MERRILL LYNCH
LATIN AMERICA
FUND, INC.
FUND LOGO
Annual Report
November 30, 1994
Investing in emerging market securities involves a
number of risk factors and special considerations,
including restrictions on foreign investments and on
repatriation of capital invested in emerging markets,
currency fluctuations, and potential price volatility
and less liquidity of securities traded in emerging
markets. In addition, there may be less publicly avail-
able information about the issuers of securities, and
such issuers may not be subject to accounting, auditing
and financial reporting standards and requirements
comparable to those to which US companies are subject.
Therefore, the Fund is designed as a long-term invest-
ment for investors capable of assuming the risks of
investing in emerging markets. The Fund should be
considered as a vehicle for diversification and not as a
complete investment program. Please refer to the
prospectus for details.
<PAGE>
This report is not authorized for use as an offer of sale
or a solicitation of an offer to buy shares of the Fund
unless accompanied or preceded by the Fund's current
prospectus. Past performance results shown in this
report should not be considered a representation of
future performance. Investment return and principal
value of shares will fluctuate so that shares, when
redeemed, may be worth more or less than their
original cost.
Merrill Lynch
Latin America
Fund, Inc.
Box 9011
Princeton, NJ
08543-9011
MERRILL LYNCH LATIN AMERICA FUND, INC.
Asset
Allocation
As a Percentage* of
Net Asets as of
November 30, 1994
IMAGE MATERIAL APPEARS HERE.
SEE APPENDIX GRAPHIC AND IMAGE MATERIAL
ITEM 1.
<PAGE>
DEAR SHAREHOLDER
Fiscal Year in Review
During the 12-month period ended
November 30, 1994, we reduced the
concentration of equity and fixed-
income investments in Mexico from
54.6% of net assets to 43.2%. This
reduction enabled us to increase our
investments in several attractive coun-
tries. We increased our position in
Brazil from 15.8% of net assets to 28.1%;
Peru from 1.8% to 3.1%; and Colombia
from 0.8% to 3.0%. These stock markets
have become more liquid, and we expect
them to have better relative returns
than Mexico. The reduction in Mexican
investments also allowed us to invest in
several new markets such as Uruguay,
where we invested 0.1% of net assets,
and Ecuador, which now accounts for
1.3% of net assets. The MSCI Latin
America Free Index rose 31.2% during
the 12 months ended November 30,
1994, while the Fund's Class B Shares'
total return was +20.19% and the Class
D Shares' total return was +21.07%.
The Fund's performance was hindered
by the weakness in markets such as
Argentina and Mexico, which rose only
1.1% and 3.1%, respectively, during this
period. The Fund benefited from an
overweighting in Peru, which was the
best-performing market, rising 79.9%.
Investment Overview
We are reassessing our investments in
Latin America in light of the sharp
devaluations of the Mexican peso during
recent weeks and the market correc-
tions that have ensued throughout the
region. Overall, we feel that the outlook
for most of these countries remains
positive and therefore consider the
selling to be indiscriminate and over-
done. As a result, we are taking this
opportunity to accumulate invest-
ments in blue chip companies outside
of Mexico.
<PAGE>
In Mexico itself, we are buying and sell-
ing stocks very carefully, as we feel that
the market's instability will continue
for weeks or months. Our caution arises
from our view that the country's leaders
have suffered a tremendous loss of
credibility and that Mexico's economic
recovery has been forestalled. We also
expect higher inflation and interest
rates, and continued currency volatility
in the near term.
Given a longer horizon, we are more
positive on the Mexican stock market.
Assuming that inflation is curbed,
the weak peso will benefit export
growth and improve the country's trade
balance. We also feel that a currency
that is market-determined will, over
time, be less subject to speculative
attacks. We are, therefore, identifying
Mexican companies which will be less
vulnerable (by having minimal dollar-
denominated costs and borrowings),
those with good cash positions, and
those whose export revenues will
benefit from the peso's depreciation.
Even before the Mexican peso's devalua-
tion, investors and strategists were con-
cerned about the possibility that rising
US interest rates may attract assets out
of equities and into alternative invest-
ments such as short-term and longer-
term fixed-income securities. This
concern is particularly prevalent when
looking at international equity invest-
ments. In recent years, investors have
greatly increased their allocation of
equity assets to international invest-
ments, especially emerging markets.
Emerging stock markets tend to be less
liquid than established markets and
thus are subject to sharp price swings.
We believe that while a correction is
possible, it would be of a short-term
nature as a result of the superior
growth characteristics of companies in
these countries. We also believe it
would represent a buying opportunity.
<PAGE>
We expect the US Federal Reserve
Board to continue to raise short-term
interest rates in the coming months. In
our opinion, the incremental increases
will have diminished negative impact
on stock markets worldwide, including
those in Latin America, as investors
begin to focus on earnings growth. As
this happens, the outlook for growth in
some Latin American countries will
compare favorably with other parts of
the world. In countries such as Argen-
tina, for example, earnings growth
should accelerate in the coming months.
Although economic growth may slow in
1995, the growth of corporate earnings
can still improve for companies where
restructuring continues to reduce costs.
One of our recent additions to the
portfolio is Grimoldi S.A., an Argentine
retailer and manufacturer of shoes. It
has licensing agreements to distribute
major brands such as Hush Puppies,
Birkenstock, Bass, Sperry Top Sider
and Cole Haan in that country. As is
the case with many Argentine stocks,
Grimoldi's stock price does not reflect
the company's potential for growth in
the coming years nor its position as the
strongest company in a fragmented
market.
Investors seeking potentially superior
long-term returns may also find them in
the newly emerging markets of Latin
America. In Peru, for example, the
economic policies of the Fujimori
administration have brought inflation
down from 7,500% in 1990 to only 25%
this year. We believe that real growth in
the economy can be sustained at over 5%
per annum in the coming years. Income
from this year's successful privatiza-
tions and improved tax collection could
turn the government's fiscal deficit into
a surplus. Under Fujimori's leadership,
terrorist activities have diminished,
resulting in increasing political stability
and resultant potential investor interest.
<PAGE>
One of our largest investments in Peru
is Banco Wiese Limitado S.A., a bank
which has been in operation since
1943. The bank's main customer is the
corporate sector, which should flourish
as the economic environment becomes
more stable. Banco Wiese has experi-
enced tremendous loan growth over the
past two years, which we believe will
translate into earnings growth of over
20% in the coming years.
In Conclusion
Going forward, we plan to continue
distributing the portfolio's investments
throughout Latin America rather than
concentrating in one market. We also
expect that stock selection will become
increasingly important in determining
how the portfolio's assets are allocated.
As we look to the coming year, we
remind our shareholders that the tran-
sition of developing countries, in Latin
America and elsewhere, to ``first world''
status takes place over years. Invest-
ments in these countries' stock markets
should have horizons of several years.
During a country's development, it will
experience many economic, political
and market trauma such as we saw in
Mexico. These events do not necessarily
reverse the country's past achievements
or halt its progress. It is during these
periods that we find the most attractive
opportunities to invest.
We appreciate your ongoing interest in
Merrill Lynch Latin America Fund,
Inc., and we look forward to assisting
you with your financial needs and
objectives in the months and years
ahead.
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
<PAGE>
(Grace Pineda)
Grace Pineda
Vice President and Portfolio Manager
January 11, 1995
Officers and
Directors
Arthur Zeikel, President and Director
Donald Cecil, Director
Edward H. Meyer, Director
Charles C. Reilly, Director
Richard R. West, Director
Edward D. Zinbarg, Director
Terry K. Glenn, Executive Vice President
Norman R. Harvey, Senior Vice President
Donald C. Burke, Vice President
Grace Pineda, Vice President and Portfolio Manager
Gerald M. Richard, Treasurer
Mark B. Goldfus, Secretary
Custodian
The Chase Manhattan Bank, N.A.
Global Securities Services
4 MetroTech Center, 18th Floor
Brooklyn, New York 11245
Transfer Agent
Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, Florida 32246-6484
(800) 637-3863
<PAGE>
PERFORMANCE DATA
About Fund
Performance
Since October 21, 1994, investors have been able to purchase
shares of the Fund through the Merrill Lynch Select Pricing SM
System, which offers four pricing alternatives:
*Class A Shares incur a maximum initial sales charge (front-
end load) of 5.25% and bear no ongoing distribution or account
maintenance fees. Class A Shares are available only to eligible
investors, as detailed in the Fund's prospectus. If you were a
Class A shareholder prior to October 21, 1994, your Class A
Shares were redesignated to Class D Shares on October 21, 1994,
which, in the case of certain eligible investors, were simulta-
neously exchanged for Class A shares.
*Class B Shares are subject to a maximum contingent deferred
sales charge of 4% if redeemed during the first year, decreasing
1% each year thereafter to 0% after the fourth year. In addition,
Class B Shares are subject to a distribution fee of 0.75% and an
account maintenance fee of 0.25%. These shares automatically
convert to Class D Shares after 8 years.
*Class C Shares are subject to a distribution fee of 0.75% and
an account maintenance fee of 0.25%. In addition, Class C
Shares are subject to a 1% contingent deferred sales charge
if redeemed within one year of purchase.
*Class D Shares incur a maximum initial sales charge of
5.25% and an account maintenance fee of 0.25% (but no distri-
bution fee).
Performance data for the Fund's Class B and Class D
Shares are presented in the "Performance Summary" and
"Average Annual Total Return" tables on page 5. Data for all
of the Fund's shares, including Class A and Class C
Shares, are presented in the "Recent Performance Results" table.
The "Recent Performance Results" table on page 6 shows
investment results before the deduction of any sales charges
for Class B and Class D Shares for the 12-month and
3-month periods ended November 30, 1994 and for Class A
and Class C Shares for the period since inception through
November 30, 1994. All data in this table assume imposition of
the actual total expenses incurred by each class of shares during
the relevant period.
<PAGE>
None of the past results shown should be considered a represen-
tation of future performance. Investment return and principal
value of shares will fluctuate so that shares, when redeemed,
may be worth more or less than their original cost.
Total Return
Based on a
$10,000
Investment
GRAPHIC MATERIAL APPEAR HERE.
SEE APPENDIX GRAPHIC AND IMAGE MATERIAL
ITEM 2.
Average Annual
Total Return
% Return % Return
Without CDSC With CDSC**
Class B Shares*
Year Ended 9/30/94 +47.89% +43.89%
Inception (9/27/91) through 9/30/94 +24.31 +24.10
[FN]
*Maximum contingent deferred sales charge is 4% and is reduced to 0% after
4 years.
**Assuming payment of applicable contingent deferred sales charge.
% Return Without % Return With
Sales Charge Sales Charge**
Class D Shares*
Year Ended 9/30/94 +48.96% +41.14%
Inception (9/27/91) through 9/30/94 +25.27 +23.04
[FN]
*Maximum sales charge is 5.25%. On 10/21/94, Class A Shares were redesignated
to Class D Shares.
**Assuming maximum sales charge.
<PAGE>
<TABLE>
Performance
Summary--
Class B Shares
<CAPTION>
Net Asset Value Capital Gains
Period Covered Beginning Ending Distributed Dividends Paid* % Change**
<C> <C> <C> <C> <C> <C>
9/27/91--12/31/91 $10.00 $10.32 -- $0.098 + 4.22%
1992 10.32 10.22 -- 0.227 + 1.34
1993 10.22 16.61 -- 0.048 +63.05
1/1/94--11/30/94 16.61 17.24 -- -- + 3.79
------
Total $0.373
Cumulative total return as of 11/30/94: +78.73%**
<FN>
*Figures may include short-term capital gains distributions.
**Figures assume reinvestment of all dividends and capital gains distributions
at net asset value on the ex-dividend date, and do not reflect deduction of
any sales charge; results would be lower if sales charge was deducted.
</TABLE>
<TABLE>
Performance
Summary--
Class D Shares***
<CAPTION>
Net Asset Value Capital Gains
Period Covered Beginning Ending Distributed Dividends Paid* % Change**
<C> <C> <C> <C> <C> <C>
9/27/91--12/31/91 $10.00 $10.31 -- $0.125 + 4.40%
1992 10.31 10.19 -- 0.326 + 2.15
1993 10.19 16.62 -- 0.108 +64.27
1/1/94--1/30/94 16.62 17.37 -- -- + 4.51
------
Total $0.559
Cumulative total return as of 11/30/94: +83.10%**
<FN>
*Figures may include short-term capital gains distributions.
**Figures assume reinvestment of all dividends and capital gains
distributions at net asset value on the ex-dividend date, and do
not include sales charge; results would be lower if sales charge
was included.
***As a result of the implementation of the Merrill Lynch Select
Pricing SM System, Class A Shares of the Fund outstanding
prior to October 21, 1994 have been redesignated to Class D Shares.
</TABLE>
<PAGE>
PERFORMANCE DATA (concluded)
<TABLE>
Recent
Performance
Results
<CAPTION>
12 Month 3 Month
11/30/94 8/31/94++ 11/30/93 % Change % Change++
<S> <C> <C> <C> <C> <C>
Class A Shares* $17.37 $18.22 -- -- -4.67%
Class B Shares* 17.24 17.89 $14.39 +19.81% -3.63
Class C Shares* 17.24 18.10 -- -- -4.75
Class D Shares* 17.37 17.99 14.45 +20.21 -3.45
Class A Shares--Total Return* -- -4.67
Class B Shares--Total Return* +20.19(1) -3.63
Class C Shares--Total Return* -- -4.75
Class D Shares--Total Return* +21.07(2) -3.45
<FN>
*Investment results shown do not reflect any sales charges;
results would be lower if a sales charge was included.
++Investment results shown for Class A and Class C Shares are
since inception (10/21/94).
(1)Percent change includes reinvestment of $0.048 per share
ordinary income dividends.
(2)Percent change includes reinvestment of $0.108 per share
ordinary income dividends.
</TABLE>
<TABLE>
CONSOLIDATED SCHEDULE OF INVESTMENTS (in US dollars)
<CAPTION>
Shares Value Percent of
COUNTRY Industries Held Long-Term Investments Cost (Note 1a) Net Assets
<S> <S> <C> <S> <C> <C> <C>
Argentina Automotive 1,180,882 Compania Interamericana de
Automoviles S.A. $ 16,206,638 $ 13,116,972 1.1%
Banking 600,099 Banco de Galicia y Buenos
Aires S.A. (ADR) (2) 3,250,066 3,543,064 0.3
59,512 Banco de Galicia y Buenos Aires S.A.
(Preferred) (ADR) (2) 1,049,513 1,361,349 0.1
185,000 Banco del Sud S.A. 3,224,461 2,017,912 0.2
658,180 Banco Frances del Rio de la Plata
S.A. 3,854,286 5,730,177 0.5
-------------- -------------- ------
11,378,326 12,652,502 1.1
<PAGE>
Beverages 1,746 Buenos Aires Embotelladora S.A.
(BAESA) 1,759,894 3,407,085 0.3
91,000 Buenos Aires Embotelladora S.A.
(BAESA) (ADR) (2) 2,575,194 3,526,250 0.3
-------------- -------------- ------
4,335,088 6,933,335 0.6
Food 156,103 ++Quilmes Industrial S.A. 1,684,480 4,128,925 0.4
Oil & Related 4,790,880 Astra Compania Argentina de
Petroleo S.A. 11,024,264 9,300,818 0.8
1,968,621 Compania Naviera Perez Companc
S.A.C.F.I.M.F.A. 11,151,188 9,554,500 0.8
519,700 Yacimientos Petroliferos Fiscales
S.A. (Sponsored) (ADR) (2) 13,162,011 11,758,211 1.0
-------------- -------------- ------
35,337,463 30,613,529 2.6
Real Estate 1,203,565 Inversiones y Representaciones
S.A. (IRSA) 3,138,864 3,565,048 0.3
Retail 132,744 Grimoldi S.A. (Class B) 1,197,811 1,062,696 0.1
Telecommunications 866,000 Telecom Argentina Stet--France
Telecom S.A. 5,307,028 4,852,997 0.4
270,580 ++Telecom Argentina Stet--France
Telecom S.A. (ADR) (2) 15,682,783 14,949,545 1.3
525,000 Telefonica de Argentina S.A. 3,009,246 2,968,328 0.3
70,276 Telefonica de Argentina S.A.
(ADR) (2) 2,132,935 3,909,101 0.3
-------------- -------------- ------
26,131,992 26,679,971 2.3
Tobacco 49,980 Massalin Particulares S.A. 508,374 575,173 0.1
Utilities 9,500 ++Central Costanera S.A. (Class B) 228,000 292,125 0.0
1,049,000 ++Transportadora de Gas del Sur S.A.
(ADR) (2) 13,793,192 11,670,125 1.0
-------------- -------------- ------
14,021,192 11,962,250 1.0
Total Long-Term Investments in
Argentina 113,940,228 111,290,401 9.6
Brazil Appliances & 29,375,500 Brasmotor Group S.A. (Preferred) 8,255,333 12,515,006 1.1
Household 1,026,160 Multibras S.A. (Preferred) 527,444 1,700,147 0.1
Durables 1,024,800,000 Refrigeracao Parana S.A.
(Preferred) 3,336,860 3,638,343 0.3
-------------- -------------- ------
12,119,637 17,853,496 1.5
<PAGE>
Automotive 802,300 CAPCO Automotive Products Corp.
S.A. (ADR) (2) 9,471,368 10,429,900 0.9
1,062,000 Confab Industrial S.A. 1,909,375 2,199,408 0.2
-------------- -------------- ------
11,380,743 12,629,308 1.1
Banking 1,886,253,276 Banco Bradesco S.A. (Preferred) 14,882,870 15,402,540 1.3
15,500,400 Banco Itau S.A. (Preferred) 2,460,710 4,402,480 0.4
380,329,908 Banco Nacional S.A. PN 10,068,684 10,127,128 0.9
17,237,154 Uniao de Bancos Brasileiros
S.A. (UNIBANCO) 397,694 467,138 0.0
-------------- -------------- ------
27,809,958 30,399,286 2.6
Beverages 18,467,072 Companhia Cervejaria Brahma
S.A. (Preferred) 3,657,137 6,490,793 0.6
1,880,905 +++Companhia Cervejaria Brahma S.A.
(Warrants) (a) 48,935 2,696 0.0
-------------- -------------- ------
3,706,072 6,493,489 0.6
Building & 547,000 Companhia Cimento Portland
Construction Itau S.A. PN 134,354 233,041 0.0
Electrical & 719,202 Companhia Energetica de Sao Paulo
Electronics S.A. (CESP) (Preferred) (ADR) (2) 482,578 1,131,764 0.1
43,052,000 Light-Servicios de Electricidade
S.A. 15,464,872 17,832,699 1.5
-------------- -------------- ------
15,947,450 18,964,463 1.6
Energy 271,000,000 +++Companhia Brasil Petro Ipiranga
S.A. (Preferred) 4,473,022 5,269,266 0.5
Food 70,800,000 Ceval Alimentos S.A. 1,075,155 1,214,911 0.1
12,275,410 Sadia Concordia S.A. Industria e
Comercio (Preferred) 10,627,282 18,376,797 1.6
-------------- -------------- ------
11,702,437 19,591,708 1.7
Forest Products 364,851 Aracruz Celulose S.A. (Preferred) 647,358 969,338 0.1
& Papers 19,626 Bardella Industrial S.A.
(Preferred) 4,974,191 4,645,207 0.4
519,000 Industrias Klabin de Papel e
Celulose S.A. (Preferred) 746,632 909,018 0.1
16,802,000 MelPaper S.A. (Preferred) 10,233,320 11,331,905 1.0
-------------- -------------- ------
16,601,501 17,855,468 1.6
<PAGE>
Machinery 8,709,000 Iochpe-Maxion S.A. (Ordinary) 3,583,312 5,204,787 0.4
33,699,765 Iochpe-Maxion S.A. (Preferred) 13,685,869 24,527,048 2.1
6,273,000 +++Weg Exportadora S.A. (Preferred) 3,432,249 4,298,304 0.4
-------------- -------------- ------
20,701,430 34,030,139 2.9
Metals & Steel 312,000 ++Companhia Siderurgica de Tubarao
S.A. (CST) 9,862,065 11,388,000 1.0
</TABLE>
<TABLE>
CONSOLIDATED SCHEDULE OF INVESTMENTS (continued) (in US dollars)
<CAPTION>
Shares Value Percent of
COUNTRY Industries Held Long-Term Investments Cost (Note 1a) Net Assets
<S> <S> <C> <S> <C> <C> <C>
Brazil Mining 88,191,200 Companhia Vale do Rio Doce S.A. $ 10,390,543 $ 16,907,661 1.5%
(concluded)
Oil & Related 55,520,000 Petroleo Brasileiro S.A. 7,056,177 8,081,610 0.7
Retail 4,188,934 Casa Anglo Brasileira S.A. 865,347 1,140,183 0.1
118,564,600 Lojas Americanas S.A. 2,125,943 4,209,394 0.4
13,896,600 Mesbla S.A. 3,127,325 2,713,538 0.2
-------------- -------------- ------
6,118,615 8,063,115 0.7
Steel 3,192,700 Acos Industria Villares S.A. 714,377 812,344 0.1
272,560,000 Companhia Metalurgica Barbara S.A. 267,267 387,068 0.0
191,318,000 Companhia Siderurgica Nacional
S.A.--CSN 6,838,186 8,603,649 0.7
12,844,682,013 Usinas Siderurgicas de Minas
Gerais-Usiminas S.A. (Preferred) 7,655,752 20,369,084 1.8
-------------- -------------- ------
15,475,582 30,172,145 2.6
Tele- 260,267 ++Telecomunicacoes Brasileiras
communications S.A.--Telebras (ADR) (2) 12,136,746 12,232,549 1.1
33,197,615 Telecomunicacoes Brasileiras
S.A.--Telebras (Ordinary) 1,178,023 1,273,295 0.1
266,134,366 Telecomunicacoes Brasileiras
S.A.--Telebras(Preferred) 11,845,357 12,755,553 1.1
60,723,102 Telecomunicacoes de Minejeros
S.A.--TELEMIG (Ordinary) 2,682,475 3,233,775 0.3
5,641,975 Telecomunicacoes de Minejeros
S.A.--TELEMIG (Preferred) 290,003 263,069 0.0
44,862,077 Telecomunicacoes de Sao Paulo
S.A.--TELESP (Preferred) 14,927,430 19,909,206 1.7
4,430,936 Telecomunicacoes Parana
S.A.-TELEPAR (Preferred) 754,996 1,651,769 0.1
-------------- -------------- ------
43,815,030 51,319,216 4.4
<PAGE>
Textiles 873,000 Brasperola Industria e
Comercio S.A. 931,692 1,157,113 0.1
3,697,363 Companhia de Tecidos Norte de
Minas S.A. 895,127 1,378,306 0.1
-------------- -------------- ------
1,826,819 2,535,419 0.2
Transportation 165,000 Marcopolo S.A. Carrocerias E Onibus
'B' (Preferred) 25,066 42,178 0.0
Utilities 17,940,467 Centrais Eletricas Brasileiras S.A.
--Eletrobras 'B' (Preferred) 4,664,934 6,220,777 0.5
4,387,500 Centrais Eletricas da Santa Catarina
S.A (CELESC) 'B' (Preferred) 764,541 4,460,193 0.4
34,321,009 Companhia Energetica de Minas Gerais
S.A. (CEMIG) 1,625,256 3,553,950 0.3
30,000 Companhia Energetica de Minas Gerais
S.A. (CEMIG) (ADR) (2) 638,750 787,500 0.1
203,820,000 Companhia Paulista de Forca e
Luz S.A. 11,896,752 18,572,947 1.6
-------------- -------------- ------
19,590,233 33,595,367 2.9
Total Long-Term Investments
in Brazil 238,736,734 325,424,375 28.1
Chile Apparel 1,206,231 Bata Chile S.A. 340,424 270,725 0.0
Banking 202,900 Banco O'Higgins S.A. (ADR) (2) 3,101,779 3,804,375 0.3
Beverages 35,891 Embotelladora Andina S.A. 134,130 161,107 0.0
384,000 Vina Concha y Toro S.A. (ADR) (2) 7,296,950 6,912,000 0.6
4,084,632 Vina Concha y Toro S.A. 1,694,797 1,558,475 0.1
-------------- -------------- ------
9,125,877 8,631,582 0.7
Building & 338,225 Empresas Pizarreno S.A. 644,310 683,197 0.1
Construction 426,700 Maderas y Sinteticos S.A. (MASISA)
(Foreign) (ADR) (2) 10,835,658 12,000,938 1.0
128,445 Maderas y Sinteticos S.A.
(MASISA) (Ordinary) 57,151 123,320 0.0
-------------- -------------- ------
11,537,119 12,807,455 1.1
Chemicals 417,300 Sociedad Quimica y Minera de Chile
S.A. (ADR) (2) 13,363,054 11,684,400 1.0
Closed-End Funds 67,984 The Chile Fund, Inc. 1,993,436 3,178,252 0.3
Food & Household 138,650 Cristalerias de Chile S.A. (ADR) (2) 3,035,094 2,582,356 0.2
Products
<PAGE>
Multi-Industry 170,000 Antofagasta Holdings PLC 933,338 891,666 0.1
509,056 +++Forestal Terranova S.A. 874,786 952,100 0.1
-------------- -------------- ------
1,808,124 1,843,766 0.2
Pharmaceutical 2,838,804 Laboratorio Chile S.A. (LABCHILE) 2,115,737 3,150,294 0.3
Publishing 2,509,443 Editorial Lord Cochrane S.A. 1,438,815 1,439,332 0.1
Retail Sales 400,000 Santa Isabel S.A. 281,952 349,127 0.0
Steel 509,056 Compania de Acero del Pacifico S.A.
de Inv. (CAP) 1,641,453 2,570,669 0.2
509,056 +++Invercap S.A. 363,675 685,512 0.1
-------------- -------------- ------
2,005,128 3,256,181 0.3
Tele- 307,225 Compania de Telefonos de Chile S.A.
communications (ADR) (2) 33,202,226 26,421,350 2.3
213,118 Empresa Nacional de Telecomunica-
ciones S.A. (Entel) 1,449,275 1,931,880 0.2
51,300 Empresas Telex-Chile S.A. 963,927 647,662 0.1
-------------- -------------- ------
35,615,428 29,000,892 2.6
Utilities 5,670,011 Empresa Nacional de Electricidad
S.A.--ENDESA 2,358,605 5,344,798 0.5
34,000 Enersis S.A. (ADR) (2) 618,250 1,015,750 0.1
-------------- -------------- ------
2,976,855 6,360,548 0.6
Total Long-Term Investments
in Chile 88,738,822 88,359,285 7.7
Colombia Banking 402,160 Banco de Bogota S.A. 1,449,888 2,182,226 0.2
10,357,000,000 Banco de Colombia S.A. 974,828 549,511 0.1
-------------- -------------- ------
2,424,716 2,731,737 0.3
Beverages & 587,154 La Compania Cervecera Bavaria S.A. 3,401,356 2,088,634 0.2
Tobacco
Building Products 90,000 Cementos Diamante S.A. 590,537 548,053 0.1
227,500 ++Cementos Diamante S.A. (ADR) (2) 3,785,350 5,175,625 0.4
155,000 +++Cementos Paz Del Rio S.A. (ADR) (2) 3,795,375 3,332,500 0.3
250,137 ++/+++Cementos Paz Del Rio S.A. 373,681 361,949 0.0
-------------- -------------- ------
8,544,943 9,418,127 0.8
Forest Products 550,000 Papeles Nacionales S.A. 9,900,000 8,456,250 0.7
&Paper
Merchandising 258,171 Carulla y CIA S.A. 3,218,691 3,113,120 0.3
367,850 ++Carulla y CIA S.A. (ADR) (2) 4,597,371 6,069,525 0.5
-------------- -------------- ------
7,816,062 9,182,645 0.8
</TABLE>
<PAGE>
<TABLE>
CONSOLIDATED SCHEDULE OF INVESTMENTS (continued) (in US dollars)
<CAPTION>
Shares Value Percent of
COUNTRY Industries Held Long-Term Investments Cost (Note 1a) Net Assets
<S> <S> <C> <S> <C> <C> <C>
Columbia Retail 1,428,814 Gran Cadena de Almacenes
(concluded) Colombianos S.A. (CADENALCO) $ 4,043,018 $ 2,588,681 0.2%
Tobacco 69,200 La Compania Colombiano de Tabaco
S.A. (COLTABACO) 356,988 233,643 0.0
Total Long-Term Investments
in Colombia 36,487,083 34,699,717 3.0
Ecuador Building Materials 40,000 ++La Cemento Nacional C.A. 7,915,328 15,000,000 1.3
Total Long-Term Investments
in Ecuador 7,915,328 15,000,000 1.3
Mexico Banking US$ 10,000,000 Bonos de la Tesoreria de la
Federacion, 8.135% due 8/10/1995 9,470,863 9,450,099 0.8
950,000 Grupo Financiero Asemex Banpais
S.A. de C.V. 9,500,000 6,768,750 0.6
1,918,500 Grupo Financiero Banamex-Accival,
S.A. de C.V. 18,565,861 13,506,240 1.1
144,800 ++Grupo Financiero Bancomer, S.A.
de C.V. (ADR) (2) 4,418,248 3,402,800 0.3
758,080 Grupo Financiero Probursa, S.A.
de C.V. 'C' 806,262 562,358 0.1
-------------- -------------- ------
42,761,234 33,690,247 2.9
Beverages & 89,000 ++Fomento Economico Mexicano, S.A.
Tobacco de C.V. (Femsa) (ADR) (2) 551,177 373,800 0.0
228,250 ++Grupo Embotellador de Mexico,
S.A. de C.V. (GGEMEX) (ADR) (2) 4,779,776 5,449,469 0.5
180,000 Grupo Embotellador de Mexico, S.A.
de C.V. (GGEMEX) (Ordinary) 3,310,000 2,144,291 0.2
-------------- -------------- ------
8,640,953 7,967,560 0.7
<PAGE>
Broadcasting & 2,320,000 Grupo Fernandez Editores,
Publishing S.A. de C.V. 3,378,804 3,846,982 0.3
Building & 877,000 Apasco, S.A. de C.V. 'A' 3,697,786 8,329,906 0.7
Construction 67,500 Bufete Industrial, S.A.
de C.V. (ADR) (2) 1,552,500 2,607,188 0.2
332,000 ++Corporacion Geo S.A. de C.V.
(PYP) (ADR) (2) 9,485,500 8,964,000 0.8
660,087 Grupo Tribasa, S.A. de C.V.
(ADR) (2) 17,292,131 21,700,360 1.9
1,971,500 Tolmex, S.A. de C.V. 'B' 21,710,606 28,733,717 2.5
-------------- -------------- ------
53,738,523 70,335,171 6.1
Building Materials 162,000 ++Cementos Mexicanos, S.A. de C.V.
(Class B) (Cemex) (ADR) (2) 2,912,366 3,118,500 0.3
2,618,999 Cementos Mexicanos, S.A. de C.V.
Nom 'B' (Cemex) 20,270,004 25,142,390 2.2
-------------- -------------- ------
23,182,370 28,260,890 2.5
Chemicals 972,300 Grupo Cydsa, S.A. de C.V. 3,467,300 4,491,672 0.4
Construction & 433,000 Empresas Ica Sociedad S.A. de C.V. 13,569,243 13,368,875 1.2
Housing
Engineering & 108,641 Grupo Mexicano de Desarrollo,
Construction S.A. de C.V. (Class B) 1,917,096 2,009,859 0.2
146,051 Grupo Mexicano de Desarrollo,
S.A. de C.V. (Class L) (ADR) (2) 2,589,809 3,030,558 0.3
378,000 +++Grupo Profesional Planeacion y
Proyectos S.A. de C.V. (PYP)
(Class B) 5,457,192 5,091,316 0.4
-------------- -------------- ------
9,964,097 10,131,733 0.9
Financial Services 380,000 Grupo Financiero (GBM) Atlantico,
S.A. de C.V. 2,270,875 1,824,000 0.2
220,000 Grupo Financiero (GBM) Atlantico,
S.A. de C.V. 'L' 4,742,022 4,015,000 0.3
US$ 8,500,000 ++Grupo Financiero InverMexico,
S.A. de C.V., 7.50% due 6/16/2001 8,500,000 6,205,000 0.5
598,900 Servicios Financieros Quadrum,
S.A. de C.V. (ADR) (2) 10,631,217 8,160,012 0.7
-------------- -------------- ------
26,144,114 20,204,012 1.7
<PAGE>
Food & Household 3,253,846 Grupo Herdez, S.A. de C.V. 'A' 3,295,834 2,792,391 0.2
Products 5,012,461 Grupo Herdez, S.A. de C.V. 'B' 6,285,722 4,301,603 0.4
3,544,189 Grupo Industrial Maseca,
S.A. de C.V. 'B2' 5,064,889 5,464,495 0.5
372,518 +++Sigma Alimentos S.A. de C.V. 6,625,947 6,231,210 0.5
-------------- -------------- ------
21,272,392 18,789,699 1.6
Foreign Government Mexican Cetes (Certificados de la
Obligations Tesoreria de la Federacion):
US$ 35,338,660 4.68% due 1/12/1995 10,186,286 10,105,315 0.9
36,551,400 0.29% due 4/12/1995 10,190,584 10,092,482 0.8
35,919,832 Nafinsa, 15.25% due 12/29/1994 10,441,987 10,291,703 0.9
-------------- -------------- ------
30,818,857 30,489,500 2.6
Glass 1,525,938 Vitro, S.A. de C.V. 10,964,952 10,831,385 0.9
Manufacturing 546,205 Vitro, S.A. de C.V. (ADR) (2) 11,442,063 11,470,305 1.0
-------------- -------------- ------
22,407,015 22,301,690 1.9
Health & 1,422,250 Kimberly-Clark de Mexico,
Personal Care S.A. de C.V. 'A' 19,522,564 27,720,945 2.4
940,500 Nacional de Drogos, S.A. de C.V.
(Nadro) 'L' 3,973,720 6,976,800 0.6
-------------- -------------- ------
23,496,284 34,697,745 3.0
Leisure 1,882,500 Grupo Posadas, S.A. de C.V. 'A' 1,819,673 1,916,727 0.2
434,300 ++Grupo Posadas, S.A. de C.V.
(ADR) (2) 6,723,293 8,794,575 0.8
542,000 Grupo Situr, S.A. de C.V. 1,866,098 1,731,247 0.1
547,040 ++Grupo Situr, S.A. de C.V.
(ADR) (2) 7,514,491 16,342,820 1.4
-------------- -------------- ------
17,923,555 28,785,369 2.5
Merchandising 134,500 Controladora de Farmacias,
S.A. de C.V. (COFAR) 199,610 117,382 0.0
626,000 Farmacias Benavides, S.A. de C.V. 2,807,047 2,203,520 0.2
1,418,000 Grupo Empresarial Fenix,
S.A. de C.V. Elektra 'L' Shares 13,024,645 15,469,091 1.3
-------------- -------------- ------
16,031,302 17,789,993 1.5
Metals & Steel 250,000 Grupo Sidek, S.A. de C.V. 'B' 1,110,815 1,069,091 0.1
284,600 Grupo Simec, S.A. de C.V. (ADR) (2) 7,794,957 6,545,800 0.5
1,830,000 Grupo Simec, S.A. de C.V.
(Ordinary) 1,645,949 2,182,691 0.2
337,500 Hylsamex S.A. de C.V. 7,792,694 8,015,625 0.7
402,000 Tubos de Acero de Mexico,
S.A. de C.V. (Tamsa) 3,433,417 1,988,073 0.2
-------------- -------------- ------
21,777,832 19,801,280 1.7
<PAGE>
Multi-Industry 607,400 Desc Sociedad de Fomento Industrial
S.A. de C.V. (Class B) 5,072,389 4,770,851 0.4
1,167,000 Desc Sociedad de Fomento Industrial,
S.A. de C.V. 8,735,843 8,657,018 0.7
83,000 ++Grupo Carso, S.A. de C.V. 'A' 1,620,823 1,867,500 0.2
3,888,500 Grupo Carso, S.A. de C.V. (ADR) (2) 37,222,784 43,777,440 3.8
-------------- -------------- ------
52,651,839 59,072,809 5.1
</TABLE>
<TABLE>
CONSOLIDATED SCHEDULE OF INVESTMENTS (concluded) (in US dollars)
<CAPTION>
Shares Value Percent of
COUNTRY Industries Held Long-Term Investments Cost (Note 1a) Net Assets
<S> <S> <C> <S> <C> <C> <C>
Mexico Retail 5,571,000 Cifra, S.A. de C.V. 'C' $ 11,683,065 $ 15,136,913 1.3%
(concluded) 860,000 Controladora Comercial Mexicana,
S.A. de C.V. (COMERCI) 1,414,574 1,506,094 0.1
2,490,000 El Puerto de Liverpool, S.A. de C.V.
(Non-Voting) (Series C1) 3,335,548 3,694,255 0.3
7,420,000 Grupo Gigante, S.A. de C.V. 5,559,608 3,885,382 0.3
287,500 Sears Roebuck de Mexico, S.A.
de C.V. 'B' 3,194,381 2,994,182 0.3
547,500 ++Sears Roebuck de Mexico, S.A.
de C.V. 'B' (ADR) (2) 14,403,127 11,223,750 1.0
-------------- -------------- ------
39,590,303 38,440,576 3.3
Transportation 107,000 Transportacion Maritima Mexicana,
S.A. de C.V. 'L' (TMM) 1,192,663 815,534 0.1
Tele- 701,400 Telefonos de Mexico,
communications S.A. de C.V. (ADR) (2) 43,706,765 37,174,200 3.2
Total Long-Term Investments
in Mexico 475,715,445 500,455,537 43.2
Panama Banking 80,000 Banco Latinoamericano de
Exportaciones, S.A. ('BLADEX')
'E' 1,992,245 2,500,000 0.2
Beverages & Tobacco 232,860 Panamerican Beverages Inc.
(Class A) 7,228,155 8,150,100 0.7
<PAGE>
Total Long-Term Investments
in Panama 9,220,400 10,650,100 0.9
Peru Banking 2,441,382 Banco de Credito de Peru S.A. 2,685,608 5,374,076 0.4
2,189,407 Banco Wiese Limitado S.A. 8,225,925 11,292,359 1.0
-------------- -------------- ------
10,911,533 16,666,435 1.4
Beverages 61,231 Cerveceria Backus and Johnston S.A. 111,704 137,040 0.0
Building Materials 610,744 Cementos Lima S.A. 607,035 1,355,647 0.1
Food & Household
Products 2,652,078 La Fabril S.A. 5,840,045 4,470,000 0.4
Mining 2,211,480 Southern Peru Copper Corp. S.A. 7,823,850 13,646,711 1.2
Total Long-Term Investments in Peru 25,294,167 36,275,833 3.1
Uruguay Banking 59,500 +++Banco Commercial S.A. 1,145,375 1,100,750 0.1
Total Long-Term Investment
in Uruguay 1,145,375 1,100,750 0.1
Venezuela Building & 937,173 Corporacion Ceramica Carabobo
Construction S.A. 'B' 2,294,951 1,105,352 0.1
941,015 Corporacion Ceramica Carabobo
S.A. C.A. 2,606,928 879,583 0.1
-------------- -------------- ------
4,901,879 1,984,935 0.2
Building Materials 445,899 Venezolana de Cementos S.A.C.A.
(Vencemos) 616,435 670,545 0.1
Food & Household 10,052,924 Mavesa S.A. 2,587,935 2,608,531 0.2
Products 366,666 ++Mavesa S.A. (ADR) (2) 4,010,625 1,695,830 0.1
380,000 Mavesa S.A. (ADR) (2) 3,519,375 1,757,500 0.2
-------------- -------------- ------
10,117,935 6,061,861 0.5
Foreign US$ 5,750,000 Republic of Venezuela,
Government Floating Rate Notes,
Obligations 5.75% due 12/18/2007 (1) 4,300,625 2,702,500 0.2
<PAGE>
Multi-Industry 1,837,882 Venaseta S.A. 482,719 186,964 0.0
2,297,352 Venaseta S.A. 'B' Shares 406,659 237,092 0.0
-------------- -------------- ------
889,378 424,056 0.0
Steel 108,000 Siderurgica Venezolana SIVENSA,
S.A.I.C.A.-S.A.C.A. 20,749 26,782 0.0
216,000 Siderurgica Venezolana SIVENSA,
S.A.I.C.A.-S.A.C.A. (ADR) (2) 1,231,384 216,000 0.0
169,940 ++Venezolana de Prerreducidos Caroni
Venprecar C.A. (GDS) (3) 1,236,470 987,776 0.1
-------------- -------------- ------
2,488,603 1,230,558 0.1
Utilities 8,634,374 C.A. La Electricidad de Caracas
S.A.I.C.A.-S.A.C.A. 19,686,959 11,102,938 1.0
Total Long-Term Investments
in Venezuela 43,001,814 24,177,393 2.1
Total Long-Term Investments
in Latin America 1,040,195,396 1,147,433,391 99.1
Short-Term Investments
United Commercial Paper* US$ 7,224,000 General Electric Capital Corp.,
States 5.70% due 12/01/1994 7,224,000 7,224,000 0.6
Total Short-Term Investments 7,224,000 7,224,000 0.6
Total Investments $1,047,419,396 1,154,657,391 99.7
-------------- -------------- ------
Other Assets Less Liabilities 2,889,375 0.3
-------------- ------
Net Assets $1,157,546,766 100.0%
============== ======
<FN>
(1)The interest rate is subject to change periodically
based on the change in the LIBOR (London
Interbank Offered Rate). The interest rate shown
is the rate in effect as of November 30, 1994.
(2)American Depositary Receipt (ADR).
(3)Global Depositary Shares (GDS).
<PAGE>
*Commercial Paper is traded on a discount basis;
the interest rates shown are the discount rates
paid at the time of purchase by the Fund.
(a)Warrants entitle the Fund to purchase a predeter-
mined number of shares of Common Stock. The
purchase price and number of shares are subject
to adjustment under certain conditions until the
expiration date.
+++Non-income producing security.
++Restricted securities as to resale. The value of the Fund's
investment in restricted securities was approximately
$149,694,000, representing 12.9% of net assets.
<CAPTION>
Issue Acquisition Value
Date Cost (Note 1a)
<S> <C> <C> <C>
Carulla S.A. (ADR) 6/23/1994 $ 4,597,371 $ 6,069,525
Cementos Diamante S.A. 5/17/1994 3,785,350 5,175,625
Cementos Paz Del Rio S.A. 9/22/1994 373,681 361,949
Cementos Mexicanos, S.A. de C.V. (Class B) (Cemex) (ADR) 1/24/1994 2,912,366 3,118,500
Central Costanera S.A. (Class B) 12/17/1993 228,000 292,125
Companhia Siderurgica de Tubarao S.A. (CST) 7/20/1994 9,862,065 11,388,000
Corporacion Geo S.A. de C.V. (PYP) (ADR) 9/28/1994 9,485,500 8,964,000
Fomento Economico Mexicano, S.A. de C.V. (Femsa) (ADR) 11/18/1993 551,177 373,800
Grupo Carso, S.A. de C.V. 'A' 5/13/1994 1,620,823 1,867,500
Grupo Embotellador de Mexico, S.A. de C.V. (GGEMEX) (ADR) 6/14/1994 4,779,776 5,449,469
Grupo Financiero Bancomer, S.A. de C.V. (ADR) 3/16/1992 4,418,248 3,402,800
Grupo Financiero InverMexico S.A. de C.V., 7.50% due 6/16/2001 6/09/1994 8,500,000 6,205,000
Grupo Posadas, S.A. de C.V. (ADR) 3/23/1992 6,723,293 8,794,575
Grupo Situr, S.A. de C.V. (ADR) 12/03/1991 7,514,491 16,342,820
La Cemento Nacional C.A. 6/22/1992 7,915,328 15,000,000
Mavesa S.A. (ADR) 10/13/1993 4,010,625 1,695,830
Quilmes Industrial S.A. 6/17/1992 1,684,480 4,128,925
Sears Roebuck de Mexico, S.A. de C.V. 'B' (ADR) 8/09/1994 14,403,127 11,223,750
Telecom Argentina Stet--France Telecom S.A. (ADR) 11/18/1993 15,682,783 14,949,545
Telecommunicacoes Brasileiras S.A.--Telebras (ADR) 12/29/1993 12,136,746 12,232,549
Transportadora de Gas del Sur S.A. (ADR) 5/17/1994 13,793,192 11,670,125
Venezolana de Prerreducidos Caroni Venprecar C.A. (GDS) 2/13/1992 1,236,470 987,776
------------ ------------
Total $136,214,892 $149,694,188
============ ============
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
CONSOLIDATED STATEMENT OF ASSETS AND LIABILITIES
<CAPTION>
As of November 30, 1994
<S> <S> <C>
Assets: Investments, at value (identified cost--$1,047,419,396) (Note 1a) $1,154,657,391
Foreign cash 4,155,651
Receivables:
Securities sold $ 6,387,148
Capital shares sold 4,104,517
Dividends 951,028
Interest 446,367 11,889,060
-----------
Deferred organization expenses (Note 1g) 42,657
Prepaid registration fees and other assets (Note 1g) 83,159
--------------
Total assets 1,170,827,918
--------------
Liabilities: Payables:
Securities purchased 3,134,761
Capital shares redeemed 3,093,315
Investment adviser (Note 2) 960,844
Distributor (Note 2) 826,037 8,014,957
-----------
Accrued expenses and other liabilities 5,266,195
--------------
Total liabilities 13,281,152
--------------
Net Assets: Net assets $1,157,546,766
==============
Net Assets Class A Common Stock, $0.10 par value, 100,000,000 shares authorized $ 59,580
Consist of: Class B Common Stock, $0.10 par value, 100,000,000 shares authorized 5,437,756
Class C Common Stock, $0.10 par value, 100,000,000 shares authorized 29,411
Class D Common Stock, $0.10 par value, 100,000,000 shares authorized 1,179,752
Paid-in capital in excess of par 1,009,731,134
Undistributed realized capital gains on investments and foreign
currency transactions--net 33,740,505
Unrealized appreciation on investments and foreign currency transactions--net 107,368,628
--------------
Net assets $1,157,546,766
==============
<PAGE>
Net Asset Class A--Based on net assets of $10,350,102 and 595,793 shares outstanding $ 17.37
Value: ==============
Class B--Based on net assets of $937,220,632 and 54,377,561 shares outstanding $ 17.24
==============
Class C--Based on net assets of $5,068,944 and 294,107 shares outstanding $ 17.24
==============
Class D--Based on net assets of $204,907,088 and 11,797,523 shares outstanding $ 17.37
==============
See Notes to Financial Statements.
</TABLE>
<TABLE>
CONSOLIDATED STATEMENT OF OPERATIONS
<CAPTION>
For the Year Ended November 30, 1994
<S> <S> <C> <C>
Investment Dividends (net of $829,480 foreign withholding tax) $ 11,264,193
Income Interest and discount earned 7,027,116
(Notes 1e & --------------
1f): Total income 18,291,309
--------------
Expenses: Investment advisory fees (Note 2) 9,298,782
Distribution fees--Class B (Note 2) 7,506,994
Custodian fees 1,345,975
Transfer agent fees--Class B (Note 2) 1,119,403
Foreign tax expense (Note 1e) 700,108
Registration fees (Note 1g) 505,698
Account maintenance fees--Class D (Note 2) 444,282
Printing and shareholder reports 379,670
Transfer agent fees--Class D (Note 2) 231,889
Accounting services (Note 2) 211,687
Professional fees 102,873
Directors' fees and expenses 35,456
Amortization of organization expenses (Note 1g) 23,267
Pricing fees 6,400
Distribution fees--Class C (Note 2) 3,895
Transfer agent fees--Class A (Note 2) 2,491
Transfer agent fees--Class C (Note 2) 1,025
Other 19,620
--------------
Total expenses 21,939,515
--------------
Investment loss--net (3,648,206)
--------------
<PAGE>
Realized & Realized gain (loss) from:
Unrealized Investments--net $40,600,153
Gain (Loss) Foreign currency transactions--net (413,009) 40,187,144
on Invest- -----------
ments & Change in unrealized appreciation/depreciation on:
Foreign Investments--net 29,447,600
Currency Foreign currency transactions--net 148,276 29,595,876
Transactions-- ----------- --------------
Net (Notes Net realized and unrealized gain on investments and
1c, 1f & 3): foreign currency transactions 69,783,020
--------------
Net Increase in Net Assets Resulting from Operations $ 66,134,814
==============
See Notes to Financial Statements.
</TABLE>
<TABLE>
CONSOLIDATED STATEMENTS OF CHANGES OF NET ASSETS
<CAPTION>
For the Year Ended
November 30,
1994 1993
Increase (Decrease) in Net Assets:
<S> <S> <C> <C>
Operations: Investment income (loss)--net $ (3,648,206) $ 2,584,432
Realized gain on investments and foreign currency transactions--net 40,187,144 3,297,579
Change in unrealized appreciation/depreciation on investments and foreign
currency transactions--net 29,595,876 88,016,931
-------------- ------------
Net increase in net assets resulting from operations 66,134,814 93,898,942
Dividends & Investment income--net:
Distributions Class B (1,113,310) (1,699,059)
to Share- Class D (624,870) (714,383)
holders Realized gain on investments--net:
(Note 1h): Class B -- (1,200,960)
Class D -- (289,614)
-------------- ------------
Net decrease in net assets resulting from dividends and
distributions to shareholders (1,738,180) (3,904,016)
-------------- ------------
<PAGE>
Capital Share Net increase in net assets derived from capital share transactions 712,764,490 133,361,981
Transactions -------------- ------------
(Note 4):
Net Assets: Total increase in net assets 777,161,124 223,356,907
Beginning of year 380,385,642 157,028,735
-------------- ------------
End of year* $1,157,546,766 $380,385,642
============== ============
<FN>
*Undistributed (accumulated) investment income--net $ (3,535,328) $ 1,851,058
============== ============
See Notes to Financial Statements.
</TABLE>
<TABLE>
CONSOLIDATED FINANCIAL HIGHLIGHTS
<CAPTION>
Class A Class B
For the For the
Period Period
The following per share data and ratios have been derived Oct. 21, Sept. 27,
from information provided in the financial statements. 1994++ to For the Year Ended 1991++ to
Nov. 30, November 30, Nov. 30,
Increase (Decrease) in Net Asset Value: 1994+++++ 1994+++++ 1993 1992 1991
<S> <S> <C> <C> <C> <C> <C>
Per Share Net asset value, beginning of period $ 18.22 $ 14.39 $ 9.83 $ 9.80 $ 10.00
Operating --------- --------- --------- --------- ---------
Performance: Investment income (loss)--net -- (.09) .10 .08 .04
Realized and unrealized gain (loss) on
investments and foreign currency
transactions--net (.85) 2.99 4.68 .05 (.24)
--------- --------- --------- --------- ---------
Total from investment operations (.85) 2.90 4.78 .13 (.20)
--------- --------- --------- --------- ---------
Less dividends and distributions:
Investment income--net -- (.05) (.13) (.10) --
Realized gain on investments--net -- -- (.09) --++++ --
--------- --------- --------- --------- ---------
Total dividends and distributions -- (.05) (.22) (.10) --
--------- --------- --------- --------- ---------
Net asset value, end of period $ 17.37 $ 17.24 $ 14.39 $ 9.83 $ 9.80
========= ========= ========= ========= =========
<PAGE>
Total Based on net asset value per share (4.67%)+++ 20.19% 49.80% 1.30% ( 2.00%)+++
Investment ========= ========= ========= ========= =========
Return:**
Ratios to Expenses, excluding account maintenance
Average and distribution fees 1.85%* 1.51% 1.59% 1.65% 1.73%*
Net Assets: ========= ========= ========= ========= =========
Expenses 1.85%* 2.51% 2.59% 2.65% 2.73%*
========= ========= ========= ========= =========
Investment income--net (.16%)* (.53%) 1.09% 1.30% 3.28%*
========= ========= ========= ========= =========
Supplemental Net assets, end of period (in thousands) $ 10,350 $ 937,221 $ 305,301 $ 126,344 $ 63,012
Data: ========= ========= ========= ========= =========
Portfolio turnover 30.15% 30.15% 24.74% 36.50% --
========= ========= ========= ========= =========
<CAPTION>
Class C Class D
For the For the
Period Period
Oct. 21, Sept. 27,
The following per share data and ratios have been derived 1994++ to For the Year Ended 1991++ to
from information provided in the financial statements. Nov. 30, November 30, Nov. 30,
Increase (Decrease) in Net Asset Value: 1994+++++ 1994+++++ 1993 1992 1991
<S> <S> <C> <C> <C> <C> <C>
Per Share Net asset value, beginning of period $ 18.10 $ 14.45 $ 9.90 $ 9.81 $ 10.00
Operating --------- --------- --------- --------- ---------
Performance: Investment income (loss)--net (.02) .03 .18 .15 .06
Realized and unrealized gain (loss) on
investments and foreign currency
transactions--net (.84) 3.00 4.69 .06 (.25)
--------- --------- --------- --------- ---------
Total from investment operations (.86) 3.03 4.87 .21 (.19)
--------- --------- --------- --------- ---------
Less dividends and distributions:
Investment income--net -- (.11) (.23) (.12) --
Realized gain on investments--net -- -- (.09) --++++ --
--------- --------- --------- --------- ---------
Total dividends and distributions -- (.11) (.32) (.12) --
--------- --------- --------- --------- ---------
Net asset value, end of period $ 17.24 $ 17.37 $ 14.45 $ 9.90 $ 9.81
========= ========= ========= ========= =========
<PAGE>
Total Based on net asset value per share (4.75%)+++ 21.07% 50.86% 2.19% (1.90%)+++
Investment ========= ========= ========= ========= =========
Return:**
Ratios to Expenses, excluding account
Average maintenance and distribution fees 1.93%* 1.48% 1.58% 1.64% 1.72%*
Net Assets: ========= ========= ========= ========= =========
Expenses 2.93%* 1.73% 1.83% 1.89% 1.97%*
========= ========= ========= ========= =========
Investment income-net (1.16%)* .23% 1.83% 2.18% 4.05%*
========= ========= ========= ========= =========
Supplemental Net assets, end of period (in thousands) $ 5,069 $ 204,907 $ 75,085 $ 30,685 $ 18,074
Data: ========= ========= ========= ========= =========
Portfolio turnover 30.15% 30.15% 24.74% 36.50% --
========= ========= ========= ========= =========
<FN>
*Annualized.
**Total investment returns exclude the effects of sales loads.
+++Aggregate total investment return.
+++++Based on average shares outstanding during the period.
++Commencement of Operations.
++++Amount is less than $.01 per share.
See Notes to Financial Statements.
</TABLE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. Significant Accounting Policies:
Merrill Lynch Latin America Fund, Inc. (the "Fund") is registered
under the Investment Company Act of 1940 as a non-diversified,
open-end management investment company. The Fund offers
four classes of shares under the Merrill Lynch Select Pricing SM
System. Shares of Class A and Class D are sold with a front-end sales
charge. Shares of Class B and Class C may be subject to a contingent
deferred sales charge. All classes of shares have identical voting,
dividend, liquidation and other rights and the same terms and
conditions, except that Class B, Class C and Class D Shares bear
certain expenses related to the account maintenance of such shares,
and Class B and Class C Shares also bear certain expenses related to
the distribution of such shares. Each class has exclusive voting rights
with respect to matters relating to its account maintenance and
distribution expenditures. The following is a summary of significant
accounting policies followed by the Fund.
<PAGE>
(a) Valuation of investments--Portfolio securities which are traded
on stock exchanges are valued at the last sale price on the principal
market on which such securities are traded as of the close of business
on the day the securities are being valued or, lacking any sales, at
the last available bid price. Securities traded in the over-the-counter
market are valued at the last available bid prices obtained from one
or more dealers in the over-the-counter market prior to the time of
valuation. Portfolio securities which are traded on more than one
exchange are valued on the exchange designated by or under the
authority of the Board of Directors as the primary market. Short-term
securities with a remaining maturity of sixty days or less are valued
at amortized cost, which approximates market value. Options written
by the Fund are valued at the last sale price in the case of exchange-
traded options or, in the case of options traded in the over-the-
counter market, the last asked price. Options purchased by the Fund
are valued at their last sale price in the case of exchange-traded
options or, in the case of options traded in the over-the-counter
market, the last bid price. Other investments, including futures
contracts and related options, are stated at market value. Securities
and assets for which market quotations are not readily available
are valued at fair value as determined in good faith by or under the
direction of the Board of Directors of the Fund.
(b) Repurchase agreements--The Fund invests in US Government
securities pursuant to repurchase agreements with a member bank
of the Federal Reserve System or a primary dealer in US Government
securities. Under such agreements, the bank or primary dealer agrees
to repurchase the security at a mutually agreed upon time and price.
The Fund takes possession of the underlying securities, marks to
market such securities and, if necessary, receives additions to such
securities daily to ensure that the contract is fully collateralized.
(c) Foreign currency transactions--Transactions denominated in
foreign currencies are recorded at the exchange rate prevailing
when recognized. Assets and liabilities denominated in foreign
currencies are valued at the exchange rate at the end of the period.
Foreign currency transactions are the result of settling (realized)
or valuing (unrealized) assets and liabilities expressed in foreign
currencies into US dollars. Realized and unrealized gains or losses
from investments include the effects of foreign exchange rates on
investments.
The Fund may also purchase or sell listed over-the-counter foreign
currency options, foreign currency futures and related options on
foreign currency futures as a short or long hedge against possible
variations in foreign exchange rates. Such transactions may be
effected with respect to hedges on non-US dollar denominated
securities owned by the Fund, sold by the Fund but not yet delivered,
or committed or anticipated to be purchased by the Fund.
<PAGE>
(d) Options--The Fund is authorized to purchase and write call
and put options. When the Fund sells an option, an amount equal to
the premium received by the Fund is reflected as an asset and
an equivalent liability. The amount of the liability is subsequently
marked to market to reflect the current value of the option written.
When a security is purchased or sold through an exercise of an
option, the related premium paid (or received) is added to (or
deducted from) the proceeds of the security sold. When an option
expires (or the Fund enters into a closing transaction), the Fund
realizes a gain or loss on the option to the extent of the premiums
received or paid (or gain or loss to the extent the cost of the closing
transaction exceeds the premium paid or received).
Written and purchased options are non-income producing
investments.
(e) Income taxes--It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of its
taxable income to its shareholders. Therefore, no Federal income
tax provision is required. Under the applicable foreign tax law, a
withholding tax may be imposed on interest, dividends and capital
gains at various rates.
(f) Security transactions and investment income--Security trans-
actions are recorded on the dates the transactions are entered into
(the trade dates). Dividend income is recorded on the ex-dividend
dates except that if the ex-dividend date has passed, certain divi-
dends from foreign securities are recorded as soon as the Fund is
informed of the ex-dividend date. Interest income (including amor-
tization of discount) is recognized on the accrual basis. Realized
gains and losses on security transactions are determined on the
identified cost basis.
(g) Deferred organization expenses and prepaid registration fees--
Deferred organization expenses are charged to expense on a straight-
line basis over a five-year period. Prepaid registration fees are
charged to expense as the related shares are issued.
(h) Dividends and distributions--Dividends and distributions paid
by the Fund are recorded on the ex-dividend dates.
(i) Basis of consolidation--The accompanying consolidated financial
statements include the accounts of ML Latin America Fund Chile
Ltd., a wholly-owned subsidiary, which primarily invests in Chilean
securities. Intercompany accounts and transactions have been
eliminated.
<PAGE>
(j) Reclassification--Accumulated investment loss-net, in the
amount of $3,535,328 has been reclassified to undistributed realized
gains-net.
2. Investment Advisory Agreement and Transactions
with Affiliates:
The Fund has entered into an Investment Advisory Agreement with
Merrill Lynch Asset Management, L.P. ("MLAM"). Effective January 1,
1994, the investment advisory business of MLAM was reorganized
from a corporation to a limited partnership. Both prior to and after
the reorganization, ultimate control of MLAM was vested with
Merrill Lynch & Co., Inc. ("ML & Co."). The general partner of MLAM
is Princeton Services, Inc. ("PSI"), an indirect wholly-owned sub-
sidiary of ML & Co. The limited partners are ML & Co. and Merrill
Lynch Investment Management, Inc. ("MLIM"), which is also an
indirect wholly-owned subsidiary of ML & Co. The Fund has entered
into a Distribution Agreement and a Distribution Plan with Merrill
Lynch Funds Distributor, Inc. ("MLFD" or "Distributor"), a wholly-
owned subsidiary of MLIM.
MLAM is responsible for the management of the Fund's portfolio
and provides the necessary personnel, facilities, equipment and
certain other services necessary to the operations of the Fund. For
such services, the Fund pays a monthly fee of 1.0%, on an annual
basis, of the average daily value of the Fund's net assets. Certain of
the states in which the shares of the Fund are qualified for sale
impose limitations on the expenses of the Fund. The most restrictive
annual expense limitation requires that the Investment Adviser
reimburse the Fund to the extent the Fund's expenses (excluding
interest, taxes, distribution fees, brokerage fees and commissions,
and extraordinary items) exceed 2.5% of the Fund's first $30 million
of average daily net assets, 2.0% of the next $70 million of average
daily net assets, and 1.5% of the average daily net assets in excess
thereof. MLAM's obligation to reimburse the Fund is limited to
the amount of the management fee. No fee payment will be made
to MLAM during any fiscal year which will cause such expenses
to exceed the most restrictive expense limitation at the time of
such payment.
Pursuant to the distribution plans ("the Distribution Plans") adopted
by the Fund in accordance with Rule 12b-1 under the Investment
Company Act of 1940, the Fund pays the Distributor ongoing account
maintenance and distribution fees. The fees are accrued daily and
paid monthly at annual rates based upon the average daily net
assets of the shares as follows:
<PAGE>
Account
Maintenance Fee Distribution Fee
Class B 0.25% 0.75%
Class C 0.25% 0.75%
Class D 0.25% --
Pursuant to a sub-agreement with the Distributor, Merrill Lynch,
Pierce, Fenner & Smith Inc. ("MLPF&S"), a subsidiary of ML & Co.,
also provides account maintenance and distribution services to the
Fund. The ongoing account maintenance fee compensates the
Distributor of MLPF&S for providing account maintenance services
to Class B, Class C and Class D shareholders. The ongoing distribu-
tion fee compensates the Distributor and MLPF&S for providing
shareholder and distribution-related services to Class B and Class C
shareholders.
For the year ended November 30, 1994, MLFD earned underwriting
discounts and MLPF&S earned dealer concessions on sales of the Fund's
Class D Shares as follows:
MLFD MLPF&S
Class D $225,515 $2,917,858
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (concluded)
MLPF&S received contingent deferred sales charges of $1,483,069
relating to transactions in Class B Shares of beneficial interest,
$11 relating to transactions in Class C Shares of beneficial interest,
and $111,787 in commissions on the execution of portfolio security
transactions for the Fund for the year ended November 30, 1994.
Financial Data Services, Inc. ("FDS"), a wholly-owned subsidiary
of ML & Co., is the Fund's transfer agent.
Accounting services are provided to the Fund by MLAM at cost.
Certain officers and/or directors of the Fund are officers and directors
of MLAM, MLIM, PSI, MLPF&S, FDS, MLFD, and/or ML & Co.
3. Investments:
Purchases and sales of investments, excluding short-term securities,
for the year ended November 30, 1994 were $977,932,768 and
$246,554,242, respectively.
Net realized and unrealized gains as of November 30, 1994 were
as follows:
<PAGE>
Realized Unrealized
Gains Gains
Long-term investments $ 40,599,651 $107,237,995
Short-term investments 502 --
Foreign currency transactions (413,009) 130,633
------------ ------------
Total $ 40,187,144 $107,368,628
============ ============
As of November 30, 1994, net unrealized appreciation for Federal
income tax purposes aggregated $107,237,995, of which $192,811,424
related to appreciated securities and $185,573,429 related to depreci-
ated securities. At November 30, 1994, the aggregate cost of invest-
ments for Federal income tax purposes was $1,047,414,396.
4. Capital Share Transactions:
Net increase in net assets derived from capital share transactions
was $712,764,490 and $133,361,981 for the years ended November 30,
1994 and November 30, 1993, respectively.
Transactions in capital shares for each class were as follows:
Class A Shares for the Period Dollar
October 21, 1994++ to November 30, 1994 Shares Amount
Shares sold 753,289 $ 13,593,383
Shares redeemed (157,496) (2,773,649)
------------ ------------
Net increase 595,793 $ 10,819,734
============ ============
[FN]
++ Commencement of Operations.
Class B Shares for the Year Ended Dollar
November 30, 1994 Shares Amount
Shares sold 45,078,402 $784,209,065
Shares issued to shareholders in
reinvestment of dividends 65,453 987,681
------------ ------------
Total issued 45,143,855 785,196,746
Shares redeemed (11,980,794) (204,167,756)
------------ ------------
Net increase 33,163,061 $581,028,990
============ ============
<PAGE>
Class B Shares for the Year Ended Dollar
November 30, 1993 Shares Amount
Shares sold 10,861,570 $136,390,183
Shares issued to shareholders in
reinvestment of dividends &
distributions 253,359 2,472,784
------------ ------------
Total issued 11,114,929 138,862,967
Shares redeemed (2,748,458) (31,777,805)
------------ ------------
Net increase 8,366,471 $107,085,162
============ ============
Class C Shares for the Period Dollar
October 21, 1994++ to November 30, 1994 Shares Amount
Shares sold 301,172 $ 5,323,437
Shares redeemed (7,065) (123,893)
------------ ------------
Net increase 294,107 $ 5,199,544
============ ============
[FN]
++ Commencement of Operations.
Class D Shares for the Year Ended Dollar
November 30, 1994 Shares Amount
Shares sold 12,305,213 $213,150,837
Shares issued to shareholders in
reinvestment of dividends 36,001 543,613
------------ ------------
Total issued 12,341,214 213,694,450
Shares redeemed (5,740,580) (97,978,228)
------------ ------------
Net increase 6,600,634 $115,716,222
============ ============
Class D Shares for the Year Ended Dollar
November 30, 1993 Shares Amount
Shares sold 2,937,106 $ 36,285,613
Shares issued to shareholders in
reinvestment of dividends &
distributions 91,657 890,902
------------ ------------
Total issued 3,028,763 37,176,515
Shares redeemed (932,700) (10,899,696)
------------ ------------
Net increase 2,096,063 $ 26,276,819
============ ============
<PAGE>
As a result of the implementation of the Merrill Lynch Select Pricing SM
System, Class A Shares of the Fund outstanding prior to October 21,
1994 have been redesignated Class D Shares. There were 12,538,430
shares redesignated amounting to $188,179,623.
5. Commitments:
At November 30, 1994, the Fund had entered into forward foreign
exchange contracts under which it agreed to purchase various
foreign currency with an approximate values of $167,000.
6. Subsequent Event:
On December 14, 1994, the Board of Directors of the Fund declared an
ordinary income dividend in the amount of $0.118230 per Class A
Share, Class B Share, Class C Share and Class D Share, and a long-
term capital gains distribution of $0.395934 per Class A Share,
Class B Share, Class C Share and Class D Share, payable on Decem-
ber 21, 1994 to shareholders of record as of December 14, 1994.
<AUDIT-REPORT>
INDEPENDENT AUDITORS' REPORT
The Board of Directors and Shareholders of
Merrill Lynch Latin America Fund, Inc.:
We have audited the accompanying consolidated statement of assets
and liabilities, including the consolidated schedule of investments, of
Merrill Lynch Latin America Fund, Inc. and its subsidiary as of Novem-
ber 30, 1994, the related consolidated statements of operations for the
year then ended and consolidated changes in net assets for each of
the years in the two-year period then ended, and the consolidated
financial highlights for the three-year period then ended and the
period September 27, 1991 (commencement of operations) to Novem-
ber 30, 1991. These consolidated financial statements and the
consolidated financial highlights are the responsibility of the Fund's
management. Our responsibility is to express an opinion on these
consolidated financial statements and the consolidated financial
highlights based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether
the financial statements and the financial highlights are free of
material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the consolidated
financial statements. Our procedures included confirmation of
securities owned at November 30, 1994 by correspondence with
the custodian and brokers. An audit also includes assessing the
accounting principles used and significant estimates made by
management, as well as evaluating the overall consolidated financial
statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
<PAGE>
In our opinion, such consolidated financial statements and consoli-
dated financial highlights present fairly, in all material respects, the
financial position of Merrill Lynch Latin American Fund, Inc. and its
subsidiary as of November 30, 1994, the results of their operations,
the changes in their net assets, and the consolidated financial high-
lights for the respective stated periods in conformity with generally
accepted accounting principles.
Deloitte & Touche LLP
Princeton, New Jersey
January 18, 1995
</AUDIT-REPORT>
<TABLE>
IMPORTANT TAX INFORMATION (unaudited)
The following information summarizes all per share
distributions paid by Merrill Lynch Latin America Fund, Inc.
during the fiscal year ended November 30, 1994:
<CAPTION>
Qualifying Non-Qualifying Foreign Total Foreign Taxes Long-Term
Record Payable Domestic Domestic Source Ordinary Paid or Capital
Date Date Ordinary Income Ordinary Income Income Income Withheld Gains
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Class B Shares 12/14/93 12/22/93 $0.011487 $0.009312 $0.027689 $0.048488 $0.020751 $ --
Class D Shares* 12/14/93 12/22/93 $0.025699 $0.020831 $0.061946 $0.108476 $0.020751 $ --
</TABLE>
The qualifying domestic ordinary income qualifies for the dividends
received deduction for corporations. Substantially all of the
foreign taxes paid or withheld represent taxes incurred by the
Fund on dividends received by the Fund from foreign sources. Foreign
taxes paid or withheld should be included in taxable income with an
offsetting deduction from gross income or as a credit for taxes
paid to foreign governments. You should consult your tax adviser
regarding the appropriate treatment of foreign taxes paid.
Please retain this information for your records.
[FN]
* As a result of the implementation of the Merrill Lynch Select
Pricing SM System, Class A Shares of the Fund outstanding prior
to October 21, 1994 have been redesignated to Class D Shares.
<PAGE>
PORTFOLIO CHANGES
For the Quarter Ended November 30, 1994
Additions
Antofagasta Holdings PLC
Banco Commercial S.A.
Bardella Industrial S.A. (Preferred)
Bonos de la Tesoreria de la Federacion, 8.135% due 8/10/1995
Carulla y Cia. S.A.
Cementos Diamante S.A. (ADR)
Cementos Paz Del Rio S.A. (ADR)
Ceval Alimentos S.A. (ADR)
Companhia Brasil Petro Ipiranga (Preferred)
Companhia Energetica de Sao Paulo S.A. (CESP) (Preferred)
Confab Industrial S.A.
Corporacion Geo S.A. de C.V. (ADR)
Desc Sociedad de Fomento Industrial S.A. de C.V. (Class B)
Editorial Lord Cochrane S.A.
Empresas Ica Sociedad S.A. de C.V.
Empresas Telex-Chile S.A.
Forestal Terranova S.A.
Grimoldi S.A. (Class B)
Grupo Profesional Planeacion y Proyectos S.A. de C.V. (Class B)
Hylsamex S.A. de C.V.
Industrias Klabin de Papel e Celulose S.A. (Preferred)
Invercap S.A.
MelPaper S.A. (Preferred)
Papeles Nacionales S.A.
Refrigeracao Parana S.A. (Preferred)
Siderurgica Venezolana SIVENSA, S.A.I.C.A.--S.A.C.A.
Sigma Alimentos S.A. de C.V.
Telecomunicacoes de Minejeros S.A.--TELEMIG (Preferred)
Vina Concha y Toro S.A.
Weg Exportadora S.A. (Preferred)
<PAGE>
Deletions
Banco de Colombia S.A., 5.20% due 2/01/1999
Bonos de la Tesoreria de la Federacion, 7.77% due 8/01/1995
Coca-Cola Femsa S.A. de C.V. (ADR)
Fomento Economico Mexicano, S.A. de C.V. (Femsa) (Ordinary)
Grupo Financiero Bancomer, S.A. de C.V. 'B' (Ordinary)
Grupo Industrial Alfa, S.A. de C.V.
Grupo Sidek, S.A. de C.V. 'L'
Internacional de Ceramica, S.A. de C.V. 'B'
Internacional de Ceramica, S.A. de C.V. 'C'
Laboratorio Chile S.A. (LABCHILE) (Rights)
Tubos de Acero de Mexico, S.A. de C.V. (Tamsa) (ADR)
PORTFOLIO INFORMATION
Ten Largest Equity Holdings Percent of
As of November 30, 1994 Net Assets
Grupo Carso, S.A. de C.V. (ADR) 3.8%
Telefonos de Mexico, S.A. de C.V. (ADR) 3.2
Tolmex, S.A. de C.V. `B' 2.5
Kimberly-Clark de Mexico, S.A. de C.V. `A' 2.4
Compania de Telefonos de Chile, S.A. (ADR) 2.3
Cementos Mexicanos, S.A. de C.V. Nom `B' (Cemex) 2.2
Iochpe-Maxion S.A. (Preferred) 2.1
Grupo Tribasa, S.A. de C.V. (ADR) 1.9
Usinas Siderurgicas de Minas
Gerais-Usiminas S.A. (Preferred) 1.8
Telecomunicacoes de Sao Paulo S.A.-TELESP
(Preferred) 1.7
<PAGE>
APPENDIX GRAPHIC AND IMAGE MATERIAL.
ITEM 1:
Asset Allocation as a Percentage* of Net Assets as of
November 30, 1994
A map illustrating the following percentages:
Mexico 43.2%
Panama 0.9%
Venezuela 2.1%
Columbia 3.0%
Ecuador 1.3%
Peru 3.1%
Brazil 28.1%
Uruguay 0.1%
Argentina 9.6%
Chile 7.7%
[FN]
*Total may not equal 100%.
<PAGE>
ITEM 2:
Total Return Based on a $10,000 Investment.
A line graph depicting the growth of an investment in the Fund's
Class B Shares and Class D Shares compared to growth of an
investment in the Emerging Markets Free Latin America Index.
Beginning and ending values are:
9/27/91** 11/30/94
ML Latin America Fund, Inc.--
Class B Shares*++ $9,600 $17,773
ML Latin America Fund, Inc.--
Class D Shares*++/+++ $9,475 $17,349
Emerging Markets Free Latin
America Index++++ $10,000 $23,866
[FN]
*Assuming maximum sales charge, transaction costs and other
operating expenses, including advisory fees.
**Commencement of Operations.
++ML Latin America Fund, Inc. invests primarily in Latin American
equity and debt securities.
++++This unmanaged market capitalization-weighted Index by Morgan
Stanley Capital International is comprised of a representative
sampling of stocks of large-, medium-, and small-capitalization
companies in Argentina, Brazil, Chile and Mexico and which are
freely purchasable by foreign investors.
+++As a result of the implementation of the Merrill Lynch Select
Pricing SM System, Class A Shares of the Fund outstanding prior
to October 21, 1994 have been redesignated to Class D Shares.
