.01% 63.37%
======== ======== ======== ========
<FN>
++Based on average shares outstanding.
++++Commencement of operations.
+++Aggregate total investment return.
*Annualized.
**Total investment returns exclude the effects of sales loads.
See Notes to Consolidated Financial Statements.
</TABLE>
Merrill Lynch Developing Capital Markets Fund, Inc., June 30, 1998
<TABLE>
CONSOLIDATED FINANCIAL HIGHLIGHTS (concluded)
<CAPTION>
Class D
For the
Period
The following per share data and ratios have been derived July 1,
from information provided in the financial statements. For the Year Ended 1994++++ to
June 30, June 30,
Increase (Decrease) in Net Asset Value: 1998++ 1997++ 1996++ 1995
<S> <S> <C> <C> <C> <C>
Per Share Net asset value, beginning of period $ 17.19 $ 15.02 $ 13.33 $ 16.77
Operating -------- -------- -------- --------
Performance: Investment income--net .04 .32 .21 .13
Realized and unrealized gain (loss) on
investments and foreign currency transactions--net (6.15) 2.20 1.69 (2.48)
-------- -------- -------- --------
Total from investment operations (6.11) 2.52 1.90 (2.35)
-------- -------- -------- --------
Less dividends and distributions:
Investment income--net (.11) (.24) (.21) (.03)
In excess of investment income--net (.08) -- -- --
Realized gain on investments--net -- (.11) -- (.60)
In excess of realized gain on investments--net (.48) -- -- (.46)
-------- -------- -------- --------
Total dividends and distributions (.67) (.35) (.21) (1.09)
-------- -------- -------- --------
Net asset value, end of period $ 10.41 $ 17.19 $ 15.02 $ 13.33
======== ======== ======== ========
Total Investment Based on net asset value per share (36.13%) 17.30% 14.55% (14.49%)+++
Return:** ======== ======== ======== ========
Ratios to Average Expenses 1.88% 1.78% 1.76% 2.19%*
Net Assets: ======== ======== ======== ========
Investment income--net .28% 2.06% 1.48% 2.10%*
======== ======== ======== ========
Supplemental Net assets, end of period (in thousands) $ 31,686 $ 73,686 $ 57,821 $ 21,899
Data: ======== ======== ======== ========
Portfolio turnover 98.16% 86.68% 71.01% 63.37%
======== ======== ======== ========
<FN>
++Based on average shares outstanding.
++++Commencement of operations.
+++Aggregate total investment return.
*Annualized.
**Total investment returns exclude the effects of sales loads.
See Notes to Consolidated Financial Statements.
</TABLE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. Significant Accounting Policies:
Merrill Lynch Developing Capital Markets Fund, Inc. (the "Fund") is
registered under the Investment Company Act of 1940 as a non-
diversified, open-end management investment company. The Fund offers
four classes of shares under the Merrill Lynch Select Pricing SM
System. Shares of Class A and Class D are sold with a front-end
sales charge. Shares of Class B and Class C may be subject to a
contingent deferred sales charge. All classes of shares have
identical voting, dividend, liquidation and other rights and the
same terms and conditions, except that Class B, Class C and Class D
Shares bear certain expenses related to the account maintenance of
such shares, and Class B and Class C Shares also bear certain
expenses related to the distribution of such shares. Each class has
exclusive voting rights with respect to matters relating to its
account maintenance and distribution expenditures. The following is
a summary of significant accounting policies followed by the Fund.
(a) Valuation of securities--Portfolio securities which are traded
on stock exchanges are valued at the last sale price on the exchange
on which such securities are traded, as of the close of business on
the day the securities are being valued or, lacking any sales, at
the last available bid price. Securities traded in the over-the-
counter market are valued at the last available bid price prior to
the time of valuation. In cases where securities are traded on more
than one exchange, the securities are valued on the exchange
designated by or under the authority of the Board of Directors as
the primary market. Securities which are traded both in the over-the-
counter market and on a stock exchange are valued according to the
broadest and most representative market. Options written are valued
at the last sale price in the case of exchange-traded options or, in
the case of options traded in the over-the-counter market, the last
asked price. Options purchased are valued at the last sale price in
the case of exchange-traded options or, in the case of options
traded in the over-the-counter market, the last bid price. Short-
term securities are valued at amortized cost, which approximates
market value. Other investments, including futures contracts and
related options, are stated at market value. Securities and assets
for which market value quotations are not available are valued at
their fair value as determined in good faith by or under the
direction of the Fund's Board of Directors.
(b) Derivative financial instruments--The Fund may engage in various
portfolio strategies to seek to increase its return by hedging its
portfolio against adverse movements in the equity, debt and currency
markets. Losses may arise due to changes in the value of the
contract or if the counterparty does not perform under the contract.
* Forward foreign exchange contracts--The Fund is authorized to
enter into forward foreign exchange contracts as a hedge against
either specific transactions or portfolio positions. Such contracts
are not entered on the Fund's records. However, the effect on
operations is recorded from the date the Fund enters into such
contracts. Premium or discount is amortized over the life of the
contracts.
* Foreign currency options and futures--The Fund may also purchase
or sell listed or over-the-counter foreign currency options, foreign
currency futures and related options on foreign currency futures as
a short or long hedge against possible variations in foreign
exchange rates. Such transactions may be effected with respect to
hedges on non-US dollar denominated securities owned by the Fund,
sold by the Fund but not yet delivered, or committed or anticipated
to be purchased by the Fund.
* Options--The Fund is authorized to write put and covered call
options and purchase call and put options. When the Fund writes an
option, an amount equal to the premium received by the Fund is
reflected as an asset and an equivalent liability. The amount of the
liability is subsequently marked to market to reflect the current
market value of the option written. When a security is purchased or
sold through an exercise of an option, the related premium paid (or
received) is added to (or deducted from) the basis of the security
acquired or deducted from (or added to) the proceeds of the security
sold. When an option expires (or the Fund enters into a closing
transaction), the Fund realizes a gain or loss on the option to the
extent of the premiums received or paid (or gain or loss to the
extent the cost of the closing transaction exceeds the premium paid
or received).
Written and purchased options are non-income producing investments.
Merrill Lynch Developing Capital Markets Fund, Inc., June 30, 1998
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
* Financial futures contracts--The Fund may purchase or sell
financial futures contracts and options on such futures contracts
for the purpose of hedging the market risk on existing securities or
the intended purchase of securities. Futures contracts are contracts
for delayed delivery of securities at a specific future date and at
a specific price or yield. Upon entering into a contract, the Fund
deposits and maintains as collateral such initial margin as required
by the exchange on which the transaction is effected. Pursuant to
the contract, the Fund agrees to receive from or pay to the broker
an amount of cash equal to the daily fluctuation in value of the
contract. Such receipts or payments are known as variation margin
and are recorded by the Fund as unrealized gains or losses. When the
contract is closed, the Fund records a realized gain or loss equal
to the difference between the value of the contract at the time it
was opened and the value at the time it was closed.
(c) Foreign currency transactions--Transactions denominated in
foreign currencies are recorded at the exchange rate prevailing when
recognized. Assets and liabilities denominated in foreign currencies
are valued at the exchange rate at the end of the period. Foreign
currency transactions are the result of settling (realized) or
valuing (unrealized) assets or liabilities expressed in foreign
currencies into US dollars. Realized and unrealized gains or losses
from investments include the effects of foreign exchange rates on
investments.
(d) Income taxes--It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute all of its taxable income to
its shareholders. Therefore, no Federal income tax provision is
required. Under the applicable foreign tax law, a withholding tax
may be imposed on interest, dividends and capital gains at various
rates.
(e) Security transactions and investment income--Security
transactions are recorded on the dates the transactions are entered
into (the trade dates). Dividend income is recorded on the ex-
dividend dates. Dividends from foreign securities where the ex-
dividend date may have passed are subsequently recorded when the
Fund has determined the ex-dividend date. Interest income (including
amortization of discount) is recognized on the accrual basis.
Realized gains and losses on security transactions are determined on
the identified cost basis.
(f) Prepaid registration fees--Prepaid registration fees are charged
to expense as the related shares are issued.
(g) Dividends and distributions--Dividends and distributions paid by
the Fund are recorded on the ex-dividend dates. Distributions in
excess of investment income and realized capital gains are due
primarily to differing tax treatments for foreign currency
transactions.
(h) Basis of consolidation--The accompanying consolidated financial
statements include the accounts of Inversiones en Marcado Accionario
de Valores Chile Limitada., a wholly-owned subsidiary, which
primarily invests in Chilean securities. Inter-company accounts and
transactions have been eliminated.
(i) Reclassification--Generally accepted accounting principles
require that certain components of net assets be adjusted to reflect
permanent differences between financial and tax reporting.
Accordingly, current year's permanent book/tax differences of
$3,289,425 have been reclassified between accumulated net realized
capital losses and accumulated distributions in excess of net
investment income. These reclassifications have no effect on net
assets or net asset values per share.
2. Investment Advisory Agreement and Transactions
with Affiliates:
The Fund has entered into an Investment Advisory Agreement with
Merrill Lynch Asset Management, L.P. ("MLAM"). The general partner
of MLAM is Princeton Services, Inc. ("PSI"), an indirect, wholly-
owned subsidiary of Merrill Lynch & Co., Inc. ("ML & Co."), which is
a limited partner. The Fund has also entered into a Distribution
Agreement and Distribution Plans with Merrill Lynch Funds
Distributor ("MLFD" or "Distributor"), a division of Princeton Funds
Distributor, Inc. ("PFD"), which is a wholly-owned subsidiary of
Merrill Lynch Group, Inc.
MLAM is responsible for the management of the Fund's portfolio and
provides the necessary personnel, facilities, equipment and certain
other services necessary to the operations of the Fund. For such
services, the Fund pays a monthly fee of 1.0%, on an annual basis,
of the average daily value of the Fund's net assets.
Pursuant to the Distribution Plans adopted by the Fund in accordance
with Rule 12b-1 under the Investment Company Act of 1940, the Fund
pays the Distributor ongoing account maintenance and distribution
fees. The fees are accrued daily and paid monthly at annual rates
based upon the average daily net assets of the shares as follows:
Account Distribution
Maintenance Fee Fee
Class B 0.25% 0.75%
Class C 0.25% 0.75%
Class D 0.25% --
Pursuant to a sub-agreement with the Distributor, Merrill Lynch,
Pierce, Fenner & Smith Inc. ("MLPF&S"), a subsidiary of ML & Co.,
also provides account maintenance and distribution services to the
Fund. The ongoing account maintenance fee compensates the
Distributor and MLPF&S for providing account maintenance services to
Class B, Class C and Class D shareholders. The ongoing distribution
fee compensates the Distributor and MLPF&S for providing shareholder
and distribution-related services to Class B and Class C
shareholders.
For the year ended June 30, 1998, MLFD earned underwriting discounts
and direct commissions and MLPF&S earned dealer concessions on sales
of the Fund's Class A and Class D Shares as follows:
MLFD MLPF&S
Class A $5,269 $ 67,350
Class D $8,796 $113,684
For the year ended June 30, 1998, MLPF&S received contingent
deferred sales charges of $1,188,241 and $37,127 relating to
transactions in Class B and Class C Shares, respectively.
In addition, MLPF&S received $341,717 in commissions on the
execution of portfolio security transactions for the Fund for the
year ended June 30, 1998.
Merrill Lynch Financial Data Services, Inc. ("MLFDS"), a wholly-
owned subsidiary of ML & Co., is the Fund's transfer agent.
Accounting services are provided to the Fund by MLAM at cost.
Certain officers and/or directors of the Fund are officers and/or
directors of MLAM, PSI, MLFDS, PFD, and/or ML & Co.
3. Investments:
Purchases and sales of investments, excluding short-term securities,
for the year ended June 30, 1998 were $721,853,274 and $943,188,405,
respectively.
Net realized gains (losses) for the year ended June 30, 1998 and net
unrealized losses as of June 30, 1998 were as follows:
Realized
Gains Unrealized
(Losses) Losses
Long-term investments $(109,261,710) $(79,170,634)
Short-term investments 75 --
Foreign currency transactions (6,889,456) (143,922)
------------- ------------
Total $(116,151,091) $(79,314,556)
============= ============
As of June 30, 1998, net unrealized depreciation for Federal income
tax purposes aggregated $85,479,487, of which $35,357,089 related to
appreciated securities and $120,836,576 related to depreciated
securities. The aggregate cost of investments at June 30, 1998 for
Federal income tax purposes was $519,291,256.
4. Capital Share Transactions:
Net increase (decrease) in net assets derived from capital share
transactions was $(184,994,706) and $146,098,497 for the years ended
June 30, 1998 and June 30, 1997, respectively.
Transactions in capital shares for each class were as follows:
Class A Shares for the Year Dollar
Ended June 30, 1998 Shares Amount
Shares sold 11,519,583 $161,951,614
Shares issued to shareholders
in reinvestment of dividends
and distributions 1,430,204 17,663,020
------------ ------------
Total issued 12,949,787 179,614,634
Shares redeemed (19,311,328) (246,084,606)
------------ ------------
Net decrease (6,361,541) $(66,469,972)
============ ============
Class A Shares for the Year Dollar
Ended June 30, 1997 Shares Amount
Shares sold 10,813,691 $171,055,059
Shares issued to shareholders
in reinvestment of dividends
and distributions 520,090 7,328,070
------------ ------------
Total issued 11,333,781 178,383,129
Shares redeemed (6,726,711) (103,736,501)
------------ ------------
Net increase 4,607,070 $ 74,646,628
============ ============
Class B Shares for the Year Dollar
Ended June 30, 1998 Shares Amount
Shares sold 4,893,597 $ 71,910,397
Shares issued to shareholders
in reinvestment of dividends
and distributions 933,535 11,426,467
------------ ------------
Total issued 5,827,132 83,336,864
Automatic conversion of shares (217,370) (2,811,462)
Shares redeemed (12,949,733) (170,607,474)
------------ ------------
Net decrease (7,339,971) $(90,082,072)
============ ============
Merrill Lynch Developing Capital Markets Fund, Inc., June 30, 1998
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (concluded)
Class B Shares for the Year Dollar
Ended June 30, 1997 Shares Amount
Shares sold 10,187,663 $157,219,448
Shares issued to shareholders
in reinvestment of dividends
and distributions 337,691 4,734,432
------------ ------------
Total issued 10,525,354 161,953,880
Automatic conversion of shares (98,887) (1,536,359)
Shares redeemed (7,323,938) (112,319,608)
------------ ------------
Net increase 3,102,529 $ 48,097,913
============ ============
Class C Shares for the Year Dollar
Ended June 30, 1998 Shares Amount
Shares sold 1,356,907 $ 19,858,908
Shares issued to shareholders
in reinvestment of dividends
and distributions 181,874 2,217,051
------------ ------------
Total issued 1,538,781 22,075,959
Shares redeemed (2,604,945) (34,584,547)
------------ ------------
Net decrease (1,066,164) $(12,508,588)
============ ============
Class C Shares for the Year Dollar
Ended June 30, 1997 Shares Amount
Shares sold 2,216,284 $ 34,190,472
Shares issued to shareholders
in reinvestment of dividends
and distributions 59,048 825,497
------------ ------------
Total issued 2,275,332 35,015,969
Shares redeemed (1,211,472) (18,623,703)
------------ ------------
Net increase 1,063,860 $ 16,392,266
============ ============
Class D Shares for the Year Dollar
Ended June 30, 1998 Shares Amount
Shares sold 2,736,989 $ 41,244,505
Automatic conversion of shares 215,130 2,811,462
Shares issued to shareholders
in reinvestment of dividends
and distributions 181,728 2,240,703
------------ ------------
Total issued 3,133,847 46,296,670
Shares redeemed (4,374,540) (62,230,744)
------------ ------------
Net decrease (1,240,693) $(15,934,074)
============ ============
Class D Shares for the Year Dollar
Ended June 30, 1997 Shares Amount
Shares sold 6,551,739 $102,865,774
Automatic conversion of shares 98,081 1,536,359
Shares issued to shareholders
in reinvestment of dividends
and distributions 74,296 1,046,092
------------ ------------
Total issued 6,724,116 105,448,225
Shares redeemed (6,287,797) (98,486,535)
------------ ------------
Net increase 436,319 $ 6,961,690
============ ============
5. Commitments:
At June 30, 1998, the Fund entered into foreign exchange contracts
under which it had agreed to purchase and sell various foreign
currencies with approximate values of $144,000 and $717,000,
respectively.
<AUDIT-REPORT>
INDEPENDENT AUDITORS' REPORT
The Board of Directors and Shareholders,
Merrill Lynch Developing Capital Markets Fund, Inc.:
We have audited the accompanying consolidated statement of assets
and liabilities, including the consolidated schedule of investments,
of Merrill Lynch Developing Capital Markets Fund, Inc. and its
subsidiary as of June 30, 1998, the related consolidated statements
of operations for the year then ended and changes in net assets for
each of the years in the two-year period then ended, and the
consolidated financial highlights for each of the years in the five-
year period then ended. These financial statements and the financial
highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial
statements and the financial highlights based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements and the financial highlights are free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements.
Our procedures included confirmation of securities owned at June 30,
1998 by correspondence with the custodians and brokers. An audit
also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, such consolidated financial statements and
consolidated financial highlights present fairly, in all material
respects, the financial position of Merrill Lynch Developing Capital
Markets Fund, Inc. and its subsidiary as of June 30, 1998, the
results of their operations, the changes in their net assets, and
the consolidated financial highlights for the respective stated
periods in conformity with generally accepted accounting principles.
Deloitte & Touche LLP
Princeton, New Jersey
August 14, 1998
</AUDIT-REPORT>
Merrill Lynch Developing Capital Markets Fund, Inc., June 30, 1998
<TABLE>
IMPORTANT TAX INFORMATION (unaudited)
<CAPTION>
The following information summarizes all per share distributions
paid by Merrill Lynch Developing Capital Markets Fund, Inc. during
its fiscal year ended June 30, 1998:
Record Payable Non-Qualifying Domestic Foreign Source Total Ordinary Foreign Taxes Long-Term
Date Date Ordinary Income Income Income Paid or Withheld Capital Gains
<S> <C> <C> <C> <C> <C> <C>
Class A Shares 12/15/97 12/23/97 $.161020 $.243827 $.404847 $.011799 $.289212*
Class B Shares 12/15/97 12/23/97 $.126732 $.191906 $.318638 $.011799 $.289212*
Class C Shares 12/15/97 12/23/97 $.129799 $.196552 $.326351 $.011799 $.289212*
Class D Shares 12/15/97 12/23/97 $.152956 $.231618 $.384574 $.011799 $.289212*
<FN>
*All of this long-term capital gain distribution is subject to the
20% tax rate.
</TABLE>
All of the foreign taxes paid or withheld represent taxes incurred
by the Fund on dividends received by the Fund from foreign sources.
Foreign taxes paid or withheld should be included in taxable income
with an offsetting deduction from gross income or as a credit for
taxes paid to foreign governments. You should consult your tax
adviser regarding the appropriate treatment of foreign taxes paid.
Please retain this information for your records.
EQUITY PORTFOLIO CHANGES (unaudited)
For the Quarter Ended June 30, 1998
Additions
Alpha Credit Bank S.A. (Rights)
Arcelik A.S.
Cementos Mexicanos, S.A. de C.V (ADR)
ComputerLand Poland S.A.
FirstRand Limited
Grupo Financiero Banorte, S.A. de C.V.
(Class B)
Hellenic Petroleum S.A.
IRSA Inversiones y Representaciones S.A.
(GDR)
Liberty Life Association of Africa Limited
Malayan Banking BHD (Class A)
Panamerican Beverages, Inc.
(USRegistered Shares)(Class A)
Pentafour Software & Exports Ltd.
Pohang Iron & Steel Company, Ltd.
Tata Chemicals Ltd.
Telerj Celular S.A. PN 'B'
Deletions
AO Mosenergo (ADR)
Al-Ahram Beverages Co. S.A.E. (GDR)
Alarko Holdings A.S.
Billiton PLC (ADR)
Bombay Surburban Electric Supply Co.
Ltd. (GDR)
Cementos Mexicanos, S.A. de C.V.
(Cemex)(Class B)
Cifra, S.A. de C.V. 'C'
Cifra, S.A. de C.V. 'V'
Cimpor-Cimentos de Portugal S.A.
Commercial International Bank
(Egypt) S.A.E.
Companhia Cervejaria Brahma S.A. PN
(Preferred)(ADR)
Delta Corporation Ltd.
First National Bank Holdings Ltd.
Gencor Ltd. (ADR)
Haci Omer Sabanci Holding A.S.
Haci Omer Sabanci Holding A.S. (ADR)
Harbin Power Equipment Co. Ltd.
Indian Hotels Company Ltd. (The)(GDR)
Kookmin Bank (GDR)
Korea Electric Power Corporation
L.G. Chemical Ltd.
Lukoil Oil Company (ADR)
Mahanagar Telephone Nigam Ltd. (ADR)
Moscow City Telephone Network
Pakistan Telecommunications Corp.
Philippine Long Distance Telephone Co.
Philippine Long Distance Telephone Co.
(ADR)
Reliance Industries Ltd. (GDR)
Rembrandt Group Ltd.
Rostelecom--RDC
South African Breweries Ltd. (ADR)
State Bank of India (GDR)
Telecommunicacoes de Sao Paulo S.A.--
TELESP (Preferred)
Telecommunicacoes do Rio de Janeiro
S.A.--TELERJ (Preferred)
Tingyi (Camyan Islands) Holdings Co.
Unified Energy Systems
Unified Energy Systems (GDR)
Usinas Siderurgicas de Minas Gerais--
Usiminas S.A. (Preferred)
Videsh Sanchar Nigam Ltd. (GDR)
Yacimientos Petroliferos Fiscales S.A.
(YPF)(ADR)
PORTFOLIO INFORMATION (unaudited)
Ten Largest Equity Holdings Percent of
As of June 30, 1998 Net Assets
Telecomunicacoes Brasileiras S.A.--Telebras* 4.6%
Elektrim Spolka Akcyjna S.A. 3.6
Hellenic Bottling Co. S.A. 3.1
National Bank of Greece S.A. 2.8
Magyar TavKozlesi Reszvenytarsasag (Matav)
(Ordinary) 2.7
Akbank T.A.S. (Ordinary) 2.5
Grupo Televisa, S.A. de C.V. (GDR) 2.4
Bank Hapoalim Ltd. 2.4
Grupo Carso, S.A. de C.V. 'A' 2.4
Telefonos de Mexico, S.A. de C.V. (ADR) 2.1
[FN]
*Includes combined holdings.
