<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 ASEAN Group countries. The ASEAN Group currently is composed of
Brunei, Cambodia, 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 subsidary of The Development Bank of Singapore, Ltd. Daiwa SB
Investments (Singapore) Ltd. 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. The
Fund's weekly NAV is also available by visiting www.daiwast.com or calling
(800) 933-3440 or (201) 915-3020. Also, the Fund's website includes a monthly
market review and a list of the Fund's top ten industries and holdings.
INQUIRIES
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, is currently prohibiting 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 Fund 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 by writing State Street Bank and Trust
Company, c/o The Singapore Fund, Inc., P.O. Box 8200, Boston, MA 02266-8200.
<PAGE>
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 6, 2000
DEAR SHAREHOLDERS:
We are pleased to present the Annual Report of The Singapore Fund, Inc. (the
"Fund") for the fiscal year ended October 31, 2000.
STOCK MARKET REVIEW
For the year ended October 31, 2000, the Singapore market, as measured by
the DBS50 Index (the "DBS50"), fell by 7.6% in U.S. Dollar ("USD") terms. This,
however, compares favorably with most of the other Southeast Asian markets.
After a flight to quality at the end of 1999 due to Year 2000 concerns, the
market in the year 2000 has been driven by concerns over rising energy prices,
inflation risk, increasing interest rates and a slew of earnings downgrades. In
Asia, the added factor of political risk in selected countries contributed to
the negative returns experienced by the countries during the period.
The strongest performers in the benchmark during the year were JIT Holdings
(44%), Creative Technologies (39%) and Overseas Union Enterprise (26%). The
worst performers were Cycle and Carriage (-46%), Hong Leong Asia (-43%) and
Neptune Orient Lines (-41%).
REGIONAL MARKET PERFORMANCE FOR THE YEAR ENDING OCTOBER 31, 2000 (IN USD TERMS)
<TABLE>
<CAPTION>
INDEX
<S> <C>
SINGAPORE DBS 50 -7.6%
BANGKOK S.E.T. -39.5
HANG SENG 11.9
JAKARTA SE COMPOSITE -50.1
KUALA LUMPUR COMPOSITE 1.3
PHILIPPINES SE COMPOSITE -50.8
</TABLE>
FUND PERFORMANCE
As of October 31, 2000, the Fund's net asset value ("NAV") per share was
$8.12. This represents a 19.4% decline from the NAV per share of $10.07 at the
start of the fiscal year. No dividend was paid out during the year. The Fund
underperformed the DBS50 by 11.8% over the year. The underperformance has
narrowed significantly from 24.8% in the previous year.
In the second half of the year, the Fund's portfolio of stocks was revamped.
The high level of cash was reduced and redeployed into interest rate sensitive
stocks. The Fund also exited from all positions outside of Singapore and is now
only invested in Singapore equities. This is in line with the stronger economy
in Singapore vis-a-vis the other ASEAN economies in which the Fund can invest.
As a result of these measures, the portfolio's relative underperformance
decreased. In the first half of the year, the Fund underperformed the DBS50 by
7.1% and in the second half of the year, the underperformance increased an
additional 4.7% to bring the underperformance for the year to 11.8%.
3
<PAGE>
THE SINGAPORE FUND, INC.
----------------------------------------------------------------------
Within Singapore, the Fund maintained a mandatory underweight position in
Banks and Financial stocks, as the maximum allowable weight in any sector is
25%, while the benchmark weight for Banks and Financials was about 34%. However,
holding a heavier position in other interest rate sensitive stocks compensated
for this restriction. The Fund's overweight position in technology stocks was
hit along with the correction in the global technology sector. This position was
reduced during the year but we still maintain a modestly overweight position in
technology given the sustainable strength of the technology industry in
Singapore.
The Fund's cash and cash equivalents at October 31, 2000 were 11.2%. This
was due to a re-positioning of the portfolio and the cash level has since been
reduced to less than 5% as of December 5, 2000. At October 31, 2000, the sector
allocation of the portfolio (as % of net assets) vs. the benchmark, DBS50 was as
follows:
<TABLE>
<CAPTION>
SECTOR SINGAPORE FUND *DBS50
<S> <C> <C>
Banks & Financials 23.5% 34.0%
Property 8.1 11.2
Telecommunication 12.3 10.4
Technology 9.9 6.2
Media & Publishing 4.0 6.1
Transportation 20.0 15.1
Others 11.0 17.0
CASH + EQUIV. 11.2 --
</TABLE>
(Total approx. weight in Technology, Media and Telecom : 26.2%)
*estimates based on in-house definition of the respective sectors
ECONOMIC PERFORMANCE AND OUTLOOK
ECONOMIC GROWTH REMAINS STRONG
Singapore's economy grew by an estimated 10.0% in 3Q00 versus a 9.0% growth
in 2Q00. For the first three quarters of the year, the Singapore economy grew by
9.8%. The government's official GDP growth target has also been raised four
times this year from a low of 5.0% to 9.5%.
4
<PAGE>
THE SINGAPORE FUND, INC.
----------------------------------------------------------------------
Surging external demand (19% year-on-year growth) and robust domestic
expenditure (9% year-on-year growth) drove the stellar economic performance. The
breakdown on a sectorial basis is as follows:
<TABLE>
<CAPTION>
SECTOR GROWTH
<S> <C>
Manufacturing 15.5%
Construction -1.3
Wholesale & Retail Trade 15.2
Hotels & Restaurants 9.0
Transport & Communications 9.2
Financial Services 4.4
Business Services 7.7
</TABLE>
OUTLOOK
Prospects for Singapore's economic growth continue to remain robust,
supported by both strong external growth and a powerful domestic consumption
recovery. For 3Q00, surging external demand (+19% year-on-year) and robust
domestic expenditure (+9% year-on-year) provided the impetus for the stellar 3Q
GDP growth of +10% versus the previous year. More importantly, strong export
growth has masked evidence of a pick-up in domestic spending as represented by
the sharp improvement in retail spending which accelerated by 23% in 3Q00.
Looking forward, though external demand is expected to wane, the Singapore
economy will be supported by a likely consumption boom. The government is
expected to increase spending by 26% in 2001 and other government stimulants
such as tax cuts should also inject further investment into the economy. The
third factor contributing to a potential consumption boom is a decrease in
savings (voluntary savings is expected to decrease from 30% of GDP in 1999 to
25% in 2001 and decreasing to 20% over the next 10 years). We expect the
Singapore economy to grow by a robust 9% to 10% in 2000 and between 6% to 7% in
2001.
MARKET OUTLOOK
After falling almost 20% since the start of the year, the Singapore market
is now offering compelling valuations. Many stocks are trading at steep
discounts to intrinsic valuation and near historical lows on earnings multiple.
The market as a whole is clearly undervalued in view of the positive economic
outlook for Singapore and the strong projected earnings growth. In addition,
rising momentum in corporate restructuring in the form of share buybacks,
mergers & acquisitions and formation of global alliances, all targeted to
improve long-term corporate return on equity (ROE) and enhance shareholder's
value, should provide the additional catalyst to drive equity prices higher. In
summary, the Singapore market is expected to outperform regional markets in
2001. Stocks are trading at compelling levels and excellent buys are available
for picking.
PORTFOLIO STRATEGY
The portfolio is likely to stay centered around Singapore stocks unless the
other ASEAN countries exhibit a convincing turnaround and strong opportunities
for outperformance can be found. Given the current weak outlook for residential
properties, we have lowered our weighting in the property sector. Moving
forward, we will be maintaining overweight positions in undervalued key
benchmark stocks such as Singapore Airlines,
5
<PAGE>
THE SINGAPORE FUND, INC.
----------------------------------------------------------------------
which was trading at a forward P/E of 11 times as of November 6, 2000. Drivers
for performance will also be found in subjects of restructuring and M&A activity
and we will be on the constant lookout for these opportunities.
PORTFOLIO MANAGEMENT
Effective October 12, 2000, Mr. Roy Phua replaced Ms. Stella Ng as the
Fund's portfolio manager. Mr. Phua is responsible for the day-to-day management
of the Fund's portfolio. Mr. Phua joined DBS Asset Management Ltd., of which the
Fund's Investment Manager, DBS Asset Management (United States) Pte. Ltd. is a
wholly owned subsidiary, in July 2000. From 1995 to 2000, Mr. Phua worked at
Rothschild Asset Management Pte. Ltd. Singapore as an analyst and portfolio
manager.
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.
Sincerely,
/s/ Masayasu Ohi
MASAYASU OHI
CHAIRMAN OF THE BOARD
6
<PAGE>
THE SINGAPORE FUND, INC.
----------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 2000
--------------------------------------------------------------------------------
-------------------------------------------
COMMON STOCKS--88.76%
--------------------------------------------------------------------------------
<TABLE>
SHARES VALUE
---------- -----------
<C> <S> <C>
SINGAPORE--88.76%
BANKS & FINANCIAL SERVICES--23.51%
1,610,000 Oversea-Chinese Banking Corp. Ltd....... $10,269,962
818,600 Overseas Union Bank Ltd................. 3,962,923
450,000 United Overseas Bank Ltd................ 3,331,815
-----------
17,564,700
-----------
COMMUNICATIONS--MEDIA--3.96%
207,000 Singapore Press Holdings Ltd............ 2,959,164
-----------
E-BUSINESS--0.16%
500,000 Adroit Innovations Ltd.*................ 118,180
-----------
ELECTRONIC COMPONENTS--9.19%
750,000 Chartered Semi-Conductor Manufacturing
Co.*+.................................. 3,246,383
740,000 CSA Holdings Ltd.*...................... 1,095,797
261,000 Venture Manufacturing (Singapore)
Ltd.................................... 2,527,053
-----------
6,869,233
-----------
ELECTRONICS--0.56%
250,000 OMNI Industries Ltd..................... 421,460
-----------
FOODS--0.26%
104,000 Cerebos Pacific Ltd..................... 194,282
-----------
INDUSTRIAL--3.77%
1,748,000 Singapore Technologies Engineering
Ltd.+.................................. 2,817,428
-----------
PROPERTY DEVELOPMENT--8.08%
450,000 City Developments Ltd................... 2,075,977
1,778,000 Keppel Land Ltd.+....................... 2,653,127
1,615,000 MCL Land Ltd............................ 1,030,186
135,000 Singapore Land Ltd...................... 279,872
-----------
6,039,162
-----------
</TABLE>
<TABLE>
SHARES VALUE
---------- -----------
<C> <S> <C>
REAL ESTATE--3.32%
630,000 Allgreen Properties Ltd................. $ 405,456
2,570,000 First Capital Corp. Ltd................. 2,078,483
-----------
2,483,939
-----------
RETAIL--0.88%
2,089,000 Courts (Singapore) Ltd.................. 654,374
-----------
SHIPYARDS--2.74%
5,000,000 Sembcorp Marine Ltd.+................... 2,050,347
-----------
TELECOMMUNICATIONS--12.33%
1,516,000 ICOMM Technology Ltd.................... 332,418
5,360,000 Singapore Telecommunications Ltd.+...... 8,883,472
-----------
9,215,890
-----------
TRANSPORTATION--3.71%
1,000,000 Delgro Corp. Ltd........................ 2,767,969
-----------
TRANSPORTATION--AIR--13.41%
1,000,000 Singapore Airlines Ltd.+................ 10,023,921
-----------
TRANSPORTATION--MARINE--2.88%
1,399,000 Neptune Orient Lines Ltd.+*............. 1,187,214
1,000,000 Sembcorp Industries Ltd.+............... 962,524
-----------
2,149,738
-----------
Total Common Stocks
(Cost--$68,688,047)................................. 66,329,787
-----------
</TABLE>
7
<PAGE>
THE SINGAPORE FUND, INC.
----------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (CONCLUDED)
OCTOBER 31, 2000
--------------------------------------------------------------------------------
-------------------------------------------
TIME DEPOSITS--6.84%
-------------------------------------------
<TABLE>
PRINCIPAL
AMOUNT
(000) VALUE
---------- -----------
<C> <S> <C>
SINGAPORE DOLLAR--5.76%
7,560 Citibank Singapore, 1.50% due 11/1/00... $ 4,305,711
-----------
U.S. DOLLAR TIME DEPOSIT--1.08%
173 Bank of New York Time Deposit, 4.20% due
11/1/00................................ 172,698
632 Citibank Singapore, 5.00% due 11/1/00... 631,888
-----------
Total U.S. Dollar Time Deposits....................... 804,586
-----------
Total Time Deposits
(Cost--$5,116,698).................................. 5,110,297
-----------
Total Investments--95.60%
(Cost--$73,804,745)................................. 71,440,084
Other assets less liabilities--4.40%.................. 3,287,757
-----------
NET ASSETS (Applicable to 9,200,840 shares of capital
stock outstanding; equivalent to $8.12 per
share)--100.00%..................................... $74,727,841
===========
</TABLE>
------------------------
+ Deemed to be an affiliated issuer.
* Non-income producing securities.
-------------------------------------------
TEN LARGEST COMMON STOCK
POSITIONS HELD
OCTOBER 31, 2000
-------------------------------------------
<TABLE>
<CAPTION>
PERCENT OF
ISSUE NET ASSETS
----- ----------
<S> <C>
Oversea-Chinese Banking Corp.
Ltd................................ 13.74%
Singapore Airlines Ltd............. 13.41
Singapore Telecommunications
Ltd................................ 11.89
Overseas Union Bank Ltd............ 5.30
United Overseas Bank Ltd........... 4.46
Chartered Semi-Conductor
Manufacturing.................... 4.34
Singapore Press Holdings Ltd....... 3.96
Singapore Technologies Engineering
Ltd.............................. 3.77
Delgro Corp. Ltd................... 3.70
Keppel Land Ltd.................... 3.55
</TABLE>
-------------------------------------------
TEN LARGEST COMMON STOCK
CLASSIFICATIONS HELD
OCTOBER 31, 2000
-------------------------------------------
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY NET ASSETS
-------- ----------
<S> <C>
Banks & Financial Services......... 23.51%
Transportation--Air................ 13.41
Telecommunications................. 12.33
Electronic Components.............. 9.19
Property Development............... 8.08
Communications--Media.............. 3.96
Industrial......................... 3.77
Transportation..................... 3.71
Real Estate........................ 3.32
Transportation--Marine............. 2.88
</TABLE>
See accompanying notes to financial statements.
8
<PAGE>
THE SINGAPORE FUND, INC.
----------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
OCTOBER 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
ASSETS
Investment in securities, at value:
Unaffiliated securities (cost --
$42,584,995)............................ $39,615,668
Affiliated securities (cost --
$31,219,750)............................ 31,824,416 $ 71,440,084
-----------
Receivable for securities sold............. 4,124,440
Interest receivable........................ 5,591
Prepaid expenses........................... 16,058
------------
Total assets............................. 75,586,173
------------
LIABILITIES
Payable for securities purchased........... 655,581
Accrued expenses and other liabilities..... 202,751
------------
Total liabilities........................ 858,332
------------
NET ASSETS
Capital stock, $0.01 par value per share;
total 100,000,000 shares authorized;
9,200,840 shares issued and outstanding... 92,008
Paid-in capital in excess of par value..... 106,392,052
Accumulated net realized loss on
investments............................... (29,390,258)
Net unrealized depreciation on investments
and other assets and liabilities
denominated in foreign currency........... (2,365,961)
------------
Net assets applicable to shares
outstanding............................. $ 74,727,841
============
NET ASSET VALUE PER SHARE............ $ 8.12
============
</TABLE>
See accompanying notes to financial statements.
9
<PAGE>
THE SINGAPORE FUND, INC.
----------------------------------------------------------------------
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED OCTOBER 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Dividends:
Unaffiliated securities (net of
withholding taxes of - $188,612)........ $ 799,321
Affiliated securities (net of withholding
taxes of - $257,642).................... 763,095 $ 1,562,416
------------
Interest................................... 135,387
------------
Total investment income.................. 1,697,803
------------
EXPENSES:
Investment management fee and expenses..... 654,101
Investment advisory fee and expenses....... 323,355
Administration fee......................... 179,143
Custodian fees and expenses................ 151,635
Audit and tax services..................... 82,800
Legal fees and expenses.................... 60,094
Osaka Securities Exchange fees and
expenses.................................. 53,996
Directors' fees and expenses............... 52,458
Reports and notices to shareholders........ 36,578
Insurance expense.......................... 24,483
Transfer agency fee and expenses........... 20,394
Other...................................... 23,311
------------
Total expenses........................... 1,662,348
------------
NET INVESTMENT INCOME........................ 35,455
------------
REALIZED AND UNREALIZED GAINS FROM INVESTMENT
ACTIVITIES AND FOREIGN CURRENCY
TRANSACTIONS:
Net realized (losses) on investments:
Unaffiliated securities.................. (12,924,133)
Affiliated securities.................... (961,658) (13,885,791)
------------
Net realized foreign currency transaction
losses.................................... (518,014)
Net change in unrealized appreciation
(depreciation) on investments in equity
securities................................ (3,534,119)
Net change in unrealized appreciation
(depreciation) on other assets and
liabilities denominated in foreign
currency.................................. 11,463
------------
Net realized and unrealized losses from
investment activities and foreign currency
transactions................................ (17,926,461)
------------
NET DECREASE IN NET ASSETS RESULTING FROM
OPERATIONS.................................. $(17,891,006)
============
</TABLE>
See accompanying notes to financial statements.
10
<PAGE>
THE SINGAPORE FUND, INC.
----------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR THE YEARS ENDED
OCTOBER 31,
---------------------------
2000 1999
------------ -----------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM
OPERATIONS:
Net investment income (loss)............... $ 35,455 $ (345,805)
Net realized gain (loss) on:
Investments.............................. (13,885,791) 16,374,428
Foreign currency transactions............ (518,014) (621,513)
Net change in unrealized appreciation
(depreciation) on:
Investments in equity securities......... (3,534,119) 12,940,708
Translation of short-term investments and
other assets and liabilities denominated
in foreign currency..................... 11,463 (10,312)
------------ -----------
Net increase (decrease) in net assets
resulting from operations................. (17,891,006) 28,337,506
------------ -----------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
FROM:
Net investment income...................... -- (965,499)
------------ -----------
FROM CAPITAL STOCK TRANSACTIONS:
Sale of capital stock resulting from:
Reinvestment of dividends................ -- 36,837
------------ -----------
Net increase (decrease) in net assets.... (17,891,006) 27,408,844
NET ASSETS:
Beginning of year.......................... 92,618,847 65,210,003
------------ -----------
End of year................................ $ 74,727,841 $92,618,847
============ ===========
</TABLE>
See accompanying notes to financial statements.
11
<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
accounting principles generally accepted in the United States of America
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 maturity of 60 days or less are valued at
amortized cost, except where the 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 isolate the effect of fluctuations 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, 2000, the Fund was subject to
withholding tax, ranging from 10% to 25.5%, 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.
12
<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 on the ex-date, except for certain
dividends and corporate actions involving foreign securities which may be
recorded after the ex-date, 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 ADVISER
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, 2000, expenses
of $16,519 were paid to the Manager, representing
13
<PAGE>
THE SINGAPORE FUND, INC.
----------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
--------------------------------------------------------------------------------
reimbursement 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,
2000, there were no brokerage 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 SB Investments (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,
2000, no such expenses were paid to the Adviser. During the year ended
October 31, 2000, brokerage commissions of $70,976 were paid by the Fund to
Daiwa Securities (Singapore), an affiliate of the Adviser, in connection with
portfolio transactions.
At October 31, 2000, the Fund owed to the Manager and the Adviser $46,893
and $23,644, for management and advisory fees, respectively.
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 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 year ended October 31, 2000,
expenses of $7,148 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, 2000, DSTC earned $21,367 and
DBS Bank earned $107,528 from the Fund for their respective custodial services.
At October 31, 2000, the Fund owed to DSTC $12,413 and $27,549 for
administration and custodian fees, respectively. The latter amount includes fees
and expenses payable to DBS Bank totaling $26,189.
During the year ended October 31, 2000, the Fund paid or accrued $55,667 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, 2000 was $68,800,806, excluding $5,116,698 of short-term
interest-bearing investments. At October 31, 2000, the net unrealized
14
<PAGE>
THE SINGAPORE FUND, INC.
----------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
--------------------------------------------------------------------------------
depreciation on investments, excluding short-term securities, of $2,471,019 was
composed of gross appreciation of $4,065,025 for those investments having an
excess of value over cost, and gross depreciation of $6,536,044 for those
investments having an excess of cost over value. For the year ended October 31,
2000, the total aggregate cost of purchases and net proceeds from sales of
portfolio securities, excluding the short-term securities, were $123,143,282 and
$127,279,865, respectively.
At October 31, 2000, the Fund had a remaining capital loss carryover of
$29,277,499, of which $15,210,895 expires in the year 2006, and $14,666,604
expires in the year 2008 available to offset future net capital gains.
At October 31, 2000, the Fund made capital account reclassifications due to
permanent book/tax differences. The Fund reclassified $518,014 from accumulated
net realized loss on investments to accumulated net investment loss as a result
of permanent book/tax differences primarily relating to net realized foreign
currency losses. The Fund also reclassified $482,559 from paid-in-capital in
excess of par value to accumulated net investment loss as a result of permanent
book/tax differences primarily relating to net operating loss for the year
ending October 31, 2000.
CONCENTRATION OF RISK
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. Of
the 9,200,840 shares outstanding at October 31, 2000, Daiwa Securities
America, Inc., an affiliate of the Adviser and DSTC, owned 14,460 shares.
15
<PAGE>
THE SINGAPORE FUND, INC.
----------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
Selected data for a share of capital stock outstanding during each fiscal year
is presented below:
<TABLE>
<CAPTION>
FOR THE YEARS ENDED OCTOBER 31,
----------------------------------------------------
2000 1999 1998 1997 1996
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year..................... $ 10.07 $ 7.09 $ 7.99 $ 12.59 $ 13.42
------- ------- ------- ------- -------
Net investment income (loss)........................... 0.00 * (0.04) 0.09 (0.04) (0.07)
Net realized and unrealized gains (losses) on
investments and foreign currency transactions......... (1.95) 3.13 (0.99) (4.18) 0.21
------- ------- ------- ------- -------
Net increase (decrease) in net asset value resulting
from operations....................................... (1.95) 3.09 (0.90) (4.22) 0.14
------- ------- ------- ------- -------
Less: dividends and distributions to shareholders
Net realized gains on investments and foreign
currency transactions............................... -- (0.11) -- (0.38) (0.97)
------- ------- ------- ------- -------
Net asset value, end of year........................... $ 8.12 $ 10.07 $ 7.09 $ 7.99 $ 12.59
======= ======= ======= ======= =======
Per share market value, end of year.................... $ 6.375 $ 8.938 $ 6.375 $ 8.750 $ 12.125
======= ======= ======= ======= =======
Total investment return:
Based on market price at beginning and end of year,
assuming reinvestment of dividends.................. (28.68)% 42.44 % (27.14)% (25.51)% (3.54)%
Based on net asset value at beginning and end of
year, assuming reinvestment of dividends............ (19.36)% 44.30 % (11.26)% (34.49)% 0.76 %
Ratios and supplemental data:
Net assets, end of year (in millions)................ $ 74.7 $ 92.6 $ 65.2 $ 73.5 $115.6
Ratios to average net assets of:
Expenses........................................... 1.93 % 1.97 % 2.23 % 1.87 % 1.85 %
Net investment income (loss)....................... 0.04 % (0.42)% 1.38 % (0.29)% (0.48)%
Portfolio turnover................................... 155.83 % 201.76 % 208.56 % 78.74 % 62.78 %
</TABLE>
---------------------------------------------------------------------------
* Represents less than 0.005 per share.
16
<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, 2000, the results of its operations for the year then
ended, the changes in 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 accounting principles generally accepted in the United
States of America. 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 auditing standards generally accepted in
the United States of America, 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, 2000 by
correspondence with the custodian and brokers, provide a reasonable basis for
our opinion.
PricewaterhouseCoopers LLP
1177 Avenues of the Americas
New York, New York 10036
December 6, 2000
17
<PAGE>
THE SINGAPORE FUND, INC.
----------------------------------------------------------------------
TAX INFORMATION (UNAUDITED)
--------------------------------------------------------------------------------
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, 2000) as to the federal tax status of any distributions received by
you during such fiscal year.
There were no dividend payments or foreign tax credits with respect to the
fiscal year 2000.
SHAREHOLDERS ARE STRONGLY ADVISED TO CONSULT THEIR OWN TAX ADVISORS WITH
RESPECT TO THE TAX CONSEQUENCES OF THEIR INVESTMENT IN THE FUND.
18
<PAGE>
----------------------------------------
BOARD OF DIRECTORS
Masayasu Ohi, CHAIRMAN
Austin C. Dowling
Martin J. Gruber
David G. Harmer
Alfred C. Morley
Oren G. Shaffer
--------------------------------------------
OFFICERS
John J. O'Keefe
VICE PRESIDENT AND TREASURER
Judy Runrun Tu
SECRETARY
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 SB Investments (Singapore) Ltd.
ADMINISTRATOR AND CUSTODIAN
Daiwa Securities Trust Company
TRANSFER AGENT AND REGISTRAR
State Street Bank and Trust Company
LEGAL COUNSEL
Clifford Chance Rogers & Wells LLP
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers 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, 2000
