<PAGE>
THE SINGAPORE FUND, INC.
- ----------------------------------------------------------------------
GENERAL INFORMATION
- --------------------------------------------------------------------------------
THE FUND
The Singapore Fund, Inc. (the "Fund") is a non-diversified, closed-end
management investment company. Its primary investment objective is capital
appreciation, which it seeks through investment primarily in Singapore equity
securities, and to a lesser degree, investment in equity securities issued by
companies in other ASEAN Group countries and Cambodia. The ASEAN Group currently
is composed of Brunei, Indonesia, Laos, Malaysia, Myanmar (formerly Burma), the
Philippines, Singapore, Thailand and Vietnam. The Fund's Investment Manager is
DBS Asset Management (United States) Pte. Ltd. (the "Manager"), an indirectly
wholly owned subsidiary of The Development Bank of Singapore, Ltd. Daiwa
International Capital Management (Singapore) Limited provides the Manager with
advice regarding investments.
SHAREHOLDER INFORMATION
The Fund's shares are listed on the New York Stock Exchange ("NYSE") and the
Osaka Securities Exchange ("OSE"). The Fund understands that its shares may
trade periodically on certain exchanges other than the NYSE or the OSE, but the
Fund has not listed its shares on those other exchanges and does not encourage
trading on those exchanges.
The Fund's NYSE trading symbol is "SGF". Weekly comparative net asset value
(NAV) and market price information about the Fund is published each Monday in
THE WALL STREET JOURNAL, each Sunday in THE NEW YORK TIMES, and each Saturday in
BARRON'S, and also in many other newspapers.
INQUIRIES
It is the policy of the Fund to respond to inquiries about its portfolio
holdings and performance. Such inquiries should be directed to the Fund's
Manager in Singapore at (011-65) 220-1111, or to Daiwa Securities Trust Company,
the Fund's Administrator at (800) 933-3440 or (201) 915-3020. Inquiries
concerning your share account should be directed to State Street Bank and Trust
Company (the "Plan Agent") at the number noted below. All written inquiries
should be directed to the Fund, c/o Daiwa Securities Trust Company, One
Evertrust Plaza, 9th Floor, Jersey City, New Jersey 07302.
RESTRICTION ON BENEFICIAL OWNERSHIP BY SINGAPORE RESIDENTS
The Fund expects to continue to qualify for a Singapore income tax exemption
granted to non-Singapore resident investors with respect to certain types of
income derived from Singapore sources. In order for the Fund to be treated as a
non-Singapore resident, and therefore qualify for this exemption, not more than
5% of the Fund's issued share capital may be beneficially owned, directly or
indirectly, by Singapore residents. For this reason, the Fund's Board of
Directors has restricted, and in the future may prohibit, the transfer of the
Fund's shares to residents of Singapore.
DIVIDEND REINVESTMENT AND CASH PURCHASE PLAN
A Dividend Reinvestment and Cash Purchase Plan (the "Plan") is available to
provide Shareholders with automatic reinvestment of dividends and capital gain
distributions in additional Fund shares. The Plan also allows you to make
optional semi-annual cash investments in the Fund's shares through the Plan
Agent. A brochure fully describing the Plan's terms and conditions is available
from the Plan Agent by calling (800) 426-5523 or (781) 575-2000, or by writing
State Street Bank and Trust Company, c/o The Singapore Fund, Inc., P.O. Box
8200, Boston, MA 02266-8200.
<PAGE>
THE SINGAPORE FUND, INC.
- ----------------------------------------------------------------------
GENERAL INFORMATION (CONCLUDED)
- --------------------------------------------------------------------------------
A brief summary of the material aspects of the Plan follows:
WHO CAN PARTICIPATE IN THE PLAN? If you wish to participate and your shares
are held in your name, no action is required on your part, as you are
AUTOMATICALLY ENROLLED by the Plan Agent. However, if your shares are held in
the name of a brokerage firm, bank or nominee, you should instruct your nominee
to participate in the Plan on your behalf. If your nominee is unable to
participate in the Plan for you, you should request that your shares be
registered in your name, so that you may participate directly in the Plan.
MAY I WITHDRAW FROM THE PLAN? If your shares are held in your name and you
wish to receive all dividends and capital gain distributions in cash rather than
in shares, you may withdraw from the Plan without penalty at any time by
contacting the Plan Agent. If your shares are held in nominee name, you should
be able to withdraw from the Plan without penalty at any time by sending written
notice to your nominee. If you withdraw, you will receive a share certificate
for all full shares or, if you wish, the Plan Agent will sell your shares and
send you the proceeds, after the deduction of brokerage commissions. The Plan
Agent will convert any fractional shares to cash at the then-current market
price and send to you a check for the proceeds.
HOW ARE THE DIVIDENDS AND DISTRIBUTIONS REINVESTED? If the market price of
the Fund's shares on the payment date should equal or exceed their net asset
value per share, the Fund will issue new shares to you at the higher of net
asset value or 95% of the then-current market price. If the market price is
lower than net asset value per share, the Fund will issue new shares to you at
the market price. If the dividends or distributions are declared and payable as
cash only, you will receive shares purchased for you by the Plan Agent on the
NYSE or otherwise on the open market to the extent available.
WHAT IS THE CASH PURCHASE FEATURE? The Plan also allows shareholders to make
optional cash investments in Fund shares semi-annually through the Plan Agent in
any amount from $100 to $3,000. The Plan Agent will purchase shares for you on
the NYSE or otherwise on the open market twice a year, on or about February 15th
and August 15th. Plan participants should send in voluntary cash payments to be
received by the Plan Agent approximately ten days before the applicable purchase
date. The Plan Agent will return any cash payments received more than thirty
days prior to the applicable date. You may withdraw a voluntary cash payment by
written notice, if the notice is received by the Plan Agent not less than two
business days before the purchase date.
IS THERE A COST TO PARTICIPATE? There are no Plan charges or brokerage
charges for shares issued directly by the Fund. However, each participant will
pay a pro rata portion of brokerage commissions for shares purchased on the NYSE
or on the open market by the Plan Agent. For purchases from voluntary cash
payments, participants must pay a nominal service fee of $0.75 for each
investment in addition to a pro rata portion of the brokerage commission.
WHAT ARE THE TAX IMPLICATIONS? The automatic reinvestment of dividends and
distributions does not relieve you of any income tax which may be payable (or
required to be withheld) on such dividends and distributions. In addition, the
Plan Agent will reinvest dividends for foreign participants and for any
participants subject to federal backup withholding after the deduction of the
amounts required to be withheld.
PLEASE NOTE THAT, IF YOU PARTICIPATE IN THE PLAN THROUGH A BROKERAGE
ACCOUNT, YOU MAY NOT BE ABLE TO CONTINUE AS A PARTICIPANT IF YOU TRANSFER THOSE
SHARES TO ANOTHER BROKER. CONTACT YOUR BROKER OR NOMINEE OR THE PLAN AGENT TO
ASCERTAIN WHAT IS THE BEST ARRANGEMENT FOR YOU TO PARTICIPATE IN THE PLAN.
2
<PAGE>
THE SINGAPORE FUND, INC.
- ----------------------------------------------------------------------
December 4, 1997
DEAR SHAREHOLDERS:
We are pleased to present the Annual Report of The Singapore Fund, Inc. (the
"Fund") for the fiscal year ended October 31, 1997.
STOCK MARKET REVIEW
The last fiscal year has proved to be a most difficult and tumultuous year
in the ASEAN markets. Selling was indiscriminate across markets. This period
marks arguably the most testing time in the history of Post-Colonial Asia, a
time at which the ASEAN growth miracle has come under serious scrutiny.
During the earlier part of the year, the regional bourses were rattled by
fears of interest rate hikes in the United States. Although these concerns were
dissipated subsequently with an improved inflation outlook, the currency crisis
triggered by Thailand's move to a floating exchange rate system caused further
turmoil to the region's stock and currency markets. With increased currency
volatility and structural concerns over the health of the financial and
corporate sector, the risk premium attached to Asian equity investments climbed
sharply.
The regional currency adjustments reflected underlying problems of
overvalued exchange rates, a heavy reliance on foreign short-term flows to
service current account deficits, and inadequate bank supervision resulting in
excessive credit growth and over-investment in the property sector.
Corporations, unprepared for the substantial depreciation of their currencies,
had to contend with huge unhedged foreign liabilities maturing in the
short-term. The above scenario was especially true for the economies of
Thailand, the Philippines and Indonesia.
As a result, economic growth and earnings forecasts for Southeast Asia were
reduced by 10% to 20% for 1998, especially in the case of Thailand. High
interest rates became a policy tool to prevent a sharp collapse of currencies in
Indonesia, the Philippines and Thailand, and fiscal policy had to be tightened.
INDIVIDUAL MARKET PERFORMANCES
For the year ended October 31, 1997, the Singapore market, as measured by
the DBS 50 Index ("DBS 50"), declined by 30.1% in U.S. Dollar ("USD") terms.
However, Singapore was the best performing market in the region during that
period. The Indonesian market, as measured by the Jakarta Composite Index,
declined by 43.1%, the Philippines market, as measured by the Philippines
Composite Index, declined by 54.4%, and the Malaysian market, as measured by the
Kuala Lumpur Composite Index ("KLCI"), declined by 57.1%. The worst performing
market in ASEAN was the Thai stock market, which declined by 69.5%, as measured
by the Stock Exchange of Thailand Index.
THE SINGAPORE MARKET
The initial rally in the market was fueled by investor perception that the
Singapore economy had bottomed out and that the turnaround would be led by a
recovery in the global electronics sector. The rally soon succumbed to
profit-taking as the economic recovery did not materialize. To compound matters,
the U.S. Federal Reserve raised interest rates by 25 basis points in March.
Further dampening sentiment was Morgan Stanley's announcement that the Singapore
weighting in the Far East Ex Japan Index was to be reduced from 14.5% to 12.3%
with effect from June 1997.
3
<PAGE>
THE SINGAPORE FUND, INC.
- ----------------------------------------------------------------------
The good news of a sustained turnaround in the non-oil domestic export
numbers in August was countered by poor sentiment in the residential property
market and worries that the foreign tranches of the big four local banks,
Singapore Airlines and Singapore Press Holdings were going to be abolished. This
worry came about as the Singapore Technologies group of companies and then
Singapore Bus Services merged their foreign and local tranches. The foreign
tranches of these six stocks which had been trading with premiums of 60 to 100
percent over their local tranches were sold down and the foreign premiums
narrowed.
The market continued its downward spiral towards the end of the fiscal year
after the Kuala Lumpur Stock Exchange's announcement of draconian measures to
prevent short selling, and the contagion effect from the speculative attack on
the Hong Kong Dollar, which prompted investors to exit from the region EN MASSE.
The Singapore Dollar ("SGD") followed the regional currencies lower, ending
the period at SGD 1.58 to USD 1.00, down 12.2% from the beginning of the Fund's
fiscal year. The magnitude of the decline was relatively less than that
experienced by the other regional currencies.
THE MALAYSIAN MARKET
The Malaysian market started the fiscal year on a positive note. Investors
were cheered by an economy that seemed to be headed for a soft landing after ten
years of solid Gross Domestic Product ("GDP") growth. Also boosting market
sentiment was Bank Negara's announcement of measures to curb bank lending to the
property sector and the stock market, so as to prevent the build-up of an asset
bubble.
However, Bank Negara's subsequent announcement of a series of clarifications
on the measures which effectively watered down the original proposals caused
investors to lose confidence in the authorities and hence the stock market. The
problems with the Malaysian currency and stock markets started in earnest in
July. The Malaysian government's state of denial that the economy was in danger
of overheating, coupled with the contagion effect from the "float" of the Thai
Baht exerted further downward pressure on the Malaysian Ringgit ("MYR"). After a
brief defense of the currency, the authorities decided to keep interest rates
down at the expense of the exchange rate. The local bourse also reacted
negatively to the authorities strong criticism of the activities of currency
speculators, and the imposition of restrictions on the trading of the MYR and
the component stocks of the KLCI.
The initial rebound in the market on hopes of a tough 1998 Malaysian budget
to reign in the overheating economy succumbed to profit-taking when the measures
announced to curb imports and promote exports lacked the details and were viewed
as insufficient. Immediately after the release of the budget, the Malaysian
market was caught up in the sharp decline in the regional markets started by the
attack on the Hong Kong Dollar peg to the USD. The fall in the Hong Kong stock
market reverberated to the other markets in the U.S. and Europe.
FUND PERFORMANCE
As of October 31, 1997, the Fund's net assets were approximately USD 73.5
million, equivalent to a net asset value ("NAV") of USD 7.99 per share, a
decrease from October 31, 1996, when the NAV was USD 12.59. However, on December
26, 1996 the Fund paid a dividend of USD 0.3790 per share. Adjusting for this
dividend, the Fund's NAV declined by 33.5% since October 31, 1996.
4
<PAGE>
THE SINGAPORE FUND, INC.
- ----------------------------------------------------------------------
Even though the Fund avoided a much larger loss by staying away from the
other ASEAN markets throughout the year, it did not escape the indiscriminate
selling in the Singapore market due to domestic economy worries and the
contagion effects of regional currency volatility. The Fund's holdings of larger
blue chips and liquid stocks were especially hit by foreign investors bailing
out of local equities.
The uncertainty regarding the fate of foreign tranches of Singapore stocks
caused their foreign premium to fall sharply and this impacted the Fund, which
can only hold foreign tranches of Singapore stocks. This proved to be the main
reason for the Fund's 3.4% underperformance (in USD terms) versus the DBS 50,
the Fund's benchmark.
The Fund ended its fiscal year with a high cash and receivables position of
47.2%, reflective of its temporary defensive investment posture.
ECONOMIC REVIEW AND OUTLOOK
During the third quarter of 1997, GDP growth in Singapore continued to
accelerate. On a year-on-year ("YOY") basis, the economy expanded by a robust
10.1%, from 8.2% in the second quarter of 1997, despite consensus estimates of
9.1%. The breakdown of the GDP figure is shown below:
<TABLE>
<CAPTION>
THIRD QUARTER
PERFORMANCE
---------------
SECTOR 1996 1997
- ---------------------------------------- ------ ------
<S> <C> <C>
Manufacturing........................... -3.9% 9.5%
Finance & Business Services............. 6.4 11.6
Commerce................................ 2.1 8.6
Transport & Communications.............. 6.2 10.8
Construction............................ 16.3 13.4
Overall................................. 3.3 10.1
</TABLE>
For the first three quarters of the year, the Singapore economy grew by a
healthy 7.5%. As can be seen from the table above, this good performance was
characterized by faster growth in all sectors, with the exception of
construction. This indicates that the real economy was not significantly
affected by the regional financial turmoil for two main reasons. First, a large
portion of the regional trade is intra-company movement of parts and products by
multi-national corporations. Since final demand in the U.S. and Europe remained
strong, Singapore's trade was not seriously affected by the regional currency
crisis. The second factor was the strong recovery in the global electronics
industry which boosted manufacturing output significantly. This, in turn, had
favorable secondary effects on the transportation and hub services sectors.
The manufacturing sector posted robust YOY growth of 9.5%, which is a
significant increase from the 3.5% posted in the last quarter. Sub-sectors like
chemicals (34% YOY growth), petroleum (16.5% YOY growth) and electronics (9.8%
YOY growth) helped contribute to the strong performance of the manufacturing
sector. This sector is particularly influenced by the performance of the
electronics sub-sector, as electronics constitutes 45% of total manufacturing
output.
The construction sector also had a strong quarter with YOY growth of 13.4%.
Both the public and private sectors experienced an increase in activity. The
commerce sector posted growth of 8.6% YOY, supported by the electronics sector
recovery. Transport and communications also received a boost from the
electronics sector recovery, posting growth of 10.8% YOY.
5
<PAGE>
THE SINGAPORE FUND, INC.
- ----------------------------------------------------------------------
The financial and business sector grew by 11.6% YOY. This was largely
attributed to the increase in volume resulting from the regional currency
turmoil, as well as the uncertainty on the continuance of the local and foreign
tranches of some listed companies in Singapore. Foreign exchange activity
moderated, as the regional currency outlook became more uncertain.
Investment commitments in the manufacturing sector totaled SGD 2.2 billion
during the quarter. Foreign commitments amounted to SGD 1.6 billion or 73% of
total investments. U.S., European and Japanese investments made up the bulk of
the foreign component. Total trade increased by 12% to reach a record high of
SGD 99.3 billion during the third quarter of 1997. The key factor was the
sustained recovery in the electronics sector, supported by strong demand in the
U.S. and Europe. This provided a buffer from the decline in demand from Japan
due to the sluggish recovery in their domestic economy. This can be seen in the
non-oil domestic export figures where there were increases in all of the top
five markets with the exception of Japan where exports fell by 8%. Export growth
to the U.S., Europe, Malaysia and Hong Kong grew by 11%, 13%, 5% and 20%,
respectively.
For 1998, prospects for the external environment appear to be mixed. The
regional economies are expected to slow down as a result of the financial
turmoil. However, the industralized economies are expected to post healthy
growth, with the exception of Japan. A key factor for Singapore is the health of
the global electronics industry. Based on the fact that U.S. electronic
component inventories continue to adjust downwards while new orders experience a
sustained pickup, the outlook for the global electronics industry in Singapore
appears bright. This would have a significant positive impact on the Singapore
economy since manufacturing activity is so heavily dependent on electronics.
However, the financial services and commerce sectors are likely to be
affected by the slowdown in the regional economies. Asian Currency Unit (ACU)
activity is expected to slow, as loans to the region moderate. The number of
tourist arrivals from the region is expected to be lower, which will impact the
retail and hotel sub-sectors within the Singapore commerce sector. The Ministry
of Trade and Industry is projecting 1997 full year GDP at 7% and 1998 GDP growth
to moderate within the 5%-7% range.
In Malaysia, first and second quarter 1997 GDP growth was 8.5% and 8.4%,
respectively. However, in the third quarter, it slowed to 8.0%. The official
Malaysian government forecast is that GDP growth in 1997 and 1998 will be about
8.0% and 7.0%, respectively. The latest trade balance for the month of September
showed a surplus of MYR 1.21 billion. A large part of this improvement is due to
the sharp fall in the MYR, which has depreciated by more than 30% since July
1997. This number brings the trade account to a deficit of MYR 1.36 billion for
the first three quarters of 1997. The projected current account deficit for 1997
is MYR 13.0 billion or 5.0% of Gross National Product (GNP).
Looking at 1998, interest rates are expected to rise further to slow down
credit expansion and rein in the economy. The Fund's management is anticipating
that the current account number may turn around due to the Malaysian
government's postponement of a number of large scale projects as well as due to
the reluctance on the part of foreign direct investors to fund larger deficits.
This environment of higher interest rates and the need to restrain the current
account deficit points to a deceleration of the Malaysian economy.
MARKET OUTLOOK AND STRATEGY
ASEAN equity markets are expected to remain weak and volatile. Governments
are trying to grapple with setting appropriate fiscal, monetary and exchange
rate policies, having lost a fixed nominal exchange rate anchor.
6
<PAGE>
THE SINGAPORE FUND, INC.
- ----------------------------------------------------------------------
Policy action is not anticipated to be swift or decisive because of the fear of
inflicting pain on the real economy and the electorate. Earnings are likely to
be revised downwards as interest rates rise and economic growth contracts.
There may be some technical rebounds but they might succumb to profit
taking. A sustained rally might come later in 1998. The recent extreme
volatility in the Asian and international markets appears to have shaken
investor confidence in equity markets. For those technically oriented, markets
have fallen through strong key long-term support levels. For confidence to
return, and markets to make sustainable gains in the coming months, economic and
earnings fundamentals must reassert themselves. In this regard, the Fund's
management is confident that the ASEAN economies will regain their footing.
The key fundamental reasons often put forward in the past to explain the
Asian growth miracle are intact. Asia remains an environment where governments
are pro-business, savings are high, people are hard-working and self-reliant,
and economies are market-oriented. Exports remain the key economic drivers of
the region. The recent falls in currency levels would in time enable Asia to
regain its competitiveness and get back on the economic growth curve.
Hence, in the short-term, the Fund's management will adopt a cautious
attitude in this period of economic adjustment. The portfolio will remain
largely in Singapore equities but will, at the appropriate time, venture out
into the other regional markets. After the recent dramatic falls, these markets
may present some good buying opportunities for the Fund. The Fund's stock
selection will focus on companies with strong balance sheets, low gearing and
low foreign currency debt. The Fund's manangement is confident that this
investment strategy will do very well for the long-term performance of the Fund.
The Fund has not invested, and presently does not intend to invest in
derivative securities. Although foreign currency hedging is permitted by the
Fund's investment policies, the Fund has not engaged in any foreign currency
hedging.
PORTFOLIO MANAGEMENT
Mr. Tan Seng Hock was appointed as the Fund's portfolio manager in May 1996,
and is responsible for the day-to-day management of the Fund's portfolio. Mr.
Tan joined DBS Asset Management Ltd., of which the Fund's Manager, DBS Asset
Management (United States) Pte. Ltd. is a wholly owned subsidiary, in November
1995 as an Investment Manager. From 1987 to 1994, Mr. Tan was Head of
Investments at ANZ Investments Ltd. and Fund Manager--International & Strategy
at Norwich Union Investment Management in New Zealand.
The Fund's management would like to thank you for your participation in The
Singapore Fund, Inc. and would be pleased to hear from you.
<TABLE>
<S> <C>
Sincerely,
/s/ Shuichi Komori /s/ Ronnie Teo Heng Hock
SHUICHI KOMORI RONNIE TEO HENG HOCK
CHAIRMAN OF THE BOARD PRESIDENT
</TABLE>
7
<PAGE>
THE SINGAPORE FUND, INC.
- ----------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1997
- --------------------------------------------------------------------------------
- -------------------------------------------
COMMON STOCKS AND WARRANTS--52.79%
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES VALUE
------------- -------------
<C> <S> <C>
SINGAPORE--51.44%
AEROSPACE--1.78%
500,000 Singapore Technologies Aerospace Ltd.++..................... $ 1,308,884
-------------
BANKS & FINANCIAL SERVICES--1.79%
968,000 Hong Leong Finance Ltd. (Foreign)*.......................... 1,315,966
-------------
CONSTRUCTION ENGINEERING--3.12%
2,922,000 Amtek Engineering Ltd....................................... 2,291,040
-------------
ELECTRICAL PRODUCTS & COMPUTERS--3.43%
350,000 Elec & Eltek International Company Ltd...................... 2,520,000
-------------
FOOD, BEVERAGE, TOBACCO--8.17%
900,000 Cerebos Pacific Ltd......................................... 2,287,702
540,000 Fraser & Neave Ltd.......................................... 2,697,439
254,000 Rothmans Industries Ltd..................................... 1,011,824
-------------
5,996,965
-------------
HOTELS--1.28%
1,250,000 Hotel Properties Ltd........................................ 940,563
-------------
INDUSTRIAL--12.95%
740,400 Acma Ltd.................................................... 632,020
300,000 Clipsal Industries Holdings Ltd............................. 777,000
74,000 Clipsal Industries Holdings Ltd. Warrants 1998+(1).......... 124,320
3,518,000 CSA Holdings Ltd............................................ 1,979,779
718,000 GP Batteries International Ltd.............................. 2,088,397
284,500 GP Batteries International Ltd. Warrants 2000+(2)........... 287,828
1,850,000 Lung Kee Metal Holdings Ltd................................. 2,127,500
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
------------- -------------
<C> <S> <C>
1,017,000 ST Electronic & Engineering Ltd. (Foreign)*++............... $ 1,498,331
-------------
9,515,175
-------------
PROPERTY DEVELOPMENT--3.45%
420,000 Keppel Land Ltd.++.......................................... 584,255
150,000 Keppel Land Ltd. Warrants 2000+(3)++........................ 43,629
672,000 Singapore Land Ltd.......................................... 1,903,610
-------------
2,531,494
-------------
REAL ESTATE--3.10%
1,000,000 Hongkong Land Holdings, Ltd................................. 2,280,000
-------------
RETAIL--1.93%
3,613,500 Courts (Singapore) Ltd...................................... 1,416,611
-------------
SHIPYARDS--6.48%
1,512,500 Keppel Corporation Ltd.++................................... 4,762,725
-------------
TELECOMMUNICATIONS--1.63%
2,000,000 Thakral Corporation Ltd..................................... 1,200,000
-------------
TRANSPORTATION--MARINE--2.33%
870,000 Osprey Maritime Ltd......................................... 814,164
350,000 Sembawang Marine & Logistics Ltd.++......................... 894,088
-------------
1,708,252
-------------
Total Singapore Common Stocks and Warrants..................................
37,787,675
-------------
MALAYSIA--1.35%
CONSTRUCTION ENGINEERING--1.35%
200,000 Hock Seng Lee Berhad........................................ 990,013
-------------
Total Common Stocks and Warrants (Cost--$64,189,797)........................
38,777,688
-------------
</TABLE>
8
<PAGE>
THE SINGAPORE FUND, INC.
- ----------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (CONCLUDED)
OCTOBER 31, 1997
- --------------------------------------------------------------------------------
- -------------------------------------------
TIME DEPOSITS--14.08%
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
(000) VALUE
------------- -------------
<C> <S> <C>
U.S. DOLLAR--8.01%
$28 Bank of New York, 3.60% due 11/3/97......................... $ 27,502
5,856 Citibank, Singapore, 4.75% due 11/3/97...................... 5,855,918
-------------
Total U.S. Dollar Time Deposits............................................. 5,883,420
-------------
SINGAPORE DOLLAR--6.07%
7,046 Citibank, Singapore, 4.25% due 11/3/97...................... 4,455,264
-------------
Total Time Deposits (Cost--$10,436,473).....................................
10,338,684
-------------
Total Investments--66.87%
(Cost--$74,626,270)....................................................... 49,116,372
Other assets less liabilities--33.13%....................................... 24,335,034
-------------
NET ASSETS (Applicable to 9,195,287 shares of capital stock outstanding;
equivalent to $7.99 per share)--100.00%................................... $ 73,451,406
-------------
-------------
</TABLE>
- ------------------------
* Foreign shares of the above issues are those held by non-Singapore
residents. Ownership of such shares is generally limited and subject to a
premium to local shares (those held by residents of Singapore).
+ Non-income producing securities.
++ Deemed to be an affiliated issuer.
(1) Each warrant entitles holders to buy one share of Common Stock for SGD
2.03.
(2) Each warrant entitles holders to buy one share of Common Stock for USD
2.10.
(3) Each warrant entitles holders to buy one share of Common Stock for SGD
3.00.
- -------------------------------------------
TEN LARGEST COMMON STOCK CLASSIFICATIONS HELD
OCTOBER 31, 1997
- -------------------------------------------
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY NET ASSETS
- ----------------------------------- ----------
<S> <C>
Industrial**....................... 12.95%
Food, Beverage, Tobacco............ 8.17
Shipyards.......................... 6.48
Construction Engineering........... 4.47
Property Development**............. 3.45
Electrical Products & Computers.... 3.43
Real Estate........................ 3.10
Transportation--Marine............. 2.33
Retail............................. 1.93
Banks & Financial Services......... 1.79
</TABLE>
- ------------------------
** Includes the value of warrants.
- -------------------------------------------
TEN LARGEST COMMON STOCK
POSITIONS HELD
OCTOBER 31, 1997
- -------------------------------------------
<TABLE>
<CAPTION>
PERCENT OF
ISSUE NET ASSETS
- ----------------------------------- ----------
<S> <C>
Keppel Corporation Ltd............. 6.48%
Fraser & Neave Ltd................. 3.67
Elec & Eltek International Company
Ltd.............................. 3.43
Amtek Engineering Ltd.............. 3.12
Cerebos Pacific Ltd................ 3.11
Hongkong Land Holdings, Ltd........ 3.10
Lung Kee Metal Holdings Ltd........ 2.90
GP Batteries International Ltd..... 2.84
CSA Holdings Ltd................... 2.70
Singapore Land Ltd................. 2.59
</TABLE>
See accompanying notes to financial statements.
9
<PAGE>
THE SINGAPORE FUND, INC.
- ----------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
OCTOBER 31, 1997
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
ASSETS
Investment in securities, at value:
Unaffiliated securities
(cost--$61,664,849)..................... $ 40,024,460
Affiliated securities
(cost--$12,961,421)..................... 9,091,912 $ 49,116,372
------------
Cash denominated in foreign currency
(cost--$5,842,987)........................ 5,765,093
Receivable for securities sold............. 18,681,141
Interest and dividends receivable.......... 86,507
Prepaid expenses........................... 26,204
-------------
Total assets............................. 73,675,317
-------------
LIABILITIES
Payable to investment manager.............. 53,046
Payable to investment adviser.............. 26,812
Payable to administrator................... 14,273
Accrued expenses and other liabilities..... 129,780
-------------
Total liabilities........................ 223,911
-------------
NET ASSETS
Capital stock, $0.01 par value per share;
total 100,000,000 shares authorized;
9,195,287 shares issued and outstanding... 91,953
Paid-in capital in excess of par value..... 107,816,972
Accumulated net realized loss on
investments............................... (8,799,076)
Net unrealized depreciation on investments
and other assets and liabilities
denominated in foreign currency........... (25,658,443)
-------------
Net assets applicable to shares
outstanding............................. $ 73,451,406
-------------
-------------
NET ASSET VALUE PER SHARE............ $ 7.99
-------------
-------------
</TABLE>
See accompanying notes to financial statements.
10
<PAGE>
THE SINGAPORE FUND, INC.
- ----------------------------------------------------------------------
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED OCTOBER 31, 1997
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Dividends:
Unaffiliated securities (net of
withholding taxes of--$272,311)......... $ 1,051,839
Affiliated securities (net of withholding
taxes of--$134,195)..................... 389,825 $ 1,441,664
------------
Interest................................... 328,677
-------------
Total investment income.................. 1,770,341
-------------
EXPENSES:
Investment management fee and expenses..... 810,075
Investment advisory fee and expenses....... 411,699
Administration fee and expenses............ 226,652
Custodian fees and expenses................ 183,971
Legal fees and expenses.................... 111,393
Osaka Securities Exchange fees and
expenses.................................. 72,365
Reports and notices to shareholders........ 71,880
Audit and tax services..................... 64,300
Insurance expense.......................... 41,031
Directors' fees and expenses............... 40,468
Transfer agency fee and expenses........... 21,019
Other...................................... 41,547
-------------
Total expenses........................... 2,096,400
-------------
NET INVESTMENT LOSS.......................... (326,059)
-------------
REALIZED AND UNREALIZED LOSSES FROM
INVESTMENT ACTIVITIES AND FOREIGN CURRENCY
TRANSACTIONS:
Net realized losses on investments:
Unaffiliated securities.................. (459,431)
Affiliated securities.................... (8,339,645) (8,799,076)
------------
Net realized foreign currency transaction
losses.................................... (2,016,662)
Net change in unrealized appreciation
(depreciation) on investments in equity
securities................................ (27,448,111)
Net change in unrealized appreciation
(depreciation) on translation of
short-term investments and other assets
and liabilities denominated in foreign
currency.................................. (204,090)
-------------
Net realized and unrealized losses from
investment activities and foreign currency
transactions................................ (38,467,939)
-------------
NET DECREASE IN NET ASSETS RESULTING FROM
OPERATIONS.................................. $ (38,793,998)
-------------
-------------
</TABLE>
See accompanying notes to financial statements.
11
<PAGE>
THE SINGAPORE FUND, INC.
- ----------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR THE YEARS ENDED
OCTOBER 31,
-------------------------------
1997 1996
------------- -------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM
OPERATIONS:
Net investment loss........................ $ (326,059) $ (582,507)
Net realized gain (loss) on:
Investments.............................. (8,799,076) 4,093,185
Foreign currency transactions............ (2,016,662) 84,875
Net change in unrealized appreciation
(depreciation) on:
Investments in equity securities......... (27,448,111) (2,342,514)
Translation of short-term investments and
other assets and liabilities denominated
in foreign currency..................... (204,090) 6,279
------------- -------------
Net increase (decrease) in net assets
resulting from operations................. (38,793,998) 1,259,318
------------- -------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
FROM:
Net realized gains from investment and
foreign currency transactions............. (3,481,087) (8,866,573)
------------- -------------
FROM CAPITAL STOCK TRANSACTIONS:
Sale of capital stock resulting from:
Reinvestment of dividends................ 121,735 330,635
------------- -------------
Net decrease in net assets................. (42,153,350) (7,276,620)
NET ASSETS:
Beginning of year.......................... 115,604,756 122,881,376
------------- -------------
End of year................................ $ 73,451,406 $ 115,604,756
------------- -------------
------------- -------------
</TABLE>
See accompanying notes to financial statements.
12
<PAGE>
THE SINGAPORE FUND, INC.
- ----------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
The Singapore Fund, Inc. (the "Fund") was incorporated in Maryland on May
31, 1990 and commenced operations on July 31, 1990. It is registered with the
Securities and Exchange Commission as a closed-end, non-diversified management
investment company.
The following significant accounting policies are in conformity with
generally accepted accounting principles for investment companies. Such policies
are consistently followed by the Fund in the preparation of its financial
statements. The preparation of financial statements in accordance with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts and disclosures in the financial statements.
Actual reporting results could differ from those estimates.
VALUATION OF INVESTMENTS--Securities which are listed on foreign stock
exchanges and for which market quotations are readily available are valued at
the last sale price on the exchange on which the securities are traded, as of
the close of business on the day the securities are being valued or, lacking any
sales on such day, at the closing price quoted for such securities. However, if
bid and asked quotations are available, such securities are valued at the mean
between the last current bid and asked prices, rather than at such quoted
closing price. Securities that are traded over-the-counter, if bid and asked
price quotations are available, are valued at the mean between the current bid
and asked prices, or, if such quotations are not available, are valued as
determined in good faith by the Board of Directors (the "Board") of the Fund. In
instances where quotations are not readily available or where the price as
determined by the above procedures is deemed not to represent fair market value,
fair value will be determined in such manner as the Board may prescribe.
Short-term investments having a maturity of 60 days or less are valued at
amortized cost, except where the Board determines that such valuation does not
represent the fair value of the investment. All other securities and assets are
valued at fair value as determined in good faith by, or under the direction of,
the Board.
FOREIGN CURRENCY TRANSLATION--The books and records of the Fund are
maintained in U.S. dollars as follows: (1) the foreign currency market value of
investment securities and other assets and liabilities stated in foreign
currencies are translated at the exchange rates prevailing at the end of the
period; and (2) purchases, sales, income and expenses are translated at the rate
of exchange prevailing on the respective dates of such transactions. The
resulting exchange gains and losses are included in the Statement of Operations.
The Fund does not generally isolate the effect of fluctuations in foreign
exchange rates from the effect of fluctations in the market price of securities.
TAX STATUS--The Fund intends to continue to distribute substantially all of
its taxable income and to comply with the minimum distribution and other
requirements of the Internal Revenue Code applicable to regulated investment
companies. Accordingly, no provision for federal income or excise taxes is
required. During the year ended October 31, 1997, the Fund was subject to
withholding tax, ranging from 26% to 30%, on certain income from its
investments.
The Fund continues to meet the conditions required to qualify for the
exemption from Singapore income tax, available to non-Singapore residents who
are beneficiaries of funds managed by approved fund managers, in respect of
certain types of income. Accordingly, no provision for Singapore income tax is
required.
13
<PAGE>
THE SINGAPORE FUND, INC.
- ----------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
- --------------------------------------------------------------------------------
INVESTMENT TRANSACTIONS AND INVESTMENT INCOME--Investment transactions are
recorded on the trade date (the date upon which the order to buy or sell is
executed). Realized and unrealized gains and losses from security and foreign
currency transactions are calculated on the identified cost basis. Dividend
income and corporate actions are recorded generally on the ex-date, except for
certain dividends and corporate actions involving foreign securities which may
be recorded after the ex-date, but recorded as soon as the Fund acquires
information regarding such dividends or corporate actions. Interest income is
recorded on an accrual basis.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS--The Fund records dividends and
distributions payable to its shareholders on the ex-dividend date. The amount of
dividends and distributions from net investment income and net realized capital
gains are determined in accordance with federal income tax regulations, which
may differ from generally accepted accounting principles. These book basis/tax
basis ("book/tax") differences are either considered temporary or permanent in
nature. To the extent these differences are permanent in nature, such amounts
are reclassified within the capital accounts based on their federal tax-basis
treatment; temporary differences do not require reclassifications. Dividends and
distributions which exceed net investment income and net realized capital gains
for financial reporting purposes but not for tax purposes are reported as
dividends in excess of net investment income or distributions in excess of net
realized capital gains. To the extent they exceed net investment income and net
realized capital gains for tax purposes, they are reported as distributions of
paid-in capital.
FORWARD FOREIGN CURRENCY CONTRACTS--The Fund may enter into forward foreign
currency exchange contracts in connection with planned purchases or sales of
securities or to hedge the U.S. dollar value of its assets denominated in a
particular currency, subject to a maximum limitation of 20% of the value of its
total assets committed to the consummation of such forward foreign currency
contracts. In addition, the Fund will not take positions in foreign forward
currency contracts where the settlement commitment exceeds the value of its
assets denominated in the currency of the contract. If the Fund enters into
forward foreign currency contracts, its custodian or subcustodian will maintain
cash or readily marketable securities in a segregated account of the Fund in an
amount equal to the value of the Fund's total assets committed to the
consummation of such contracts. Risks may arise upon entering into these
contracts from the potential inability of counterparties to meet the terms of
their contracts and from unanticipated movements in the value of a foreign
currency relative to the U.S. dollar.
INVESTMENT MANAGER AND INVESTMENT ADVISOR
The Fund has entered into an Investment Management Agreement (the
"Management Agreement") with DBS Asset Management (United States) Pte. Ltd. (the
"Manager"). Pursuant to the Management Agreement, the Manager makes investment
management decisions relating to the Fund's assets. For such services, the Fund
pays the Manager a monthly fee at an annual rate of 0.80% of the first $50
million of the Fund's average weekly net assets and 0.66% of the Fund's average
weekly net assets in excess of $50 million. In addition, as permitted by the
Management Agreement, the Fund reimburses the Manager for its out-of-pocket
expenses related to the Fund. During the year ended October 31, 1997, expenses
of $977 were paid to the Manager, representing reimbursement
14
<PAGE>
THE SINGAPORE FUND, INC.
- ----------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
- --------------------------------------------------------------------------------
to the Manager of costs relating to the attendance by its employees at meetings
of the Fund's Board. During the year ended October 31, 1997, there were no
commissions paid by the Fund to affiliates of the Manager in connection with
portfolio transactions.
The Fund has entered into an Investment Advisory Agreement (the "Advisory
Agreement") with Daiwa International Capital Management (Singapore) Limited (the
"Adviser"), which provides general and specific investment advice to the Manager
with respect to the Fund's assets. The Fund pays the Adviser a monthly fee at an
annual rate of 0.40% of the first $50 million of the Fund's average weekly net
assets and 0.34% of the Fund's average weekly net assets in excess of $50
million. In addition, as permitted by the Advisory Agreement, the Fund
reimburses the Adviser for its out-of-pocket expenses related to the Fund.
During the year ended October 31, 1997, expenses of $746 were paid to the
Adviser, representing reimbursement to the Adviser of costs relating to the
attendance by its employees at meetings of the Fund's Board. During the year
ended October 31, 1997, brokerage commissions of $212,857 were paid by the Fund
to Daiwa Securities (Singapore), an affiliate of the Adviser, in connection with
portfolio transactions.
ADMINISTRATOR AND CUSTODIAN AND OTHER RELATED PARTIES
Daiwa Securities Trust Company ("DSTC"), an affiliate of the Adviser,
provides certain administrative services to the Fund. For such services, the
Fund pays DSTC a monthly fee at an annual rate of 0.20% of the Fund's average
weekly net assets, with a minimum annual fee of $150,000. In addition, as
permitted by the Administration Agreement, the Fund reimburses the Administrator
for its out-of-pocket expenses related to the Fund. During the year ended
October 31, 1997, expenses of $2,617 were paid to the Administrator,
representing reimbursement to the Administrator of costs relating to the
attendance by its employees at meetings of the Fund's Board.
DSTC also acts as custodian for the Fund's assets and appoints subcustodians
for the Fund's assets held outside of the United States. DSTC has appointed The
Development Bank of Singapore, Ltd. ("DBS Bank"), an affiliate of the Manager,
to act as the subcustodian for all of the cash and securities of the Fund held
in Singapore. As compensation for its services as custodian, DSTC receives a
monthly fee and reimbursement of out-of- pocket expenses related to the Fund.
Such expenses include the fees and out-of-pocket expenses of each of the
subcustodians. During the year ended October 31, 1997, DSTC earned $29,148 and
DBS Bank earned $139,649 from the Fund for their respective custodial services.
At October 31, 1997, the Fund owed to DSTC $14,273 and $31,649 for
administration and custodian fees, respectively. The latter amount includes fees
and expenses payable to DBS Bank totalling $29,447.
During the year ended October 31, 1997, the Fund paid or accrued $106,961
for legal services, in connection with the Fund's on-going operations, to a law
firm of which the Fund's Assistant Secretary is a partner.
INVESTMENTS IN SECURITIES AND FEDERAL INCOME TAX MATTERS
For federal income tax purposes, the cost of securities owned at October 31,
1997 was substantially the same as the cost of the securities for financial
statement purposes. At October 31, 1997, the net unrealized depreciation on
investments, excluding short-term securities, of $25,412,109 was composed of
gross appreciation of $1,397,104
15
<PAGE>
THE SINGAPORE FUND, INC.
- ----------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONCLUDED)
- --------------------------------------------------------------------------------
for those investments having an excess of value over cost, and gross
depreciation of $26,809,213 for those investments having an excess of cost over
value. For the year ended October 31, 1997, the total aggregate cost of
purchases and net proceeds from sales of portfolio securities, excluding the
short-term securities, were $73,828,002 and $105,982,576, respectively.
At October 31, 1997, the Fund had a capital loss carryover of $8,799,076,
which expires in 2005.
To reflect reclassifications arising from permanent book/tax differences for
the year ended October 31, 1997, $330,758 was reclassified from accumulated net
investment loss, $42,797 was reclassified from distributions in excess of net
realized gains, $2,016,662 was reclassified from accumulated net realized loss
on foreign currency transactions and $2,390,217 was charged to paid-in capital
in excess of par value.
CONCENTRATION OF RISK
At October 31, 1997, the Fund had approximately 14% of its net assets
invested in time deposits of a first-tier U.S. financial institution located in
Singapore. While there is currently no rating system for Singapore debt
securities, the Fund invests only in short-term debt securities which the
Manager believes to be of high quality and subject to relatively low risk of
loss of principal or interest.
Investments in countries in which the Fund may invest may involve certain
considerations and risks not typically associated with U.S. investments as a
result of, among others, the possibility of future political and economic
developments and the level of governmental supervision and regulation of the
securities markets in which the Fund invests.
CAPITAL STOCK
There are 100,000,000 shares of $0.01 par value common stock authorized.
During the years ended October 31, 1997 and 1996, 10,324 and 25,237 shares,
respectively, were issued as a result of the reinvestment of dividends paid to
those shareholders electing to reinvest dividends.
Of the 9,195,287 shares outstanding at October 31, 1997, Daiwa Securities
America Inc., an affiliate of the Adviser and DSTC, owned 14,086 shares.
16
<PAGE>
THE SINGAPORE FUND, INC.
- ----------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Selected data for a share of capital stock outstanding during each year is
presented below:
<TABLE>
<CAPTION>
FOR THE YEARS ENDED OCTOBER 31,
---------------------------------------------------------
1997 1996 1995 1994 1993
------------ --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year............................ $ 12.59 $ 13.42 $ 18.49 $ 17.23 $ 10.38
------------ --------- --------- --------- ---------
Net investment loss........................................... (0.04) (0.07) (0.07) (0.01) (0.14)
Net realized and unrealized gains (losses) on investments and
foreign currency transactions................................ (4.18) 0.21 (1.43) 2.66 7.32
------------ --------- --------- --------- ---------
Net increase (decrease) in net asset value resulting from
operations................................................... (4.22) 0.14 (1.50) 2.65 7.18
------------ --------- --------- --------- ---------
Less: dividends and distributions to shareholders
Net realized gains from investments and foreign currency
transactions............................................... (0.38) (0.97) (2.89) (1.03) (0.33)
------------ --------- --------- --------- ---------
Dilutive effect of rights offering............................ -- -- (0.64) (0.30) --
------------ --------- --------- --------- ---------
Offering costs charged to paid-in capital in excess of par
value........................................................ -- -- (0.04) (0.06) --
------------ --------- --------- --------- ---------
Net asset value, end of year.................................. $ 7.99 $ 12.59 $ 13.42 $ 18.49 $ 17.23
------------ --------- --------- --------- ---------
------------ --------- --------- --------- ---------
Per share market value, end of year........................... $ 8.750 $ 12.125 $ 13.500 $ 18.000 $ 19.750
------------ --------- --------- --------- ---------
------------ --------- --------- --------- ---------
Total investment return:
Based on market price at beginning and end of year, assuming
reinvestment of dividends*................................. (25.51)% (3.54)% (6.89)% (0.19)% 99.02%
Based on net asset value at beginning and end of year,
assuming reinvestment of dividends*........................ (34.49)% 0.76% (10.06)% 18.39% 71.46%
Ratios and supplemental data:
Net assets, end of year (in millions)....................... $ 73.5 $115.6 $122.9 $126.1 $ 87.8
Ratios to average net assets of:
Expenses+................................................. 1.87 % 1.85% 2.01% 1.90% 2.42%
Net investment loss+...................................... (0.29)% (0.48)% (0.49)% (0.08)% (1.05)%
Portfolio turnover.......................................... 78.74 % 62.78% 62.85% 82.12% 90.19%
Average commission rate per share........................... $0.0204 $0.0194 N/A N/A N/A
</TABLE>
- --------------------------
* For the years ended October 31, 1995 and 1994, the total investment
return includes the benefit of shares resulting from the exercise of
the rights.
+ Ratios for the year ended October 31, 1993 include the amortization of
certain initial and non-recurring expenses totaling $32,519, related
to the listing of the Fund's shares on the Osaka Securities Exchange.
If such expenses had not been included, the ratios of expenses and of
net investment loss to average net assets would have been 2.38% and
(1.01)%, respectively.
17
<PAGE>
THE SINGAPORE FUND, INC.
- ----------------------------------------------------------------------
REPORT OF INDEPENDENT ACCOUNTANTS
- --------------------------------------------------------------------------------
To the Shareholders and
Board of Directors of
The Singapore Fund, Inc.
In our opinion, the accompanying statement of assets and liabilities,
including the portfolio of investments, and the related statements of operations
and of changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of The Singapore Fund, Inc. (the
"Fund") at October 31, 1997, the results of its operations for the year then
ended, the changes in its net assets for each of the two years in the period
then ended and the financial highlights for each of the five years in the period
then ended, in conformity with generally accepted accounting principles. These
financial statements and financial highlights (hereafter referred to as
"financial statements") are the responsibility of the Fund's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with generally accepted auditing standards which require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits, which included confirmation of securities at October
31, 1997 by correspondence with the custodian, provide a reasonable basis for
the opinion expressed above.
PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, New York 10036
December 4, 1997
18
<PAGE>
THE SINGAPORE FUND, INC.
- ----------------------------------------------------------------------
TAX INFORMATION
- --------------------------------------------------------------------------------
The Fund is required by Subchapter M of the Internal Revenue Code of 1986,
as amended, to advise you within 60 days of the Fund's fiscal year end (October
31, 1997) as to the federal tax status of distributions received by you during
such fiscal year. Accordingly, the Fund is hereby advising you that of the
$0.3790 per share distribution paid during the fiscal year, on December 26,
1996, $0.1360 represented an ordinary income dividend, and $0.2430 represented a
long-term capital gain distribution. This distribution was taxable for the
calendar year 1996.
There will be no dividend payment or foreign tax credit with respect to the
fiscal year 1997.
SHAREHOLDERS ARE STRONGLY ADVISED TO CONSULT THEIR OWN TAX ADVISERS WITH
RESPECT TO THE TAX CONSEQUENCES OF THEIR INVESTMENT IN THE FUND.
- --------------------------------------------------------------------------------
RESULTS OF ANNUAL MEETING OF STOCKHOLDERS (UNAUDITED)
- --------------------------------------------------------------------------------
On June 5, 1997, the Annual Meeting of Stockholders of The Singapore Fund,
Inc. (the "Fund") was held and the following matters were voted upon and passed.
(1) To elect one Class III Director to the Board of Directors of the Fund, to
serve for a term expiring on the date on which the Annual Meeting of
Stockholders is held in the year 2000.
<TABLE>
<CAPTION>
NUMBER OF SHARES/VOTES
- -------------------------------------------------------
PROXY AUTHORITY
NAME OF DIRECTOR VOTED FOR WITHHELD NON-VOTES
- ---------------- --------- --------------- ---------
<S> <C> <C> <C>
Shuichi Komori 7,024,678 359,562 1,811,030
</TABLE>
In addition to the Director re-elected at the Meeting, David G. Harmer,
James Q. McCarthy*, Alfred C. Morley and Frederick W. Zuckerman* were the other
members of the Board who continued to serve as Directors of the Fund.
(2) To ratify the selection of Price Waterhouse LLP as independent accountants
of the Fund for its fiscal year ending October 31, 1997.
<TABLE>
<CAPTION>
NUMBER OF SHARES/VOTES
- --------------------------------------------------
PROXY AUTHORITY
VOTED FOR WITHHELD ABSTENTIONS NON-VOTES
- --------- --------------- ----------- ---------
<S> <C> <C> <C>
7,255,379 93,742 35,119 1,811,030
</TABLE>
- ------------------------
* Mr. McCarthy and Mr. Zuckerman are no longer Directors of the Fund. Mr.
McCarthy resigned as President and as a Director in September, 1997 and Mr.
Zuckerman passed away in September, 1997. Mr. Ronnie Teo Heng Hock was elected
in September, 1997 as the Fund's President and a Director and Mr. Oren G.
Shaffer was elected as a Director in December, 1997 by the remaining members
of the Board to replace Mr. McCarthy and Mr. Zuckerman, respectively. Under
the Fund's By-Laws, both Mr. Teo and Mr. Shaffer must stand for election as
Directors at the next Annual Meeting of Stockholders, which will be held in
June, 1998.
19
<PAGE>
- ----------------------------------------
BOARD OF DIRECTORS
Shuichi Komori, CHAIRMAN
David G. Harmer
Alfred C. Morley
Oren G. Shaffer
Ronnie Teo Heng Hock
- --------------------------------------------
OFFICERS
Ronnie Teo Heng Hock
PRESIDENT
Daniel F. Barry
VICE PRESIDENT
Lawrence Jacob
SECRETARY
Edward J. Grace
TREASURER
John J. O'Keefe
ASSISTANT TREASURER
Laurence E. Cranch
ASSISTANT SECRETARY
- --------------------------------------------
ADDRESS OF THE FUND
c/o Daiwa Securities Trust Company
One Evertrust Plaza, 9th Floor
Jersey City, New Jersey 07302
- --------------------------------------------
INVESTMENT MANAGER
DBS Asset Management (United States) Pte. Ltd.
INVESTMENT ADVISER
Daiwa International Capital Management
(Singapore) Limited
ADMINISTRATOR AND CUSTODIAN
Daiwa Securities Trust Company
TRANSFER AGENT AND REGISTRAR
State Street Bank and Trust Company
LEGAL COUNSEL
Rogers & Wells
INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP
- --------------------------------------------
Notice is hereby given in accordance with
Section 23(c) of the Investment Company Act of 1940 that from time to time the
Fund may purchase shares of its common stock in the open market at prevailing
market prices.
This report is sent to shareholders of the Fund for their information. It is not
a prospectus, circular or representation intended for use in the purchase or
sale of shares of the Fund or of any securities mentioned in the report.
THE
SINGAPORE
FUND, INC.
[LOGO]
Annual Report
October 31, 1997
