DEAN WITTER PACIFIC GROWTH SECURITIES INC, N-30D, 1998-01-09

DEAN WITTER PACIFIC GROWTH SECURITIES INC
N-30D, 1998-01-09

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<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC. TWO WORLD TRADE CENTER, NEW YORK, NEW YORK
10048
LETTER TO THE SHAREHOLDERS OCTOBER 31, 1997

DEAR SHAREHOLDER:

The twelve months ended October 31, 1997 proved to be a uniquely difficult
period for the markets of the Pacific Basin and for Dean Witter Pacific Growth
Fund. During the first half of the fiscal year the Fund generated a marginally
positive return, albeit a disappointing one relative to equity markets elsewhere
in the world, which continued to perform strongly. The only markets that were
notably weak during the first half were Japan, Korea and Thailand, all of which
were addressing specific economic difficulties. Performance during the first
half provided little hint of the severe weakness that would overcome the region
in the second half of the period.

It was the economic problems of Thailand that proved to be the catalyst for the
currency crisis that engulfed the region from July onward. The uncertain state
of Thailand's economy had concerned us for some time. The rigid peg of the Thai
baht to the U.S. dollar had resulted in a significant level of overinvestment in
the Thai economy, particularly in real estate. This overinvestment was funded by
access to "cheap" U.S.-dollar loans, at interest rates well below those
prevailing locally, without any apparent currency risk. Thailand also ran a
current-account deficit of about 8 percent of GDP in 1996, which made its
dependence on foreign capital even more marked. For some months we had believed
that there would be a sharp increase in non-performing bank loans and that the
Thai economy would have to go through a severe adjustment period in order to
purge these excesses. As a result, we had been cautious regarding Thailand and
were heavily underweighted there. In June, we concluded that the Thai currency
management system would have to be radically altered as part of this adjustment
and we put in place a hedging strategy to protect the Fund against a Thai baht
devaluation. It did not, therefore, come as a surprise when on July 2 the Thai
authorities devalued the currency, abandoning the U.S.-dollar peg, and moved to
a managed float of the exchange rate.

However, we did not anticipate that the Thai crisis would trigger similar
developments in the other countries of Southeast Asia, particularly Indonesia,
Malaysia, the Philippines and Singapore. The first three of these countries have
current-account deficits, although considerably
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
LETTER TO THE SHAREHOLDERS OCTOBER 31, 1997, CONTINUED

smaller than that of Thailand relative to their GDP. They had also seen some
signs of excessive investment, particularly in real estate, in recent years,
although the authorities in these countries had moved to control this phenomenon
earlier in the year in a way that the Thai authorities had failed to do.
Indonesia also has exposure to foreign currency debt, by both the government and
corporations. However, the scale of these problems did not, in our view or in
that of the regional authorities, justify currency devaluation, especially since
these currencies were not pegged to the U.S. dollar in the rigid manner that the
baht had been. However, once the baht fell, it proved to be impossible, given
the reliance on foreign capital implied by the current-account deficits, to
protect these other currencies, despite rapidly rising interest rates. The
Philippines quickly followed Thailand in devaluation, and Malaysia and Indonesia
continued the trend in August. Even Singapore, which enjoys one of the world's
largest current-account surpluses, has seen its currency come under pressure
because of its role as the financial center of Southeast Asia.

The combination of weakening currencies and high interest rates is not a good
one for economic activity or corporate earnings in the region over the short
term, and expectations for both these variables have been sharply downgraded for
1997 and 1998. The region's currency weakness has become self-feeding and, until
stability is again achieved, it will be difficult for interest rates to decline.
The longer the high-rate environment remains, the greater will be its impact on
GDP growth and corporate earnings.

For much of 1997, the Northeast Asian markets have stood apart from their
Southeast Asian counterparts and have produced considerably better performance.
Hong Kong, the largest market in the Pacific Basin outside Japan, performed well
through August, despite the death of Chinese leader Deng Xiaopeng in February
and the handover of Hong Kong to China in June. The first of these two events
had long been feared by market participants given the uncertainty surrounding
the succession and the resultant potential changes in economic strategy. By
contrast, we believed that the succession was already well in place and that
there was no realistic possibility that China would significantly reverse its
policy of increased economic openness. In practice, Jiang Zemin has considerably
strengthened his position as leader since February, forcing the retirement of
two potential rivals at the 15th Communist Party Congress in September. In
addition, this Congress actually continued to broaden and deepen the economic
reform strategy, with China's highly inefficient state-owned enterprise sector
being the main focus. We had also always expected the handover of Hong Kong to
go smoothly, which proved to be the case in practice, and view the territory's
new status as a Special Administrative Region of China as being positive for
Hong Kong's long-term economic development.

In August, the Hong Kong authorities appeared to have successfully defended
their pegged currency rate against speculative attacks. However, the pressure
reemerged much more severely in October, following a move by the authorities in
Taiwan (again despite a large current-account surplus) to permit a small further
depreciation in its currency. The result has been a sharp upward movement in
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
LETTER TO THE SHAREHOLDERS OCTOBER 31, 1997, CONTINUED

Hong Kong interest rates, which has severely affected the stock market given its
significant exposure to bank and real-estate related stocks. It is now
anticipated that Hong Kong real estate prices could drop by 30 percent or more,
which would substantially address the perception, which had taken hold
especially since the devaluation of Southeast Asia's currencies, that Hong Kong
has become an expensive place to do business.

The Japanese market had reached its year-to-date peak in June. Supportive
factors included very strong first quarter GDP growth, strong corporate profits
and a realization that U.S. interest rates were on hold. The second quarter was
weak, as was widely anticipated, because of the fiscal tightening -- including
an increased consumption tax of an additional 2 percent, the withdrawal of
income tax rebates and increased medical costs -- that was effective from April
1.

In the third quarter, evidence emerged that the economic slowdown in Japan was
worsening. In fact, this was the weakest quarter that the Japanese economy had
seen in nearly 23 years. This realization further depressed the market and made
it vulnerable to the crisis that was developing elsewhere in Asia. The dramatic
fall of the Hong Kong market in October was the trigger that pushed the Nikkei
index through critical support levels thereby threatening the capital adequacy
ratios of many financial institutions. Reports that the currency devaluations
and market falls of Southeast Asia were spreading to Northeast Asia added to the
concern, as Korean and Taiwanese companies are viewed as more direct competitors
to Japan.

Japan's heavy reliance on business with Asia also contributed. In 1996, exports
constituted 10 percent of Japan's nominal GNP, with Asia accounting for 44
percent of the total, compared with 15 percent to Europe and 28 percent to the
United States. Most recent statistics show a slowdown in exports to countries,
such as Thailand, that were among the first to be involved in the currency
turmoil. In addition, Japanese banks have made large loans to other Asian
countries, with $87.5 billion outstanding to Hong Kong alone.

These factors provided hedge funds with reasons to short Japan, which pushed the
market to a two-year low, and to levels approaching the post-crash bottoms of
1992 and 1995. Subsequently, suggestions that public money would be used to
support the financial system and reports that the "convoy system" -- whereby
stronger institutions are expected to carry the weaker -- had been abandoned,
resulted in a dramatic rebound of around 10 percent. However, news that
Yamaichi, the fourth largest broker in Japan was to be declared insolvent
reversed much of this move and again raised questions about the stability of the
financial sector should the government not take firm action. The government and
the Bank of Japan have moved rapidly to reassure depositors in the wake of the
Yamaichi bankruptcy. Concrete proposals from the government on the wider
economic issues facing Japan are due on December 10 and will be carefully
watched by the market.

At least some of the blame for the extreme weakness in Japanese markets falls on
the government. So far, they have only attempted to talk their way out of this
situation. They could and should take
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
LETTER TO THE SHAREHOLDERS OCTOBER 31, 1997, CONTINUED

more concrete action to stimulate the economy. Measures such as cutting
corporate taxes, which are among the highest in the world, and cutting income
taxes, which are also quite high, would help, as would continued and aggressive
support of the deregulation program.

PERFORMANCE AND PORTFOLIO STRATEGY

For the fiscal year ended October
31, 1997, Dean Witter Pacific Growth
Fund Class B produced a total return
of -31.01 percent versus 15.13
percent for the Morgan Stanley
Capital International World Index
(MSCI World Index), -20.66 percent
for the MSCI Pacific Free Index,
- -35.86 percent for the MSCI All
Country Far East Free Index
excluding Japan and -18.52 for the
Lipper Pacific Region Funds Average.
It is important to note that the
Fund invests primarily in securities
of the markets of the Pacific Rim
while the MSCI World Index measures
the performance of the European,
Asian and American markets. The MSCI
Pacific Free Index measures the
performance of markets in the
Pacific Rim. Because of the relative
size of the Japanese market, the
Index is dominated by the
performance of equities within that
country. (Japan currently makes up
more than 70% of the Index.) The
MSCI All Country Far East Free Index
excluding Japan measures the
performance of the smaller stock
markets of the Pacific Basin,
commonly referred to as the Tiger
economies, and contains no exposure
to the markets of Japan and
Australia. The Lipper Pacific Region
Funds Average tracks the performance
of funds that invest in equity
securities whose primary trading
markets or operations are
concentrated in the Pacific Basin or
a single country within this region.

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<CAPTION>
Growth of $10,000 - Class B
($ in Thousands)
Average Annual Total Return
(Fund)
Life of
1 Year 5 Years Fund
<S> <C> <C> <C> <C> <C>
- -31.01%(1) 2.33%(1) 5.50%(1)
- -34.41%(2) 1.96%(2) 5.50%(2)
Fund MSCI(4) MSCI PF(5) MSCI ACFEF(6) Lipper(7)
November 1990 $10,000 $10,000 $10,000 $10,000 $10,000
October 1991 $11,754 $11,561 $11,962 $12,292 $11,582
October 1992 $12,913 $10,735 $9,202 $16,850 $11,054
October 1993 $20,162 $13,392 $13,629 $25,341 $16,059
October 1994 $22,297 $14,162 $14,730 $28,731 $17,871
October 1995 $20,387 $15,264 $12,974 $26,062 $16,178
October 1996 $20,999 $17,474 $13,288 $28,123 $17,024
October 1997 $14,486(3) $20,119 $10,542 $18,038 $13,871
</TABLE>

PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE RETURNS.
(1) Figure shown assumes reinvestment of all distributions and does not reflect
the deduction of any sales charges.
(2) Figure shown assumes reinvestment of all distributions and the deduction of
the maximum applicable contingent deferred sales charge (CDSC) (1 year-5%, 5
years-2%, since inception-0%). See the Fund's current prospectus for
complete details on fees and sales charges.
(3) Closing Value assuming a complete redemption on October 31, 1997.
(4) The Morgan Stanley Capital International World Index (MSCI) measures
performance from a diverse range of global stock markets including the U.S.,
Europe, Australia, New Zealand, and the Far East. The Index does not include
any expenses, fees, or charges, or reinvestment of dividends. The Index is
unmanaged and should not be considered an investment.
(5) The Morgan Stanley Capital International Pacific Free Index (MSCI PF)
measures performance of stock markets in Australia, Hong Kong, Japan,
Malaysia, New Zealand and Singapore, and excludes shares that are not
readily purchased by non-local investors. The Index does not include any
expenses, fees, or charges, or reinvestment of dividends. The Index is
unmanaged and should not be considered an investment.
(6) The Morgan Stanley Capital International All Country Far East Free
(excluding Japan) Index (MSCI ACFEF) measures performance of both the
developed and the emerging markets of the Far East (excluding Japan), and
excludes shares that are not readily purchased by non-local investors. The
Index does not include any expenses, fees, or charges, or reinvestment of
dividends. The Index is unmanaged and should not be considered an
investment.
(7) The Lipper Pacific Region Funds Average tracks the performance of funds
which invest in equity securities whose primary trading markets or
operations are concentrated in the Western Pacific basin region or a single
country within this region, as reported by Lipper Analytical Services.
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
LETTER TO THE SHAREHOLDERS OCTOBER 31, 1997, CONTINUED

We anticipate that, in future reports, we will compare the Fund's performance
only to the MSCI Pacific Free Index, the MSCI All Country Far East Free Index
excluding Japan and the Lipper Pacific Region Funds Average. The Fund will be
compared first to the MSCI Pacific Free Index, which includes Japan. However,
the Fund's exposure to Japan is generally modest compared to this index and we
will therefore compare the Fund's performance also to the MSCI All Country Far
East Free Index excluding Japan.

The Fund underperformed its Lipper benchmark because other funds in the category
have significantly higher weightings in Japan and Australia, which have
performed better than other regional markets as a result of the events described
above. It has been the Fund's long-term strategy to emphasize investment in the
growth economies of Asia. This has led us to focus on the equity markets of the
Tiger economies, as opposed to those of the more mature, developed economies of
the region, i.e. Japan and Australia. We continue to believe that the strategy
of emphasizing what we believe to be higher growth areas is an appropriate one
over the longer term.

The accompanying chart illustrates the growth of a $10,000 investment in the
Fund from inception (November 30, 1990) through the fiscal year ended October
31, 1997, versus similar hypothetical investments in the MSCI World Index, the
MSCI Pacific Free Index, the MSCI All Country Far East Free Index and the Lipper
Pacific Region Funds Average.

At period end, the Fund's largest single country position continued to be Hong
Kong (34 percent of net assets). The Fund's exposure to greater China, including
Taiwan and direct China exposure, was 6.2 percent. As the present crisis
subsides, we will look for opportunities to reweight the portfolio toward the
markets of Southeast Asia, which in many cases have fallen by more than 60
percent in U.S. dollar terms from their highs.

We continue to seek out well-managed companies with good earnings visibility and
strong balance sheets. (A number of utility companies and infrastructure
providers fall into this category.) We have made strenuous efforts to obtain
exposure in the portfolio to electronic and other export-related U.S.-
dollar-earning stocks, which will benefit from the currency crisis. We also
believe that value is beginning to emerge in some of the more cyclical areas.
For example, some Singapore and Hong Kong banks appear to have overdiscounted
the prospects for rising nonperforming loans, while some Hong Kong and Singapore
real estate stocks have fallen to levels that may be overcompensating for likely
further declines in real estate prices.

On July 28, 1997, the Fund began offering four classes of shares -- A, B, C and
D -- each with its own sales charge and distribution fee structure. A revised
prospectus, which includes complete details regarding the Fund's conversion to
multiple classes of shares, was mailed to shareholders in midsummer.
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
LETTER TO THE SHAREHOLDERS OCTOBER 31, 1997, CONTINUED

OUTLOOK

The latest country under the currency-speculation spotlight is Korea. This
economy has always been a highly leveraged one with a significant amount of
foreign currency debt. Although the country has been narrowing its
current-account deficit rapidly this year, forecasted to be about 1 percent of
GDP for 1998, it still relies upon foreign capital. This, together with the
substantial short-term portion of foreign currency debts due, makes the currency
vulnerable. Both the Korean stock market and the currency, the won, have fallen
sharply since October. On December 3, Korea followed Thailand and Indonesia in
announcing that it had negotiated an economic support package led by the
International Monetary Fund (IMF). The support package for Korea totals 57
billion U.S. dollars, including bilateral support, and is substantially larger
than that granted to Thailand (17 billion U.S. dollars) and Indonesia (38
billion U.S. dollars) earlier this year, and even larger than that granted to
Mexico in 1995 (50 billion U.S. dollars). The negotiation of this support
package has occurred much more rapidly than had been anticipated. It is
encouraging that positive steps are now being taken to address Korea's economic
difficulties and those of the region as a whole.

In Japan, recent events will likely cause economic growth to slow, corporate
profits to be reduced and Japanese companies to encounter more competition from
the rest of Asia. The temptation for Korea and, to a lesser extent, Taiwan to
export their way out of difficulty will be very high and competition will be
intense in steel, semi-conductors, chemicals, textiles and ship building -- all
vital areas for Japan. Over the next few months, the Japanese market will almost
certainly remain volatile. Investors there are extremely nervous and, to date,
the government's response has been long on rhetoric and short on substance. The
degree of pessimism has probably been overdone but events elsewhere in the
region have done little to improve sentiment.

Although the past several months have shown how volatile these markets can be,
we believe that over the medium-term currency volatility may subside, stability
will return and with it will come the possibility for interest rates to begin
declining from their current high levels. For the most part, regional currencies
are now cheap on a purchasing power parity basis, which points to the potential
for longer-term appreciation once the current crisis and the rollover or
repayment of short-term foreign currency debt have passed. The recent IMF
support packages for the region should also contribute to reestablishing
regional stability.

Equity markets are also cheap throughout Asia, relative both to their own
history and to their counterparts elsewhere in the world. The average regional
P/E on twelve-month forward earnings is now around 12. However, earnings remain
uncertain and may be subject to further downgrades, owing to continuing high
interest rates.

The current situation is a symptom of Asia's difficult transition to a new
economic and currency management system but this should have significant
benefits over the longer term. First, with currencies devalued, Asian exports
are now highly competitive. Export growth is already beginning
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
LETTER TO THE SHAREHOLDERS OCTOBER 31, 1997, CONTINUED

to show sharp acceleration across the region, which will provide the eventual
solution for countries currently suffering current-account deficits. Second, in
a floating exchange rate environment, regional authorities will eventually be
able to set interest rates at levels reflecting their domestic circumstances
rather than having to inherit U.S. monetary policy, as was largely the case
under the old pegged or partially pegged systems. We believe this will have
beneficial consequences for long-term economic management.

The current transition will result in a period of slower growth in the region.
We believe that economic growth in 1998 will remain respectable in global terms
at around 4 percent, although this is substantially down from the levels of
growth which have typified the late 1980s and 1990s. Over the longer term, we
believe growth will reaccelerate, driven by two primary factors. First, the
region continues to exhibit strong demographic trends, with relatively young
work forces that are only beginning to enter economic maturity. Work force
participation will continue to grow for some years before reaching maturity.
This expansion will bring with it growing production, consumption and wealth
generation as well as a steady trend away from the historical export-led growth
economy toward one driven more by intraregional growth. Second, the importance
of the continued emergence of China onto the world stage is difficult to
overestimate not only for the global economy as a whole but particularly for
Asia. China will act as an engine of growth for the whole region over the medium
term. China is, of course, particularly important for Hong Kong, which is the
main conduit by which China accesses the foreign capital vital to its economic
transition and long-term success. The Chinese authorities have successfully
grappled with inflation over the last three years and have now begun easing
monetary policy, a process we expect to continue well into 1998. This should be
positive for all of Asia, but especially for Hong Kong and Taiwan.

Nineteen ninety-seven has been a frustrating year for investors in Dean Witter
Pacific Growth Fund. The short-term outlook remains difficult, with regional
currencies remaining under pressure, no immediate sharp recovery is likely on a
sustainable basis. However, we believe that for investors with a longer-term
time horizon there continue to be significant reasons to be positive about the
Pacific Basin and the investment prospects for the Fund.

We appreciate your support of Dean Witter Pacific Growth Fund and look forward
to continuing to serve your investment needs and objectives.

Sincerely,

[/S/ CHARLES A. FIUMEFREDDO]
CHARLES A. FIUMEFREDDO
CHAIRMAN OF THE BOARD
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
RESULTS OF SPECIAL MEETING (UNAUDITED)

On May 21, 1997, a special meeting of shareholders of Dean Witter Pacific Growth
Fund was held for the purpose of voting on five separate matters, the results of
which are as follows:

1) APPROVAL OF A NEW INVESTMENT MANAGEMENT AGREEMENT BETWEEN THE FUND AND DEAN
WITTER INTERCAPITAL INC., IN CONNECTION WITH THE MERGER OF MORGAN STANLEY
GROUP INC. WITH DEAN WITTER DISCOVER & CO.:

<TABLE>
<CAPTION>
VOTE NO. OF SHARES
- ---------------------------------------- -------------
<S> <C>
For..................................... 37,034,695
Against................................. 1,133,207
Abstain................................. 3,546,330
</TABLE>

2) APPROVAL OF A NEW SUB-ADVISORY AGREEMENT BETWEEN DEAN WITTER INTERCAPITAL
INC. AND MORGAN GRENFELL INVESTMENT SERVICES LIMITED:

<TABLE>
<CAPTION>
VOTE NO. OF SHARES
- ---------------------------------------- -------------
<S> <C>
For..................................... 36,853,812
Against................................. 1,248,607
Abstain................................. 3,611,813
</TABLE>

3) ELECTION OF DIRECTORS:

<TABLE>
<S> <C>
Michael Bozic
For..................................... 38,889,425
Withheld................................ 2,824,807
Charles A. Fiumefreddo
For..................................... 38,957,217
Withheld................................ 2,757,015
Edwin J. Garn
For..................................... 38,948,299
Withheld................................ 2,765,932
John R. Haire
For..................................... 38,870,390
Withheld................................ 2,843,842
Wayne E. Hedien
For..................................... 38,969,642
Withheld................................ 2,744,590
Dr. Manuel H. Johnson
For..................................... 38,992,569
Withheld................................ 2,721,663
Michael E. Nugent
For..................................... 39,005,323
Withheld................................ 2,708,909
Philip J. Purcell
For..................................... 39,008,636
Withheld................................ 2,705,596
John L. Schroeder
For..................................... 38,973,590
Withheld................................ 2,740,642
</TABLE>

4) APPROVAL OF A NEW INVESTMENT POLICY WITH RESPECT TO INVESTMENTS IN CERTAIN
OTHER INVESTMENT COMPANIES:

<TABLE>
<CAPTION>
VOTE NO. OF SHARES
- ---------------------------------------- -------------
<S> <C>
For..................................... 35,530,484
Against................................. 2,007,638
Abstain................................. 4,176,110
</TABLE>

<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
RESULTS OF SPECIAL MEETING (UNAUDITED), CONTINUED

5) RATIFICATION OF THE SELECTION OF PRICE WATERHOUSE LLP AS THE FUND'S
INDEPENDENT ACCOUNTANTS:

<TABLE>
<CAPTION>
VOTE NO. OF SHARES
- ---------------------------------------- -------------
<S> <C>
For..................................... 37,973,965
Against................................. 671,322
Abstain................................. 3,068,945
</TABLE>
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
PORTFOLIO OF INVESTMENTS OCTOBER 31, 1997
<TABLE>
<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
COMMON STOCKS, WARRANTS, RIGHTS AND BONDS (95.2)
AUSTRALIA (6.3%)
BANKING
700,000 Australia & New Zealand Banking Group Ltd....................................... $ 4,867,050
1,500,000 Westpac Banking Corp., Ltd...................................................... 8,705,178
------------
13,572,228
------------
BUILDING & CONSTRUCTION
1,666,000 Boral Ltd....................................................................... 4,367,196
------------
ENERGY
500,000 Woodside Petroleum Ltd.......................................................... 4,208,904
------------
FOOD, BEVERAGE, TOBACCO & HOUSEHOLD PRODUCTS
1,200,000 Foster's Brewing Group Ltd...................................................... 2,270,916
6,000,000 Goodman Fielder Ltd............................................................. 9,167,772
------------
11,438,688
------------
METALS & MINING
450,000 Broken Hill Proprietary Co., Ltd................................................ 4,447,211
------------
MULTI-INDUSTRY
1,750,000 Pacific Dunlop Ltd.............................................................. 3,725,108
------------
RETAIL STORES
1,000,000 Coles Myer Ltd.................................................................. 4,794,156
------------

TOTAL AUSTRALIA................................................................. 46,553,491
------------
CHINA (0.8%)
AUTOMOTIVE
2,200,000 Qingling Motors Co.............................................................. 1,437,537
------------
TRANSPORTATION
1,700,000 Jinhui Shipping and Transportation Ltd.......................................... 1,210,964
------------
UTILITIES - ELECTRIC
10,350,000 Zhejiang Southeast Electric Power Co., Ltd. (B Shares).......................... 3,332,700
------------
TOTAL CHINA..................................................................... 5,981,201
------------

<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
HONG KONG (33.7%)
BANKING
750,400 Bank of East Asia, Ltd.......................................................... $ 1,679,746
450,200 Dah Sing Financial Group........................................................ 1,130,087
1,285,838 Dao Heng Bank Group Ltd......................................................... 2,961,495
504,000 Guoco Group Ltd................................................................. 1,102,103
1,600,000 Hang Seng Bank Ltd.............................................................. 13,922,495
230,000 HSBC Holdings PLC............................................................... 5,207,996
156,000 International Bank of Asia...................................................... 72,666
------------
26,076,588
------------
CONGLOMERATES
250,000 Citic Pacific Ltd............................................................... 1,196,869
6,568,000 Hutchison Whampoa, Ltd.......................................................... 45,466,520
514,800 Jardine Matheson Holdings Ltd................................................... 3,294,720
920,000 Shanghai Industrial Holdings Ltd................................................ 4,094,973
1,500,000 Swire Pacific Ltd. (Class A).................................................... 8,015,786
------------
62,068,868
------------
ELECTRONIC & ELECTRICAL EQUIPMENT
1,500,000 ASM Pacific Technology Ltd...................................................... 1,125,704
6,700,000 Elec & Eltek International Holdings Ltd......................................... 2,470,725
843,000 Johnson Electric Holdings Ltd................................................... 2,301,520
------------
5,897,949
------------
ENGINEERING & CONSTRUCTION
673,000 Cheung Kong Infrastructure Holdings............................................. 1,741,606
1,000,000 Road King Infrastructure Ltd.*.................................................. 646,956
------------
2,388,562
------------
HOTELS/MOTELS
6,000,000 CDL Hotels International, Ltd................................................... 1,727,373
------------
INVESTMENT COMPANIES
100,000 Investment Co. of China*** *.................................................... 494,000
------------
LIFE INSURANCE
999,000 National Mutual Asia Ltd........................................................ 904,833
------------
</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
PORTFOLIO OF INVESTMENTS OCTOBER 31, 1997, CONTINUED
<TABLE>
<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
PUBLISHING
3,000,000 South China Morning Post (Holdings) Ltd......................................... $ 2,600,763
------------
REAL ESTATE
1,500,000 Amoy Properties, Ltd............................................................ 1,290,677
4,215,000 Cheung Kong (Holdings) Ltd...................................................... 29,314,388
1,300,000 China Resources Enterprise Ltd.................................................. 3,566,022
1,260,000 Great Eagle Holdings Ltd........................................................ 1,923,789
600,000 Henderson Land Development Co., Ltd............................................. 3,322,766
2,100,000 Hong Kong Land Holdings Ltd..................................................... 4,788,000
400,200 Hysan Development Co., Ltd...................................................... 836,285
4,333,000 New World Development Co., Ltd.................................................. 15,249,738
3,222,500 Sun Hung Kai Properties Ltd..................................................... 23,766,902
3,074,000 Wharf (Holdings) Ltd............................................................ 6,284,428
------------
90,342,995
------------
RETAIL - SPECIALTY APPAREL
412,000 Dickson Concepts International Ltd. (New)....................................... 887,598
------------
TELECOMMUNICATIONS
11,500,400 Hong Kong Telecommunications Ltd................................................ 22,023,151
------------
TRANSPORTATION
3,450,000 Cosco Pacific Ltd............................................................... 4,017,597
------------
UTILITIES
2,209,000 China Light & Power Co., Ltd.................................................... 11,633,085
5,850,000 Hong Kong & China Gas Co., Ltd.................................................. 11,051,304
2,700,000 Hong Kong Electric Holdings Ltd................................................. 9,153,135
------------
31,837,524
------------

TOTAL HONG KONG................................................................. 251,267,801
------------

<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>

INDIA (1.3%)
ALUMINUM
91,000 Hindalco Industries Ltd. (GDR)*................................................. $ 2,502,500
------------
BANKS
213,000 State Bank of India (GDR)*...................................................... 3,780,750
------------
TEXTILES
70,000 Reliance Industries Ltd. (GDR).................................................. 1,426,250
$ 2,000 K Reliance Industries Ltd. 3.50% due 11/03/99 (Conv.)............................. 2,270,000
------------
3,696,250
------------

TOTAL INDIA..................................................................... 9,979,500
------------

INDONESIA (5.7%)
AUTO PARTS
16,000,000 PT Gajah Tunggal................................................................ 2,681,564
------------
BANKING
13,730,200 Pt Bank Bira.................................................................... 1,917,626
1,000,000 PT Bank Dagang Nasional Indonesia (Rights)*..................................... 30,447
906,730 PT Bank Internasional Indonesia (Warrants due 01/17/00)*........................ 51,668
6,997,500 PT Pan Indonesia Bank........................................................... 1,563,687
999,642 PT Pan Indonesia Bank (Warrants due 06/26/00)*.................................. 25,131
------------
3,588,559
------------
BUILDING MATERIALS
10,333,096 PT Mulia Industrindo*........................................................... 1,876,121
------------
CONGLOMERATES
2,500,000 PT Bimantara Citra.............................................................. 2,304,469
------------
CONSTRUCTION EQUIPMENT
1,900,000 PT United Tractors.............................................................. 1,326,816
------------
CONSTRUCTION PLANT & EQUIPMENT
11,000,000 PT Citra Marga Nusaphala Persada................................................ 3,149,441
------------
FOOD, BEVERAGE, TOBACCO & HOUSEHOLD PRODUCTS
568,000 PT Hanjaya Mandala Sampoerna.................................................... 995,587
------------
</TABLE>

TOTAL INDONESIA................................................................. 42,724,542
------------

JAPAN (22.0%)
AGRICULTURE
2,500 Hokuto Corp..................................................................... 70,865
------------
APPAREL
41,000 World Co., Ltd.................................................................. 1,516,625
------------
AUTO TRUCKS & PARTS
110,000 NGK Spark Plug Co., Ltd......................................................... 765,337
55,000 Yasunaga Corp................................................................... 457,190
------------
1,222,527
------------
AUTOMOTIVE
97,000 Honda Motor Co.................................................................. 3,265,586
112,000 Toyota Motor Corp............................................................... 3,118,870
------------
6,384,456
------------

<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
BANKING
217,000 Asahi Bank, Ltd................................................................. $ 1,125,586
246,000 Bank of Tokyo-Mitsubishi Ltd.................................................... 3,210,474
196,000 Mitsui Trust & Banking Co., Ltd................................................. 681,031
158,000 Sanwa Bank, Ltd................................................................. 1,589,194
157,000 Sumitomo Bank................................................................... 1,670,490
164,000 Sumitomo Trust & Banking........................................................ 1,250,108
------------
9,526,883
------------
BUILDING & CONSTRUCTION
55,000 Kaneshita Construction.......................................................... 368,038
------------
BUILDING MATERIALS
94,000 Ibiden Co., Ltd................................................................. 1,562,760
276,000 Sanwa Shutter................................................................... 1,734,464
------------
3,297,224
------------
BUSINESS SERVICES
185,000 Ricoh Co., Ltd.................................................................. 2,383,624
36,000 Secom Co........................................................................ 2,328,180
------------
4,711,804
------------
CHEMICALS
707,000 Mitsubishi Chemical Corp........................................................ 1,592,660
132,000 Mitsubishi Gas Chemical Co...................................................... 459,751
489,000 Nippon Zeon Co., Ltd............................................................ 1,772,269
104,000 Shin-Etsu Chemical Co........................................................... 2,541,646
225,000 Sumitomo Bakelite Co., Ltd...................................................... 1,569,202
------------
7,935,528
------------
COMMERCIAL SERVICES
30,000 Nichii Gakkan Co................................................................ 1,221,945
------------
COMPUTER SOFTWARE & SERVICES
84,000 Hitachi Software Engineering Co., Ltd........................................... 2,283,292
13,000 Ines Corp....................................................................... 184,788
53,000 Meitec Corp..................................................................... 1,564,007
16,000 Nintendo Co., Ltd............................................................... 1,383,209
62 NTT Data Corp................................................................... 2,963,425
34,000 Ricoh Elemex.................................................................... 276,974
------------
8,655,695
------------
COMPUTERS
21,000 Nidec Corp...................................................................... 820,449
------------
ELECTRIC
80,000 Tokyo Electric Power Co......................................................... 1,529,510
------------
ELECTRONIC & ELECTRICAL EQUIPMENT
27,000 Advantest Corp.................................................................. 2,233,167
130,000 Aiwa Co., Ltd................................................................... 2,906,899
</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
PORTFOLIO OF INVESTMENTS OCTOBER 31, 1997, CONTINUED
<TABLE>
<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
Y 100,000 K Canon, Inc. 1.20% due 12/20/05 (Conv.).......................................... $ 1,828,761
Y 50,000 K Canon, Inc. 1.30% due 12/19/08 (Conv.).......................................... 813,383
224,000 Fujitsu, Ltd.................................................................... 2,457,855
176,000 Hitachi, Ltd.................................................................... 1,353,283
60,000 Mitsui High-Tec................................................................. 1,366,584
37,000 Murata Manufacturing Co., Ltd................................................... 1,500,914
33,600 Sony Corp....................................................................... 2,790,224
135,000 Sumitomo Electric Industries.................................................... 1,784,289
34,000 TDK Corp........................................................................ 2,820,615
------------
21,855,974
------------
ELECTRONIC COMPONENTS
155,000 Dainippon Screen Manufacturing Co., Ltd......................................... 1,257,523
70,000 Mitsumi Electric Co., Ltd....................................................... 1,373,234
2,000 Sunx Ltd........................................................................ 20,948
------------
2,651,705
------------
ELECTRONICS
29,000 Rohm Co., Ltd................................................................... 2,868,662
------------
ELECTRONICS - SEMICONDUCTORS/COMPONENTS
33,000 Shinko Electric Industries Co., Ltd............................................. 1,399,003
100,000 Toshiba Ceramics Co., Ltd....................................................... 642,560
------------
2,041,563
------------
ELECTRONICS - SPECIALTY
90,000 Taiyo Yuden Co., Ltd............................................................ 1,039,900
------------
ENGINEERING & CONSTRUCTION
364,000 Kajima Corp..................................................................... 1,630,889
55,500 Nitto Kohki Co., Ltd............................................................ 991,895
------------
2,622,784
------------
ENTERTAINMENT
33,000 H.I.S. Co., Ltd................................................................. 1,072,569
37,700 Sony Music Entertainment Inc.................................................... 1,325,611
------------
2,398,180
------------
FINANCIAL SERVICES
15,400 Nichiei Co., Ltd. (Kyoto)....................................................... 1,689,776
156,000 Nomura Securities Co., Ltd...................................................... 1,815,461
27,500 Orix Corp....................................................................... 1,879,052
------------
5,384,289
------------

<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
FOOD, BEVERAGE, TOBACCO & HOUSEHOLD PRODUCTS
163,000 Nippon Meat Packers, Inc........................................................ $ 2,276,309
------------
HAND TOOLS
16,000 Disco Corp...................................................................... 514,713
------------
INDUSTRIALS
Y 43,000 K Nippon Densan Corp. 1.00% 09/30/03 (Conv.)...................................... 482,544
------------
INSURANCE
249,000 Tokio Marine & Fire Insurance Co................................................ 2,483,791
------------
MACHINERY
212,000 Daifuku Co., Ltd................................................................ 1,589,559
88,000 Fuji Machine Manufacturing Co., Ltd............................................. 2,552,951
16,500 Keyence Corp.................................................................... 2,468,828
250,000 Minebea Co., Ltd................................................................ 2,493,766
Y 21,000 K Minebea Co., Ltd. 0.80% due 03/31/03 (Conv.).................................... 247,880
356,000 Mitsubishi Heavy Industries, Ltd................................................ 1,748,928
171,000 Nippon Thompson Co.............................................................. 1,172,693
270,000 OSG Corp........................................................................ 1,571,072
100,000 Tsudakoma....................................................................... 332,502
------------
14,178,179
------------
MANUFACTURING
61,000 Nichiha Corp.................................................................... 689,609
------------
MERCHANDISING
50,000 Shimamura Co., Ltd.............................................................. 1,350,790
------------
METALS & MINING
919,000 Nippon Steel Co................................................................. 1,894,530
87,000 Sumitomo Sitix Corp............................................................. 1,533,167
80,000 Sumitomo Special Metals......................................................... 1,536,160
------------
4,963,857
------------
METALS NON-FERROUS
234,000 Fujikura Ltd.................................................................... 1,604,738
582,000 Mitsui Mining & Smelting........................................................ 2,568,928
------------
4,173,666
------------
NATURAL GAS
620,000 Tokyo Gas Co., Ltd.............................................................. 1,422,444
------------
OFFICE EQUIPMENT
13,000 Riso Kagaku..................................................................... 766,168
------------
PHARMACEUTICALS
103,000 Eisai Co., Ltd.................................................................. 1,618,204
79,000 Takeda Chemical Industries...................................................... 2,153,948
</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
PORTFOLIO OF INVESTMENTS OCTOBER 31, 1997, CONTINUED
<TABLE>
<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
49,000 Terumo Corp..................................................................... $ 806,484
------------
4,578,636
------------
REAL ESTATE
43,700 Chubu Sekiwa Real Estate, Ltd................................................... 345,096
124,000 Mitsubishi Estate Co., Ltd...................................................... 1,566,750
223,000 Mitsui Fudosan Co............................................................... 2,521,031
------------
4,432,877
------------
RETAIL
45,300 Ministop Co., Ltd............................................................... 1,317,955
23,200 Otsuka Kagu Ltd................................................................. 1,523,525
29,000 Shimachu Co., Ltd............................................................... 617,124
203,000 Tokyo Style Co., Ltd............................................................ 2,143,059
------------
5,601,663
------------
RETAIL - DEPARTMENT STORES
183,000 Hankyu Department Stores........................................................ 1,461,870
------------
RETAIL - GENERAL MERCHANDISE
28,200 Circle K Japan Co., Ltd......................................................... 1,448,678
37,000 Seven - Eleven Japan............................................................ 2,768,080
------------
4,216,758
------------
RETAIL - SPECIALTY
60,000 Aderans Co., Ltd................................................................ 1,615,960
------------
STEEL
1,013,000 Sumitomo Metal Industries....................................................... 2,029,368
100,000 Yamato Kogyo Co., Ltd........................................................... 789,692
------------
2,819,060
------------
TELECOMMUNICATIONS
392 DDI Corp........................................................................ 1,309,925
127,000 Nippon Comsys Corp.............................................................. 1,541,313
358 Nippon Telegraph & Telephone Corp............................................... 3,035,411
------------
5,886,649
------------
TEXTILES
768,000 Mitsubishi Rayon Co., Ltd....................................................... 2,464,239
560,000 Nitto Boseki Co., Ltd........................................................... 1,526,850
------------
3,991,089
------------
TRANSPORTATION
19,000 Kanto Seino Transportation...................................................... 401,164
303,000 Tokyu Corp...................................................................... 1,259,352
------------
1,660,516
------------
UTILITIES - ELECTRIC
69,300 Hokkaido Electric Power......................................................... 1,134,838
------------

<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
WHOLESALE & INTERNATIONAL TRADE
359,000 Mitsui & Co..................................................................... $ 2,724,580
7,000 Satori Electric Co., Ltd........................................................ 124,522
------------
2,849,102
------------
WHOLESALE DISTRIBUTOR
31,200 Fujimi, Inc.*................................................................... 1,716,908
49,500 Misumi Corp..................................................................... 806,484
------------
2,523,392
------------

TOTAL JAPAN..................................................................... 164,199,086
------------

MALAYSIA (6.2%)
AUTOMOTIVE
370,000 Edaran Otomobil Nasional Berhad................................................. 1,159,701
455,000 Oriental Holdings Berhad........................................................ 923,582
99,000 UMW Holdings Berhad............................................................. 115,254
------------
2,198,537
------------
BANKING
1,100,000 Affin Holdings Berhad........................................................... 837,313
34,000 Hong Leong Credit Berhad........................................................ 47,296
701,000 Malayan Banking Berhad.......................................................... 2,699,373
2,200,333 Public Bank Berhad.............................................................. 1,372,745
------------
4,956,727
------------
BUILDING & CONSTRUCTION
60,000 Dialog Group Berhad............................................................. 240,000
700,000 Gamuda Berhad................................................................... 1,065,672
134,000 Gamuda Berhad (Warrants due 12/29/01)*.......................................... 33,600
1,500,000 Lingkaran Trans Kota Holdings Berhad*........................................... 1,432,836
1,750 Sungei Way Holdings Berhad (Warrants due 06/29/99)*............................. 345
956,968 United Engineers Malaysia Berhad................................................ 2,256,731
273,000 YTL Corp. Berhad................................................................ 301,522
------------
5,330,706
------------
CONGLOMERATES
650,000 Sime Darby Berhad............................................................... 931,343
------------
ELECTRONICS
475,000 Malaysian Pacific Industries Berhad............................................. 1,474,627
------------
INSURANCE
605,000 Malaysian Assurance Alliance Berhad............................................. 1,083,582
------------
</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
PORTFOLIO OF INVESTMENTS OCTOBER 31, 1997, CONTINUED
<TABLE>
<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
LEISURE
460,000 Berjaya Sports Toto Berhad...................................................... $ 1,249,552
2,332,800 Magnum Corporation Berhad....................................................... 1,817,495
3,161,000 Metroplex Berhad................................................................ 1,094,555
500,000 Resorts World Berhad............................................................ 888,060
------------
5,049,662
------------
PLANTATION
1,800,000 Highlands & Lowlands Berhad..................................................... 2,031,045
2,695,000 IOI Corporated Berhad........................................................... 2,284,716
900,000 Kuala Lumpur Kepong Berhad...................................................... 2,149,254
------------
6,465,015
------------
PUBLISHING
702,000 Star Publications............................................................... 1,299,224
------------
REAL ESTATE
1,200,000 Pelangi Berhad.................................................................. 576,716
900,000 Sime UEP Properties Berhad...................................................... 832,836
------------
1,409,552
------------
TELECOMMUNICATIONS
1,850,000 Telekom Malaysia Berhad......................................................... 4,776,866
------------
TOBACCO
600,000 RJ Reynolds Berhad.............................................................. 922,388
------------
UTILITIES
229,000 Prime Utilities Berhad.......................................................... 676,746
147,000 Prime Utilities Berhad (Warrants due 03/11/01)*................................. 71,964
294,000 Prime Utilities Berhad 1.00% due 03/01/01 (Loan Stock).......................... 52,657
2,650,000 Tenaga Nasional Berhad.......................................................... 5,695,522
------------
6,496,889
------------
WATER
2,207,000 Puncak Niaga Holdings Berhad.................................................... 2,595,696
------------
WIRE & CABLE
1,400,000 Leader Universal Holdings Berhad................................................ 852,537
------------

TOTAL MALAYSIA.................................................................. 45,843,351
------------
PHILIPPINES (1.2%)
BUILDING MATERIALS
341,400 Bacnotan Consolidated Industries................................................ 229,882
------------

<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
CONGLOMERATES
2,700,000 First Philippine Holdings Corp. (B Shares)...................................... $ 2,282,235
------------
ENGINEERING & CONSTRUCTION
14,334,000 DMCI Holdings, Inc.*............................................................ 1,150,006
------------
LEISURE
14,000,000 Belle Corp.*.................................................................... 1,283,668
2,800,000 Belle Corp. (Warrants due 10/06/00)*............................................ 521
------------
1,284,189
------------
TELECOMMUNICATIONS
80,000 Philippine Long Distance Telephone Co. (ADR).................................... 1,940,000
------------
UTILITIES
782,963 Manila Electric Co. (B Shares).................................................. 2,422,923
------------

TOTAL PHILIPPINES............................................................... 9,309,235
------------

SINGAPORE (8.1%)
BANKING
583,250 Development Bank of Singapore, Ltd.............................................. 5,450,588
1,198,200 Overseas Chinese Banking Corp., Ltd............................................. 6,665,130
600,000 Overseas Union Bank, Ltd........................................................ 2,002,543
1,028,000 United Overseas Bank, Ltd....................................................... 5,685,696
------------
19,803,957
------------
CONGLOMERATES
659,000 Jardine Strategic Holdings Ltd.................................................. 2,108,800
988,750 Keppel Corp., Ltd.*............................................................. 3,130,308
1,430,000 Natsteel Ltd.................................................................... 2,318,182
1,016,000 Sembawang Corp., Ltd............................................................ 3,126,154
------------
10,683,444
------------
ELECTRONIC & ELECTRICAL EQUIPMENT
260,000 Elec & Eltek International Co., Ltd............................................. 1,872,000
1,308,000 Venture Manufacturing Ltd....................................................... 4,490,273
------------
6,362,273
------------
ELECTRONICS
300,000 GP Batteries International Ltd.................................................. 877,305
------------
FINANCE
240,000 Hong Leong Finance Ltd. (Warrants due 09/15/98)*................................ 15,258
------------
</TABLE>

TOTAL SINGAPORE................................................................. 60,202,084
------------

SOUTH KOREA (2.4%)
AUTOMOTIVE
57,000 Hyundai Motor Co., Ltd.......................................................... 944,063
36,000 Hyundai Motor Co., Ltd. (GDR)................................................... 126,000
------------
1,070,063
------------
BANKING
7,003 Shinhan Bank.................................................................... 53,982
------------
COMMUNICATIONS - EQUIPMENT/MANUFACTURERS
27,249 LG Information & Communication Ltd.............................................. 1,566,818
------------
ELECTRONIC & ELECTRICAL EQUIPMENT
40,000 Samsung Display Devices Co...................................................... 1,229,167
80,118 Samsung Electronics Co. (GDR)................................................... 3,162,992
------------
4,392,159
------------
ENGINEERING & CONSTRUCTION
39,990 Hyundai Engineering & Construction Co........................................... 595,684
------------
INSURANCE
30,840 Oriental Fire & Marine Insurance................................................ 359,800
------------

<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
INVESTMENT COMPANIES
234,000 Atlantis Korean Smaller Companies*.............................................. $ 760,500
65,000 Clemente Korea Emerging Growth Fund*............................................ 276,250
------------
1,036,750
------------
SHIPBUILDING
200,650 Daewoo Heavy Industries......................................................... 1,170,458
------------
STEEL & IRON
110,685 Pohang Iron & Steel Co., Ltd.................................................... 4,942,085
------------
UTILITIES
90,640 Korea Electric Power Corp....................................................... 1,293,508
46,838 Seoul City Gas Go Ltd........................................................... 1,122,160
------------
2,415,668
------------

TOTAL SOUTH KOREA............................................................... 17,603,467
------------

TAIWAN (5.4%)
BANKS
705,000 China Development Corp.......................................................... 2,015,931
846,400 China Trust Commercial Bank*.................................................... 1,178,321
372,960 International Commercial Bank of China.......................................... 688,635
614,900 United World Chinese Commercial Bank*........................................... 1,165,497
------------
5,048,384
------------
BUILDING & CONSTRUCTION
802,420 Cathay Construction Corp........................................................ 865,355
------------
BUILDING MATERIALS
307,491 Asia Cement Corp. (GDR)......................................................... 3,305,528
------------
CHEMICALS
56,000 Formosa Chemical & Fibre Corp................................................... 52,157
1,013,700 Formosa Plastic Corp............................................................ 1,629,871
$ 2,925 K Nan Ya Plastics Corp. 1.75% due 07/19/01 (Conv.)................................ 3,188,250
------------
4,870,278
------------
COMPUTERS
52,750 Acer Inc........................................................................ 73,092
$ 1,900 K Acer Peripherals Inc. 1.25% due 11/27/06 (Conv.)................................ 2,090,000
</TABLE>

TOTAL TAIWAN.................................................................... 40,163,222
------------
THAILAND (2.1%)
BANKING
320,000 Bangkok Bank PCL................................................................ 1,092,683
------------
ENERGY
124,900 Ban Pu Coal Co., Ltd............................................................ 859,068
258,500 Lanna Lignite Public Co., Ltd................................................... 895,293
------------
1,754,361
------------

<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
INVESTMENT COMPANIES
7,896,100 Ruang Khao 2 Fund (Units)++..................................................... $ 1,117,009
------------
OIL RELATED
570,000 PTT Exploration & Production PCL................................................ 5,700,000
------------
TELECOMMUNICATIONS
270,000 Advanced Info Service Public Co., Ltd........................................... 1,422,439
------------
TELEVISION
250,000 BEC World Public Co., Ltd....................................................... 1,256,097
------------
TRANSPORTATION
3,300,000 Bangkok Expressway Public Co., Ltd.*............................................ 2,173,171
312,000 Regional Container Line Co., Ltd................................................ 502,244
------------
2,675,415
------------
UTILITIES - ELECTRIC
800,000 Cogeneration Public Co.*........................................................ 790,244
------------

TOTAL THAILAND.................................................................. 15,808,248
------------

TOTAL COMMON STOCKS, WARRANTS, RIGHTS AND BONDS
(IDENTIFIED COST $911,863,478).................................................. 709,635,228
------------
</TABLE>

<TABLE>
<CAPTION>
CURRENCY
AMOUNT IN
THOUSANDS
- -----------
<C> <S> <C>
PURCHASED PUT OPTIONS ON FOREIGN CURRENCY (0.7%)
HKD 257,760 April 24, 1998/HKD 8.055............................................................. 947,200
HKD 290,520 April 24, 1998/HKD 8.07.............................................................. 1,058,400
Y 6,613,322 February 10, 1998/YEN 115.82......................................................... 2,192,640
Y 5,914,300 February 10, 1998/YEN 120.70......................................................... 877,100
------------

TOTAL PURCHASED PUT OPTIONS ON FOREIGN CURRENCY
(IDENTIFIED COST $5,029,510)......................................................... 5,075,340
------------
</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
PORTFOLIO OF INVESTMENTS OCTOBER 31, 1997, CONTINUED

<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT IN
THOUSANDS VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
SHORT-TERM INVESTMENTS (a) (1.2%)
COMMERCIAL PAPER
AUTOMOTIVE - FINANCE
$ 350 Ford Motor Credit Co. 5.50% due 11/26/97............................................. $ 348,663
------------
U.S. GOVERNMENT AGENCY
9,000 Federal Home Loan Mortgage Corp. 5.65% due 11/03/97.................................. 8,997,175
------------

TOTAL SHORT-TERM INVESTMENTS
(AMORTIZED COST $9,345,838).......................................................... 9,345,838
------------

TOTAL INVESTMENTS
(IDENTIFIED COST $926,238,826)....................................................... 724,056,406
------------
</TABLE>

<TABLE>
<CAPTION>
CURRENCY
AMOUNT IN
THOUSANDS
- -----------
<C> <S> <C>
WRITTEN OPTIONS ON FOREIGN CURRENCY (0.4%)
HKD 290,520 April 24, 1998/HKD 8.07.............................................................. (1,420,200)
HKD 257,760 April 24, 1998/HKD 8.05.............................................................. (1,228,800)
------------

TOTAL WRITTEN OPTIONS ON FOREIGN CURRENCY
(PREMIUM RECEIVED $2,594,840)........................................................ (2,649,000)
------------
</TABLE>

<TABLE>
<S> <C> <C>
TOTAL INVESTMENTS
(IDENTIFIED COST $926,238,826) (B)........................................................ 97.1 % 724,056,406
TOTAL WRITTEN OPTIONS OUTSTANDING......................................................... (0.4) (2,649,000)

CASH AND OTHER ASSETS IN EXCESS OF LIABILITIES............................................ 3.3 24,284,164
------ ------------

NET ASSETS................................................................................ 100.0 % $745,691,570
------ ------------
------ ------------

</TABLE>

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

ADR American Depository Receipt.
GDR Global Depository Receipt.
K In thousands.
* Non-income producing security.
** Resale is restricted to qualified institutional investors.
*** Partially paid shares. Resale is restricted to qualified institutional
investors.
++ Consists of one or more class of securities traded together as a unit;
stocks with attached warrants.
(a) Securities were purchased on a discount basis. The interest rates shown
have been adjusted to reflect a money market equivalent yield.
(b) The aggregate cost for federal income tax purposes approximates identified
cost. The aggregate gross unrealized appreciation is $47,368,650 and the
aggregate gross unrealized depreciation is $249,551,070, resulting in net
unrealized depreciation of $202,182,420.

FORWARD FOREIGN CURRENCY CONTRACTS OPEN AT OCTOBER 31, 1997

<TABLE>
<CAPTION>
UNREALIZED
CONTRACTS IN DELIVERY APPRECIATION
TO DELIVER EXCHANGE FOR DATE (DEPRECIATION)
- --------------------------------------------------------
<S> <C> <C> <C>
$ 3,870,634 HKD29,929,677 11/03/97 $ 2,003
MYR 4,283,151 $ 1,254,768 11/03/97 (23,784)
JPY 29,990,882 $ 249,238 11/04/97 (62)
SGD 2,883,450 $ 1,831,227 11/04/97 (1,863)
JPY 20,597,489 $ 171,246 11/05/97 28
MYR 6,850,446 $ 1,984,486 11/05/97 (60,423)
MYR 977,094 $ 288,654 11/05/97 (3,016)
SGD 4,295,384 $ 2,715,161 11/05/97 (15,535)
--------------
Net unrealized depreciation............. $(102,652)
--------------
--------------
</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
SUMMARY OF INVESTMENTS OCTOBER 31, 1997
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY VALUE NET ASSETS
<S> <C> <C>
- ------------------------------------------------------------------------------------------------------------
Agriculture....................................................................... $ 70,864 0.0%
Aluminum.......................................................................... 2,502,500 0.3
Apparel........................................................................... 1,516,625 0.2
Auto Parts........................................................................ 2,681,564 0.3
Auto Trucks & Parts............................................................... 1,222,527 0.2
Automotive........................................................................ 11,090,592 1.5
Automotive - Finance.............................................................. 348,663 0.1
Banking........................................................................... 78,671,607 10.6
Banks............................................................................. 8,829,134 1.2
Building & Construction........................................................... 10,931,294 1.5
Building Materials................................................................ 8,708,755 1.2
Business Services................................................................. 4,711,804 0.6
Chemicals......................................................................... 12,805,806 1.7
Commercial Services............................................................... 1,221,945 0.1
Communications - Equipment/Manufacturers.......................................... 1,566,818 0.2
Computer Software & Services...................................................... 8,655,694 1.2
Computers......................................................................... 7,976,188 1.1
Conglomerates..................................................................... 78,270,359 10.5
Construction Equipment............................................................ 1,326,816 0.2
Construction Plant & Equipment.................................................... 3,149,441 0.4
Currency Options.................................................................. 5,075,340 0.7
Electric.......................................................................... 1,529,510 0.2
Electronic & Electrical Equipment................................................. 38,508,358 5.2
Electronic Components............................................................. 2,651,704 0.3
Electronics....................................................................... 5,220,593 0.7
Electronics - Semiconductors/Components........................................... 7,853,228 1.0
Electronics - Specialty........................................................... 1,039,900 0.1
Energy............................................................................ 5,963,265 0.8
Engineering & Construction........................................................ 6,757,037 0.9
Entertainment..................................................................... 2,398,180 0.3
Finance........................................................................... 15,257 0.0
Financial Services................................................................ 5,384,289 0.7
Food, Beverage, Tobacco & Household Products...................................... 14,710,584 2.0
Forest Products, Paper & Packing.................................................. 419,984 0.1
Hand Tools........................................................................ 514,713 0.1
Healthcare........................................................................ 824,844 0.1
Hotels/Motels..................................................................... 1,727,373 0.2
Industrials....................................................................... 482,544 0.1
Insurance......................................................................... 3,927,173 0.5
Investment Companies.............................................................. 10,135,509 1.3
Leisure........................................................................... 6,333,851 0.9
Life Insurance.................................................................... 3,201,901 0.4
Machinery......................................................................... 14,178,180 1.9
Manufacturing..................................................................... 1,886,863 0.3

<CAPTION>
PERCENT OF
INDUSTRY VALUE NET ASSETS
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Merchandising..................................................................... $ 1,350,790 0.2%
Metals............................................................................ 4,231,536 0.6
Metals & Mining................................................................... 9,411,068 1.2
Metals - Miscellaneous............................................................ 1,576,999 0.2
Metals - Non-Ferrous.............................................................. 4,173,666 0.6
Multi-Industry.................................................................... 3,725,108 0.5
Natural Gas....................................................................... 1,422,444 0.2
Office Equipment.................................................................. 766,168 0.1
Oil & Gas Exploration............................................................. 2,100,000 0.3
Oil Related....................................................................... 5,700,000 0.8
Pharmaceuticals................................................................... 6,422,212 0.9
Plantation........................................................................ 10,286,003 1.4
Property.......................................................................... 776,000 0.1
Publishing........................................................................ 5,969,282 0.8
Real Estate....................................................................... 104,118,189 14.0
Retail............................................................................ 5,601,663 0.8
Retail - Department Stores........................................................ 6,079,468 0.8
Retail - General Merchandise...................................................... 4,216,758 0.6
Retail - Specialty................................................................ 1,615,960 0.2
Retail - Specialty Apparel........................................................ 887,598 0.1
Retail Stores..................................................................... 4,794,156 0.6
Shipbuilding...................................................................... 3,057,299 0.4
Steel............................................................................. 2,819,061 0.4
Steel & Iron...................................................................... 7,829,036 1.0
Telecommunications................................................................ 42,653,658 5.7
Television........................................................................ 1,256,098 0.2
Textiles.......................................................................... 7,687,339 1.0
Tobacco........................................................................... 922,388 0.1
Transportation.................................................................... 16,815,683 2.3
U.S. Government Agency............................................................ 8,997,175 1.2
Utilities......................................................................... 43,173,004 5.8
Utilities - Electric.............................................................. 5,257,782 0.7
Utilities - Telecommunications.................................................... 2,542,912 0.3
Water............................................................................. 2,595,696 0.3
Wholesale & International Trade................................................... 2,849,102 0.4
Wholesale Distributor............................................................. 2,523,392 0.3
Wire & Cable...................................................................... 852,537 0.1
------------ ---
$724,056,406 97.1%
------------ ---
------------ ---
</TABLE>

<TABLE>
<CAPTION>
PERCENT OF
TYPE OF INVESTMENT VALUE NET ASSETS
<S> <C> <C>
- ------------------------------------------------------------------------------------------------------------
Common Stocks..................................................................... $690,530,946 92.7%
Convertible Bonds................................................................. 18,784,469 2.5
Foreign Currency Put Options...................................................... 5,075,340 0.7
Short-Term Investments............................................................ 9,345,838 1.2
Warrants & Rights................................................................. 319,813 0.0
------------ ---
$724,056,406 97.1%
------------ ---
------------ ---
</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES
OCTOBER 31, 1997

<TABLE>
<S> <C>
ASSETS:
Investments in securities, at value
(identified cost $926,238,826)............................................................ $ 724,056,406
Cash (including $7,592,446 in foreign currency)............................................. 11,905,736
Receivable for:
Investments sold........................................................................ 17,570,446
Capital stock sold...................................................................... 2,506,157
Dividends............................................................................... 1,016,602
Interest................................................................................ 129,180
Prepaid expenses and other assets........................................................... 86,201
--------------
TOTAL ASSETS........................................................................... 757,270,728
--------------
LIABILITIES:
Written call options outstanding, at value
(premiums received $2,594,840)............................................................ 2,649,000
Payable for:
Investments purchased................................................................... 4,400,209
Capital stock repurchased............................................................... 1,837,702
Plan of distribution fee................................................................ 799,956
Investment management fee............................................................... 799,585
Accrued expenses and other payables......................................................... 1,092,706
--------------
TOTAL LIABILITIES...................................................................... 11,579,158
--------------
NET ASSETS............................................................................. $ 745,691,570
--------------
--------------
COMPOSITION OF NET ASSETS:
Paid-in-capital............................................................................. $1,079,062,994
Net unrealized depreciation................................................................. (202,672,283)
Dividends in excess of net investment income................................................ (3,880,806)
Accumulated net realized loss............................................................... (126,818,335)
--------------
NET ASSETS............................................................................. $ 745,691,570
--------------
--------------
CLASS A SHARES:
Net Assets.................................................................................. $622,202
Shares Outstanding (500,000,000 AUTHORIZED, $.01 PAR VALUE)................................. 48,394
NET ASSET VALUE PER SHARE.............................................................. $12.86
--------------
--------------
Maximum Offering Price Per Share
(NET ASSET VALUE PLUS 5.54% OF NET ASSET VALUE)......................................... $13.57
--------------
--------------
CLASS B SHARES:
Net Assets.................................................................................. $744,132,621
Shares Outstanding (500,000,000 AUTHORIZED, $.01 PAR VALUE)................................. 57,991,437
NET ASSET VALUE PER SHARE.............................................................. $12.83
--------------
--------------
CLASS C SHARES:
Net Assets.................................................................................. $819,243
Shares Outstanding (500,000,000 AUTHORIZED, $.01 PAR VALUE)................................. 63,853
NET ASSET VALUE PER SHARE.............................................................. $12.83
--------------
--------------
CLASS D SHARES:
Net Assets.................................................................................. $117,504
Shares Outstanding (500,000,000 AUTHORIZED, $.01 PAR VALUE)................................. 9,137
NET ASSET VALUE PER SHARE.............................................................. $12.86
--------------
--------------
</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
FINANCIAL STATEMENTS, CONTINUED

STATEMENT OF OPERATIONS
FOR THE YEAR ENDED OCTOBER 31, 1997*

<TABLE>
<S> <C>
NET INVESTMENT INCOME:

INCOME
Dividends (net of $2,126,874 foreign withholding tax)........................................ $ 33,599,748
Interest..................................................................................... 1,282,514
-------------

TOTAL INCOME............................................................................ 34,882,262
-------------

EXPENSES
Plan of distribution fee (Class A shares).................................................... 278
Plan of distribution fee (Class B shares).................................................... 14,155,635
Plan of distribution fee (Class C shares).................................................... 1,074
Investment management fee.................................................................... 13,946,846
Custodian fees............................................................................... 3,270,864
Transfer agent fees and expenses............................................................. 2,507,387
Professional fees............................................................................ 245,395
Shareholder reports and notices.............................................................. 223,412
Registration fees............................................................................ 92,743
Directors' fees and expenses................................................................. 6,994
Other........................................................................................ 44,740
-------------

TOTAL EXPENSES.......................................................................... 34,495,368
-------------

NET INVESTMENT INCOME................................................................... 386,894
-------------

NET REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) on:
Investments.............................................................................. (79,085,850)
Options written.......................................................................... 718,720
Foreign exchange transactions............................................................ (2,636,120)
-------------

NET LOSS................................................................................ (81,003,250)
-------------
Net change in unrealized appreciation/depreciation on:
Investments.............................................................................. (280,418,627)
Translation of forward foreign currency contracts, other assets and liabilities
denominated in foreign currencies...................................................... (406,090)
-------------

NET DEPRECIATION........................................................................ (280,824,717)
-------------

NET LOSS................................................................................ (361,827,967)
-------------

NET DECREASE................................................................................. $(361,441,073)
-------------
-------------
</TABLE>

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

* Class A, Class C and Class D shares were issued July 28, 1997.

SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
FINANCIAL STATEMENTS, CONTINUED

STATEMENT OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
FOR THE YEAR FOR THE YEAR
ENDED ENDED
OCTOBER 31, 1997* OCTOBER 31, 1996
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C>

INCREASE (DECREASE) IN NET ASSETS:

OPERATIONS:
Net investment income.................................................. $ 386,894 $ 2,914,418
Net realized gain (loss)............................................... (81,003,250) 2,758,084
Net change in unrealized appreciation.................................. (280,824,717) 28,304,565
----------------- ----------------

NET INCREASE (DECREASE)........................................... (361,441,073) 33,977,067

Dividends to shareholders from net investment income - Class B
shares............................................................... (25,258,274) (33,521,569)
Net increase (decrease) from capital stock transactions................ (492,076,963) 182,463,571
----------------- ----------------

NET INCREASE (DECREASE)........................................... (878,776,310) 182,919,069

NET ASSETS:
Beginning of period.................................................... 1,624,467,880 1,441,548,811
----------------- ----------------

END OF PERIOD
(INCLUDING DIVIDENDS IN EXCESS OF NET INVESTMENT INCOME OF
$3,880,806 AND UNDISTRIBUTED NET INVESTMENT INCOME OF $1,241,493,
RESPECTIVELY)...................................................... $ 745,691,570 $ 1,624,467,880
----------------- ----------------
----------------- ----------------
</TABLE>

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

* Class A, Class C and Class D shares were issued July 28, 1997.

SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
NOTES TO FINANCIAL STATEMENTS OCTOBER 31, 1997

1. ORGANIZATION AND ACCOUNTING POLICIES

Dean Witter Pacific Growth Fund Inc. (the "Fund") is registered under the
Investment Company Act of 1940, as amended (the "Act"), as a diversified,
open-end management investment company. The Fund's investment objective is to
maximize capital appreciation of its investments. The Fund was incorporated in
Maryland on June 13, 1990 and commenced operations on November 30, 1990. On July
28, 1997, the Fund commenced offering three additional classes of shares, with
the then current shares designated as Class B shares.

The Fund offers Class A shares, Class B shares, Class C shares and Class D
shares. The four classes are substantially the same except that most Class A
shares are subject to a sales charge imposed at the time of purchase, some Class
A shares, and most Class B shares and Class C shares are subject to a contingent
deferred sales charge imposed on shares redeemed within one year, six years and
one year, respectively. Class D shares are not subject to a sales charge.
Additionally, Class A shares, Class B shares and Class C shares incur
distribution expenses.

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

The following is a summary of significant accounting policies:

A. VALUATION OF INVESTMENTS -- (1) an equity security listed or traded on the
New York, American or other domestic or foreign stock exchange is valued at its
latest sale price on that exchange prior to the time when assets are valued; if
there were no sales that day, the security is valued at the latest bid price (in
cases where securities are traded on more than one exchange, the securities are
valued on the exchange designated as the primary market pursuant to procedures
adopted by the Directors); (2) listed options are valued at the latest sale
price on the exchange on which they are listed unless no sales of such options
have taken place that day, in which case they are valued at the mean between
their latest bid and asked price; (3) all other portfolio securities for which
over-the-counter market quotations are readily available are valued at the
latest available bid price prior to the time of valuation; (4) when market
quotations are not readily available, including circumstances under which it is
determined by Dean Witter InterCapital Inc. (the "Investment Manager") or Morgan
Grenfell Investment Services Limited (the "Sub-Adviser") that sale and bid
prices are not reflective of a security's market value, portfolio securities are
valued at their fair value as determined in good faith under procedures
established by and under the general supervision of the Directors (valuation of
debt securities for which market quotations are not readily available may be
based upon current
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
NOTES TO FINANCIAL STATEMENTS OCTOBER 31, 1997, CONTINUED

market prices of securities which are comparable in coupon, rating and maturity
or an appropriate matrix utilizing similar factors); and (5) short-term debt
securities having a maturity date of more than sixty days at the time of
purchase are valued on a mark-to-market basis until sixty days prior to maturity
and thereafter at amortized cost based on their value on the 61st day.
Short-term debt securities having a maturity date of sixty days or less at the
time of purchase are valued at amortized cost.

B. ACCOUNTING FOR INVESTMENTS -- Security transactions are accounted for on the
trade date (date the order to buy or sell is executed). Realized gains and
losses on security transactions are determined by the identified cost method.
Dividend income and other distributions are recorded on the ex-dividend date
except for certain dividends from foreign securities which are recorded as soon
as the Fund is informed after the ex-dividend date. Discounts are accreted over
the life of the respective securities. Interest income is accrued daily.

C. MULTIPLE CLASS ALLOCATIONS -- Investment income, expenses (other than
distribution fees), and realized and unrealized gains and losses are allocated
to each class of shares based upon the relative net asset value on the date such
items are recognized. Distribution fees are charged directly to the respective
class.

D. OPTION ACCOUNTING PRINCIPLES -- When the Fund writes a call option, an amount
equal to the premium received is included in the Fund's Statement of Assets and
Liabilities as a liability which is subsequently marked-to-market to reflect the
current market value of the option written. If a written option either expires
or the Fund enters into a closing purchase transaction, the Fund realizes a gain
or loss without regard to any unrealized gain or loss on the underlying security
or currency and the liability related to such option is extinguished. If a
written call option is exercised, the Fund realizes a gain or loss from the sale
of the underlying security or currency and the proceeds from such sale are
increased by the premium originally received.

When the Fund purchases a call or put option, the premium paid is recorded as an
investment which is subsequently marked-to-market to reflect the current market
value. If a purchased option expires, the Fund will realize a loss to the extent
of the premium paid. If the Fund enters into a closing sale transaction, a gain
or loss is realized for the difference between the proceeds from the sale and
the cost of the option. If a put option is exercised, the cost of the security
or currency sold upon exercise will be increased by the premium originally paid.
If a call option is exercised, the cost of the security purchased upon exercise
will be increased by the premium originally paid.
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
NOTES TO FINANCIAL STATEMENTS OCTOBER 31, 1997, CONTINUED

E. 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, other assets and liabilities and forward foreign currency
contracts are translated at the exchange rates prevailing at the end of the
period; and (2) purchases, sales, income and expenses are translated at the
exchange rates prevailing on the respective dates of such transactions. The
resultant exchange gains and losses are included in the Statement of Operations
as realized and unrealized gain/loss on foreign exchange transactions. Pursuant
to U.S. Federal income tax regulations, certain foreign exchange gains/losses
included in realized and unrealized gain/loss are included in or are a reduction
of ordinary income for federal income tax purposes. The Fund does not isolate
that portion of the results of operations arising as a result of changes in the
foreign exchange rates from the changes in the market prices of the securities.

F. FORWARD FOREIGN CURRENCY CONTRACTS -- The Fund may enter into forward foreign
currency contracts which are valued daily at the appropriate exchange rates. The
resultant unrealized exchange gains and losses are included in the Statement of
Operations as unrealized gain/loss on foreign exchange transactions. The Fund
records realized gains or losses on delivery of the currency or at the time the
forward contract is extinguished (compensated) by entering into a closing
transaction prior to delivery.

G. FEDERAL INCOME TAX STATUS -- It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to its shareholders.
Accordingly, no federal income tax provision is required.

H. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS -- The Fund records dividends and
distributions to its shareholders on the record 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/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 reclassification. 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.
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
NOTES TO FINANCIAL STATEMENTS OCTOBER 31, 1997, CONTINUED

2. INVESTMENT MANAGEMENT AND SUB-ADVISORY AGREEMENTS

Pursuant to an Investment Management Agreement, the Fund pays the Investment
Manager a management fee, accrued daily and payable monthly, by applying the
following annual rates to the net assets of the Fund determined as of the close
of each business day: 1.0% to the portion of daily net assets not exceeding $1
billion and 0.95% to the portion of daily net assets in excess of $1 billion.
Effective May 1, 1997, the Agreement was amended to reduce the annual rate to
0.90% to the portion of daily net assets in excess of $2 billion.

Under the terms of the Agreement, in addition to managing the Fund's
investments, the Investment Manager maintains certain of the Fund's books and
records and furnishes, at its own expense, office space, facilities, equipment,
clerical, bookkeeping and certain legal services and pays the salaries of all
personnel, including officers of the Fund who are employees of the Investment
Manager. The Investment Manager also bears the cost of telephone services, heat,
light, power and other utilities provided to the Fund.

Under a Sub-Advisory Agreement between the Sub-Adviser and the Investment
Manager, the Sub-Adviser provides the Fund with investment advice and portfolio
management relating to the Fund's investments in securities, subject to the
overall supervision of the Investment Manager. As compensation for its services
provided pursuant to the Sub-Advisory Agreement, the Investment Manager pays the
Sub-Adviser monthly compensation equal to 40% of its monthly compensation.

3. PLAN OF DISTRIBUTION

Shares of the Fund are distributed by Dean Witter Distributors Inc. (the
"Distributor"), an affiliate of the Investment Manager. The Fund has adopted a
Plan of Distribution (the "Plan") pursuant to Rule 12b-1 under the Act. The Plan
provides that the Fund will pay the Distributor a fee which is accrued daily and
paid monthly at the following annual rates: (i) Class A -- up to 0.25% of the
average daily net assets of Class A; (ii) Class B -- 1.0% of the lesser of: (a)
the average daily aggregate gross sales of the Class B shares since the
inception of the Fund (not including reinvestment of dividend or capital gain
distributions) less the average daily aggregate net asset value of the Class B
shares redeemed since the Fund's inception upon which a contingent deferred
sales charge has been imposed or waived; or (b) the average daily net assets of
Class B; and (iii) Class C -- up to 1.0% of the average daily net assets of
Class C. In the case of Class A shares, amounts paid under the Plan are paid to
the Distributor for services provided. In the case of Class B and Class C
shares, amounts paid under the Plan are paid to the Distributor for services
provided and the expenses borne by it and others in the distribution of the
shares of these Classes, including
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
NOTES TO FINANCIAL STATEMENTS OCTOBER 31, 1997, CONTINUED

the payment of commissions for sales of these Classes and incentive compensation
to, and expenses of, the account executives of Dean Witter Reynolds Inc.
("DWR"), an affiliate of the Investment Manager and Distributor, and others who
engage in or support distribution of the shares or who service shareholder
accounts, including overhead and telephone expenses; printing and distribution
of prospectuses and reports used in connection with the offering of these shares
to other than current shareholders; and preparation, printing and distribution
of sales literature and advertising materials. In addition, the Distributor may
utilize fees paid pursuant to the Plan, in the case of Class B shares, to
compensate DWR and other selected broker-dealers for their opportunity costs in
advancing such amounts, which compensation would be in the form of a carrying
charge on any unreimbursed expenses.

In the case of Class B shares, provided that the Plan continues in effect, any
cumulative expenses incurred by the Distributor but not yet recovered may be
recovered through the payment of future distribution fees from the Fund pursuant
to the Plan and contingent deferred sales charges paid by investors upon
redemption of Class B shares. Although there is no legal obligation for the Fund
to pay expenses incurred in excess of payments made to the Distributor under the
Plan and the proceeds of contingent deferred sales charges paid by investors
upon redemption of shares, if for any reason the Plan is terminated, the
Trustees will consider at that time the manner in which to treat such expenses.
The Distributor has advised the Fund that such excess amounts, including
carrying charges, totaled $41,117,586 at October 31, 1997.

In the case of Class A shares and Class C shares, expenses incurred pursuant to
the Plan in any calendar year in excess of 0.25% or 1.0% of the average daily
net assets of Class A or Class C, respectively, will not be reimbursed by the
Fund through payments in any subsequent year, except that expenses representing
a gross sales credit to account executives may be reimbursed in the subsequent
calendar year. For the period ended October 31, 1997, the distribution fee was
accrued for Class A shares and Class C shares at the annual rate of 0.25% and
1.0%, respectively.

The Distributor has informed the Fund that for the year ended October 31, 1997,
it received contingent deferred sales charges from certain redemptions of the
Fund's Class B shares and Class C shares of $4,821,220, and $650, respectively
and approximately $11,000 in front-end sales charges from sales of the Fund's
Class A shares. The respective shareholders pay such charges which are not an
expense of the Fund.
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
NOTES TO FINANCIAL STATEMENTS OCTOBER 31, 1997, CONTINUED

4. SECURITY TRANSACTIONS AND TRANSACTIONS WITH AFFILIATES

The cost of purchases and proceeds from sales of portfolio securities, excluding
short-term investments, for the year ended October 31, 1997 aggregated
$576,215,868 and $1,113,880,798, respectively.

For the year ended October 31, 1997, the Fund incurred $177,930 in brokerage
commissions with affiliates of the Sub-Adviser for portfolio transactions
executed on behalf of the Fund.

For the period May 31, 1997 through October 31, 1997, the Fund incurred
brokerage commissions of $119,132 with Morgan Stanley & Co., Inc., an affiliate
of the Investment Manager since May 31, 1997, for portfolio transactions
executed on behalf of the Fund. At October 31, 1997, the Fund's receivable for
investments sold included unsettled trades with Morgan Stanley & Co., Inc., of
$385,903.

Dean Witter Trust FSB, an affiliate of the Investment Manager and Distributor,
is the Fund's transfer agent. At October 31, 1997, the Fund had transfer agent
fees and expenses payable of approximately $56,508.

The Fund has an unfunded noncontributory defined benefit pension plan covering
all independent Directors of the Fund who will have served as independent
Directors for at least five years at the time of retirement. Benefits under this
plan are based on years of service and compensation during the last five years
of service. Aggregate pension costs for the year ended October 31, 1997 included
in Directors' fees and expenses in the Statement of Operations, amounted to
$4,186. At October 31, 1997, the Fund had an accrued pension liability of
$39,918 which is included in accrued expenses in the Statement of Assets and
Liabilities.
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
NOTES TO FINANCIAL STATEMENTS OCTOBER 31, 1997, CONTINUED

5. CAPITAL STOCK

Transactions in capital stock were as follows:

<TABLE>
<CAPTION>
FOR THE YEAR FOR THE YEAR
ENDED ENDED
OCTOBER 31, 1997 OCTOBER 31, 1996
---------------------------- --------------------------
SHARES AMOUNT SHARES AMOUNT
----------- -------------- ----------- ------------
<S> <C> <C> <C> <C>
CLASS A SHARES*
Sold............................................................. 63,214 $ 998,769 -- --
Redeemed......................................................... (14,820) (235,608) -- --
----------- -------------- ----------- ------------
Net increase - Class A 48,394 763,161 -- --
----------- -------------- ----------- ------------
CLASS B SHARES
Sold............................................................. 28,630,560 521,923,627 38,199,038 $744,616,070
Reinvestment of dividends........................................ 1,228,090 23,456,516 1,685,192 31,243,453
Redeemed......................................................... (57,878,288) (1,039,376,437) (30,677,011) (593,395,952)
----------- -------------- ----------- ------------
Net increase (decrease) - Class B................................ (28,019,638) (493,996,294) 9,207,219 182,463,571
----------- -------------- ----------- ------------
CLASS C SHARES*
Sold............................................................. 76,313 1,169,997 -- --
Redeemed......................................................... (12,460) (171,011) -- --
----------- -------------- ----------- ------------
Net increase - Class C........................................... 63,853 998,986 -- --
----------- -------------- ----------- ------------
CLASS D SHARES*
Sold............................................................. 9,137 157,184 -- --
----------- -------------- ----------- ------------
Net increase (decrease) in Fund.................................. (27,898,254) $ (492,076,963) 9,207,219 $182,463,571
----------- -------------- ----------- ------------
----------- -------------- ----------- ------------
</TABLE>

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

* For the period July 28, 1997 (issue date) through October 31, 1997.

6. FEDERAL INCOME TAX STATUS

At October 31, 1997, the Fund had an approximate net capital loss carryover of
$116,663,000, which may be used to offset future capital gains to the extent
provided by regulations, which is available through October 31 of the following
years:

<TABLE>
<CAPTION>
AMOUNTS IN THOUSANDS
- -----------------------------------------
2003 2004 2005
- --------- -------------- --------------
<S> <C> <C>
$3,193 $15,875 $97,595
- --------- -------------- --------------
- --------- -------------- --------------
</TABLE>

As of October 31, 1997, the Fund had temporary book/tax differences primarily
attributable to the mark-to-market of passive foreign investment companies
("PFICs") and capital loss deferrals on wash sales and permanent book/tax
differences primarily attributable to foreign currency losses and tax
adjustments on PFICs sold by the Fund. To reflect reclassifications arising from
the permanent differences, accumulated net realized loss was charged
$19,755,676, paid-in-capital was credited $6,595, and dividends in excess of net
investment income was credited $19,749,081.
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
NOTES TO FINANCIAL STATEMENTS OCTOBER 31, 1997, CONTINUED

7. PURPOSES OF AND RISKS RELATING TO CERTAIN FINANCIAL INSTRUMENTS

The Fund may enter into forward foreign currency contracts ("forward contracts")
to facilitate settlement of foreign currency denominated portfolio transactions
or to manage foreign currency exposure associated with foreign currency
denominated securities.

Forward contracts involve elements of market risk in excess of the amounts
reflected in the Statement of Assets and Liabilities. The Fund bears the risk of
an unfavorable change in the foreign exchange rates underlying the forward
contracts. Risks may also arise upon entering into these contracts from the
potential inability of the counterparties to meet the terms of their contracts.

At October 31, 1997, there were outstanding forward contracts used to facilitate
settlement of foreign currency denominated portfolio transactions.

At October 31, 1997, the Fund's cash balance consisted principally of interest
bearing deposits with Chase Manhattan Bank N.A., the Fund's custodian.

8. COMMITMENTS

As of October 31, 1997, the Fund has purchased shares which are subject to
installment payments. At October 31, 1997, the Fund had outstanding commitments
as follows:

<TABLE>
<CAPTION>
TOTAL OUTSTANDING
ISSUER COMMITMENT INSTALLMENT PAYMENT TERMS
- ---------------------------------- ----------------------- --------------------------------------------
<S> <C> <C>
Investment Co. of China $158,000 Balance payable in one
installment upon notification
by the issuer.
</TABLE>
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
FINANCIAL HIGHLIGHTS

Selected ratios and per share data for a share of capital stock outstanding
throughout each period:

<TABLE>
<CAPTION>
FOR THE PERIOD
FOR THE YEAR ENDED OCTOBER 31 NOVEMBER 30, 1990*
---------------------------------------------------------- THROUGH
1997***++ 1996 1995 1994 1993 1992** OCTOBER 31, 1991
- ---------------------------------------------------------------------------------------------------------------------------

<S> <C> <C> <C> <C> <C> <C> <C>
CLASS B SHARES

PER SHARE OPERATING PERFORMANCE:

Net asset value, beginning of period...... $ 18.89 $ 18.77 $ 21.60 $ 19.80 $ 12.69 $ 11.72 $10.00
-------- ------- ------- ------- ------- ------- ------

Net investment income (loss).............. 0.01 0.05 0.08 (0.10) (0.04) (0.01) 0.06

Net realized and unrealized gain (loss)... (5.77) 0.50 (1.94) 2.22 7.15 1.14 1.69
-------- ------- ------- ------- ------- ------- ------

Total from investment operations.......... (5.76) 0.55 (1.86) 2.12 7.11 1.13 1.75
-------- ------- ------- ------- ------- ------- ------

Less dividends and distributions from:
Net investment income.................. (0.30) (0.43) -- -- -- (0.01) (0.03)
Net realized gain...................... -- -- (0.97) (0.32) -- (0.15) --
-------- ------- ------- ------- ------- ------- ------

Total dividends and distributions......... (0.30) (0.43) (0.97) (0.32) -- (0.16) (0.03)
-------- ------- ------- ------- ------- ------- ------

Net asset value, end of period............ $ 12.83 $ 18.89 $ 18.77 $ 21.60 $ 19.80 $ 12.69 $11.72
-------- ------- ------- ------- ------- ------- ------
-------- ------- ------- ------- ------- ------- ------

TOTAL INVESTMENT RETURN+.................. (31.01)% 3.00% (8.65)% 10.69% 56.13% 9.86% 17.54%(1)

RATIOS TO AVERAGE NET ASSETS:

Expenses.................................. 2.44% 2.39% 2.45% 2.41% 2.38% 2.77% 2.43%(2)(3)

Net investment income (loss).............. 0.03% 0.18% 0.35% (0.70)% (0.46)% (0.30)% 0.61%(2)(3)

SUPPLEMENTAL DATA:

Net assets, end of period, in millions.... $744 $1,624 $1,442 $1,571 $694 $177 $86

Portfolio turnover rate................... 42% 49% 50% 35% 30% 73% 70%(1)

Average commission rate paid.............. $0.0075 $0.0095 -- -- -- -- --

- ---------------------
* Commencement of operations.
** Net investment loss was computed based upon the monthly average shares
outstanding.
*** Prior to July 28, 1997, the Fund issued one class of shares. All shares of
the Fund held prior to that date have been designated Class B shares.
++ The per share amounts were computed using an average number of shares
outstanding during the period.
+ Does not reflect the deduction of sales charge. Calculated based on the net
asset value as of the last business day of the period.
(1) Not annualized.
(2) Annualized.
(3) If the Fund had borne all expenses that were assumed or waived by the
Investment Manager, the above annualized expense and net investment income
ratios would have been 2.83% and 0.22%, respectively.
</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
FINANCIAL HIGHLIGHTS, CONTINUED

<TABLE>
<CAPTION>
FOR THE PERIOD
JULY 28, 1997*
THROUGH
OCTOBER 31,
1997++
- ----------------------------------------------------------------------------------------
<S> <C>
CLASS A SHARES
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period.................................. $ 19.39
Net realized and unrealized loss...................................... (6.53)
------
Net asset value, end of period........................................ $ 12.86
------
------
TOTAL INVESTMENT RETURN+.............................................. (33.68)%(1)
RATIOS TO AVERAGE NET ASSETS:
Expenses.............................................................. 1.92% (2)
Net investment loss................................................... (0.03)%(2)
SUPPLEMENTAL DATA:
Net assets, end of period, in thousands............................... $622
Portfolio turnover rate............................................... 42%
Average commission rate paid.......................................... $0.0075
</TABLE>

<TABLE>
<S> <C>
CLASS C SHARES
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period.................................. $ 19.39
------
Net investment loss................................................... (0.04)
Net realized and unrealized loss...................................... (6.52)
------
Total from investment operations...................................... (6.56)
------
Net asset value, end of period........................................ $ 12.83
------
------
TOTAL INVESTMENT RETURN+.............................................. (33.83)%(1)
RATIOS TO AVERAGE NET ASSETS:
Expenses.............................................................. 2.62% (2)
Net investment loss................................................... (0.77)%(2)
SUPPLEMENTAL DATA:
Net assets, end of period, in thousands............................... $819
Portfolio turnover rate............................................... 42%
Average commission rate paid.......................................... $0.0075

- ---------------------
* The date shares were first issued.
++ The per share amounts were computed using an average number of shares
outstanding during the period.
+ Does not reflect the deduction of sales charge. Calculated based on the net
asset value as of the last business day of the period.
(1) Not annualized.
(2) Annualized.
</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
FINANCIAL HIGHLIGHTS, CONTINUED

<TABLE>
<CAPTION>
FOR THE PERIOD
JULY 28, 1997*
THROUGH
OCTOBER 31,
1997++
- ----------------------------------------------------------------------------------------

<S> <C>
CLASS D SHARES

PER SHARE OPERATING PERFORMANCE:

Net asset value, beginning of period.................................. $ 19.39
------

Net investment income................................................. 0.02

Net realized and unrealized loss...................................... (6.55)
------

Total from investment operations...................................... (6.53)
------

Net asset value, end of period........................................ $ 12.86
------
------

TOTAL INVESTMENT RETURN+.............................................. (33.68)%(1)

RATIOS TO AVERAGE NET ASSETS:

Expenses.............................................................. 1.62% (2)

Net investment income................................................. 0.42% (2)

SUPPLEMENTAL DATA:

Net assets, end of period, in thousands............................... $118

Portfolio turnover rate............................................... 42%

Average commission rate paid.......................................... $0.0075

- ---------------------
* The date shares were first issued.
++ The per share amounts were computed using an average number of shares
outstanding during the period.
+ Calculated based on the net asset value as of the last business day of the
period.
(1) Not annualized.
(2) Annualized.
</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER PACIFIC GROWTH FUND INC.
REPORT OF INDEPENDENT ACCOUNTANTS

TO THE SHAREHOLDERS AND BOARD OF DIRECTORS
OF DEAN WITTER PACIFIC GROWTH 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 Dean Witter Pacific Growth 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 periods
presented, 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 and brokers and the application of
alternative auditing procedures where confirmations from brokers were not
received, provide a reasonable basis for the opinion expressed above.

PRICE WATERHOUSE LLP
1177 AVENUE OF THE AMERICAS
NEW YORK, NEW YORK 10036
DECEMBER 17, 1997

1997 FEDERAL TAX NOTICE (UNAUDITED)

For the year ended October 31, 1997, the Fund has elected,
pursuant to Section 853 of the Internal Revenue Code, to
pass-through foreign taxes of $0.04 per share to its shareholders.
The Fund generated net foreign source income of $0.04 per share
with respect to this election.
<PAGE>

BOARD OF DIRECTORS

Michael Bozic
Charles A. Fiumefreddo
Edwin J. Garn
John R. Haire
Wayne E. Hedien
Dr. Manuel H. Johnson
Michael E. Nugent
Philip J. Purcell
John L. Schroeder

OFFICERS

Charles A. Fiumefreddo
Chairman and Chief Executive Officer

Barry Fink
Vice President, Secretary and General Counsel

Thomas F. Caloia
Treasurer

TRANSFER AGENT

Dean Witter Trust FSB
Harborside Financial Center - Plaza Two
Jersey City, New Jersey 07311

INDEPENDENT ACCOUNTANTS

Price Waterhouse LLP
1177 Avenue of the Americas
New York, New York 10036

INVESTMENT MANAGER

Dean Witter InterCapital Inc.
Two World Trade Center
New York, New York 10048

SUB-ADVISOR

Morgan Grenfell Investment Services Limited

This report is submitted for the general information of shareholders of the
Fund. For more detailed information about the Fund, its officers and
directors, fees, expenses and other pertinent information, please see the
prospectus of the Fund.

This report is not authorized for distribution to prospective investors in the
Fund unless preceded or accompanied by an effective prospectus.

DEAN WITTER PACIFIC GROWTH FUND

[GRAPHIC]

ANNUAL REPORT
OCTOBER 31, 1997