TURKISH INVESTMENT FUND INC, DEF 14A, 1997-03-27

TURKISH INVESTMENT FUND INC
DEF 14A, 1997-03-27

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<PAGE> 1
SCHEDULE 14A
(Rule 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENTS
SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )

Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]

Check the appropriate box:

[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12

The Turkish Investment Fund, Inc.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(Name of Registrant as Specified in Its Charter)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

Payment of Filing Fee (Check the appropriate box):

[X] No fee required.

[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

1) Title of each class of securities to which transaction applies:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2) Aggregate number of securities to which transaction applies:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4) Proposed maximum aggregate value of transaction:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5) Total fee paid: . . . . . . . . . . . . . . . . . . . . . . . . . . .

[ ] Fee paid previously with preliminary materials.

[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.

1) Amount Previously Paid:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2) Form, Schedule or Registration Statement No.:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3) Filing Party:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4) Date Filed:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
<PAGE> 2

THE TURKISH INVESTMENT FUND, INC.

C/O MORGAN STANLEY ASSET MANAGEMENT INC.

1221 AVENUE OF THE AMERICAS

NEW YORK, NEW YORK 10020

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

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

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

To Our Stockholders:

Notice is hereby given that the Annual Meeting of Stockholders of The
Turkish Investment Fund, Inc. (the "Fund") will be held on Wednesday, April 30,
1997, at 8:45 a.m. (New York time), in Conference Room 3 at 1221 Avenue of the
Americas, 22nd Floor, New York, New York 10020, for the following purposes:

1. To elect two Class II Directors for a term of three years.

2. To ratify or reject the selection by the Board of Directors of
Price Waterhouse LLP as independent accountants of the Fund for the fiscal
year ending October 31, 1997.

3. To approve or disapprove an Investment Advisory and Management
Agreement among the Fund, Morgan Stanley Asset Management Inc. and Morgan
Stanley Asset Management Limited.

4. To consider and act upon any other business as may properly come
before the Meeting or any adjournment thereof.

Only stockholders of record at the close of business on March 24, 1997 are
entitled to notice of, and to vote at, this Meeting or any adjournment thereof.

VALERIE Y. LEWIS

Secretary

Dated: March 27, 1997

IF YOU DO NOT EXPECT TO ATTEND THE MEETING, PLEASE SIGN AND PROMPTLY RETURN
THE ENCLOSED PROXY IN THE ENCLOSED SELF-ADDRESSED ENVELOPE. IN ORDER TO AVOID
THE ADDITIONAL EXPENSE TO THE FUND OF FURTHER SOLICITATION, WE ASK YOUR
COOPERATION IN MAILING IN YOUR PROXY PROMPTLY.
<PAGE> 3

THE TURKISH INVESTMENT FUND, INC.

C/O MORGAN STANLEY ASSET MANAGEMENT INC.

1221 AVENUE OF THE AMERICAS

NEW YORK, NEW YORK 10020

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

PROXY STATEMENT

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

This statement is furnished by the Board of Directors of The Turkish
Investment Fund, Inc. (the "Fund") in connection with the solicitation of
Proxies for use at the Annual Meeting of Stockholders (the "Meeting") to be held
on Wednesday, April 30, 1997, at 8:45 a.m. (New York time), in Conference Room 3
at the principal executive office of Morgan Stanley Asset Management Inc.
(hereinafter "MSAM"), 1221 Avenue of the Americas, 22nd Floor, New York, New
York 10020. It is expected that the Notice of Annual Meeting, Proxy Statement
and form of Proxy will first be mailed to stockholders on or about March 27,
1997.

The purpose of the Meeting and the matters to be acted upon are set forth
in the accompanying Notice of Annual Meeting of Stockholders. At the Meeting,
the Fund's stockholders will consider a New Advisory Agreement (defined below)
to take effect following the consummation of the transactions contemplated by an
Agreement and Plan of Merger, dated as of February 4, 1997 (the "Merger
Agreement"), between Dean Witter, Discover & Co. ("Dean Witter Discover") and
Morgan Stanley Group Inc. ("MS Group"), the direct parent of MSAM, the Fund's
investment manager. Pursuant to the Merger Agreement, the Fund's investment
manager will become a direct subsidiary of the merged company, which will be
called Morgan Stanley, Dean Witter, Discover & Co. The Fund's New Advisory
Agreement is substantially the same as the Fund's Current Advisory Agreement
(defined below), except for its date of execution.

If the accompanying form of Proxy is executed properly and returned, shares
represented by it will be voted at the Meeting in accordance with the
instructions on the Proxy. A Proxy may be revoked at any time prior to the time
it is voted by written notice to the Secretary of the Fund or by attendance at
the Meeting. If no instructions are specified, shares will be voted FOR the
election of the nominees for Directors, FOR ratification of Price Waterhouse LLP
as independent accountants of the Fund for the fiscal year ending October 31,
1997 and FOR the approval of the New Advisory Agreement. Abstentions and broker
non-votes are each included in the determination of the number of shares present
and voting at the Meeting.

The Board has fixed the close of business on March 24, 1997 as the record
date for the determination of stockholders entitled to notice of, and to vote
at, the Meeting and at any adjournment thereof. On that date, the Fund had
7,046,430 shares of Common Stock outstanding and entitled to vote. Each share
will be entitled to one vote at the Meeting.

The expense of solicitation will be borne by the Fund and will include
reimbursement to brokerage firms and others for expenses in forwarding proxy
solicitation materials to beneficial owners. The solicitation of Proxies will be
largely by mail, but may include, without cost to the Fund, telephonic,
telegraphic or oral communications by regular employees of MSAM. The
solicitation of Proxies is also expected to include communications by employees
of Shareholder
<PAGE> 4

Communications Corporation, a proxy solicitation firm expected to be engaged by
the Fund at a cost not expected to exceed $5,000 plus expenses. MSAM has agreed
to reimburse the Fund for all incremental expenses incurred by the Fund that
would not have been incurred if the New Advisory Agreement was not submitted to
stockholders of the Fund for their approval.

THE FUND WILL FURNISH, WITHOUT CHARGE, A COPY OF ITS ANNUAL REPORT FOR ITS
FISCAL YEAR ENDED OCTOBER 31, 1996, TO ANY STOCKHOLDER REQUESTING SUCH REPORT.
REQUESTS FOR THE ANNUAL REPORT SHOULD BE MADE IN WRITING TO THE TURKISH
INVESTMENT FUND, INC., C/O CHASE GLOBAL FUNDS SERVICES COMPANY, P.O. BOX 2798,
BOSTON, MASSACHUSETTS 02208-2798, OR BY CALLING 1-800-221-6726.

Chase Global Funds Services Company is an affiliate of the Fund's
administrator, The Chase Manhattan Bank ("Chase Bank"), and provides
administrative services to the Fund. The business address of Chase Bank and
Chase Global Funds Services Company is 73 Tremont Street, Boston, Massachusetts
02108.

THE BOARD RECOMMENDS THAT THE STOCKHOLDERS VOTE IN FAVOR OF EACH OF THE
MATTERS MENTIONED IN ITEMS 1, 2 AND 3 OF THE NOTICE OF ANNUAL MEETING.

ELECTION OF DIRECTORS

(PROPOSAL NO. 1)

At the Meeting, two Directors will be elected to hold office for a term of
three years and until their successors are duly elected and qualified. It is the
intention of the persons named in the accompanying form of Proxy to vote, on
behalf of the stockholders, for the election of John W. Croghan and Graham E.
Jones as Class II Directors.

On or about the same date as the Meeting, each of the other closed-end,
U.S. registered investment companies advised by MSAM (except Morgan Stanley
India Investment Fund, Inc.) also is holding a meeting of stockholders at which,
among other things, such stockholders are considering a proposal to elect as
directors of such other investment companies the same people nominated to be
Directors of the Fund. Accordingly, if elected, all of the nominees for
Directors of the Fund also will act as directors of: The Brazilian Investment
Fund, Inc., The Latin American Discovery Fund, Inc., The Malaysia Fund, Inc.,
Morgan Stanley Africa Investment Fund, Inc., Morgan Stanley Asia-Pacific Fund,
Inc., Morgan Stanley Emerging Markets Debt Fund, Inc., Morgan Stanley Emerging
Markets Fund, Inc., Morgan Stanley Global Opportunity Bond Fund, Inc., The
Morgan Stanley High Yield Fund, Inc., Morgan Stanley Russia & New Europe Fund,
Inc., The Pakistan Investment Fund, Inc. and The Thai Fund, Inc. (collectively,
with the Fund, the "MSAM closed-end funds"). The Board believes that this
arrangement enhances the ability of the Directors to deal expeditiously with
administrative matters common to the MSAM closed-end funds, such as evaluating
the performance of common service providers, including MSAM and the
administrators, transfer agents, custodians and accountants of the MSAM
closed-end funds.

Pursuant to the Fund's By-laws, the terms of office of the Directors are
staggered. The Board of Directors is divided into three classes, designated
Class I, Class II and Class III, with each class having a term of three years.
Each year the term of one class expires. Class I currently consists of Peter J.
Chase, David B. Gill and Warren J. Olsen. Class II currently consists of John W.
Croghan

2
<PAGE> 5

and Graham E. Jones. Class III currently consists of Barton M. Biggs, John A.
Levin and William G. Morton, Jr. Only the Directors in Class II are being
considered for election at this Meeting.

Pursuant to the Fund's By-laws, each Director holds office until (i) the
expiration of his term and until his successor has been elected and qualified,
(ii) his death, (iii) his resignation, (iv) October 31 of the year in which he
reaches seventy-three years of age, or (v) his removal as provided by statute or
the Articles of Incorporation.

The Board of Directors has an Audit Committee. The Audit Committee makes
recommendations to the full Board of Directors with respect to the engagement of
independent accountants and reviews with the independent accountants the plan
and results of the audit engagement and matters having a material effect on the
Fund's financial operations. The members of the Audit Committee are currently
John W. Croghan, John A. Levin and William G. Morton, Jr., none of whom is an
"interested person," as defined under the Investment Company Act of 1940, as
amended (the "1940 Act"). The Chairman of the Audit Committee is Mr. Levin.
After the Meeting, the Audit Committee will continue to consist of Directors of
the Fund who are not "interested persons." The Audit Committee met twice during
the fiscal year ended October 31, 1996. The Board of Directors does not have
nominating or compensation committees or other committees performing similar
functions.

There were four meetings of the Board of Directors held during the fiscal
year ended October 31, 1996. For the fiscal year ended October 31, 1996, each
current Director, during his tenure, attended at least seventy-five percent of
the aggregate number of meetings of the Board and of any committee on which he
served, except Mr. Biggs, who attended two of the four meetings of the Board.

Each of the nominees for Director has consented to be named in this Proxy
Statement and to serve as a director of the Fund if elected. The Board of
Directors has no reason to believe that any of the nominees named above will
become unavailable for election as a director, but if that should occur before
the Meeting, Proxies will be voted for such persons as the Board of Directors
may recommend.

3
<PAGE> 6

Certain information regarding the Directors and officers of the Fund is set
forth below:

<TABLE>
<CAPTION>
COMMON STOCK SHARE
BENEFICIALLY EQUIVALENTS
OWNED AS OF OWNED UNDER
POSITION WITH PRINCIPAL OCCUPATIONS MARCH 24, DEFERRED FEE
NAME AND ADDRESS THE FUND AND OTHER AFFILIATIONS AGE 1997** ARRANGEMENTS+ PERCENTAGE
- ------------------------------- --------------- ----------------------------- --- ------------ ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
Barton M. Biggs*............... Director and Chairman, Director and 64 10,000 -- ***
1221 Avenue of the Americas Chairman of Managing Director of Morgan
New York, New York 10020 the Board Stanley Asset Management
since 1995 Inc. and Chairman and
Director of Morgan Stanley
Asset Management Limited;
Managing Director of Morgan
Stanley & Co. Incorporated;
Director of Morgan Stanley
Group Inc.; Director of the
Rand McNally Company;
Member of the Yale
Development Board; Director
and Chairman of the Board
of seventeen U.S.
registered investment
companies managed by Morgan
Stanley Asset Management
Inc.
Peter J. Chase................. Director since Chairman and Chief Financial 64 500 -- ***
1441 Paseo De Peralta 1995 Officer, High Mesa
Santa Fe, New Mexico 87501 Technologies, LLC; Chairman
of CGL, Inc.;
Principal/Owner of
STATEMENTS; Director of
thirteen U.S. registered
investment companies
managed by Morgan Stanley
Asset Management Inc.
John W. Croghan................ Nominee; President of Lincoln 66 1,000 853 ***
200 South Wacker Drive Director Partners, a partnership of
Chicago, Illinois 60606 since 1995 Lincoln Capital Management
Company; Director of St.
Paul Bancorp, Inc. and
Lindsay Manufacturing Co.;
Director of thirteen U.S.
registered investment
companies managed by Morgan
Stanley Asset Management
Inc.; Previously Director
of Blockbuster
Entertainment Corporation.
</TABLE>

4
<PAGE> 7

<TABLE>
<CAPTION>
COMMON STOCK SHARE
BENEFICIALLY EQUIVALENTS
OWNED AS OF OWNED UNDER
POSITION WITH PRINCIPAL OCCUPATIONS AGE MARCH 24, DEFERRED FEE
NAME AND ADDRESS THE FUND AND OTHER AFFILIATIONS -- 1997** ARRANGEMENTS+ PERCENTAGE
- ------------------------------- --------------- ----------------------------- ------ -------- ---
<S> <C> <C> <C> <C> <C> <C>
David B. Gill.................. Director since Director of thirteen U.S. 70 500 607 ***
26210 Ingleton Circle 1995 registered investment
Easton, Maryland 21601 companies managed by Morgan
Stanley Asset Management
Inc.; Director of the
Mauritius Fund Limited;
Director of Moneda Chile
Fund Limited; Director of
First NIS Regional Fund
SIAC; Director of
Commonwealth Africa
Investment Fund Ltd.;
Chairman of the Advisory
Board of Advent Latin
American Private Equity
Fund; Chairman and Director
of Norinvest Bank; Director
of Surinvest International
Limited; Director of
National Registry Company;
Previously Director of
Capital Markets Department
of the International
Finance Corporation;
Trustee, Batterymarch
Finance Management;
Chairman and Director of
Equity Fund of Latin
America S.A.; Director of
Commonwealth Equity Fund
Limited; and Director of
Global Securities, Inc.
Graham E. Jones................ Nominee; Senior Vice President of BGK 64 1,000 -- ***
330 Garfield Street Director Properties; Trustee of nine
Suite 200 since 1989 investment companies
Santa Fe, New Mexico 87501 managed by Weiss, Peck &
Greer; Trustee of eleven
investment companies
managed by Morgan Grenfell
Capital Management
Incorporated; Director of
thirteen U.S. registered
investment companies
managed by Morgan Stanley
Asset Management Inc.;
Previously Chief Financial
Officer of Practice
Management Systems, Inc.
</TABLE>

5
<PAGE> 8

<TABLE>
<CAPTION>
COMMON STOCK SHARE
BENEFICIALLY EQUIVALENTS
OWNED AS OF OWNED UNDER
POSITION WITH PRINCIPAL OCCUPATIONS AGE MARCH 24, DEFERRED FEE
NAME AND ADDRESS THE FUND AND OTHER AFFILIATIONS -- 1997** ARRANGEMENTS+ PERCENTAGE
- ------------------------------- --------------- ----------------------------- ------ -------- ---
<S> <C> <C> <C> <C> <C> <C>
John A. Levin.................. Director since President of John A. Levin & 58 2,000 628 ***
One Rockefeller Plaza 1995 Co., Inc.; Director and
New York, New York 10020 President of Baker,
Fentress & Company;
Director of fourteen U.S.
registered investment
companies managed by Morgan
Stanley Asset Management
Inc.
William G. Morton, Jr.......... Director since Chairman and Chief Executive 60 500 -- ***
1 Boston Place 1995 Officer of Boston Stock
Boston, Massachusetts 02108 Exchange; Director of Tandy
Corporation; Director of
thirteen U.S. registered
investment companies
managed by Morgan Stanley
Asset Management Inc.
Warren J. Olsen*............... Director and Principal of Morgan Stanley & 40 2,034 -- ***
1221 Avenue of the Americas President Co. Incorporated and Morgan
New York, New York 10020 since 1991 Stanley Asset Management
Inc.; Director of sixteen
and President of seventeen
U.S. registered investment
companies managed by Morgan
Stanley Asset Management
Inc.
James W. Grisham*.............. Vice President Principal of Morgan Stanley & 55 200 -- ***
1221 Avenue of the Americas since 1992 Co. Incorporated and Morgan
New York, New York 10020 Stanley Asset Management
Inc.; Officer of various
investment companies
managed by Morgan Stanley
Asset Management Inc.
Michael F. Klein*.............. Vice President Principal of Morgan Stanley & 37 -- -- ***
1221 Avenue of the Americas since 1996 Co. Incorporated and Morgan
New York, New York 10020 Stanley Asset Management
Inc. and previously a Vice
President thereof; Officer
of various investment
companies managed by Morgan
Stanley Asset Management
Inc.; Previously practiced
law with the New York law
firm of Rogers & Wells.
Harold J. Schaaff, Jr.*........ Vice President Principal of Morgan Stanley & 36 202 -- ***
1221 Avenue of the Americas since 1992 Co. Incorporated and Morgan
New York, New York 10020 Stanley Asset Management
Inc.; General Counsel and
Secretary of Morgan Stanley
Asset Management Inc.;
Officer of various
investment companies
managed by Morgan Stanley
Asset Management Inc.
</TABLE>

6
<PAGE> 9

<TABLE>
<CAPTION>
COMMON STOCK SHARE
BENEFICIALLY EQUIVALENTS
OWNED AS OF OWNED UNDER
POSITION WITH PRINCIPAL OCCUPATIONS MARCH 24, DEFERRED FEE
NAME AND ADDRESS THE FUND AND OTHER AFFILIATIONS AGE 1997** ARRANGEMENTS+ PERCENTAGE
- ------------------------------- --------------- ----------------------------- --- ------------ ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
Joseph P. Stadler*............. Vice President Vice President of Morgan 42 -- -- ***
1221 Avenue of the Americas since 1994 Stanley & Co. Incorporated
New York, New York 10020 and Morgan Stanley Asset
Management Inc.; Officer of
various investment
companies managed by Morgan
Stanley Asset Management
Inc.; Previously with Price
Waterhouse LLP.
Valerie Y. Lewis*.............. Secretary since Vice President of Morgan 41 -- -- ***
1221 Avenue of the Americas 1990 Stanley & Co. Incorporated
New York, New York 10020 and Morgan Stanley Asset
Management Inc.; Officer of
various investment
companies managed by Morgan
Stanley Asset Management
Inc.; Previously with
Citicorp.
James M. Rooney................ Treasurer since Assistant Vice President and 38 -- -- ***
73 Tremont Street 1994 Manager of Fund
Boston, Massachusetts 02108 Administration, Chase
Global Funds Services
Company; Officer of various
investment companies
managed by Morgan Stanley
Asset Management Inc.;
Previously Assistant Vice
President and Manager of
Fund Compliance and
Control, Scudder Stevens &
Clark Inc. and Audit
Manager, Ernst & Young LLP.
Belinda Brady.................. Assistant Manager, Fund Administration, 28 -- -- ***
73 Tremont Street Treasurer Chase Global Funds Services
Boston, Massachusetts 02108 since 1996 Company; Officer of various
investment companies
managed by Morgan Stanley
Asset Management Inc.;
Previously with Price
Waterhouse LLP.
------ -------- ---
All Directors and Officers as a Group............................................ 17,936 2,088 ***
====== ======== ===
</TABLE>

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

* "Interested person" within the meaning of the 1940 Act. Mr. Biggs is
chairman, director and managing director of MSAM, and Messrs. Olsen,
Grisham, Klein, Schaaff and Stadler and Ms. Lewis are officers of MSAM.

** This information has been furnished by each nominee, director and officer.

*** Less than 1%.

+ Indicates share equivalents owned by the Directors and held in cash accounts
by the Fund on behalf of the Directors in connection with the deferred fee
arrangements described below.

Each officer of the Fund will hold such office until a successor has been
duly elected and qualified.

7
<PAGE> 10

The Fund pays each of its Directors who is not a director, officer or
employee of MSAM or its affiliates, in addition to certain out-of-pocket
expenses, an annual fee of $4,000 ($3,000 in 1996) plus certain out-of-pocket
expenses. Each of the members of the Fund's Audit Committee, which will consist
of the Fund's Directors who are not "interested persons" of the Fund as defined
in the 1940 Act, as amended, will receive an additional fee of $500 for serving
on such committee. Aggregate fees and expenses paid or payable to the Board of
Directors for the fiscal year ended October 31, 1996 were approximately $19,895.

Each of the Directors who is not an "affiliated person" of MSAM within the
meaning of the 1940 Act may enter into a deferred fee arrangement (the "Fee
Arrangement") with the Fund, pursuant to which such Director may defer to a
later date the receipt of his Director's fees. The deferred fees owed by the
Fund are credited to a bookkeeping account maintained by the Fund on behalf of
such Director and accrue income from and after the date of credit in an amount
equal to the amount that would have been earned had such fees (and all income
earned thereon) been invested and reinvested either (i) in shares of the Fund or
(ii) at a rate equal to the prevailing rate applicable to 90-day United States
Treasury Bills at the beginning of each calendar quarter for which this rate is
in effect, whichever method is elected by the Director.

Under the Fee Arrangement, deferred Director's fees (including the return
accrued thereon) will become payable in cash upon such Director's resignation
from the Board of Directors in generally equal annual installments over a period
of five years (unless the Fund has agreed to a longer or shorter payment period)
beginning on the first day of the year following the year in which such
Director's resignation occurred. In the event of a Director's death, remaining
amounts payable to him under the Fee Arrangement will thereafter be payable to
his designated beneficiary; in all other events, a Director's right to receive
payments is non-transferable. Under the Fee Arrangement, the Board of Directors
of the Fund, in its sole discretion, has reserved the right, at the request of a
Director or otherwise, to accelerate or extend the payment of amounts in the
deferred fee account at any time after the termination of such Director's
service as a director. In addition, in the event of liquidation, dissolution or
winding up of the Fund or the distribution of all or substantially all of the
Fund's assets and property to its stockholders (other than in connection with a
reorganization or merger into another fund advised by MSAM), all unpaid amounts
in the deferred fee account maintained by the Fund will be paid in a lump sum to
the Directors participating in the Fee Arrangement on the effective date
thereof.

Currently, Messrs. Croghan, Gill and Levin are the only Directors who have
entered into the Fee Arrangement with the Fund.

8
<PAGE> 11

Set forth below is a table showing the aggregate compensation paid by the
Fund to each of its Directors, as well as the total compensation paid to each
Director of the Fund by the Fund and by other U.S. registered investment
companies advised by MSAM or its affiliates (collectively, the "Fund Complex")
for their services as Directors of such investment companies for the fiscal year
ended October 31, 1996.

<TABLE>
<CAPTION>
AGGREGATE PENSION OR RETIREMENT TOTAL COMPENSATION NUMBER OF FUNDS
COMPENSATION BENEFITS ACCRUED FROM FUND AND IN FUND COMPLEX
FROM FUND AS PART OF THE FUND COMPLEX PAID FOR WHICH
NAME OF DIRECTORS (2)(3) FUND'S EXPENSES TO DIRECTORS(2)(4) DIRECTOR SERVES(5)
------------------------- ------------ --------------------- ------------------ ------------------
<S> <C> <C> <C> <C>
Barton M. Biggs(1) $ 0 None $ 0 17
Peter J. Chase 3,006 None 54,269 13
John W. Croghan 3,613 None 70,435 13
David B. Gill 3,090 None 58,496 13
Graham E. Jones 3,006 None 56,240 13
John A. Levin 3,590 None 74,388 14
William G. Morton, Jr. 3,590 None 66,009 13
Warren J. Olsen(1) 0 None 0 17
Frederick B.
Whittemore(1)(6) 0 None 0 16
</TABLE>

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

(1)"Interested persons" of the Fund within the meaning of the 1940 Act. Messrs.
Biggs and Olsen do not receive any compensation from the Fund or any other
investment company in the Fund Complex for their services as a director of
such investment companies.

(2)The amounts reflected in this table include amounts payable by the Fund and
the Fund Complex for services rendered during the fiscal year ended October
31, 1996, regardless of whether such amounts were actually received by the
Directors during such fiscal year.

(3)Mr. Croghan earned $3,613, Mr. Gill earned $2,590 and Mr. Levin earned $2,603
in deferred compensation from the Fund, pursuant to the deferred fee
arrangements described above, including any capital gains or losses or
interest associated therewith, during the fiscal year ended October 31, 1996.
Such amounts are included in these Directors' respective aggregate
compensation from the Fund reported in this table.

(4)Mr. Croghan earned $68,389, Mr. Gill earned $20,330, Mr. Jones earned $24,113
and Mr. Levin earned $58,196 in deferred compensation from the Fund and the
Fund Complex, pursuant to the deferred fee arrangements described above,
including any capital gains or losses or interest associated therewith,
during the fiscal year ended October 31, 1996. Such amounts are included in
these Directors' respective compensations from the Fund and the Fund Complex
reported in this table.

(5)Indicates the total number of boards of directors of investment companies in
the Fund Complex, including the Fund, on which the Director served at any
time during the fiscal year ended October 31, 1996.

(6) Mr. Whittemore resigned as a Director of the Fund effective March 14, 1997.

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Fund's officers and directors, and persons who own more than ten percent of
a registered class of the Fund's equity securities, to file reports of ownership
and changes in ownership with the Securities and Exchange Commission (the
"Commission") and the New York Stock Exchange, Inc. The Fund believes that its
officers and Directors complied with all applicable filing requirements for the
fiscal year ended October 31, 1996.

The election of Messrs. Croghan and Jones requires the affirmative vote of
a majority of the votes cast at a meeting at which a quorum is present. Under
the Fund's By-laws, the presence in person or by proxy of stockholders entitled
to cast a majority of the votes entitled to be cast thereat shall constitute a
quorum. For this purpose, abstentions and broker non-votes will be counted in
determining whether a quorum is present at the Meeting, but will not be counted
as votes cast at the Meeting.

9
<PAGE> 12

THE BOARD OF DIRECTORS OF THE FUND RECOMMENDS THAT YOU VOTE "FOR" THE
ELECTION OF THE TWO NOMINEES AS DIRECTORS.

SELECTION OF INDEPENDENT ACCOUNTANTS

(PROPOSAL NO. 2)

The Board of Directors of the Fund, including a majority of the Directors
who are not interested persons of the Fund, has selected Price Waterhouse LLP as
independent accountants for the Fund for the fiscal year ending October 31,
1997. The ratification of the selection of independent accountants is to be
voted on at the Meeting, and it is intended that the persons named in the
accompanying Proxy will vote for Price Waterhouse LLP. Price Waterhouse LLP acts
as the independent accountants for certain of the other investment companies
advised by MSAM. Although it is not expected that a representative of Price
Waterhouse LLP will attend the Meeting, a representative will be available by
telephone to respond to stockholder questions, if any.

The Board's policy regarding engaging independent accountants' services is
that management may engage the Fund's principal independent accountants to
perform any services normally provided by independent accounting firms, provided
that such services meet any and all of the independence requirements of the
American Institute of Certified Public Accountants and the Securities and
Exchange Commission. In accordance with this policy, the Audit Committee reviews
and approves all services provided by the independent accountants prior to their
being rendered. The Board of Directors also receives a report from its Audit
Committee relating to all services that have been performed by the Fund's
independent accountants.

The ratification of the selection of independent accountants requires the
affirmative vote of a majority of the votes cast at a meeting at which a quorum
is present. For this purpose, abstentions and broker non-votes will be counted
in determining whether a quorum is present at the Meeting, but will not be
counted as votes cast at the Meeting.

THE BOARD OF DIRECTORS OF THE FUND RECOMMENDS THAT YOU VOTE "FOR" THIS
PROPOSAL NO. 2.

APPROVAL OF A NEW ADVISORY CONTRACT

(PROPOSAL NO. 3)

THE MANAGERS

The Fund's advisory structure provides a multinational arrangement for
furnishing management skills and investment advice to pursue the Fund's
investment objective of investing primarily in equity securities of Turkish
corporations. MSAM, a United States investment advisory firm, and Morgan Stanley
Asset Management Limited ("MSAL"), an English company, act as investment
advisers (the "Managers") for the Fund. The Managers have acted as investment
managers for the Fund since the Fund commenced its investment operations. MSAM
and MSAL provide portfolio management and named fiduciary services to taxable
and nontaxable institutions, international organizations and individuals
investing in United States and international equities and fixed income
securities. At December 31, 1996, the Managers had, together with their
affiliated investment management companies (which include Van Kampen American
Capital, Inc.

10
<PAGE> 13

and Miller Anderson & Sherrerd, LLP), assets under management (including assets
under fiduciary advisory control) totalling approximately $162 billion. As
investment advisers, the Managers emphasize a global investment strategy and
benefit from research coverage of a broad spectrum of equity investment
opportunities worldwide. The Managers draw not only upon the research
capabilities of the MS Group, but also upon the research and investment ideas of
other companies whose brokerage services the Managers utilize. For the fiscal
year ended October 31, 1996, the Fund paid approximately $119,000 in brokerage
commissions, of which approximately $15,000 was paid by the Fund to affiliates
of the Managers, including Morgan Stanley & Co.

The Fund employs MSAM and MSAL pursuant to an Investment Advisory and
Management Agreement (the "Current Advisory Agreement") to manage the investment
and reinvestment of the assets of the Fund, subject to the supervision of the
Fund's Directors. Each of MSAM and MSAL is a wholly-owned subsidiary of MS
Group, and each is registered under the U.S. Investment Advisers Act of 1940.
MSAM's principal address is 1221 Avenue of the Americas, New York, New York
10020. MSAL's principal address is Commercial Union Building, 1 Undershaft,
Leadenhall Street, London EC3 3HB. The principal address of MS Group is 1585
Broadway, New York, New York 10036.

Certain information regarding the directors and the principal executive
officers of MSAM is set forth below.

<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION AND
NAME AND ADDRESS POSITION WITH MSAM OTHER INFORMATION
- --------------------- --------------------------- ---------------------------
<S> <C> <C>
Barton M. Biggs*..... Chairman, Director and Chairman and Director of
Managing Director Morgan Stanley Asset
Management Limited;
Managing Director of Morgan
Stanley & Co. Incorporated;
Director of Morgan Stanley
Group Inc.
Peter A. Nadosy*..... Vice Chairman, Director and Managing Director of Morgan
Managing Director Stanley & Co. Incorporated;
Director of Morgan Stanley
Asset Management Limited
James M. Allwin*..... President, Director and Managing Director of Morgan
Managing Director Stanley & Co. Incorporated;
President of Morgan Stanley
Realty Inc.
Gordon S. Gray*...... Director and Managing Managing Director of Morgan
Director Stanley & Co. Incorporated;
Director of Morgan Stanley
Asset Management Limited
Dennis G. Sherva*.... Director and Managing Managing Director of Morgan
Director Stanley & Co. Incorporated
</TABLE>

- ---------------
* Business Address: 1221 Avenue of the Americas, New York, New York 10020

11
<PAGE> 14

INFORMATION CONCERNING MORGAN STANLEY GROUP INC.

MS Group and various of its directly or indirectly owned subsidiaries,
including Morgan Stanley & Co. Incorporated ("Morgan Stanley & Co."), a
registered broker-dealer and investment adviser, and Morgan Stanley & Co.
International provide a wide range of financial services on a global basis.
Their principal businesses include securities underwriting, distribution and
trading; merger, acquisition, restructuring, real estate, project finance and
other corporate finance advisory activities; merchant banking and other
principal investment activities; stock brokerage and research services; asset
management; the trading of foreign exchange and commodities as well as
derivatives on a broad range or asset categories, rates and indices; real estate
advice, financing and investing; and global custody, securities clearance
services and securities lending.

INFORMATION CONCERNING DEAN WITTER, DISCOVER & CO.

Dean Witter Discover is a diversified financial services company offering a
broad range of nationally marketed credit and investment products with a primary
focus on individual customers. Dean Witter Discover has two principal lines of
business: credit services and securities. Its credit services business consists
primarily of the issuance, marketing and servicing of general purpose credit
cards and the provision of transaction processing services, private-label credit
cards services and real estate secured loans. It is the largest single issuer of
general purpose credit cards in the United States as measured by number of
accounts and cardmembers and the third largest originator and servicer of credit
card receivables, as measured by managed loans. Dean Witter Discover's
securities business is conducted primarily through its wholly owned
subsidiaries, Dean Witter Reynolds Inc. ("DWR") and Dean Witter InterCapital
Inc. ("Intercapital"). DWR is a full-service securities firm offering a wide
variety of securities products, with a particular focus on serving the
investment needs of its individual clients through over 9,100 professional
account executives located in 371 branch offices. DWR is among the largest NYSE
members and is a member of other major securities, futures and options
exchanges. Intercapital is a registered investment adviser that, along with its
subsidiaries, services investment companies, individual accounts and
institutional portfolios.

THE MERGER

Pursuant to the Merger Agreement, MS Group will be merged (the "Merger")
with and into Dean Witter Discover and the surviving corporation will be named
Morgan Stanley, Dean Witter, Discover & Co. Following the Merger, each of the
Managers will be a direct subsidiary of Morgan Stanley, Dean Witter, Discover &
Co.

Under the terms of the Merger Agreement, each of MS Group's common shares
will be converted into the right to receive 1.65 shares of Morgan Stanley, Dean
Witter, Discover & Co. common stock and each issued and outstanding share of
Dean Witter Discover common stock will remain outstanding and will thereafter
represent one share of Morgan Stanley, Dean Witter, Discover & Co. common stock.
Following the Merger, MS Group's former shareholders will own approximately 45%
and Dean Witter Discover's former shareholders will own approximately 55% of the
outstanding shares of common stock of Morgan Stanley, Dean Witter, Discover &
Co.

12
<PAGE> 15

The Merger is expected to be consummated in mid-1997 and is subject to
certain closing conditions, including certain regulatory approvals and the
approval of shareholders of both MS Group and Dean Witter Discover.

The Board of Directors of Morgan Stanley, Dean Witter, Discover & Co. will
initially consist of fourteen members, two of whom will be MS Group insiders and
two of whom will be Dean Witter Discover insiders. The remaining ten directors
will be independent directors, with MS Group and Dean Witter Discover each
nominating five of the ten. The Chairman and Chief Executive Officer of Morgan
Stanley, Dean Witter, Discover & Co. will be the current Chairman and Chief
Executive Officer of Dean Witter Discover, Phillip Purcell. The President and
Chief Operating Officer of Morgan Stanley, Dean Witter, Discover & Co. will be
the current President of MS Group, John Mack.

The Managers do not anticipate any reduction in the quality of services now
provided to the Fund and do not expect that the Merger will result in any
material changes in their business or in the manner in which they render
services to the Fund. Nor do the Managers anticipate that the Merger or any
ancillary transactions will have any adverse effect on their ability to fulfill
their obligations under the New Advisory Agreement (as defined below) with the
Fund or to operate their business in a manner consistent with past business
practice.

THE ADVISORY AGREEMENTS

In anticipation of the Merger, a majority of the Directors of the Fund who
are not parties to the New Advisory Agreement or interested persons of any such
party ("Disinterested Directors") approved a new investment advisory agreement
(the "New Advisory Agreement") between the Fund and the Manager. The form of the
proposed New Advisory Agreement is substantially the same as the Fund's Current
Advisory Agreement, except for the date of execution and the omission of
obsolete provisions described below. The holders of a majority of the
outstanding voting securities (within the meaning of the 1940 Act) of the Fund
are being asked to approve the New Advisory Agreement. See "The New Advisory
Agreement" below.

The following is a summary of the Current Advisory Agreement and the New
Advisory Agreement. The description of the New Advisory Agreement is qualified
by reference to Annex A.

THE CURRENT ADVISORY AGREEMENT. The Current Advisory Agreement, dated as
of December 5, 1989 (the "Current Advisory Agreement"), was last approved by
stockholders of the Fund at a meeting held on May 14, 1991.

Under the terms of the Current Advisory Agreement, the Managers, who are
jointly and severally responsible for the services provided thereunder, make
investment decisions, prepare and make available research and statistical data,
and supervise the purchase and sale of securities on behalf of the Fund,
including the selection of brokers and dealers to carry out the transactions,
all in accordance with the Fund's investment objective and policies, under the
direction and control of the Fund's Board of Directors. The Managers are also
jointly and severally responsible for maintaining records and furnishing all
required reports or other information of the Fund to the extent such records,
reports and other information are not maintained or furnished by the Fund's
administrators, custodians or other agents. The Managers pay the salaries and
expenses of those of the Fund's officers and employees, as well as fees and
expenses of those of the Fund's Directors, who are directors, officers or
employees of the Managers, except that the Fund bears travel

13
<PAGE> 16

expenses or an appropriate fraction thereof of officers and directors of the
Fund who are managing directors, officers or employees of the Managers to the
extent that such expenses relate to attendance at meetings of the Fund's Board
of Directors or any committee thereof. MSAL is primarily responsible for
portfolio management and MSAM is primarily responsible for supervision of MSAL
and recordkeeping. The Managers make investment decisions for the Fund based on
analysis of a variety of information, including, as the Managers deem
appropriate, available public information, research, discussions with management
and major stockholders and others knowledgeable concerning a relevant company.

The Fund pays all of its other expenses, including among others:
organization expenses (but not the overhead or employee costs of the Managers);
legal fees and expenses of counsel (United States and Turkish) to the Fund;
auditing and accounting expenses; taxes and governmental fees; New York Stock
Exchange listing fees; dues and expenses incurred in connection with membership
in investment company organizations; fees and expenses of the Fund's custodian,
subcustodians, transfer agents and registrars; fees and expenses with respect to
administration, except as may be provided otherwise pursuant to administration
agreements; expenses for portfolio pricing services by a pricing agent, if any;
expenses of preparing share certificates and other expenses in connection with
the issuance, offering and underwriting of shares issued by the Fund; expenses
relating to investor and public relations; expenses of registering or qualifying
securities of the Fund for public sale; freight, insurance and other charges in
connection with the shipment of the Fund's portfolio securities; brokerage
commissions or other costs of acquiring or disposing of any portfolio holding of
the Fund; expenses of preparation and distribution of reports, notices and
dividends to stockholders; expenses of the dividend reinvestment and share
purchase plan (except for brokerage expenses paid by participants in such plan);
costs of stationery; any litigation expenses; and costs of stockholders' and
other meetings.

For its services under the Current Advisory Agreement, MSAL receives an
annual fee in U.S. dollars of 0.95% of the first $50 million of average weekly
net assets of the Fund, 0.75% of such assets in excess of $50 million up to and
including $100 million and 0.55% of the excess over $100 million, payable
monthly. The Fund pays no advisory fee to MSAM; however, MSAL reimburses MSAM
for salaries, expenses and overhead incurred by MSAM in performing its
obligation under the Current Advisory Agreement. The aggregate fee paid to MSAL
in the year ended October 31, 1996 was $359,000. This fee is higher than
advisory fees paid by most other investment companies, but comparable to the
fees paid by funds with similar objectives.

Under the Current Advisory Agreement, the Managers are permitted to provide
investment advisory services to other clients, including clients who may invest
in Turkish securities.

The Current Advisory Agreement may be terminated at any time without
payment of penalty by the Fund or by either Manager upon 60 days' written
notice. The Current Advisory Agreement automatically terminates in the event of
its assignment, as defined under the U.S. Investment Company Act of 1940, as
amended.

The Current Advisory Agreement provides that neither Manager will be liable
for any act or omission, error or judgment or mistake of law, or for any loss
suffered by the Fund in connection with matters to which the Current Advisory
Agreement relates, except for a loss resulting from willful misfeasance, bad
faith or gross negligence on the part of a Manager in the performance of

14
<PAGE> 17

its respective duties, or from reckless disregard by it of its obligations and
duties under the Current Advisory Agreement.

The net assets of the Fund as of February 28, 1997, as well as the net
assets of other U.S. registered investment companies advised by MSAM, and other
U.S. registered investment companies for which MSAM acts as sub-adviser, the
rates of compensation to the Managers, the aggregate amount of advisory fees
paid by the Fund to the Managers and the aggregate amount of any other material
payments by the Fund to the Managers are set forth in Annex B hereto.

THE NEW ADVISORY AGREEMENT. The Board approved a proposed New Advisory
Agreement between the Fund and the Managers on March 13, 1997, the form of which
is attached as Annex A (the "New Advisory Agreement"). The form of the proposed
New Advisory Agreement is substantially the same as the Current Advisory
Agreement, except for the date of execution and the deletion of references in
the Current Advisory Agreement to a subadvisory arrangement with a Turkish
adviser that was terminated by the Fund in 1992.

The investment advisory fee as a percentage of net assets payable by the
Fund to MSAL will be the same under the New Advisory Agreement as under the
Current Advisory Agreement, and the reimbursement arrangements between MSAM and
MSAL would also remain the same. If the investment advisory fee under the New
Advisory Agreement had been in effect for the Fund's most recently completed
fiscal year, advisory fees paid to MSAL by the Fund would have been identical to
those paid under the Current Advisory Agreement.

The Board of the Fund held a meeting on March 13, 1997, at which meeting
the Directors, including the Disinterested Directors, unanimously approved the
New Advisory Agreement for the Fund and recommended the Agreement for approval
by the stockholders of the Fund. The New Advisory Agreement would take effect
upon the later to occur of (i) the obtaining of stockholder approval or (ii) the
closing of the Merger. The New Advisory Agreement will continue in effect for an
initial two year term and thereafter for successive annual periods as long as
such continuance is approved in accordance with the 1940 Act.

In evaluating the New Advisory Agreement, the Board took into account that
the Fund's Current Advisory Agreement and the New Advisory Agreement, including
their terms relating to the services to be provided thereunder by the Managers
and the fees and expenses payable by the Fund, are identical, except for the
date of execution and the omission of obsolete provisions described above. The
Board also considered other possible benefits to the Managers and Morgan
Stanley, Dean Witter, Discover & Co. that may result from the Merger including
the continued use of Morgan Stanley & Co. and Dean Witter Discover brokers and
its affiliates, to the extent permitted by law, for brokerage services.

The Board also examined the terms of the Merger Agreement and the possible
effects of the Merger upon the Managers' organization and upon the ability of
the Managers to provide advisory services to the Fund. The Board also considered
the skills and capabilities of the Managers. In this regard, the Board was
informed of the resources of Morgan Stanley, Dean Witter, Discover & Co. to be
made available to the Managers.

The Board also weighed the effect on the Fund of the Managers becoming
affiliated persons of Morgan Stanley, Dean Witter, Discover & Co. Following the
Merger, the 1940 Act will prohibit or impose certain conditions on the ability
of the Fund to engage in certain transactions with

15
<PAGE> 18

Morgan Stanley, Dean Witter, Discover & Co. and its affiliates. For example,
absent exemptive relief the Fund will be prohibited from purchasing securities
from Morgan Stanley & Co. and DWR in transactions in which Morgan Stanley & Co.
and/or DWR act as principal. Currently the Fund is prohibited from making such
purchases in only those transactions in which Morgan Stanley & Co. or an
affiliate acts as principal. The Fund will also have to satisfy certain
conditions in order to engage in securities transactions in which Morgan Stanley
& Co. or DWR is acting as an underwriter. The Fund is already required to
satisfy such conditions when engaging in transactions in which Morgan Stanley &
Co. or an affiliate is acting as an underwriter. In this connection, management
of each Manager represented to the Board that they do not believe these
prohibitions or conditions will have a material effect on the management or
performance of the Fund.

After consideration of the above factors and such other factors and
information that the Board deemed relevant, the Directors, and the Disinterested
Directors voting separately, unanimously approved the New Advisory Agreement and
voted to recommend its approval to the stockholders of the Fund.

In the event that stockholders of the Fund do not approve the New Advisory
Agreement, the Current Advisory Agreement will remain in effect and the Board
will take such action as it deems in the best interest of the Fund and its
stockholders, which may include proposing that stockholders approve an agreement
in lieu of the New Advisory Agreement. In the event the Merger is not
consummated, the Managers would continue to serve as investment managers of the
Fund pursuant to the terms of the Current Advisory Agreement.

STOCKHOLDER APPROVAL

To become effective, the New Advisory Agreement must be approved by a vote
of a majority of the outstanding voting securities of the Fund. The "vote of a
majority of the outstanding voting securities" is defined under the 1940 Act as
the lesser of the vote of (i) 67% or more of the shares of the Fund entitled to
vote thereon present at the Meeting if the holders of more than 50% of such
outstanding shares of the Fund are present in person or represented by proxy, or
(ii) more than 50% of such outstanding shares of the Fund entitled to vote
thereon. The New Advisory Agreement was unanimously approved by the Board after
consideration of all factors which they determined to be relevant to their
deliberations, including those discussed above. The Board also unanimously
determined to submit the New Advisory Agreement for consideration by the
stockholders of the Fund.

THE BOARD OF DIRECTORS OF THE FUND RECOMMENDS THAT YOU VOTE "FOR" APPROVAL
OF THE NEW ADVISORY AGREEMENT.

16
<PAGE> 19

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS

To the knowledge of the Fund's management, the following person owned
beneficially more than 5% of the Fund's outstanding shares at March 24, 1997:

<TABLE>
<CAPTION>
NAME AND ADDRESS OF AMOUNT AND NATURE OF
BENEFICIAL OWNER BENEFICIAL OWNERSHIP PERCENT OF CLASS
- --------------------------------------------------- -------------------- ----------------
<S> <C> <C>
United Nations Joint Staff Pension Fund**.......... 650,000* 9.2%
United Nations
New York, New York 10017
Fiduciary Trust Company International**............ 650,000* 9.2%
Two World Trade Center
New York, New York 10048
Kuwait Investment Authority***..................... 900,000 12.8%
P.O. Box 38346
Dahieh Abdullah Al Salem
Kuwait City, Kuwait 72254
</TABLE>

- ---------------
* Shared voting and dispositive power with respect to all shares.
** Based on a Schedule 13G filed with the Commission on February 3, 1997.
*** Based on a Schedule 13G filed with the Commission on November 2, 1992.

OTHER MATTERS

No business other than as set forth herein is expected to come before the
Meeting, but should any other matter requiring a vote of stockholders arise,
including any question as to an adjournment of the Meeting, the persons named in
the enclosed Proxy will vote thereon according to their best judgment in the
interests of the Fund.

STOCKHOLDER PROPOSALS FOR 1998 ANNUAL MEETING

A stockholders' proposal intended to be presented at the Fund's Annual
Meeting of Stockholders in 1998 must be received by the Fund on or before
November 27, 1997, in order to be included in the Fund's proxy statement and
form of proxy relating to that meeting.

VALERIE Y. LEWIS

Secretary

Dated: March 27, 1997

STOCKHOLDERS WHO DO NOT EXPECT TO BE PRESENT AT THE MEETING AND WHO WISH TO
HAVE THEIR SHARES VOTED ARE REQUESTED TO DATE AND SIGN THE ENCLOSED PROXY AND
RETURN IT IN THE ENCLOSED ENVELOPE. NO POSTAGE IS REQUIRED IF MAILED IN THE
UNITED STATES.

17
<PAGE> 20

ANNEX A

INVESTMENT ADVISORY AND MANAGEMENT AGREEMENT

Agreement, dated and effective as of , 1997 between THE
TURKISH INVESTMENT FUND, INC., a Maryland corporation (herein referred to as the
"Fund"), MORGAN STANLEY ASSET MANAGEMENT INC., a Delaware corporation ("MSAM")
and MORGAN STANLEY ASSET MANAGEMENT LIMITED, a United Kingdom corporation
("MSAL") (MSAM and MSAL collectively referred to as the "Managers").

WITNESSETH: That in consideration of the mutual covenants herein contained,
it is agreed by the parties as follows:

1. The Managers hereby jointly and severally undertake and agree, upon the
terms and conditions herein set forth, (i) to make investment decisions for the
Fund, to prepare and make available to the Fund research and statistical data in
connection therewith, and to supervise the acquisition and disposition of
securities by the Fund, including the selection of brokers or dealers to carry
out the transactions, all in accordance with the Fund's investment objective and
policies and in accordance with guidelines and directions from the Fund's Board
of Directors; (ii) to assist the Fund as it may reasonably request in the
conduct of the Fund's business, subject to the direction and control of the
Fund's Board of Directors; (iii) to maintain or cause to be maintained for the
Fund all books and records required under the Investment Company Act of 1940, as
amended (the "1940 Act"), to the extent that such books and records are not
maintained or furnished by the administrators, custodians or other agents of the
Fund; (iv) to furnish at the Managers' expense for the use of the Fund such
office space and facilities as the Fund may require for its reasonable needs in
New York and London, and to furnish at the Managers' expense clerical services
in the United States and London related to research, statistical and investment
work; and (v) to pay the reasonable salaries and expenses of such of the Fund's
officers and employees (including the Fund's share of payroll taxes) and any
fees and expenses of such of the Fund's direct directors, officers or employees
of the Managers, provided, however, that the Fund, and not the Managers, shall
bear travel expenses or an appropriate fraction thereof of directors and
officers of the Fund who are managing directors, officers or employees of the
Managers to the extent that such expenses relate to attendance at meetings of
the Board of Directors of the Fund or any committees thereof. The Managers shall
bear all expenses arising out of their duties hereunder but shall not be
responsible for any expenses of the Fund other than those specifically allocated
to the Managers in this paragraph 1. In particular, but without limiting the
generality of the foregoing, the Managers shall not be responsible, except to
the extent of the compensation of such of the Fund's employees as are directors,
officers or employees of the Managers whose services may be involved, for the
following expenses of the Fund: organization expenses (but not the overhead or
employee costs of the Managers); legal fees and expenses of counsel (United
States and Turkish) to the Fund; auditing and accounting expenses; taxes and
governmental fees; New York Stock Exchange listing fees; dues and expenses
incurred in connection with membership in investment company organizations; fees
and expenses of the Fund's custodian, subcustodians, transfer agents and
registrars; fees and expenses with respect to administration except as may be
provided otherwise pursuant to administration agreements; expenses for portfolio
pricing services by a pricing agent, if any; expenses of preparing share
certificates and other expenses in connection with the issuance, offering and
underwriting of shares issued by the Fund; expenses relating to investor

A-1
<PAGE> 21

and public relations; expenses of registering or qualifying securities of the
Fund for public sale; freight, insurance and other charges in connection with
the shipment of the Fund's portfolio securities; brokerage commissions or other
costs of acquiring or disposing of any portfolio holding of the Fund; expenses
of preparation and distribution of reports, notices and dividends to
shareholders; expenses of the dividend reinvestment and share purchase plan
(except for brokerage expenses paid by participants in such Plan); costs of
stationery; any litigation expenses; and costs of stockholders' and other
meetings.

2. In connection with the rendering of the services required under
paragraph 1, the Managers may contract with or consult with such banks,
securities firms or other parties in Turkey or elsewhere as they may deem
appropriate to obtain additional advisory information and advice, including
investment recommendations, advice regarding economic factors and trends and
advice as to currency exchange matters, but any fee, compensation or expenses to
be paid to any such parties shall be paid by the Managers, and no obligation
shall be incurred on the Fund's behalf in any such respect.

3. The Fund agrees to pay in United States dollars to MSAL, as full
compensation for the services to be rendered and expenses to be borne by MSAL
hereunder, an annual fee equal to 0.95% of the value of the average weekly net
assets of the Fund up to and including $50 million, plus 0.75% of the value of
the next $50 million of the average weekly net assets of the Fund, plus 0.55% of
the value of the average weekly net assets of the Fund over $100 million,
payable monthly. For purposes of computing the monthly fee, the weekly net
assets of the Fund for any month shall be determined as of the close of business
in Istanbul on the last Istanbul Stock Exchange business day of each week where
such last business day of the week falls within that month and the aggregate
value of all such weekly net assets shall be divided by the number of such weeks
in such month. Such fee shall be computed beginning on the "Closing Date" (as
defined in the Underwriting Agreement dated as of even date herewith with
respect to the offering of the Fund's common stock) until the termination of
this Agreement for whatever reason. The fee from the Closing Date to the end of
the month during which the Closing Date occurs shall be prorated according to
the proportion which such period bears to the full monthly period. Upon the
termination of this Agreement before the end of any month, such fee for such
part of a month shall be prorated according to the proportion which such period
bears to the full monthly period, and shall be payable on the date of
termination of this Agreement. Each payment of a monthly fee to MSAL shall be
made within the 15 Istanbul business days of the first day of each month
following the day as of which such payment is computed. From time to time, MSAL
will reimburse MSAM for salaries, expenses and overhead incurred by MSAM in
performing its obligations under this Agreement.

4. The Managers agree that they will not make a short sale of any capital
stock of the Fund, or purchase any share of the capital stock of the Fund
otherwise than for investment.

5. Nothing herein shall be construed as prohibiting the Managers from
providing investment advisory services to, or entering into investment advisory
agreements with, other clients (including other registered investment
companies), including clients which may invest in securities of Turkish issuers,
or from utilizing (in providing such services) information furnished to the
Managers by others as contemplated by Section 2 of this Agreement; nor, except
as explicitly provided herein, shall anything herein be construed as
constituting the Managers as agents of the Fund.

A-2
<PAGE> 22

6. The Managers may rely on information reasonably believed by them to be
accurate and reliable. Neither the Managers nor their officers, directors,
employees, agents or controlling persons as defined in the Investment Company
Act shall be subject to any liability for any act or omission, error of judgment
or mistake of law, or for any loss suffered by the Fund, in the course of,
connected with or arising out of any services to be rendered hereunder, except
by reason of willful misfeasance, bad faith or gross negligence on the part of a
Manager in the performance of its respective duties or by reason of reckless
disregard on the part of a Manager of its respective obligations and duties
under this Agreement. Any person, even though also employed by MSAM or MSAL, who
may be or become an employee of the Fund and paid by the Fund shall be deemed,
when acting within the scope of his employment by the Fund, to be acting in such
employment solely for the Fund and not as an employee or agent of the Manager.

7. This Agreement shall remain in effect for a period of two years from
the date hereof, and shall continue in effect thereafter, but only so long as
such continuance is specifically approved at least annually by the affirmative
vote of (i) a majority of the members of the Fund's Board of Directors who are
neither parties to this Agreement nor interested persons of the Fund or of the
Managers or of any entity regularly furnishing investment advisory services with
respect to the Fund pursuant to an agreement with the Managers, cast in person
at a meeting called for the purpose of voting on such approval, and (ii) a
majority of the Fund's Board of Directors or the holders of a majority of the
outstanding voting securities of the Fund.

This Agreement may nevertheless be terminated at any time without penalty,
on 60 days' written notice, by the Fund's Board of Directors, by vote of holders
of a majority of the outstanding voting securities of the Fund, or by either of
the Managers. This Agreement shall automatically be terminated in the event of
its assignment, provided, however, that a transaction which does not, in
accordance with the 1940 Act, result in a change of actual control or management
of the Managers' business shall not be deemed to be an assignment for the
purposes of this Agreement. Termination by or with respect to MSAL or MSAM shall
also terminate this Agreement with respect to such other entity. Any such notice
shall be deemed given when received by the addressee.

8. This Agreement may not be transferred, assigned, sold or in any manner
hypothecated or pledged by either party hereto other than pursuant to Section 7.
It may be amended by mutual agreement, but only after authorization of such
amendment by the affirmative vote of (i) the holders of a majority of the
outstanding voting securities of the Fund, and (ii) a majority of the members of
the Fund's Board of Directors who are not interested persons of the Fund or of
the Managers, cast in person at a meeting called for the purpose of voting on
such approval.

9. This Agreement shall be construed in accordance with the laws of the
State of New York, provided, however, that nothing herein shall be construed as
being inconsistent with the 1940 Act. As used herein, the terms "interested
person," "assignment," and "vote of a majority of the outstanding voting
securities" shall have the meanings set forth in the 1940 Act.

10. Any notice hereunder shall be in writing and shall be delivered in
person or by telex or facsimile (followed by mailing such notice, air mail
postage prepaid, on the day on which such

A-3
<PAGE> 23

telex or facsimile is sent to the address set forth below) to the following
address or telex or facsimile numbers:

If to Morgan Stanley Asset Management Inc., to the attention of

General Counsel

1221 Avenue of the Americas

New York, New York 10020

Telex No. 212-765-3114

Facsimile No. 212-921-5477.

If to Morgan Stanley Asset Management Limited, to the attention of

James Lyle

Commercial Union Building

1 Undershaft

London EC3 3HB, England

Telex No. 881-2564

Facsimile No. 441-283-4455.

If to the Fund, to the attention of the

President

1221 Avenue of the Americas

New York, New York 10020

Telex No. 212-765-3114

Facsimile No. 212-921-5477.

or to such other address as to which the recipient shall have informed the other
parties in writing.

Notice given as provided above shall be deemed to have been given, if by
personal delivery, on the day of such delivery, and, if by telex or facsimile
and mail, on the date on which such telex or facsimile and confirmatory letter
are sent.

11. Each party hereto irrevocably agrees that any suit, action or
proceeding against either of the Managers or the Fund arising out of or relating
to this Agreement shall be subject exclusively to the jurisdictions of the
United States District Court for the Southern District of New York and the
Supreme Court of the State of New York, New York County, and each party hereto
irrevocably submits to the jurisdiction of each such court in connection with
any such suit, action or proceeding. Each party hereto waives any objection to
the laying of venue of any such suit, action or proceeding in either such court,
and waives any claim that such suit, action or proceeding has been brought in an
inconvenient forum. Each party hereto irrevocably consents to service of process
in connection with any such suit, action or proceeding by mailing a copy thereof
in English by registered or certified mail, postage prepaid, to their respective
addresses as set forth in this Agreement.

To the extent that any party hereto may now or hereafter be entitled, in
any jurisdiction in which judicial proceedings may at any time be commenced with
respect to this Agreement, to claim for itself or its revenues or properties any
immunity from suit, court jurisdiction, attachment prior to judgment, attachment
in aid of execution of a judgment, execution of a judgment or from set-off,
banker's lien, counterclaim or any other legal process or remedy with respect to
its

A-4
<PAGE> 24

obligations under this Agreement and/or to the extent that in such jurisdiction
there may be attributed to any such party such an immunity (whether or not
claimed), the parties hereto each hereby to the fullest extent permitted by
applicable law irrevocably agrees not to claim, and hereby to the fullest extent
permitted by applicable law expressly waives, any such immunity, including,
without limitation, a complete waiver of immunity pursuant to the United States
Foreign Sovereign Immunities Act.

IN WITNESS WHEREOF, the parties have executed this Agreement by their
officers thereunto duly authorized as of the day and year first written above.

THE TURKISH INVESTMENT FUND, INC.

By:
--------------------------------------------
Name:
Title:

MORGAN STANLEY ASSET MANAGEMENT INC.

By:
--------------------------------------------
Name:
Title:

MORGAN STANLEY ASSET MANAGEMENT LIMITED

By:

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

Name:

Title:

A-5
<PAGE> 25

ANNEX B

The following table indicates the size of each U.S. investment company
advised or sub-advised by the Manager, the amount of advisory fees or
sub-advisory fees paid to the Manager for the last fiscal year of such
investment company, the amount of other material fees paid to the Manager for
such fiscal year and the advisory fee rate. Average net assets are calculated on
a daily basis for open-end funds and on a weekly basis for closed-end funds.

<TABLE>
<CAPTION>
AGGREGATE
AMOUNT
OF
ADVISORY/ AMOUNT OF
SUBADVISORY OTHER MATERIAL
NET ASSETS AS FEE FOR THE PAYMENTS TO ASSET MANAGEMENT FEE AS PERCENTAGE
OF LAST THE MANAGER OF AVERAGE NET ASSETS
FEBRUARY 28, FISCAL FOR THE LAST (ANNUAL RATE OF MSAM'S
INVESTMENT COMPANY 1997 YEAR(1) FISCAL YEAR COMPENSATION)
- --------------------------------------- -------------- ----------- -------------- ---------------------------------------
<S> <C> <C> <C> <C>
Morgan Stanley Institutional Fund, Inc.*(2)
- -- Active Country Allocation Portfolio $ 187,031,777 $ 1,168,571 $0 0.65% of average daily net assets
- -- Aggressive Equity Portfolio 121,791,751 400,006 0 0.80% of average daily net assets
- -- Asian Equity Portfolio 365,212,440 3,378,056 0 0.80% of average daily net assets
- -- Balanced Portfolio 7,573,877 74,832 0 0.50% of average daily net assets
- -- China Growth Portfolio(3) 0 0 0 1.25% of average daily net assets
- -- Emerging Growth Portfolio 82,677,378 1,024,956 0 1.00% of average daily net assets
- -- Emerging Markets Debt Portfolio 162,883,938 1,887,155 0 1.00% of average daily net assets
- -- Emerging Markets Portfolio 1,557,680,866 15,367,651 0 1.25% of average daily net assets
- -- Equity Growth Portfolio 467,132,622 1,192,888 0 0.60% of average daily net assets
- -- European Equity Portfolio 215,681,709 1,034,869 0 0.80% of average daily net assets
- -- Fixed Income Portfolio 122,195,042 559,304 0 0.35% of average daily net assets
- -- Global Equity Portfolio 87,115,900 630,346 0 0.80% of average daily net assets
- -- Global Fixed Income Portfolio 116,017,909 437,198 0 0.40% of average daily net assets
- -- Gold Portfolio(4) 38,303,227 274,000 0 1.00% of average daily net assets
- -- Growth and Income Fund(3) 0 0 0 0.75% of average daily net assets
- -- High Yield Portfolio 123,820,445 438,512 0 0.50% of average daily net assets
- -- International Equity Portfolio 2,412,774,091 15,860,657 0 0.80% of average daily net assets
- -- International Magnum Portfolio 124,710,803 381,756 0 0.80% of average daily net assets
- -- International Small Cap Portfolio 239,291,131 2,092,097 0 0.95% of average daily net assets
- -- Japanese Equity Portfolio 156,667,861 1,642,268 0 0.80% of average daily net assets
- -- Latin American Portfolio 55,950,497 287,055 0 1.10% of average daily net assets
- -- MicroCap Portfolio(3) 0 0 0 1.00% of average daily net assets
- -- Money Market Portfolio 1,278,773,524 3,343,176 0 0.30% of average daily net assets
- -- Mortgaged-Backed Securities 0 0 0 0.35% of average daily net assets
Portfolio(3)
- -- Municipal Bond Portfolio 43,819,386 134,963 0 0.35% of average daily net assets
- -- Municipal Money Market Portfolio 721,197,094 1,932,187 0 0.30% of average daily net assets
- -- Small Cap Value Equity Portfolio 29,921,023 345,122 0 0.85% of average daily net assets
- -- Technology Portfolio(5) 5,504,680 12,699 0 1.00% of average daily net assets
- -- U.S. Real Estate Portfolio 246,501,294 1,017,980 0 0.80% of average daily net assets
- -- Value Equity Portfolio 109,811,808 655,516 0 0.50% of average daily net assets
Morgan Stanley Fund, Inc.*(6)
- -- American Value Fund 54,190,478 363,998 0 0.85% of average daily net assets
- -- Aggressive Equity Fund 30,105,256 31,323 0 0.90% of average daily net assets
- -- Asian Growth Fund 394,810,098 3,762,252 0 1.00% of average daily net assets
- -- Emerging Markets Fund 174,767,303 1,081,943 0 1.25% of average daily net assets
- -- Emerging Markets Debt Fund(3) 0 0 0 1.25% of average daily net assets
- -- Equity Growth Fund(3) 0 0 0 0.70% of average daily net assets
- -- European Equity Fund(3) 0 0 0 1.00% of average daily net assets
- -- Global Equity Allocation Fund 161,349,524 1,047,751 0 1.00% of average daily net assets
- -- Global Equity Fund(3) 0 0 0 1.00% of average daily net assets
- -- Global Fixed Income Fund 9,525,078 121,568 0 0.75% of average daily net assets
- -- Government Obligations Money 122,965,353 0 0 0.45% of the first $250 million
Market(7) 0.40% of the next $250 million
0.35% of the excess over $500 million
</TABLE>

B-1
<PAGE> 26

Morgan Stanley Universal Funds, Inc.*
- -- Asian Equity(3) 0 0 0 0.80% of the first $500 million
0.75% of the next $500 million
0.70% of the excess over $1 billion
- -- Emerging Markets Debt(3) 0 0 0 0.75% of the first $500 million
0.70% of the next $500 million
0.65% of the excess over $1 billion
- -- Emerging Markets Equity 15,607,752 32,000 0 1.25% of the first $500 million
1.20% of the next $500 million
1.15% of the excess over $1 billion
- -- Global Equity(8) 5,225,659 0 0 0.80% of the first $500 million
0.75% of the next $500 million
0.70% of the excess over $1 billion
- -- Growth(8) 2,843,221 0 0 0.55% of the first $500 million
0.50% of the next $500 million
0.45% of the excess over $1 billion
- -- International Magnum(8) 10,283,605 0 0 0.80% of the first $500 million
0.75% of the next $500 million
0.70% of the excess over $1 billion
- -- Money Market(3) $ 0 $ 0 $0 0.30% of the first $500 million
0.25% of the next $500 million
0.20% of the excess over $1 billion
- -- U.S. Real Estate(8) 0 0 0 0.80% of the first $500 million
0.75% of the next $500 million
0.70% of the excess over $1 billion
The Brazilian Investment Fund, Inc. 58,816,028 425,000 0 0.90% of the first $50 million
0.70% of the next $50 million
0.50% of the excess over $100 million
The Latin American Discovery Fund, Inc. 204,346,643 1,899,000 0 1.15% of average weekly net assets
The Malaysia Fund, Inc. 192,501,967 1,330,000 0 0.90% of the first $50 million
0.70% of the next $50 million
0.50% of the excess over $100 million
Morgan Stanley Africa Investment Fund, 310,803,693 3,106,000 0 1.20% of average weekly net assets
Inc.
Morgan Stanley Asia-Pacific Fund, Inc. 854,649,586 8,796,000 0 1.00% of average weekly net assets
Morgan Stanley Emerging Markets Debt 321,966,172 3,125,000 0 1.00% of average weekly net assets
Fund, Inc.
Morgan Stanley Emerging Markets Fund, 407,981,941 4,713,000 0 1.25% of average weekly net assets
Inc.
</TABLE>

B-2
<PAGE> 27

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

* With respect to each of Morgan Stanley Institutional Fund, Inc., Morgan
Stanley Fund, Inc. and Morgan Stanley Universal Funds, Inc., MSAM has
voluntarily agreed to a reduction in the fees payable to it and to
reimburse each portfolio, if necessary, if payment of advisory fees would
cause the total annual operating expenses of such portfolio to exceed
certain minimums.

(1) Net of any fees waived by the Manager for the last fiscal year.

(2) Includes Class A and Class B shares.

(3) Currently Inactive.

(4) Management fee includes a 0.40% sub-advisory fee payable by the Manager.

(5) Commenced operations March 16, 1996.

(6) Includes Class A, Class B and Class C shares. Fiscal year end June 30, 1996.

(7) Formerly, a portfolio of PCS Cash Fund, which was merged with and into
Morgan Stanley Fund, Inc. on September 27, 1996.

(8) Portfolio had not commenced operations as of December 31, 1996.

B-3
<PAGE> 28
PROXY

THE TURKISH INVESTMENT FUND, INC.

C/O MORGAN STANLEY ASSET MANAGEMENT INC.
1221 AVENUE OF THE AMERICAS
NEW YORK, NEW YORK 10020

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

The undersigned hereby constitutes and appoints WARREN J. OLSEN,
MICHAEL F. KLEIN, VALERIE Y. LEWIS and HAROLD J. SCHAAFF, JR., and each of
them, as proxies for the undersigned, with full power of substitution and
resubstitution, and hereby authorizes said proxies, and each of them, to
represent and vote, as designated on the reverse side, all stock of the
above Company held of record by the undersigned on March 24, 1997 at the
Annual Meeting of Stockholders to be held on April 30, 1997, and at any
adjournment thereof.

The undersigned hereby revokes any and all proxies with respect to
such stock heretofore given by the undersigned. The undersigned
acknowledges receipt of the Proxy Statement dated March 27, 1997.

(CONTINUED AND TO BE SIGNED AND DATED ON REVERSE SIDE.)
SEE REVERSE SIDE

<PAGE> 29
[X] Please mark your votes as in this sample.

1. Election of the following nominees as Directors:

FOR WITHHELD

[ ] [ ] Class II Nominees:
John W. Croghan and Graham E. Jones

______________________________________
For all nominees except as noted above

MARK HERE FOR ADDRESS CHANGE AND NOTE BELOW [ ]

2. Ratification of the selection of Price Waterhouse LLP as independent
accountants.

FOR AGAINST ABSTAIN

[ ] [ ] [ ]

3. Approval of the Investment Advisory and Management Agreement among The
Turkish Investment Fund, Inc., Morgan Stanley Asset Management Inc. and
Morgan Stanley Asset Management Limited.

FOR AGAINST ABSTAIN

[ ] [ ] [ ]

4. In the discretion of such proxies, upon any and all other business as
may properly come before the Meeting or any adjournment thereof.

THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY
WILL BE VOTED FOR THE ELECTION OF THE TWO CLASS II NOMINEES AND IN FAVOR OF
PROPOSAL NO. 2 AND PROPOSAL NO. 3. PLEASE SIGN EXACTLY AS YOUR NAME APPEARS.
WHEN SHARES ARE HELD BY JOINT TENANTS, EACH JOINT TENANT SHOULD SIGN.

SIGNATURES(S)___________________________________ DATE _______________,
1997

When signing as attorney, executor, administrator, trustee, guardian or
custodian, please sign full title as such. If a corporation, please sign
full corporate name by authorized officer and indicate the signer's office.

If a partnership, please sign in partnership name. PLEASE MARK, SIGN, DATE
AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE.