ALLIANCE WORLD DOLLAR GOVERNMENT FUND
SEMI-ANNUAL REPORT
APRIL 30, 1997
ALLIANCE CAPITAL
LETTER TO SHAREHOLDERS ALLIANCE WORLD DOLLAR GOVERNMENT FUND
_______________________________________________________________________________
June 6, 1997
Dear Shareholder:
Since our last report, the U.S. bond market has posted modest returns. After
rallying at the end of 1996, the market reversed direction in early 1997 and
gave up some of its earlier gains. Data indicating resurgent strength in the
economy, particularly within the labor market, and renewed concerns about
inflation, pushed the bond market lower during the first quarter. In response
to continued strong growth and what were perceived as potential inflationary
imbalances, the Federal Reserve raised interest rates in March, further eroding
bond market returns.
INVESTMENT RESULTS
Although the pace of price appreciation of securities in the emerging market
sector has slowed recently, we are pleased to report that Alliance World Dollar
Government Fund posted solid returns over the most recent period. For the six
months ended April 30, 1997, the Fund returned 10.27% on a net asset value
(NAV) basis. This compares with a return of 11.90% for its benchmark, the J. P.
Morgan Emerging Markets Bond Index. Your Fund's return trailed that of its
benchmark as rising U.S. interest rates negatively impacted your portfolio's
performance. As noted in the Fund's prospectus, 75% of the emerging market debt
securities in your Fund's portfolio must be collateralized, typically using
U.S. Treasury zero coupon bonds. This collateralization makes these securities
disproportionately sensitive to U.S. interest rate movements as compared to the
benchmark. For the twelve months ended April 30, 1997, the Fund achieved a
total return of 35.94% on a net asset value basis compared with 29.02% for the
benchmark.
ECONOMIC REVIEW
As is usually the case with funds that invest in emerging markets, your Fund's
performance was strongly influenced by developments in the U.S. economy. Most
emerging market bonds are issued in U.S. dollars and trade in the U.S. relative
to the U.S. yield curve, making them sensitive to U.S. interest rate levels.
Therefore, we present you with a U.S. economic review and investment outlook in
addition to an emerging markets investment outlook.
The U.S. economy finished 1996 on a strong note. After moderating in the third
quarter, the economy picked up speed as the year came to a close, led by a
rebound in consumer spending. The annualized gain in retail sales of
merchandise jumped to 4.8% in the fourth quarter, up from only 0.9% in the
third quarter. An unexpected surge in export growth also added to year-end
growth. In all, growth in aggregate output (gross domestic product or GDP),
which dipped to 2.1% in the third quarter, accelerated to 3.8% during the final
three months of 1996.
The economy continued its strong performance early in 1997, buoyed by continued
growth in the labor market. The unemployment rate edged down to 4.9% in April,
its lowest level for 25 years. Total hours worked fell for the first time in
seven months, but overtime hours set a new record. Retail sales data moved
lower in April, indicating that the consumer is finally taking a breather after
the first quarter spending spree. Consumer confidence is stabilizing at a high
level, and the production side of the economy showed considerable strength with
industrial production through April up by 4.6% over levels from a year earlier.
Overall, GDP growth jumped to 5.8% during the first three months of 1997, its
fastest rate of increase in nearly 10 years.
Despite the strong growth, inflation news continues to be generally favorable.
After moving slightly higher late in 1996, consumer and producer price gains
both retreated in early 1997 with consumer prices advancing through April at a
2.5% annual rate, a three-year low, and producer prices up just 0.8% for the
same period. Nonetheless, the Federal Reserve raised interest rates 0.25% at
the end of March in a preemptive strike against what were seen as mounting
inflationary pressures.
INVESTMENT OUTLOOK
U.S. economic growth has continued into its third consecutive quarter at a pace
considered above the long-term, non-inflationary rate. While continued growth
at the current pace may warrant additional rate increases, we expect the U.S.
economy to gradually slow over the next several quarters to a more sustainable
2% to 2.5% growth rate. We anticipate this slowing will occur before any
substantial inflationary pressures materialize. Given the potential for further
rate increases in the near-term, the market will be particularly vulnerable to
daily economic news which may put upward pressure on yields. In contrast to
recent periods of rising rates, the relative lack of leverage in the U.S.
financial system suggests that the interest rates and volatility will be less
substantial than in 1994.
1
ALLIANCE WORLD DOLLAR GOVERNMENT FUND
_______________________________________________________________________________
Overall, we remain positive on emerging market debt which constitutes the
majority of the Fund's portfolio. Higher U.S. interest rates may produce
temporary weakness in emerging market debt prices; however, the fundamental
economics remain sound for this fixed income sector and should support
additional gains in the upcoming year.
In Argentina, the economy is gaining momentum and is on track for at least 5%
growth this year, after 4.4% growth in 1996. The strength of the economic
expansion is producing a rapid increase in tax revenues while fiscal
expenditures remain largely unchanged from last year's levels. The recent
decision by Standard & Poor's to raise many Argentine corporate debt ratings
underscores the economic progress being made in this country.
Panama's external debt (including Brady bonds) was recently assigned a Ba1
rating by Moody's. This rating reflects the sound economic policies being
pursued by the Panamanian government and should support significant price gains
in the debt securities of that country in the upcoming year.
The Mexican economy continues to perform strongly, led by strong growth in
investments and exports. Growth is expected to remain strong at around 4% in
1997 and inflation and interest rates should both decline during the upcoming
year. Investor confidence in Mexico's economic policies is growing and the
decision to prepay the remaining $3.5 billion owed to the U.S. for the 1995
peso bailout is another positive step in Mexico's efforts to restore
credibility in international capital markets.
In Russia, recent data indicate that the economy is beginning to grow.
Inflation remains on a downward trend and reserves have increased considerably.
The government has reinforced its commitment to pursuing a market-oriented
economy with the naming of an aggressive, reform-minded cabinet, but the fiscal
situation remains negative. Development of a realistic budget will be an
essential step in putting the country's fiscal affairs in order. Our exposure
to Russian markets is 9.0% of Fund net assets.
Heavy investment in the Venezuelan oil industry continues at a fast pace. This
sector will continue to be a strong and dynamic sector of the economy and allow
for a solid current account position.
Thank you for your continued interest and investment in Alliance World Dollar
Government Fund. We look forward to reporting to you again on market activity
and the Fund's investment results in coming periods.
Sincerely,
John D. Carifa
Chairman
Wayne D. Lyski
President
2
PORTFOLIO OF INVESTMENTS
APRIL 30, 1997 (UNAUDITED) ALLIANCE WORLD DOLLAR GOVERNMENT FUND
_______________________________________________________________________________
PRINCIPAL
AMOUNT
(000) U.S. $ VALUE
- -------------------------------------------------------------------------
SOVEREIGN DEBT OBLIGATIONS-102.2%
COLLATERALIZED BRADY BONDS(A)-76.4%
ARGENTINA-14.4%
Republic of Argentina
Discount Bonds FRN
6.375%, 3/31/23 $15,250 $12,633,672
Euro Par Bonds
5.25%, 3/31/23 (b) 11,500 7,500,156
------------
20,133,828
BRAZIL-15.4%
Republic of Brazil
Discount Bonds FRN Series Z-L
6.875%, 4/15/24 21,600 17,394,750
Par Bonds Series Z-L
5.25%, 4/15/24 (b) 6,500 4,151,875
------------
21,546,625
BULGARIA-7.4%
Republic of Bulgaria
Discount Bonds FRN
6.5625%, 7/28/24 16,000 10,340,000
MEXICO-13.1%
United Mexican States
Discount Bonds Series B FRN
6.375%, 12/31/19 (c) 10,240 9,084,800
Discount Bonds Series D FRN
6.35156%, 12/31/19 (c) 6,000 5,323,125
Euro Par Bonds Series B
6.25%, 12/31/19 (c) 5,500 4,001,250
------------
18,409,175
NIGERIA-6.9%
Central Bank of Nigeria Par Bonds
6.25%, 11/15/20 (d) 15,000 9,600,000
POLAND-2.0%
Republic of Poland Par Bonds
3.00%, 10/27/24 (b) 5,000 2,740,625
VENEZUELA-17.2%
Republic of Venezuela Discount Bonds FRN
6.8125%, 3/31/20 13,000 10,692,500
Republic of Venezuela Par Bonds
6.75%, 3/31/20 (e)
Series W-A 6,500 4,724,687
Series W-B 12,000 8,722,500
------------
24,139,687
Total Collateralized Brady Bonds
(cost $99,386,297) 106,909,940
LOAN PARTICIPATIONS & ASSIGNMENTS-7.9%
ALGERIA-1.6%
Algeria Refinancing Trust FRN
Loan Assignment Tranche B
6.50%, 9/05/05 3,000 2,186,250
MOROCCO-6.3%
Kingdom of Morocco
Loan Participation FRN
6.375%, 1/01/09 10,000 8,800,000
Total Loan Participations & Assignments
(cost $7,018,562) 10,986,250
OTHERSOVEREIGN DEBT RELATED-6.9%
Morgan Guaranty Trust Co. Indexed Note
Linked to Russian US$
Vneshekonombank Loan Assignment
14.00%, 6/15/97 (f)
(cost $9,330,000) 9,330 9,714,396
3
PORTFOLIO OF INVESTMENTS (CONTINUED) ALLIANCE WORLD DOLLAR GOVERNMENT FUND
_______________________________________________________________________________
PRINCIPAL
AMOUNT
(000) U.S. $ VALUE
- -------------------------------------------------------------------------
OTHER SOVEREIGN DEBT OBLIGATIONS-5.7%
ECUADOR-3.6%
Republic of Ecuador
11.25%, 4/25/02 (g) $ 5,000 $ 5,118,750
RUSSIA-2.1%
Russia Principal Loans FRN WI
12/15/20 (g)(h) 5,000 2,934,375
Total Other Sovereign Debt Obligations
(cost $7,782,575) 8,053,125
NON-COLLATERALIZED BRADY BONDS-5.3%
PANAMA-3.7%
Republic of Panama IRB
3.50%, 7/17/14 (b) 7,000 5,188,750
PERU-1.6%
Republic of Peru FLIRB
3.25%, 3/07/17 (b)(g) 4,000 2,170,000
Total Non-Collateralized Brady Bonds
(cost $6,520,091) 7,358,750
Total Sovereign Debt Obligations
(cost $130,037,525) 143,022,461
U.S. GOVERNMENT OBLIGATION-31.4%
U.S. Treasury Strip Zero coupon, 2/15/03
(cost $44,295,192) 64,000 43,910,967
TOTAL INVESTMENTS-133.6%
(cost $174,332,717) 186,933,428
Other assets less liabilities-(33.6%) (47,011,650)
NET ASSETS-100% $139,921,778
(a) Sovereign debt obligations issued as part of debt restructurings that are
collateralized in full as to principal due at maturity by U.S. Treasury zero
coupon obligations which have the same maturity as the Brady Bond.
(b) Coupon will increase periodically based upon a predetermined schedule.
Stated interest rate in effect at April 30, 1997.
(c) Security trades with value recovery rights expiring June 30, 2003.
(d) Security trades with oil warrants expiring November 15, 2020.
(e) Security trades with oil warrants expiring April 15, 2020.
(f) Principal amount represents par value at purchase date. The redemption
value of this security is linked to the change in the bid price of the
referenced emerging market debt.
(g) Securities are exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At April 30, 1997,
these securities amounted to $10,223,125 representing 7.3% of net assets.
(h) An interest rate based on the six-month Libor Rate plus 81.25 basis points
will take effect upon issuance of bonds.
Glossary of Terms:
FLIRB Front loaded interest reduction bond.
FRN Floating rate note.
IRB Interest reduction bond.
WI When issued.
See notes to financial statements.
4
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 1997 (UNAUDITED) ALLIANCE WORLD DOLLAR GOVERNMENT FUND
_______________________________________________________________________________
ASSETS
Investments in securities, at value (cost $174,332,717) $186,933,428
Interest receivable 3,146,695
Deferred organization expenses and other assets 28,959
Total assets 190,109,082
LIABILITIES
Due to custodian 2,945,735
Payable for investment securities purchased 46,774,692
Unrealized depreciation on interest rate swap contract 179,580
Advisory fee payable 123,361
Administrative fee payable 18,504
Accrued expenses and other liabilities 145,432
Total liabilities 50,187,304
NET ASSETS $139,921,778
COMPOSITION OF NET ASSETS
Capital stock, at par $ 86,527
Additional paid-in capital 119,218,745
Undistributed net investment income 2,157,291
Accumulated net realized gain on investments 6,038,084
Net unrealized appreciation of investments and other assets 12,421,131
$139,921,778
NET ASSET VALUE PER SHARE (based on 8,652,707 shares outstanding) $16.17
See notes to financial statements.
5
STATEMENT OF OPERATIONS
SIX MONTHS ENDED APRIL 30, 1997 (UNAUDITED)
ALLIANCE WORLD DOLLAR GOVERNMENT FUND
_______________________________________________________________________________
INVESTMENT INCOME
Interest $ 7,867,165
EXPENSES
Advisory fee $715,087
Administrative fee 107,264
Audit and legal 54,916
Custodian 51,478
Transfer agency 42,494
Directors' fees 12,495
Printing 11,503
Amortization of organization expenses 8,869
Registration 7,191
Taxes 3,971
Miscellaneous 5,492
Total expenses 1,020,760
Net investment income 6,846,405
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain on investment transactions 13,366,919
Net change in unrealized appreciation of investments
and other assets (7,250,267)
Net gain on investments 6,116,652
NET INCREASE IN NET ASSETS FROM OPERATIONS $12,963,057
See notes to financial statements.
6
STATEMENT OF CHANGES
IN NET ASSETS ALLIANCE WORLD DOLLAR GOVERNMENT FUND
_______________________________________________________________________________
SIX MONTHS ENDED YEAR ENDED
APRIL 30,1997 OCTOBER 31,
(UNAUDITED) 1996
-------------- -------------
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
Net investment income $ 6,846,405 $ 12,618,227
Net realized gain on investment transactions 13,366,919 13,908,106
Net change in unrealized appreciation of
investments and other assets (7,250,267) 16,452,008
Net increase in net assets from operations 12,963,057 42,978,341
DIVIDENDS TO SHAREHOLDERS FROM:
Net investment income (7,181,748) (11,594,630)
Total increase 5,781,309 31,383,711
NET ASSETS
Beginning of year 134,140,469 102,756,758
End of period (including undistributed net
investment income of $2,157,291 and
$2,492,634, respectively) $139,921,778 $134,140,469
See notes to financial statements.
7
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 1997 (UNAUDITED) ALLIANCE WORLD DOLLAR GOVERNMENT FUND
_______________________________________________________________________________
NOTE A: SIGNIFICANT ACCOUNTING POLICIES
Alliance World Dollar Government Fund, Inc. (the "Fund") was incorporated under
the laws of the State of Maryland on August 20, 1992 and is registered under
the Investment Company Act of 1940, as a non-diversified, closed-end management
investment company. The following is a summary of significant accounting
policies followed by the Fund.
1. SECURITY VALUATION
Portfolio securities traded on a national securities exchange are valued at the
last sale price on such exchange on the day of valuation or, if there was no
sale on such day, the last bid price quoted on such day. Listed securities not
traded and securities traded in the over-the-counter market, including listed
debt securities whose primary market is believed to be over-the-counter, are
valued at the mean between the most recently quoted bid and asked price
provided by the principal market makers. Publicly traded Sovereign Debt
Obligations are typically traded internationally on the over-the-counter
market. Because of the nature of the markets for Sovereign Debt Obligations,
quotations from several sources will be obtained so that the Fund's portfolio
investments will not generally be priced by a single source. Readily marketable
Sovereign Debt Obligations may be valued on the basis of prices provided by a
pricing service when such prices are believed by the Adviser to reflect the
fair value of such securities. Securities for which market quotations are not
readily available and restricted securities which are subject to limitations as
to their resale are valued in good faith, at fair value, using methods
determined by the Board of Directors. Securities which mature in 60 days or
less are valued at amortized cost, which approximates fair value, unless this
method does not represent fair value.
2. ORGANIZATION EXPENSES
Organization expenses of approximately $90,000 have been deferred and are being
amortized on a straight-line basis through November, 1997.
3. TAXES
It is the Fund's policy to meet the requirements of the Internal Revenue Code
applicable to regulated investment companies and to distribute all of its
investment company taxable income and net realized gains, if applicable, to
shareholders. Therefore, no provisions for federal income or excise taxes are
required.
4. INVESTMENT INCOME AND INVESTMENT TRANSACTIONS
Interest income is accrued daily. Investment transactions are accounted for on
the date securities are purchased or sold. Investment gains and losses are
determined on the identified cost basis. The Fund accretes discount as
adjustment to interest income.
5. DIVIDENDS AND DISTRIBUTIONS
Dividends and distributions to shareholders are recorded on the ex-dividend
date and are determined in accordance with income tax regulations.
For federal income tax purposes, the Fund's distributions of income and capital
gains are subject to recharacterization, which may include a tax return of
capital, at the end of the year to reflect the final investment results for
that year.
NOTE B: ADVISORY AND ADMINISTRATIVE FEES
Under the terms of an Investment Advisory Agreement, the Fund pays Alliance
Capital Management L.P. a monthly fee equal to the annualized rate of 1% of the
Fund's average weekly net assets.
Under the terms of an Administrative Agreement, the Fund pays Alliance Capital
Management L.P. (the "Administrator") a monthly fee equal to the annualized
rate of .15 of 1% of the Fund's average weekly net assets. The Administrator
provides administrative functions to the Fund as well as other clerical
services. The Administrator also prepares financial and regulatory reports for
the Fund.
On November 28, 1995, the Fund entered into a Shareholder Inquiry Agency
Agreement with Alliance Fund Services, Inc. ("AFS"), an affiliate of the
Investment Adviser whereby the Fund reimburses AFS for costs relating to
servicing phone inquiries for the Fund. The Fund reimbursed AFS $5,480 during
the six months ended April 30, 1997, relating to shareholder servicing costs.
8
ALLIANCE WORLD DOLLAR GOVERNMENT FUND
_______________________________________________________________________________
NOTE C: INVESTMENT TRANSACTIONS
Purchases and sales of investment securities (excluding short-term investments
and U.S. government securities) aggregated $93,165,925 and $101,553,000,
respectively, for the six months ended April 30, 1997. There were purchases of
$132,870,115 and sales of $131,673,576 of U.S. government obligations for the
six months ended April 30, 1997.
At April 30, 1997, the cost of investments for federal income tax purposes was
the same as the cost for financial reporting purposes. Accordingly, gross
unrealized appreciation of investments was $13,018,736 and gross unrealized
depreciation of investments was $418,025 resulting in net unrealized
appreciation of $12,600,711 (excluding swap contracts). At October 31, 1996,
the Fund had a capital loss carryforward of $7,179,105 which expires in the
year 2003.
1. INTEREST RATE SWAP AGREEMENT
The Fund enters into swaps on sovereign debt obligations to protect itself from
interest rate fluctuations on the underlying floating rate debt instruments and
for investment purposes. A swap is an agreement that obligates two parties to
exchange a series of cash flows at specified intervals based upon or calculated
by reference to changes in specified prices or rates for a specified amount of
an underlying asset. The payment flows are usually netted against each other,
with the difference being paid by one party to the other.
Risks may arise as a result of the failure of another party to the swap
contract to comply with the terms of the swap contract. The loss incurred by
the failure of a counterparty is generally limited to the net interest payment
to be received by the Fund, and/or the termination value at the end of the
contract. Therefore, the Fund considers the creditworthiness of each
counterparty to a swap contract in evaluating potential credit risk.
Additionally, risks may arise from unanticipated movements in interest rates or
in the value of the underlying securities.
The Fund records a net receivable or payable on a daily basis for the net
interest income or expense expected to be received or paid in the interest
period. Net interest received or paid on these contracts is recorded as
interest income (or as an offset to interest income). Fluctuations in the value
of swap contracts are recorded for financial statement purposes as unrealized
appreciation or depreciation on swap contracts.
At April 30, 1997, the Fund had an outstanding interest rate swap contract with
the following terms:
<TABLE>
<CAPTION>
RATE TYPE
--------------------------------
SWAP NOTIONAL TERMINATION PAYMENTS MADE PAYMENTS RECEIVED UNREALIZED
COUNTERPARTY AMOUNT DATE BY THE FUND BY THE FUND DEPRECIATION
- ------------ -------------- ----------- ------------- ----------------- ------------
<C> <C> <C> <C> <C> <C>
Morgan US$ 12,000,000 1/01/09 LIBOR# 6.8526% $179,580
Guaranty
</TABLE>
# LIBOR (London Interbank Offered Rate).
NOTE D: CAPITAL STOCK
There are 100,000,000 shares of $0.01 par value Common Stock authorized.
Of the 8,652,707 shares outstanding at April 30, 1997, the Adviser owned 7,200
shares. During the six months ended April 30, 1997 and the year ended October
31, 1996, the Fund did not issue shares in connection with the dividend
reinvestment plan.
9
NOTES TO FINANCIAL STATEMENTS
(CONTINUED) ALLIANCE WORLD DOLLAR GOVERNMENT FUND
_______________________________________________________________________________
NOTE E: CONCENTRATION OF RISK
Investing in securities of foreign governments involves special risks which
include revaluation of currencies and the possibility of future adverse
political and economic developments. Moreover, securities of many foreign
governments and their markets may be less liquid and their prices more volatile
than those of the United States government. The Fund invests in the sovereign
debt obligations of countries that are considered emerging market countries at
the time of purchase. Therefore, the Fund is susceptible to governmental
factors and economic and debt restructuring developments adversely affecting
the economies of these emerging market countries. In addition, these debt
obligations may be less liquid and subject to greater volatility than debt
obligations of more developed countries.
10
FINANCIAL HIGHLIGHTS ALLIANCE WORLD DOLLAR GOVERNMENT FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF COMMON STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
SIX MONTHS NOVEMBER 2,
ENDED YEAR ENDED OCTOBER 31, 1992(A) TO
APRIL 30,1997 ------------------------------------- OCTOBER 31,
(UNAUDITED) 1996 1995 1994 1993
------------- ----------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $15.50 $11.88 $11.08 $22.09 $13.82(b)
INCOME FROM INVESTMENT OPERATIONS
Net investment income .79(c) 1.46 1.51(c) 1.32 1.54
Net realized and unrealized gain (loss)
on investments .71 3.50 .71 (5.66) 8.19
Net increase (decrease) in net asset
value from operations 1.50 4.96 2.22 (4.34) 9.73
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.83) (1.34) (1.42) (1.39) (1.46)
Distributions from net realized gains -0- -0- -0- (4.96) -0-
Distributions in excess of net
realized gains -0- -0- -0- (.09) -0-
Tax return of capital distribution -0- -0- -0- (.23) -0-
Total dividends and distributions (.83) (1.34) (1.42) (6.67) (1.46)
Net asset value, end of period $16.17 $15.50 $11.88 $11.08 $22.09
Market value, end of period $14.625 $13.625 $11.75 $13.00 $20.375
TOTAL RETURN
Total investment return based on: (d)
Market value 13.49% 28.49% 2.78% (7.52)% 59.14%
Net asset value 10.27% 44.57% 21.92% (27.29)% 72.53%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $139,922 $134,140 $102,757 $93,528 $164,622
Ratio of expenses to average net assets 1.47%(e) 1.70% 1.55% 1.43% 1.44%(e)
Ratio of net investment income to
average net assets 9.83%(e) 10.84% 14.12% 9.08% 9.79%(e)
Portfolio turnover rate 126% 352% 441% 395% 417%
</TABLE>
(a) Commencement of operations.
(b) Net of offering costs of $.13.
(c) Based on average shares outstanding.
(d) Total investment return is calculated assuming a purchase of common stock
on the opening of the first day and a sale on the closing of the last day of
the period reported. Dividends and distributions, if any, are assumed, for
purposes of this calculation, to be reinvested at prices obtained under the
Fund's Dividend Reinvestment Plan. Generally, total investment return based on
net asset value will be higher than total investment return based on market
value in periods where there is an increase in the discount or a decrease in
the premium of the market value to the net asset value from the beginning to
the end of such periods. Conversely, total investment return based on net asset
value will be lower than total investment return based on market value in
periods where there is a decrease in the discount or an increase in the premium
of the market value to the net asset value from the beginning to the end of
such periods. Total investment return calculated for a period of less than one
year is not annualized.
(e) Annualized.
11
ADDITIONAL INFORMATION ALLIANCE WORLD DOLLAR GOVERNMENT FUND
_______________________________________________________________________________
SUPPLEMENTAL PROXY INFORMATION
The Annual Meeting of Shareholders of The Alliance World Dollar Government Fund
was held on January 23, 1997. The description of each proposal and number of
shares voted at the meeting are as follows:
SHARES SHARES VOTED
VOTED FOR WITHOUT AUTHORITY
- -------------------------------------------------------------------------------
1. To elect directors: Class One Directors
(term expires 1998)
Donald J. Robinson 6,693,817 286,639
Class Three Directors
(term expires 2000)
Ruth Block 6,682,938 297,519
John D. Carifa 6,695,900 284,556
Robert C. White 6,675,093 305,364
SHARES SHARES VOTED SHARES VOTED
VOTED FOR AGAINST ABSTAIN
- -------------------------------------------------------------------------------
2. To ratify the selection of Ernst
& Young LLP as the Fund's
independent auditors for the
Fund's fiscal year ending
October 31, 1997: 6,682,932 215,624 81,901
12
ALLIANCE WORLD DOLLAR GOVERNMENT FUND
_______________________________________________________________________________
BOARD OF DIRECTORS
JOHN D. CARIFA, CHAIRMAN
RUTH BLOCK (1)
DAVID H. DIEVLER (1)
JOHN H. DOBKIN (1)
WILLIAM H. FOULK, JR. (1)
DR. JAMES M. HESTER (1)
CLIFFORD L. MICHEL (1)
DONALD J. ROBINSON (1)
ROBERT C. WHITE (1)
OFFICERS
WAYNE D. LYSKI, PRESIDENT
KATHLEEN A. CORBET, SENIOR VICE PRESIDENT
PAUL J. DENOON, VICE PRESIDENT
VICKI L. FULLER, VICE PRESIDENT
EDMUND P. BERGAN, JR., SECRETARY
MARK D. GERSTEN, TREASURER & CHIEF FINANCIAL OFFICER
JOSEPH J. MANTINEO, CONTROLLER
ADMINISTRATOR
ALLIANCE CAPITAL MANAGEMENT, L.P.
1345 Avenue of the Americas
New York, NY 10105
CUSTODIAN
THE BANK OF NEW YORK
48 Wall Street
New York, NY 10286
DIVIDEND PAYING AGENT,
TRANSFER AGENT AND REGISTRAR
FIRST DATA INVESTOR SERVICES GROUP, INC.
(FORMERLY THE SHAREHOLDER SERVICES GROUP, INC.)
53 State Street
Boston, MA 02109
INDEPENDENT AUDITORS
ERNST & YOUNG LLP
787 Seventh Avenue
New York, NY 10019
LEGALCOUNSEL
SEWARD & KISSEL
One Battery Park Plaza
New York, NY10004
(1) Member of the Audit Committee.
13
ALLIANCE WORLD DOLLAR GOVERNMENT FUND
Summary of General Information
THE FUND
Alliance World Dollar Government Fund is a closed-end management investment
company which seeks high current income from investment in debt obligations of
countries with emerging economies whose recent interest rates are higher than
those of the United States.
SHAREHOLDER INFORMATION
Daily market prices for the Fund's shares are published in the New York Stock
Exchange Composite Transactions Section of newspapers each day, under the
designation "Alliance Wrld". The Fund's NYSE trading symbol is "AWG". Weekly
comparative net asset value (NAV) and market price information about the Fund
is published each Monday in THE WALL STREET JOURNAL, each Sunday in the NEW
YORK TIMES and each Saturday in BARRON'S and other newspapers in a table called
"Closed-End Funds." Additional information about the Fund is available by
calling 1-800-247-4154.
DIVIDEND REINVESTMENT PLAN
A Dividend Reinvestment Plan provides automatic reinvestment of dividends and
capital gains distributions in additional Fund shares. For a copy of the Plan
Brochure, please write to the Plan Agent, First Data Investor Services Group,
Inc., P.O. Box 1376, Boston, MA 02104.
ALLIANCE WORLD DOLLAR GOVERNMENT FUND
1345 Avenue of the Americas
New York, New York 10105
ALLIANCE CAPITAL
R THESE REGISTERED SERVICE MARKS USED UNDER LICENSE FROM THE OWNER, ALLIANCE
CAPITAL MANAGEMENT L.P.
WDGSR
