<PAGE>
GLOBAL HIGH INCOME DOLLAR FUND INC. SEMIANNUAL REPORT
June 15, 2000
Dear Shareholder,
We are pleased to present you with the semiannual report for the Global High
Income Dollar Fund Inc. (the "Fund") for the six-month period ended April 30,
2000.
MARKET REVIEW
Emerging-market debt outperformed developed market bonds during the
reporting period, as it had during most of the previous year. As measured by the
J.P. Morgan Emerging Market Bond Index Plus (EMBI+), emerging markets gained
14.42%. Developed bond markets, as measured by the Salomon Smith Barney World
Government Bond Index (WGBI) gained 3.37% on a U.S. dollar, currency-hedged
basis.
High returns on defaulted Soviet debt exerted a strong influence on the
EMBI+ return over the six-month period; Latin credits averaged more modest
returns.
PORTFOLIO REVIEW
AVERAGE ANNUAL RETURNS, PERIODS ENDED 4/30/00
Net Asset Value Returns+ Fund Lipper Median*
--------------------------------------------------------------------------------
6 Months 12.84% 12.84%
1 Year 16.16 18.10
5 Years 14.06 15.54
Since Inception (10/8/93) 9.53 N/A
--------------------------------------------------------------------------------
Market Price Returns+ Fund Lipper Median*
--------------------------------------------------------------------------------
6 Months 12.93% 5.00%
1 Year 17.82 -1.15
5 Years 14.07 12.74
Since Inception (10/8/93) 7.96 N/A
--------------------------------------------------------------------------------
* Lipper Emerging Market Debt Funds Median. Lipper Peer Group data calculated
by Lipper Inc.; used with permission. Lipper total return methodology
compares a fund's NAV (or market price in the case of market price returns)
at the beginning and end of a period, with the result being expressed as a
percent change of the beginning net asset value (or market price). The net
asset value (or market price) is adjusted to reflect the compounding effect
of reinvesting income dividends as well as capital gains distributions, if
any. Distributions are reinvested on the ex-dividend date at the
ex-dividend NAV (or market price on the pay date). Lipper total returns do
not reflect any commissions. The Lipper Median is the return of the fund
that places in the middle of the peer group.
+ Past performance is no guarantee of future results. The Fund's share price
and investment return will vary so that an investor's shares may be worth
more or less than their original cost. NAV and market price returns for
periods of one year or less are cumulative. NAV return assumes, for
illustration only, that dividends were reinvested at the net asset value on
the payable dates. Market price return assumes dividends were reinvested
under the Dividend Reinvestment Plan. Returns do not reflect any
commissions and are not representative of the performance of an individual
investment.
GLOBAL HIGH INCOME DOLLAR FUND INC.
Investment Goals:
Primarily,high level of current income; secondarily,capital appreciation
Portfolio Manager:
Stuart Waugh
Mitchell Hutchins Asset Management Inc.
Commencement:
October 8,1993
NYSE Symbol:
GHI
Dividend Payments:
Monthly
1
<PAGE>
SEMIANNUAL REPORT GLOBAL HIGH INCOME DOLLAR FUND INC.
PORTFOLIO HIGHLIGHT
Several of the Fund's holdings hit predefined sell-price targets during the
period, and consequently we reduced those positions. Such transactions included
Mexican discount bonds, Moroccan loans and Bulgarian Brady bonds. Additionally,
the Fund benefited when we tendered for cash the Fund's holdings in Televisa SA,
a Mexican media company.
During the period we reduced the Fund's holdings in Polish Brady bonds,
which we felt had become less attractive due to Poland's poor balance of
payments performance. We reinvested a portion of the proceeds into Polish
zloty-denominated government bonds, which are perhaps more risky than the Brady
bonds but have a better risk-return profile. Net proceeds of these transactions
left the Fund with a cash balance, which we are looking to invest.
OUTLOOK
After the crisis of 1998, the emerging market debt sector has enjoyed a
period of steadily appreciating prices with relatively few episodes of price
correction. Credit developments generally have been positive. Brazil has
achieved the targets specified in its International Monetary Fund program.
Mexico's macroeconomic performance has remained stable enough to earn an
investment grade rating from Moody's. And higher oil prices have contributed to
improved balance of payments performance for many countries within the sector.
However, present valuations are not without risks. We believe such risks
include the escalating civil war in Colombia and related risks to the Andean
region. The continuing recession in Argentina--and the lack of policy responses
available to the government to prevent further deterioration in its fiscal
accounts--ultimately threatens the country's ability to continue to meet its
debt obligations, especially in the context of rising U.S. interest rates.
The overall global recovery with as yet only moderate inflation continues
to present a favorable background for the emerging-market debt sector. We
continue to maintain core holdings in stable or improving sovereign credits like
Brazil, Korea, Morocco, Panama, Tunisia and Trinidad and Tobago. We reduced
positions in Mexican sovereign debt to market weight because of price
appreciation but intend to maintain substantial holdings there.
2
<PAGE>
GLOBAL HIGH INCOME DOLLAR FUND INC. SEMIANNUAL REPORT
PORTFOLIO STATISTICS
Currency Exposure* 4/30/00 10/31/99
--------------------------------------------------------------------------------
U.S. Dollar Denominated 95.6% U.S. Dollar Denominated 94.1%
Total Foreign Currency 4.4 Total Foreign Currency 5.9
--------------------------------------------------------------------------------
Total 100.0 Total 100.0
Top Ten Countries* 4/30/00 10/31/99
--------------------------------------------------------------------------------
Mexico 20.5% Mexico 23.1%
Brazil 12.6 Brazil 13.8
Russia 7.2 Poland 8.4
Poland 4.8 Argentina 5.0
Panama 4.5 Bulgaria 5.0
Venezuela 4.4 Venezuela 4.8
Malaysia 4.2 Morocco 4.7
Argentina 3.9 Korea 4.5
Morocco 3.5 Panama 3.9
Korea 3.0 Philippines 3.6
--------------------------------------------------------------------------------
Total 68.6 Total 76.8
Credit Quality* 4/30/00 10/31/99
--------------------------------------------------------------------------------
A1/P1 11.9% 3.2%
A 2.6 3.8
BBB 16.0 17.9
BB 33.2 44.5
B 26.2 24.6
Non-Rated 3.0 3.4
Below B 2.1 0.6
Selective Default** 5.0 2.0
--------------------------------------------------------------------------------
Total 100.0 100.0
** Relates to the Fund's Soviet Union position.
Characteristics+ 4/30/00 10/31/99
--------------------------------------------------------------------------------
Net Asset Value $ 14.64 $ 13.66
Market Price $ 12.19 $ 11.50
12-Month Dividend $1.3514 $1.4043
Current Month Dividend $0.1364 $0.1000
Net Assets ($mm) $ 297.3 $ 284.3
Weighted Average Maturity 12.9 years 15.1 years
--------------------------------------------------------------------------------
+ Prices and other characteristics will vary over time.
* Weightings represent percentages of net assets as of the dates indicated.
The Fund's portfolio is actively managed and its composition will vary over
time.
3
<PAGE>
SEMIANNUAL REPORT GLOBAL HIGH INCOME DOLLAR FUND INC.
SHARE REPURCHASES
On December 20, 1999, the Fund announced that its Board of Directors had
authorized the Fund to repurchase up to an additional 10% of its outstanding
shares of common stock. As a result of this, and an earlier share repurchase
program, the Fund had repurchased 2,425,000 shares as of April 30, 2000,
representing roughly 11.7% of its shares outstanding on December 20, 1999.
Our ultimate objective in managing your investments is to help you
successfully meet your financial goals. We thank you for your continued support
and welcome any comments or questions you may have. For a Quarterly Review on
Global High Income Dollar Fund Inc. or a fund in the PaineWebber Family of
Funds,1 please contact your Financial Advisor.
Sincerely,
/s/ MARGO ALEXANDER /s/ BRIAN M. STORMS
MARGO ALEXANDER BRIAN M. STORMS
Chairman and Chief Executive Officer President and Chief Operating Officer
Mitchell Hutchins Asset Management Inc. Mitchell Hutchins Asset Management Inc.
/s/ STUART WAUGH
STUART WAUGH
Managing Director
Mitchell Hutchins Asset Management Inc.
Portfolio Manager
Global High Income Dollar Fund Inc.
This letter is intended to assist shareholders in understanding how the
Fund performed during the six-month period ended April 30, 2000, and reflects
our views at the time of its writing. Of course, these views may change in
response to changing circumstances. We encourage you to consult your Financial
Advisor regarding your personal investment program.
1 Mutual funds are sold by prospectus only. The prospectuses for the funds
contain more complete information regarding risks, charges and expenses,
and should be read carefully before investing.
4
<PAGE>
Global High Income Dollar Fund Inc.
Portfolio of Investments April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
Principal
Amount Maturity Interest
(000) Dates Rates Value
----------- -------------------- ---------------- ------------
<C> <S> <C> <C> <C>
LONG - TERM DEBT SECURITIES -- 88.24%
Algeria -- 1.01%
$ 4,000 The People's Democratic
Republic of Algeria
Loan Participation,
Tranche 3 (Chase
Manhattan Bank)(1)(2).. 03/04/10 7.188% $ 3,000,000
------------
Argentina -- 3.86%
ARS 3,050 Republic of Argentina... 02/12/07 11.750 2,723,991
$ 9,000 Republic of Argentina... 04/07/09 to 01/30/17 11.375 to 11.750 8,748,000
------------
11,471,991
------------
Brazil -- 12.58%
4,430 Federal Republic of
Brazil................. 10/15/09 14.500 4,667,005
7,676 Federal Republic of
Brazil, DCB............ 04/15/12 7.438+ 5,526,720
21,300 Federal Republic of
Brazil, DISC........... 04/15/24 7.375+ 16,454,250
2,700 Federal Republic of
Brazil, EXIT........... 09/15/13 6.000 1,863,000
5,000 Federal Republic of
Brazil, NMB............ 04/15/09 7.438+ 4,100,000
7,500 Federal Republic of
Brazil, PAR............ 04/15/24 5.750++ 4,781,250
------------
37,392,225
------------
Bulgaria -- 2.57%
11,000 Republic of Bulgaria,
FLIRB.................. 07/28/12 2.750++ 7,645,000
------------
Chile -- 1.00%
3,000 CIA de Telecom de Chile,
S.A. .................. 01/01/06 8.375 2,977,800
------------
Costa Rica -- 1.19%
3,500 Republic of Costa Rica.. 05/15/09 9.335 3,526,250
------------
El Salvador -- 1.43%
4,170 Republic of El
Salvador(1)............ 08/15/06 9.500 4,253,400
------------
Hungary -- 0.93%
HUF 760,000 Republic of Hungary..... 06/12/01 13.500 2,765,348
------------
Korea -- 3.00%
$ 8,660 Republic of Korea....... 04/15/08 8.875 8,930,192
------------
Mexico -- 20.52%
4,000 Alestra S.A. de C.V. ... 05/15/06 12.125 3,960,000
2,310 Coca-Cola Femsa, S.A. de
C.V. .................. 11/01/06 8.950 2,298,450
3,000 Grupo Industrial
Durango, S.A. de C.V. . 07/15/01 12.000 3,045,000
5,700 Grupo Televisa, S.A. de
C.V.(a) ............... 05/15/08 0/13.250@ 5,600,250
6,250 Mexican Multi Year
Refinance Loan
Participation
(Salomon Brothers)(1)(2) 03/20/05 7.000+ 5,937,500
3,000 Pemex Finance LTD(1).... 11/15/18 9.150 3,054,600
15,068 United Mexican States... 04/06/05 to 05/15/26 9.750 to 11.500 17,441,660
</TABLE>
5
<PAGE>
Global High Income Dollar Fund Inc.
<TABLE>
<CAPTION>
Principal
Amount Maturity Interest
(000) Dates Rates Value
----------- -------------------- -------------- ------------
<C> <S> <C> <C> <C>
LONG - TERM DEBT SECURITIES --
(continued)
Mexico -- (concluded)
$ 17,126 United Mexican States,
DISC(3)................ 12/31/19 6.836 to 6.943%+ $ 16,783,480
3,500 United Mexican States,
PAR(4)................. 12/31/19 6.250 2,878,750
------------
60,999,690
------------
Malaysia -- 4.23%
7,176 Petroliam Nasional
Berhad................. 10/18/06 to 10/15/26 7.125 to 7.625 6,431,725
6.005 Republic of Malaysia.... 05/01/09 8.750 6,155,125
------------
12,586,850
------------
Morocco -- 3.54%
2,202 Kingdom of Morocco Loan
Participation, Tranche
A (Chase Manhattan
Bank)(1)(2)............ 01/01/09 6.844+ 1,964,842
9,590 Kingdom of Morocco Loan
Participation, Tranche
A (Morgan Guaranty
Trust)(1)(2)........... 01/01/09 6.844+ 8,559,472
------------
10,524,314
------------
Panama -- 4.45%
7,308 Republic of Panama...... 04/01/29 9.375 6,869,520
7,913 Republic of Panama, PDI. 07/17/16 7.063+ 6,370,205
------------
13,239,725
------------
Peru -- 2.83%
5,000 Republic of Peru, FLIRB. 03/07/17 3.750++ 3,050,000
8,000 Republic of Peru, PDI... 03/07/17 4.500++ 5,350,000
------------
8,400,000
------------
Philippines -- 2.31%
7,179 Republic of Philippines. 10/21/24 9.500 6,873,892
------------
Poland -- 4.82%
3,000 PTC International
Finance II S.A......... 12/01/09 11.250 2,985,000
PLN 23,780 Republic of Poland...... 06/12/02 to 02/12/03 12.000 4,878,847
$ 7,200 Republic of Poland, PDI. 10/27/24 6.000++ 6,471,000
------------
14,334,847
------------
Russia -- 7.18%
14,308 Russian IAN(b).......... 12/15/15 6.906+ 3,934,589
4,200 Russia Federation....... 06/24/28 12.750 3,402,000
8,800 Russia Federation*...... 03/31/30 2.250++ 2,959,000
22,080 Russian Principal Loan
(Chase Manhattan
Bank)(1)(2)(b)......... 12/15/20 6.906+ 6,044,400
18,300 Russian Principal Loan
(Morgan Guaranty
Trust)(1)(2)(b)........ 12/15/20 6.063+ 5,009,625
------------
21,349,614
------------
Trinidad & Tobago -- 2.64%
3,000 Republic of Trinidad and
Tobago(1).............. 10/03/04 11.750 3,225,000
4,500 Republic of Trinidad and
Tobago................. 10/01/09 9.875 4,635,000
------------
7,860,000
------------
</TABLE>
6
<PAGE>
Global High Income Dollar Fund Inc.
<TABLE>
<CAPTION>
Principal
Amount Maturity Interest
(000) Dates Rates Value
----------- -------------------- -------- ------------
<C> <S> <C> <C> <C>
LONG - TERM DEBT SECURITIES --
(concluded)
Tunisia -- 1.92%
$ 6,500 Banque Centrale de Tunisie.. 09/19/27 8.250% $ 5,703,750
------------
Turkey -- 1.79%
5,000 Republic of Turkey.......... 11/05/04 to 01/15/30 11.875 5,322,213
------------
Venezuela -- 4.44%
11,710 Republic of Venezuela....... 09/15/27 9.250 7,482,690
8,175 Republic of Venezuela,
PAR(5)..................... 03/31/20 6.750 5,702,062
------------
13,184,752
------------
Total Long-Term Debt Securities (cost --
$256,262,620).......................... 262,341,853
------------
U.S. GOVERNMENT AGENCY OBLIGATIONS --
9.07%
15,000 Federal Home Loan Bank
Discount Notes............. 05/11/00 5.436** 14,977,350
12,000 Federal Home Loan Mortgage
Corporation Discount Notes. 05/02/00 5.469** 11,998,177
------------
Total U.S. Government Agency Obligations
(cost -- $26,975,527)................... 26,975,527
------------
REPURCHASE AGREEMENT -- 1.34%
3,975 Repurchase agreement dated
04/28/00 with Dresdner
Bank,
collateralized by $3,286,000
U.S. Treasury Notes, 8.000%
due 11/15/21 (value --
$4,055,688); proceeds:
$3,976,885
(cost -- $3,975,000)....... 05/01/00 5.690 3,975,000
------------
Total Investments (cost --
$287,213,147) -- 98.65%................ 293,292,380
Other assets in excess of liabilities --
1.35%................................... 3,997,202
------------
Net Assets -- 100.00%.................... $297,289,582
============
</TABLE>
---------
Note: The Portfolio of Investments is listed by the issuer's country of origin
+ Reflects rate at April 30, 2000 on variable rate instruments
++ Reflects rate at April 30, 2000 on step coupon rate instruments
@ Current coupon rate is 0% on step up rate. Subsequent to 05/15/01 rate
will change to 13.250%.
* Security was purchased on when-issued basis
** Interest rates shown are discount rates at date of purchase
(1) Illiquid securities represent 13.8% of net assets
(2) Participation interest was acquired through the financial institution
indicated parenthetically
(3) With an additional 26,347,000 recoverable rights attached maturing on
06/30/03 with no market value
(4) With an additional 3,500,000 warrants attached maturing on 06/03/03 with
no market value
(5) With an additional 40,875 warrants attached maturing on 4/15/20 with no
market value
(a) Per agreement, security will be tendered
(b) Interest in default
ARS Argentine Peso
DCB Debt Conversion Bond
DISC Discount Bond
EXIT Investment Bond
FLIRB Front-loaded Interest Reduction Bond
HUF Hungary Forint
IAN Interest Arrears Note
NMB New Money Bond
PAR Par Bond
PDI Past Due Interest Bond
PLN Polish Zloty
7
<PAGE>
Global High Income Dollar Fund Inc.
Forward Foreign Currency Contracts
<TABLE>
<CAPTION>
Unrealized
Contract to Deliver In Exchange For Maturity Date Appreciation
------------------- ----------------- ------------- ------------
<S> <C> <C> <C> <C>
U.S. Dollars.. 2,979,418 KRW 3,311,623,000 05/30/000 $5,005
</TABLE>
---------
KRW Korean Won
Investments By Type of Issuer
<TABLE>
<CAPTION>
Percentage of Net Assets
----------------------------
Long-term Short-term
------------ ------------
<S> <C> <C>
Government and other public issuers.... 80.20% --
U.S. Government Agency Obligations..... -- 9.07%
Telecom................................ 3.34 --
Broadcasting........................... 1.88 --
Repurchase agreement................... -- 1.34
Oil/Gas................................ 1.03 --
Industrial............................. 1.02 --
Beverage/Bottling...................... 0.77 --
------------ ------------
88.24% 10.41%
============ ============
</TABLE>
See accompanying notes to financial statements
8
<PAGE>
Global High Income Dollar Fund Inc.
Statement of Assets and Liabilities April 30, 2000 (unaudited)
<TABLE>
<S> <C>
Assets
Investments in securities, at value (cost -- $287,213,147)....... $293,292,380
Cash............................................................. 54
Receivable for investments and foreign currency sold............. 10,998,588
Interest receivable.............................................. 5,249,739
Unrealized appreciation on forward currency contracts............ 5,005
Other assets..................................................... 4,146
------------
Total assets..................................................... 309,549,912
------------
Liabilities
Payable for investments purchased................................ 11,458,345
Payable for shares of capital stock repurchased.................. 346,104
Payable to investment adviser and administrator.................. 309,234
Accrued expenses and other liabilities........................... 146,647
------------
Total liabilities................................................ 12,260,330
------------
Net Assets
Capital stock -- $0.001 per value; total authorized shares --
100,000,000; 20,311,667 shares issued and outstanding.......... 301,291,735
Distributions in excess of net investment income................. (2,059,034)
Accumulated net realized loss from investment and foreign
currency transactions........................................... (7,935,077)
Net unrealized appreciation of investments, other assets,
liabilities and forward contracts denominated in foreign
currencies...................................................... 5,991,958
------------
Net assets....................................................... $297,289,582
============
Net asset value per share........................................ $ 14.64
============
</TABLE>
See accompanying notes to financial statements
9
<PAGE>
Global High Income Dollar Fund Inc.
Statement of Operations
<TABLE>
<CAPTION>
For the
Six Months
Ended
April 30, 2000
(unaudited)
--------------
<S> <C>
Investment Income:
Interest (net of foreign withholding taxes of $2,382)............ $14,763,590
-----------
Expenses:
Investment advisory and administration........................... 1,856,841
Custody and accounting........................................... 114,768
Reports and notices to shareholders.............................. 22,996
Legal and audit.................................................. 27,304
Transfer agency fees............................................. 12,691
Directors' fees.................................................. 5,250
Other expenses................................................... 1,289
-----------
2,041,139
-----------
Net Investment Income............................................ 12,722,451
-----------
Realized and unrealized gains (losses) from investment
activities:
Net realized gains (losses) from:
Investment transactions......................................... 2,231,564
Foreign currency transactions................................... (188,638)
Net change in unrealized appreciation/depreciation of:
Investments..................................................... 19,656,695
Other assets, liabilities and forward contracts denominated in
foreign currencies............................................. (36,427)
-----------
Net realized and unrealized gains from investment activities..... 21,663,194
-----------
Net increase in net assets resulting from operations............. $34,385,645
===========
</TABLE>
See accompanying notes to financial statements
10
<PAGE>
Global High Income Dollar Fund Inc.
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
For the
Six Months
Ended For the Year
April 30, 2000 Ended
(unaudited) October 31, 1999
-------------- ----------------
<S> <C> <C>
From operations:
Net investment income.......................... $ 12,722,451 $ 23,924,757
Net realized gains (losses) on investment
transactions.................................. 2,231,564 (9,435,714)
Net realized gains (losses) from foreign
currency transactions......................... (188,638) 604,250
Net change in unrealized
appreciation/depreciation of:
Investments................................... 19,656,695 25,641,962
Other assets, liabilities and forward
contracts denominated in foreign currencies.. (36,427) 257,104
------------ ------------
Net increase in net assets resulting from
operations.................................... 34,385,645 40,992,359
------------ ------------
Dividends and distributions to stockholders:
From net investment income..................... (15,456,599) (23,852,464)
From net realized gains from investment
transactions.................................. -- (6,829,547)
------------ ------------
Total dividends and distributions to
stockholders.................................. (15,456,599) (30,682,011)
------------ ------------
Capital stock transactions:
Cost of shares repurchased..................... (5,905,846) (20,111,126)
------------ ------------
Net increase (decrease) in net assets.......... 13,023,200 (9,800,778)
------------ ------------
Net Assets:
Beginning of period............................ 284,266,382 294,067,160
------------ ------------
End of period (including undistributed net
investment income of $675,114 at October 31,
1999)......................................... $297,289,582 $284,266,382
============ ============
</TABLE>
See accompanying notes to financial statements
11
<PAGE>
Notes to Financial Statements (unaudited)
Organization and Significant Accounting Policies
Global High Income Dollar Fund Inc. (the "Fund") was incorporated in the State
of Maryland on February 23, 1993 and is registered with the Securities and Ex-
change Commission as a closed-end, non-diversified management investment compa-
ny. The Fund's primary investment objective is to achieve a high level of cur-
rent income. As a secondary objective the Fund seeks capital appreciation, to
the extent consistent with its primary objective.
The preparation of financial statements in accordance with generally accepted
accounting principles requires Fund management to make estimates and assump-
tions that affect the reported amounts and disclosures in the financial state-
ments. Actual results could differ from those estimates. The following is a
summary of significant accounting policies:
Valuation of Investments--The Fund calculates its net asset value based on the
current market value for its portfolio securities. The Fund normally obtains
market values for its securities from independent pricing sources. Independent
pricing sources may use reported last sale prices, current market quotations or
valuations from computerized "matrix" systems that derive values based on com-
parable securities. Securities traded in the over-the-counter ("OTC") market
and listed on The Nasdaq Stock Market, Inc. ("Nasdaq") normally are valued at
the last sale price on Nasdaq prior to valuation. Other OTC securities are val-
ued at the last bid price available prior to valuation. Securities which are
listed on U.S. and foreign stock exchanges normally are valued at the last sale
price on the day the securities are valued or, lacking any sales on such day,
at the last available bid price. In cases where securities are traded on more
than one exchange, the securities are valued on the exchange designated as the
primary market by Mitchell Hutchins Asset Management Inc. ("Mitchell
Hutchins"), a wholly owned asset management subsidiary of PaineWebber Incorpo-
rated ("PaineWebber") and investment adviser and administrator of the Fund. If
a market value is not available from an independent pricing source for a par-
ticular security, that security is valued at fair value as determined in good
faith by or under the direction of the Fund's board of directors (the "board").
The amortized cost method of valuation, which approximates market value, gener-
ally is used to value short-term debt instruments with sixty days or less re-
maining to maturity, unless the board determines that this does not represent
fair value. All investments quoted in foreign currencies will be valued weekly
in U.S. dollars on the basis of the foreign currency exchange rates prevailing
at the time such valuation is determined by the Fund's custodian.
Foreign currency exchange rates are generally determined prior to the close of
the New York Stock Exchange ("NYSE"). Occasionally, events affecting the value
of foreign investments and such exchange rates occur between the time at which
they are determined and the close of the NYSE, which will not be reflected in
the computation of the Fund's net asset value. If events materially affecting
the value of such securities or currency exchange rates occur during such time
periods, the securities will be valued at their fair value as determined in
good faith by or under the direction of the board.
Repurchase Agreements--The Fund's custodian takes possession of the collateral
pledged for investments in repurchase agreements. The underlying collateral is
valued daily on a mark-to-market basis to ensure that the value, including ac-
crued interest, is at least equal to the repurchase price. In the event of de-
fault of the obligation to repurchase, the Fund has the right to liquidate the
collateral and apply the proceeds in satisfaction of the obligation. Under cer-
tain circumstances, in the event of default or bankruptcy by the other party to
the agreement, realization and/or retention of the collateral may be subject to
legal proceedings. The Fund occasionally participates in joint repurchase
agreement transactions with other funds managed by Mitchell Hutchins.
Investment Transactions and Investment Income--Investment transactions are re-
corded on the trade date. Realized gains and losses from investments and for-
eign exchange transactions are calculated on the identified cost method. Inter-
est
12
<PAGE>
Notes to Financial Statements (unaudited)
income is recorded on an accrual basis. Discounts are accreted as adjustments
to interest income and the identified cost of investments.
Foreign Currency Translation--The books and records of the Fund are maintained
in U.S. dollars. Foreign currency amounts are translated into U.S. dollars on
the following basis: (1) market value of investment securities, other assets
and liabilities--at the exchange rates prevailing at the end of the period; and
(2) purchases and sales of investment securities, income and expenses--at the
rates of exchange prevailing on the respective dates of such transactions.
Although the net assets and the market value of the Fund's portfolio are pre-
sented at the foreign exchange rates at the end of the period, the Fund does
not generally isolate the effect of fluctuations in foreign exchange rates from
the effect of the changes in market prices of securities. However, the Fund
does isolate the effect of fluctuations in foreign exchange rates when deter-
mining the gain or loss upon the sale or maturity of foreign currency-denomi-
nated debt obligations pursuant to federal income tax regulations. Certain for-
eign exchange gains and losses included in realized and unrealized gains and
losses are included in or are a reduction of ordinary income in accordance with
federal income tax regulations.
Forward Foreign Currency Contracts--The Fund may enter into forward foreign
currency exchange contracts ("forward contracts") in connection with planned
purchases or sales of securities or to hedge the U.S. dollar value of portfolio
securities denominated in a particular currency. The Fund may also use forward
currency contracts to enhance income.
The Fund has no specific limitation on the percentage of assets which may be
committed to such contracts. The Fund may enter into forward contracts or main-
tain a net exposure to forward contracts only if (1) the consummation of the
contracts would not obligate the Fund to deliver an amount of foreign currency
in excess of the value of the position being hedged by such contracts or (2)
the Fund maintains cash or liquid securities in a segregated account in an
amount not less than the value of its total assets committed to the consumma-
tion of the forward contracts and not covered as provided in (1) above, as
marked-to-market daily.
Risks may arise with respect to entering into forward contracts from the po-
tential inability of counterparties to meet the terms of their forward con-
tracts and from unanticipated movements in the value of foreign currencies rel-
ative to the U.S. dollar.
Fluctuations in the value of forward contracts are recorded for book purposes
as unrealized gains or losses by the Fund. Realized gains and losses include
net gains and losses recognized by the Fund on contracts which have matured.
Dividends and Distributions--Dividends and distributions to stockholders are
recorded on the ex-dividend date. The amount of dividends and distributions are
determined in accordance with federal income tax regulations, which may differ
from generally accepted accounting principles. These "book/tax" differences are
either considered temporary or permanent in nature. To the extent these differ-
ences are permanent in nature, such amounts are reclassified within the capital
accounts based on their federal tax-basis treatment; temporary differences do
not require reclassification.
Concentration of Risk
Investing in securities of foreign issuers and currency transactions may in-
volve certain considerations and risks not typically associated with invest-
ments in the United States. These risks include revaluation of currencies, ad-
verse fluctuations in foreign currency values and possible adverse political,
social and economic developments, including those particular to a specific in-
dustry, country or region, which could cause the securities and their markets
to be less liquid and prices more volatile than those of comparable U.S. compa-
nies and U.S. government securities. These risks are greater with respect to
securities of issuers located in emerging market countries in which the Fund
invests. The ability of the issuers of debt
13
<PAGE>
Notes to Financial Statements (unaudited)
securities held by the Fund to meet their obligations may be affected by eco-
nomic and political developments particular to a specific industry, country or
region.
Investment Adviser and Administrator
The Fund's board of directors has approved an Investment Advisory and Adminis-
tration Contract ("Advisory Contract") with Mitchell Hutchins, under which
Mitchell Hutchins serves as investment adviser and administrator of the Fund.
In accordance with the Advisory Contract, the Fund pays Mitchell Hutchins an
investment advisory and administration fee, which is accrued weekly and paid
monthly, at the annual rate of 1.25% of the Fund's average weekly net assets.
At April 30, 2000, the Fund owed Mitchell Hutchins $309,234 investment advisory
and administration fees.
Security Lending
The Fund may lend securities up to 33 1/3% of its total assets to qualified
institutions. The loans are secured at all times by cash or U.S. government se-
curities in an amount at least equal to the market value of the securities
loaned, plus accrued interest, determined on a daily basis and adjusted accord-
ingly. The Fund will regain ownership of loaned securities to exercise certain
beneficial rights, however, the Fund may bear the risk of delay in recovery of,
or even loss of rights in, the securities loaned should the borrower fail fi-
nancially. The Fund receives compensation, which is included in interest in-
come, for lending its securities from interest earned on the cash or U.S. gov-
ernment securities held as collateral, net of fee rebates paid to the borrower
plus reasonable administrative and custody fees. During the six months ended
April 30, 2000, the Fund did not lend securities.
Investments in Securities
For federal income tax purposes, the cost of securities owned at April 30,
2000, was substantially the same as the cost of securities for financial state-
ment purposes.
At April 30, 2000, the components of net unrealized appreciation of invest-
ments were as follows:
<TABLE>
<S> <C>
Gross depreciation (investments having an excess of cost over
value)........................................................ $(9,781,076)
Gross appreciation (investments having an excess of value over
cost)......................................................... 15,860,309
-----------
Net unrealized appreciation of investments..................... $ 6,079,233
===========
</TABLE>
For the six months ended April 30, 2000, total aggregate purchases and sales
of portfolio securities, excluding short-term securities, were $66,344,297 and
$103,279,640, respectively.
Capital Stock
There are 100,000,000 shares of $0.001 par value capital stock authorized. Of
the 20,311,667 shares outstanding at April 30, 2000 Mitchell Hutchins owned
10,921 shares.
For the six months ended April 30, 2000, the Fund repurchased 498,600 shares
of common stock at an average market price per share of $11.79 and a weighted
average discount from net asset value of 18.46% per share.
For the period September 17, 1998 (commencement of repurchase program) through
April 30, 2000, the Fund repurchased 2,425,000 shares of common stock at an av-
erage market price per share of $11.35 and a weighted average discount from net
asset value of 15.49% per share. At April 30, 2000, paid-in-capital was reduced
by the cost of $27,666,456 of capital stock repurchased.
14
<PAGE>
Notes to Financial Statements (unaudited)
Federal Income Tax Status
The Fund intends to distribute substantially all of its taxable income and to
comply with the other requirements of the Internal Revenue Code applicable to
regulated investment companies. Accordingly, no provision for federal income
taxes is required. In addition, by distributing during each calendar year sub-
stantially all of its net investment income, capital gains and certain other
amounts, if any, the Fund intends not to be subject to a federal excise tax.
At October 31, 1999, the Fund had a net capital loss carryforward of
$9,435,714. The loss carryforward is available as a reduction, to the extent
provided in the regulations, of future net realized capital gains, and will ex-
pire by October 31, 2007. To the extent that such losses are used to offset fu-
ture net realized capital gains as provided in the regulations, it is possible
that these gains will not be distributed.
15
<PAGE>
Global High Income Dollar Fund Inc.
Financial Highlights
Selected data for a share of common stock outstanding throughout each period is
presented below:
<TABLE>
<CAPTION>
For the
Six Months
Ended For the Years Ended October 31,
April 30, 2000 -------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
-------------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of period.... $ 13.66 $ 13.02 $ 15.16 $ 14.99 $ 13.07 $ 12.83
-------- -------- -------- -------- -------- --------
Net investment income... 0.62 1.10 1.28 1.31 1.30 1.34
Net realized and
unrealized gains
(losses) from
investments and
foreign currency....... 1.05 0.78 (2.12) 0.13 1.89 0.21
-------- -------- -------- -------- -------- --------
Net increase (decrease)
from investment
operations............. 1.67 1.88 (0.84) 1.44 3.19 1.55
-------- -------- -------- -------- -------- --------
Dividends from net
investment income...... (0.75) (1.10) (1.10) (1.08) (1.27) (1.16)
Distributions from net
realized gains from
investment
transactions........... -- (0.30) (0.11) -- -- --
Distributions in excess
of net investment
income................. -- -- (0.10) (0.19) -- --
Distributions from paid-
in-capital............. -- -- -- -- -- (0.15)
-------- -------- -------- -------- -------- --------
Total dividends and
distributions to
stockholders........... (0.75) (1.40) (1.31) (1.27) (1.27) (1.31)
-------- -------- -------- -------- -------- --------
Net increase in net
asset value resulting
from repurchase of
common stock........... 0.06 0.16 0.01 -- -- --
-------- -------- -------- -------- -------- --------
Net asset value, end of
period................. $ 14.64 $ 13.66 $ 13.02 $ 15.16 $ 14.99 $ 13.07
======== ======== ======== ======== ======== ========
Market value, end of
period................. $ 12.19 $ 11.50 $ 11.50 $ 12.81 $ 12.63 $ 11.63
======== ======== ======== ======== ======== ========
Total investment
return(1).............. 12.93% 13.23% (0.70)% 11.47% 20.26% 13.65%
======== ======== ======== ======== ======== ========
Ratios/Supplemental
data:
Net assets, end of
period (000's)......... $297,290 $284,266 $294,067 $344,612 $340,910 $297,087
Expenses to average net
assets................. 1.37%* 1.42% 1.44% 1.42% 1.43% 1.46%
Net investment income to
average net assets..... 8.57%* 8.27% 8.55% 8.24% 9.18% 10.76%
Portfolio turnover rate. 24%* 33% 89% 56% 80% 71%
</TABLE>
---------
* Annualized
(1) Total investment return is calculated assuming a purchase at market value
on the first day of each period reported, reinvestment of all dividends and
distributions in accordance with the Fund's Dividend Reinvestment Plan, and
a sale at market value on the last day of each period reported. Total
investment return does not reflect brokerage commissions. Total investment
return for periods of less than one year has not been annualized.
16
<PAGE>
Global High Income Dollar Fund Inc.
General Information (unaudited)
The Fund
Global High Income Dollar Fund Inc. (the "Fund") is a non-diversified, closed-
end management investment company whose shares trade on the New York Stock Ex-
change ("NYSE"). The Fund's primary investment objective is to achieve a high
level of current income. As a secondary objective the Fund seeks capital appre-
ciation, to the extent consistent with its primary objective. The Fund's in-
vestment adviser and administrator is Mitchell Hutchins Asset Management Inc.,
a wholly owned asset management subsidiary of PaineWebber Incorporated, which
has over $68 billion in asset management as of May 31, 2000.
Shareholder Information
The Fund's NYSE trading symbol is "GHI." Comparative net asset value and mar-
ket price information about the Fund is published weekly in The Wall Street
Journal, New York Times and Barron's, as well as numerous other publications.
An annual meeting of stockholders of the Fund was held on February 17, 2000.
At the meeting, Margo N. Alexander, Richard Q. Armstrong, E. Garrett Bewkes,
Jr., Richard R. Burt, Mary C. Farrell, Meyer Feldberg, George W. Gowen, Frede-
ric V. Malek, Carl W. Schafer and Brian M. Storms were elected to serve as di-
rectors until the next annual meeting of stockholders, or until their succes-
sors are elected and qualified.
<TABLE>
<CAPTION>
Shares
Shares Withhold
Voted For Authority
-------------- -----------
<S> <C> <C>
1. To elect ten members of its Board of Directors:
Margo N. Alexander.................................. 19,300,634.638 529,691.543
Richard Q. Armstrong................................ 19,302,926.413 527,399.768
E. Garrett Bewkes, Jr. ............................. 19,255,012.440 575,313.741
Richard R. Burt..................................... 19,296,566.049 533,760.132
Mary C. Farrell..................................... 19,297,553.638 532,772.544
Meyer Feldberg...................................... 19,308,535.748 521,790.433
George W. Gowen..................................... 19,259,544.437 570,781.744
Frederic V. Malek................................... 19,288,398.373 541,921.808
Carl W. Schafer..................................... 19,294,454.069 535,872.112
Brian M. Storms..................................... 19,302,755.748 527,570.433
</TABLE>
<TABLE>
<CAPTION>
Shares Shares Shares
Voted For Against Abstain
-------------- ----------- -----------
<S> <C> <C> <C>
2. Ratification of the selection of
PricewaterhouseCoopers LLP as
independent auditors for the current
fiscal year.......................... 19,440,155.743 220,300.980 169,870.458
</TABLE>
(Broker abstentions are included within the "Shares Withhold Authority" to-
tals; one share "no vote" was recorded in connection with the election of each
of the directors.)
17
<PAGE>
Global High Income Dollar Fund Inc.
General Information (unaudited) (concluded)
Dividend Reinvestment Plan
The Fund has established a Dividend Reinvestment Plan (the "Plan") under which
all stockholders whose shares are registered in their own names, or in the name
of PaineWebber or its nominee, will have all dividends and other distributions
on their shares automatically reinvested in additional shares, unless such
stockholders elect to receive cash. Stockholders who elect to hold their shares
in the name of another broker or nominee should contact such broker or nominee
to determine whether, or how, they may participate in the Dividend Reinvestment
Plan. The ability of such stockholders to participate in the Plan may change if
their shares are transferred into the name of another broker or nominee.
A stockholder may elect not to participate in the Plan or may terminate par-
ticipation in the Plan at any time without penalty, and stockholders who have
previously terminated participation in the Plan may rejoin it at any time.
Changes in elections must be made in writing to the Fund's transfer agent and
should include the stockholder's name and address as they appear on that share
certificate or in the transfer agent's records. An election to terminate par-
ticipation in the Plan, until such election is changed, will be deemed an elec-
tion by a stockholder to take all subsequent distributions in cash. An election
will be effective only for distributions declared and having a record date at
least ten days after the date on which the election is received.
Additional shares of common stock acquired under the Dividend Reinvestment
Plan will be purchased in the open market, on the NYSE or otherwise, at prices
that may be higher or lower than the net asset value per share at the time of
the purchase. The number of shares of common stock purchased with each dividend
will be equal to the result obtained by dividing the amount of the dividend
payable to a particular stockholder by the average price per share (including
applicable brokerage commissions) that the transfer agent was able to obtain in
the open market. The Fund will not issue any new shares in connection with its
Dividend Reinvestment Plan. There currently is no charge to participants for
reinvesting dividends or other distributions. The transfer agent's fees for
handling the reinvestment of distributions are paid by the Fund. However, each
participant pays a pro rata share of brokerage commissions incurred with re-
spect to the transfer agent's open market purchases of common stock in connec-
tion with the reinvestment of distributions. The automatic reinvestment of div-
idends and other distributions in shares of common stock does not relieve par-
ticipants of any income tax that may be payable on such distributions.
Additional information regarding the Plan may be obtained from, and all corre-
spondence concerning the Plan should be directed to, the transfer agent at PFPC
Inc., P.O. Box 8950, Wilmington, Delaware 19899.
Distribution Policy
The Fund's board adopted a managed distribution policy in December 1999, which
means that the Fund will make regular monthly distributions at an annualized
rate equal to 11% of the Fund's net asset value, as determined as of the last
trading day during the first week of that month (usually a Friday, unless the
New York Stock Exchange is closed that Friday). Prior to December 20, 1999, the
Fund's distributions varied based on the Fund's net investment income and real-
ized capital gains or losses.
To the extent that the Fund's taxable income in any fiscal year exceeds the
aggregate amount distributed based on a fixed percentage of its net asset val-
ue, the Fund would distribute that excess near the end of the fiscal year. If
the aggregate amount distributed by the Fund (based on a fixed percentage of
its net asset value) exceeds its taxable income, the amount of that excess
would constitute a return of capital for tax purposes.
Monthly distributions based on a fixed percentage of the Fund's net asset
value may require the Fund to make multiple distributions of long-term capital
gains during a single fiscal year, and the Fund has applied to the Securities
and Exchange Commission to enable this change. The Fund's board will annually
reassess the annualized percentage of net assets at which the Fund's monthly
distributions will be made.
18
<PAGE>
DIRECTORS
E. Garrett Bewkes, Jr. Meyer Feldberg
Chairman George W. Gowen
Frederic V. Malek
Margo N. Alexander Carl W. Schafer
Richard Q. Armstrong Brian M. Storms
Richard R. Burt
Mary C. Farrell
PRINCIPAL OFFICERS
Margo N. Alexander Dennis L. McCauley
President Vice President
Dianne E. O'Donnell Stuart Waugh
Vice President and Secretary Vice President
Paul H. Schubert
Vice President and Treasurer
INVESTMENT ADVISER
AND ADMINISTRATOR
Mitchell Hutchins Asset Management Inc.
51 West 52nd Street
New York, New York 10019
This report is sent to the shareholders of the Fund for their information. It is
not a prospectus, circular or representation intended for the use in the
purchase or sale of shares of the Fund or of any securities mentioned in this
report.
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940 that from time to time the Fund may purchase shares of its
common stock in the open market at market prices.
The financial information included herein is taken from the records of the Fund
without examination by independent accountants who do not express an opinion
thereon.
<PAGE>
------------------------------
GLOBAL HIGH
INCOME DOLLAR
FUND INC.
SEMIANNUAL REPORT
PaineWebber
(C)2000 PaineWebber Incorporated
All Rights Reserved.
Member SIPC APRIL 30, 2000
