(2_FIDELITY_LOGOS)FIDELITY ADVISOR
(registered trademark)
EMERGING ASIA
FUND, INC.
SEMIANNUAL REPORT
APRIL 30, 1997
CONTENTS
PRESIDENT'S MESSAGE 3 Ned Johnson on investing
strategies.
FUND TALK 4 The manager's review of fund
performance, strategy and outlook.
INVESTMENT CHANGES 7 A summary of major shifts in the
fund's investments over the past six
months.
INVESTMENTS 8 A complete list of the fund's
investments with their market
values.
FINANCIAL STATEMENTS 14 Statements of assets and liabilities,
operations, and changes in net
assets,
as well as financial highlights.
NOTES 18 Notes to the financial statements.
DIVIDENDS AND DISTRIBUTIONS 23 Dividend reinvestment and cash
purchase plan.
OTHER FUND INFORMATION 26 Changes and updates.
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 AT MARKET PRICES
SHARES OF
ITS COMMON STOCK IN THE OPEN MARKET.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUND. IT IS NOT A PROSPECTUS,
CIRCULAR OR
REPRESENTATION INTENDED FOR USE IN THE PURCHASE OR SALE OF SHARES OF THE
FUND OR OF ANY
SECURITIES MENTIONED
IN THE REPORT.
PRESIDENT'S MESSAGE
(photo_of_Edward_C_Johnson_3d)
DEAR SHAREHOLDER:
Through the first four months of 1997, stock and bond markets experienced
the kind of short-term volatility that can affect them from time to time.
After climbing steadily upward for more than two years, stock prices saw a
sharp correction in late March and early April. Returns in the bond market
were essentially stagnant as the Federal Reserve Board implemented a
long-expected increase in short-term interest rates at the end of March.
While it's impossible to predict the future direction of the markets with
any degree of certainty, there are certain basic principles that can help
investors plan for their future needs.
First, investors are encouraged to take a long-term view of their
portfolios. If you can afford to leave your money invested through the
inevitable up and down cycles of the financial markets, you will greatly
reduce your vulnerability to any single decline. We know from experience,
for example, that stock prices have gone up over longer periods of time,
have significantly outperformed other types of investments and have stayed
ahead of inflation.
Second, you can further manage your investing risk through diversification.
A stock mutual fund, for instance, is already diversified, because it
invests in many different companies. You can increase your diversification
further by investing in a number of different stock funds, or in such other
investment categories as bonds. If you have a short investment time
horizon, you might want to consider moving some of your investment into a
money market fund, which seeks income and a stable share price by investing
in high-quality, short-term investments. Of course, it's important to
remember that there is no assurance that a money market fund will achieve
its goal of maintaining a stable net asset value of $1.00 per share, and
that these types of funds are neither insured nor guaranteed by any agency
of the U.S. government.
Finally, no matter what your time horizon or portfolio diversity, it makes
good sense to follow a regular investment plan, investing a certain amount
of money in a fund at the same time each month or quarter and periodically
reviewing your overall portfolio. By doing so, you won't get caught up in
the excitement of a rapidly rising market, nor will you buy all your shares
at market highs. While this strategy - known as dollar cost averaging -
won't assure a profit or protect you from a loss in a declining market, it
should help you lower the average cost of your purchases.
Remember to contact your investment professional if you need help with your
investments.
Best regards,
Edward C. Johnson 3d
FUND TALK: THE MANAGER'S OVERVIEW
An interview with Peter Phillips, Portfolio Manager of Fidelity Advisor
Emerging Asia Fund, Inc.
Q. HOW DID THE FUND PERFORM, PETER?
A. For the six and 12 months ended April 30, 1997, the fund had a total
return of 2.71% and -1.02%, respectively, based on net asset value (see
Financial Highlights on page 17). This compares to a six month total return
of -0.16% for the Morgan Stanley Capital International (MSCI) All Country
Asia ex-Japan Free Index, and a 12-month return of -5.00% for the blended
MSCI Combined Asia ex-Japan Free including Taiwan Index and the MSCI All
Country Asia ex-Japan Free Index. Since this is a closed-end fund that
trades on the New York Stock Exchange, we also need to look at the fund's
market value return, which reflects gains or losses in the fund's share
price over the period. The market value returns for the six and 12 months
ended April 30, 1997 were 0.03% and -4.32%, respectively. This reflects the
effect of changes in the fund's market value and assumes dividends and
capital gain distributions, if any, were reinvested.
Q. HONG KONG CONTINUES TO BE THE LARGEST HOLDING IN THE FUND. HOW HAS THIS
MARKET PERFORMED?
A. The Hong Kong market was very strong in 1996, rising more than 30%.
However, since the beginning of the year, the market has weakened, giving
up a large part of its gains, primarily over new measures to cool down the
local property sector and concerns of higher interest rates - the Hong Kong
dollar is linked to the U.S. dollar, and therefore any interest rate
increases in the U.S. will generally translate into rate increases in Hong
Kong. Over the past six months, the market rose just 3%. However, the fund
continues to have a relatively large exposure to Hong Kong, as we are
starting to see encouraging signs of an economic recovery, which could be
positive for corporate earnings growth both this year and next year.
Q. HAVE YOU MADE ANY CHANGES TO THE FUND'S HOLDINGS IN HONG KONG?
A. I've reduced the fund's exposure to Hong Kong property developers. We
saw Hong Kong property prices rise about 30% in 1996, and a further 15% or
so in the first quarter of 1997. I felt it was prudent to take profits in
some of the property developers, including Sun Hung Kai Properties and New
World Development, as I felt the market was likely to go through some
period of consolidation following such a rapid rise in prices. The property
sector was hard hit late in March and in April as a result of rising
interest rates and new government measures to ease speculation in the
property sector. I used some of the proceeds from these sales to increase
the fund's exposure to Hong Kong Telecommunications, which is now the fifth
largest holding of the fund. Given the company's strong balance sheet and
high cash position, there was an increased likelihood that the company
would be able to use the money to grow its business or buy back shares. In
addition, the increased effort by Hong Kong Telecommunications' parent
company, Cable & Wireless, to improve shareholder value made the stock
attractive.
Q. I SEE THAT YOUR WEIGHTING IN TAIWAN HAS INCREASED. WHAT'S HAPPENING
THERE?
A. I increased the fund's exposure to selected electronics companies in
Taiwan. Many of the technology companies that the fund owns performed
strongly as investors believed that the global electronics cycle had
bottomed and, therefore, they grew more optimistic about the outlook for
global demand. Examples of stocks that performed well in this sector
include Acer and Asustek Computers, which have benefited from strong
overseas demand for their products.
Q. WHAT OTHER CHANGES HAVE YOU MADE TO THE FUND?
A. I increased the fund's exposure to Indonesia, where the economic picture
looks reasonably stable. We've seen inflation come down and, as a result,
the central bank has been able to lower interest rates, which is very
positive for the stock market. In addition, many of the companies in
Indonesia are benefiting from rising consumer incomes and increased
consumer spending. We could see some volatility in this market over the
short-term as we near the Parliamentary elections in late May, but the
volatility could provide us with some very attractive buying opportunities.
Q. WHAT WAS THE BIGGEST DISAPPOINTMENT DURING THE REVIEW PERIOD?
A. Some of the fund's investments in Malaysia did not perform as well as
anticipated. Malaysia's central bank announced new measures in March of
this year to limit loans to finance purchases of property and stocks. This
significantly hurt investor sentiment and pulled down the market about 8%
during the six month period. In particular, banks and some of the
medium-sized companies saw their share prices drop sharply, as investors
feared that the new share financing measures would reduce investor demand
for these companies.
Q. WHAT IS YOUR OUTLOOK FOR THE NEXT SIX MONTHS?
A. Markets will probably continue to fluctuate. Investors remain concerned
that the problems we've seen in Thailand - that is, a sharp slowdown in
economic growth, increases in problem loans and a large oversupply in the
property market - may repeat themselves elsewhere in the region. This is
particularly true for Malaysia and the Philippines, where loan growth has
been very strong. The outlook for the Greater China region of China, Taiwan
and Hong Kong is more positive. The rebound in economic growth in China is
starting to filter through to its neighbors, and we are seeing signs of a
recovery in economic growth in Hong Kong and Taiwan. I continue to find
that the best way to invest in growth in China is via Hong Kong and
Taiwanese companies, which generally provide better management, disclosure,
earnings quality and liquidity. With regard to the handover of Hong Kong to
China on July 1, 1997, I believe that closer ties between Hong Kong and
China should ultimately be a positive for the Hong Kong economy. Hong Kong
companies have a clear advantage over other companies in the region because
they are close to China and they understand the culture and language.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO MANAGER
ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON THE COVER.
THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND
OTHER CONDITIONS.
FUND FACTS
GOAL: to achieve long-term
capital appreciation through
investments in equity and
debt securities of Asian
emerging market issuers
FUND NUMBER: 627
TRADING SYMBOL: FAE
START DATE: March 25, 1994
SIZE: as of April 30, 1997,
more than $121 million
MANAGER: Peter Phillips,
since 1994; joined Fidelity in
1987
(checkmark)
PETER PHILLIPS ON HIS
INVESTMENT STYLE:
"My aim in managing the fund
is to provide long-term
outperformance with low
volatility, arising from a
portfolio that is broadly
diversified across a number of
different countries and stocks.
The fund tends to have a bias
toward medium- and
large-sized `blue chip'
companies, as I believe that
oligopolies tend to perform
best in Southeast Asia, often
at the expense of smaller
companies. My focus is on
companies with
above-average earnings
growth, strong cash flow and
good management.
"I work very closely with our
team of over 30 investment
professionals to uncover the
best investment
opportunities in this region. I
believe this resource gives us
a huge edge over our
competitors. Many
companies in the region
continue to be
under-researched, and it's only
by going out and meeting the
management of companies
that we can gain an in-depth
knowledge of their operations
and future potential. Fidelity
places a big emphasis on
company visits, and I
generally visit about 350
companies a year."
INVESTMENT CHANGES
TOP TEN STOCKS AS OF APRIL 30, 1997
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE STOCKS
6 MONTHS AGO
Cheung Kong Holdings Ltd. 4.0 3.6
Sun Hung Kai Properties Ltd. 3.5 4.9
Hang Seng Bank Ltd. 3.4 4.4
Hutchison Whampoa Ltd. Ord. 3.4 3.6
Hong Kong Telecommunications Ltd. 3.2 1.5
Korea Electric Power Corp. 2.5 2.5
Hong Kong & China Gas Co. Ltd. 2.5 2.3
Telkom PT (For Reg.) 2.3 1.4
Tenega Nasional BHD 2.2 0.0
Malayan Banking BHD 2.0 1.3
TOP FIVE MARKET SECTORS AS OF APRIL 30, 1997
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
IN THESE MARKET SECTORS
6 MONTHS AGO
Finance 24.7 26.5
Utilities 19.3 13.1
Construction & Real Estate 16.2 20.2
Media & Leisure 5.5 6.2
Technology 5.3 1.6
ASSET ALLOCATION (% OF FUND'S INVESTMENTS)
AS OF APRIL 30, 1997 AS OF OCTOBER 31, 1996
Row: 1, Col: 1, Value: 2.0
Row: 1, Col: 2, Value: 0.0
Row: 1, Col: 3, Value: 50.0
Row: 1, Col: 4, Value: 48.0
Row: 1, Col: 1, Value: 2.0
Row: 1, Col: 2, Value: 0.0
Row: 1, Col: 3, Value: 50.0
Row: 1, Col: 4, Value: 48.0
Stocks 98.3%
Short-term
investments 1.7%
Stocks 98.3%
Short-term
investments 1.7%
INVESTMENTS APRIL 30, 1997 (UNAUDITED)
Showing Percentage of Total Value of Investment in Securities
COMMON STOCKS - 98.3%
SHARES VALUE (NOTE 1)
BANGLADESH - 0.0%
Advanced Chemical Industries 5,100 $ 12,818
BERMUDA - 0.3%
FPB Bank Holding Co. Ltd. 449,000 182,579
Mandarin Oriental International Ltd. 110,000 127,600
310,179
HONG KONG - 33.2%
Cheung Kong Holdings Ltd. 544,000 4,775,318
Cheung Kong Infrastructure Holdings Ltd. 200,000 566,708
China Light & Power Co. Ltd. 522,000 2,351,746
Dairy Farm International Holdings Ltd. (SG) 360,000 266,400
Dah Sing Financial Holdings Ltd. 139,600 580,278
Great Eagle Holdings Ltd. 119,695 357,702
Guangdong Investments Co. Ltd. Ord. 640,000 598,980
HSBC Holdings PLC 27,000 681,188
Hang Seng Bank Ltd. 362,700 4,085,145
Hong Kong & China Gas Co. Ltd. 1,898,714 3,014,804
Hong Kong & Shanghai Hotels 337,833 490,624
Hong Kong Telecommunications Ltd. (a) 2,264,400 3,877,785
Hutchison Whampoa Ltd. Ord. 540,000 4,008,262
JCG Holdings Ltd. 684,000 547,447
Manhattan Card Co. Ltd. 1,096,000 339,560
National Mutual Asia Ltd. 504,000 520,493
New World Development Co. Ltd. 387,730 2,237,337
Sime Darby Hongkong Ltd. 128,000 137,972
Shanghai Industrial Holdings Ltd. Class H 166,000 934,306
Sun Hung Kai Properties Ltd. 390,000 4,229,007
Swire Pacific Ltd. Class A 292,000 2,252,243
Television Broadcast Ltd. Ord. 231,000 948,273
Wharf Holdings Ltd. 286,000 1,081,753
Wing Hang Bank Ltd. 203,400 743,074
39,626,405
INDIA - 6.8%
Bajaj Auto Ltd. 8,550 217,997
Bharat Petroleum Corp. Ltd. 36,000 387,909
Digital Equipment Ltd. 63,000 273,741
East India Hotels Ltd. 24,300 270,982
Gujarat Ambuja Cement Ltd. GDR 35,280 335,160
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
INDIA - CONTINUED
Hindustan Lever Ltd. 44,605 $ 1,339,713
Hindustan Petroleum Corp. Ltd. 33,300 389,106
Housing Development Finance Corp. Ltd. 8,098 720,219
ITC Ltd. 63,000 728,861
Industrial Credit & Investments Corp. Ltd. (a) 142,470 231,270
Mahindra & Mahindra Ltd. 45,000 465,050
Mahanagar Telephone Nigam Ltd. 133,700 1,098,263
Procter & Gamble India Ltd. 9,000 145,907
Ranbaxy Laboratories Ltd. 8,000 145,200
State Bank of India (a) 100,755 897,433
Videsh Sanchar Nigam Ltd. 15,000 514,274
8,161,085
INDONESIA - 7.6%
Astra International PT (For. Reg.) 488,000 1,787,327
Bank International Indonesia PT (For. Reg.) 1,378,986 993,098
Bank International Indonesia PT (warrants) (For. Reg.) (a) 151,288 48,250
Berlian Laju Tanker PT (For. Reg.) 424,400 392,963
Gudang Garam PT (For. Reg.) 166,500 698,890
Kalbe Farma (For. Reg.) 360,000 355,556
Lippo Land Development PT (For. Reg.) 244,000 273,622
Lippo Securities PT (For. Reg.) 1,296,000 746,667
Multipolar PT (For. Reg.) 400,000 230,453
Panin Bank PT (For. Reg.) 209,000 305,330
Putra Surya Multidana PT (For. Reg.) 460,000 520,577
Telkom PT (For. Reg.) 1,869,000 2,711,206
9,063,939
KOREA (SOUTH) - 5.4%
Hyundai Engineering & Construction Co. Ltd. (a) 4,396 88,216
Hyundai Motor Co. Ltd. sponsored GDR 7,500 63,750
Kookmin Bank 13,950 264,925
Korea Electric Power Corp. 102,000 3,041,703
Lg Information & Communications Ltd. 1,400 138,117
Medison Co. Ltd. 2,530 249,596
Pohang Iron & Steel Co. Ltd. 3,600 270,404
SK Telecom Ltd. 721 552,874
Samsung Electronics Co. Ltd. (vtg.) 7,720 634,615
Samsung Fire & Marine Insurance 810 279,368
S1 Corp. 900 246,844
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
KOREA (SOUTH) - CONTINUED
Sungmi Telecom Co. 220 $ 29,596
Shin Sung Engineering Co. 3,600 343,049
Shinhan Bank 19,884 287,114
6,490,171
MALAYSIA - 18.1%
Arab Malaysian Corp. BHD 177,000 733,240
Affin Holdings BHD 194,000 467,516
Amway Holding BHD (a) 54,000 346,306
Berjaya Sports Toto BHD 405,000 1,935,869
Carlsberg Brewery BHD 37,000 322,764
EON (Edaran Otomobil Nasional) BHD 204,000 1,925,832
Kwong Yik Bank BHD 184,000 644,971
Magnum Corp. BHD 121,000 191,826
Malakoff BHD 97,000 386,377
Malayan Banking BHD (a) 240,000 2,389,962
Oriental Holdings BHD 56,000 423,820
Perusahaan Otomobil Nasional BHD 130,000 776,738
Petronas Dagangan BHD 81,000 180,681
Public Bank BHD (For. Reg.) 188,000 311,524
Rashid Hussain BHD 84,000 558,773
Resorts World BHD 116,000 427,405
Rothmans of Pall Mall Malaysia BHD 171,000 1,580,243
Sime Darby BHD (a) 194,000 598,885
Tanjong PLC (For. Reg.) 126,000 456,722
Telekom Malaysia BHD 206,000 1,444,174
Tenega Nasional BHD 570,000 2,633,738
United Engineers BHD 236,000 1,673,292
YTL Corp. BHD (rights) (a) 25,450 -
YTL Corp. BHD (c) 228,500 928,381
YTL Power International BHD 150,450 239,713
21,578,752
PAKISTAN - 0.0%
Askari Commercial Bank (a) 63 46
DG Kahn Cement Ltd. (a) 110 38
National Development Leasing Corp. 12,500 2,631
Pak Electron Ltd. (a) 55 18
Sui Southern Gas Pipelines Ltd. (a) 2,018 1,362
4,095
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
PHILIPPINES - 2.2%
Ayala Land, Inc. Class B 470,000 $ 338,642
Benpress Holdings Corp. GDR (a) 58,580 427,634
C & P Homes, Inc. 622,000 235,874
Manila Electric Co. Class B 132,400 823,421
Petron Corp. 1,440,000 529,693
Philippine Commercial International Bank 20,500 252,655
2,607,919
SINGAPORE - 8.5%
City Developments Ltd. 116,000 937,811
Cycle & Carriage Ltd. 23,000 235,213
Datacraft Asia Ltd. 353,000 776,600
DBS Land Ltd. 135,000 436,567
Development Bank of Singapore Ltd. (For. Reg.) 59,000 701,216
Hong Leong Finance Ltd. (For. Reg.) 215,000 665,561
Keppel Corp. Ltd. (new) 15,250 65,373
Keppel Corp. Ltd. 61,000 265,547
Natsteel Ltd. 173,000 468,601
Overseas Chinese Banking Corp. 150,400 1,756,329
Parkway Holdings Ltd. 135,000 550,373
Singapore International Airlines Ltd. 148,000 1,309,011
Singapore Press Holdings Ltd. (For. Reg.) 19,000 351,852
United Industrial Corp. Ltd. 309,000 232,732
United Overseas Bank Ltd. (For. Reg.) 143,400 1,347,595
10,100,381
TAIWAN (FREE CHINA) - 12.5%
Acer, Inc. (a) 384,090 978,971
Asia Cement Corp. 244,350 446,120
Asustek Computer, Inc. (a) 35,000 1,031,273
Bank Sinopac (a) 391,000 388,738
Cathay Construction Co. Ltd. 509,900 894,076
Cathay Life Insurance Co. Ltd. 179,300 1,069,577
China Development Corp. 196,338 816,300
China Steel Corp. 758,750 811,967
China Trust Co. Ltd. 265,000 498,192
Formosa Chemical & Fibre 417,000 603,037
Formosa Plastic 28,573 71,278
ICBC (International Commerce Bank of China) 271,000 680,929
Nan Ya Plastics Corp. 250,000 664,317
Phoenixtec Power Company (a) 225,500 603,290
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
TAIWAN (FREE CHINA) - CONTINUED
President Enterprises Corp. (a) 348,200 $ 616,840
Siliconware Precision Industries (a) 158,000 571,222
Taishin Intl. Bank 387,000 419,740
Taiwan Secom Co. (a) 143,250 538,612
United World Chinese Commercial Bank (a) 201,800 517,997
Wan Hai Lines Ltd. 230,000 681,851
Yageo Corp. (a) 200,000 704,989
Yue Loong Motor 222,000 493,601
Yung Shin Pharmaceutical Industries Co. Ltd. 295,355 816,871
14,919,788
THAILAND - 3.5%
Bangkok Bank Ltd. (For. Reg.) 115,200 1,067,320
BEC World PCL (For. Reg.) 23,600 216,845
Cogeneration Public Company Limited (For. Reg.) (a) 72,100 247,050
Electricity Generating PCL (For. Reg.) 130,500 349,732
Grammy Entertainment PCL (For. Reg.) 27,000 355,590
Industrial Finance Corp. of Thailand (For. Reg.) 88,200 236,371
Matichon Newspaper Group PCL (For. Reg.) 26,900 86,508
PTT Exploration & Production (For. Reg.) 50,600 647,029
Siam Cement PCL (For. Reg.) 21,700 581,547
Telecomasia Corp. PCL (For. Reg.) (a) 86,000 130,877
Thai Farmers Bank PCL 48,600 293,982
4,212,851
VIETNAM - 0.2%
Vietnam Enterprise Investments Ltd. (a)(b) 250,000 252,500
TOTAL COMMON STOCKS
(Cost $107,456,817) 117,340,883
CASH EQUIVALENTS - 1.7%
MATURITY
AMOUNT
Investments in repurchase agreements
(U.S. Treasury obligations), in a joint
trading account at 5.37%, dated
4/30/97 due 5/1/97 $ 2,004,299 2,004,000
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $109,460,817) $ 119,344,883
LEGEND
1. Non-income producing
2. Security 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 the period
end, the value of these securities amounted to $252,500 or 0.2% of net
assets.
3. A portion of the security purchased on a delayed delivery basis (see
Note 2 of Notes to Financial Statements).
INCOME TAX INFORMATION
At April 30, 1997, the aggregate cost of investment securities for income
tax purposes was $109,462,693. Net unrealized appreciation aggregated
$9,882,190, of which $17,432,465 related to appreciated investment
securities and $7,550,275 related to depreciated investment securities.
MARKET SECTOR DIVERSIFICATION
As a Percentage of Total Value of Investment in Securities
Aerospace & Defense 0.3%
Basic Industries 2.2
Cash Equivalents 1.7
Construction & Real Estate 16.2
Durables 4.0
Energy 1.6
Finance 24.7
Health 1.4
Holding Companies 4.1
Industrial Machinery & Equipment 4.8
Media & Leisure 5.5
Nondurables 3.3
Retail & Wholesale 1.1
Services 0.6
Technology 5.3
Transportation 3.9
Utilities 19.3
100.0%
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
APRIL 30, 1997 (UNAUDITED)
ASSETS
Investment in securities, at value (including repurchase $ 119,344,883
agreements of $2,004,000) (cost $109,460,817) -
See accompanying schedule
Cash 848
Foreign currency held at value (cost $2,317,361) 2,314,186
Receivable for investments sold 207,507
Dividends receivable 240,366
Interest receivable 8,037
Prepaid expenses 70,125
TOTAL ASSETS 122,185,952
LIABILITIES
Payable for investments purchased $ 400,203
Regular delivery
Delayed delivery 200,149
Accrued management fee 125,893
Other payables and accrued expenses 411,935
TOTAL LIABILITIES 1,138,180
NET ASSETS $ 121,047,772
Net Assets consist of:
Paid in capital $ 104,780,440
Distributions in excess of net investment income (477,738)
Accumulated undistributed net realized gain (loss) on 6,863,612
investments and foreign currency transactions
Net unrealized appreciation (depreciation) on 9,881,458
investments and assets and liabilities in foreign
currencies
NET ASSETS, for 7,602,384 shares outstanding $ 121,047,772
NET ASSET VALUE, offering price and redemption price $15.92
per share ($121,047,772 (divided by) 7,602,384 shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS ENDED APRIL 30, 1997 (UNAUDITED)
INVESTMENT INCOME $ 1,062,160
Dividends
Interest 152,818
1,214,978
Less foreign taxes withheld (103,882)
TOTAL INCOME 1,111,096
EXPENSES
Management fee $ 696,665
Basic fee
Performance adjustment 61,964
Transfer agent fees 7,807
Administrative fees and expenses 139,413
Directors' compensation 15,000
Custodian fees and expenses 122,568
Audit 41,283
Legal 558
Amortization of organization expenses 19,125
Miscellaneous 882
Total expenses before reductions 1,105,265
Expense reductions (5,012) 1,100,253
NET INVESTMENT INCOME (LOSS) 10,843
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:
Investment securities 6,943,756
Foreign currency transactions (20,552) 6,923,204
Change in net unrealized appreciation (depreciation) on:
Investment securities (3,553,749)
Assets and liabilities in foreign currencies (1,727) (3,555,476)
NET GAIN (LOSS) 3,367,728
NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 3,378,571
FROM OPERATIONS
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS YEAR ENDED
ENDED OCTOBER 31,
APRIL 30, 1997 1996
(UNAUDITED)
INCREASE (DECREASE) IN NET ASSETS
Operations $ 10,843 $ 112,027
Net investment income
Net realized gain (loss) 6,923,204 5,845,507
Change in net unrealized appreciation (depreciation) (3,555,476) 11,409,848
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 3,378,571 17,367,382
FROM OPERATIONS
Distributions to shareholders (10,843) (112,027)
From net investment income
In excess of net investment income (73,628) (394,799)
From net realized gain (3,463,308) -
TOTAL DISTRIBUTIONS (3,547,779) (506,826)
Share transactions (13,397,085) -
Common stock repurchased
Repurchase offer expenses (113,869) -
Redemption fees added to paid in capital 113,869 -
Cost of shares repurchased (13,397,085) -
TOTAL INCREASE (DECREASE) IN NET ASSETS (13,566,293) 16,860,556
NET ASSETS
Beginning of period 134,614,065 117,753,509
End of period (including distributions in excess of $ 121,047,772 $ 134,614,065
net investment income of $477,738 and
$404,110, respectively)
OTHER INFORMATION (844,709) -
Shares repurchased
</TABLE>
FINANCIAL HIGHLIGHTS
SIX MONTHS YEARS ENDED MARCH 25, 1994
ENDED OCTOBER 31, (COMMENCEME
APRIL 30, 1997 NT
OF OPERATIONS)
TO
OCTOBER 31,
(UNAUDITED) 1996 1995 1994
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
SELECTED PER-SHARE DATA H
Net asset value, beginning of period $ 15.94 $ 13.94 $ 16.01 $ 14.10
Income from Investment Operations
Net investment income - .01 .01 .03
Net realized and unrealized gain (loss) .40 2.05 (1.83) 1.97
Total from investment operations .40 2.06 (1.82) 2.00
Less Distributions - (.01) (.04) -
From net investment income
In excess of net investment income (.01) (.05) (.09) -
From net realized gain (.41) - (.10) -
In excess of net realized gain - - (.02) -
Total distributions (.42) (.06) (.25) -
Antidilution resulting from additional - - - .02
offering of shares
Offering expenses - - - (.11)
Net asset value, end of period $ 15.92 J $ 15.94 $ 13.94 $ 16.01
Market value, end of period $ 13.375 $ 13.750 $ 11.875 $ 15.125
TOTAL RETURN B .03% 16.26% (19.94)% L .83% D
Market value E
Net asset value C, F 2.71% 14.81% (11.21)% L 13.39% G
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 121,048 $ 134,614 $ 117,754 $ 135,273
Ratio of expenses to average net assets 1.62% A 1.63% 1.68% 1.70% A
Ratio of expenses to average net assets 1.61% A, 1.63% 1.68% 1.70% A
K
after expense reductions
Ratio of net investment income to .02% A .09% .08% .29% A
average net assets
Portfolio turnover rate 57% A 63% 69% 70% A
Average commission rate I $ .0111 $ .0134
</TABLE>
A ANNUALIZED B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED. C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES
NOT BEEN REDUCED DURING THE PERIODS SHOWN (SEE NOTE 5 OF NOTES TO FINANCIAL
STATEMENTS). D TOTAL MARKET VALUE RETURN INCLUDES ONE TIME SALES LOAD OF 6%
PAID IN CONNECTION WITH THE INITIAL PUBLIC OFFERING. E TOTAL MARKET VALUE
RETURN REFLECTS THE EFFECT OF CHANGES IN THE FUND'S MARKET VALUE AND
ASSUMES DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS, IF ANY, WERE REINVESTED.
F TOTAL NET ASSET VALUE RETURN REFLECTS THE EFFECTS OF CHANGES IN THE
FUND'S NET ASSET VALUE AND ASSUMES DIVIDENDS AND CAPITAL GAINS
DISTRIBUTIONS, IF ANY, WERE REINVESTED. THIS PERCENTAGE IS NOT AN
INDICATION OF THE PERFORMANCE OF A SHAREHOLDERS' INVESTMENT IN THE FUND
BASED ON MARKET VALUE DUE TO DIFFERENCES BETWEEN THE MARKET PRICE OF THE
STOCK AND THE NET ASSET VALUE OF THE FUND. G TOTAL NET ASSET VALUE RETURN
DOES NOT INCLUDE THE EFFECT OF ANTIDILUTION OR SALES LOADS. IF THE OFFERING
EXPENSES ASSOCIATED WITH THE INITIAL PUBLIC OFFERING HAD NOT BEEN TAKEN
INTO ACCOUNT, THE TOTAL RETURN BASED ON NET ASSET VALUE WOULD HAVE BEEN
14.27%. H NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON
AVERAGE SHARES OUTSTANDING DURING THE PERIOD. I FOR FISCAL YEARS BEGINNING
ON OR AFTER SEPTEMBER 1, 1995, A FUND IS REQUIRED TO DISCLOSE ITS AVERAGE
COMMISSION RATE PER SHARE FOR SECURITY TRADES ON WHICH COMMISSIONS ARE
CHARGED. THIS AMOUNT MAY VARY FROM PERIOD TO PERIOD AND FUND TO FUND
DEPENDING ON THE MIX OF TRADES EXECUTED IN VARIOUS MARKETS WHERE TRADING
PRACTICES AND COMMISSION RATE STRUCTURES MAY DIFFER. J THE FUND INCURRED
EXPENSES OF $.01 PER SHARE IN CONNECTION WITH ITS REPURCHASE OFFER WHICH
WERE OFFSET BY REDEMPTION FEES COLLECTED AS PART OF THE REPURCHASE OFFER. K
FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD PARTIES
WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES (SEE NOTE 5 OF
NOTES TO FINANCIAL STATEMENTS). L THE TOTAL RETURNS INCLUDE THE EFFECT OF A
CORRECTION TO DIVIDEND REINVESTMENT METHODOLOGY.
NOTES TO FINANCIAL STATEMENTS
For the period ended April 30, 1997 (Unaudited)
1. SIGNIFICANT ACCOUNTING POLICIES.
Fidelity Advisor Emerging Asia Fund, Inc. (the fund), a Maryland
corporation, is registered under the Investment Company Act of 1940, as
amended (the 1940 Act), as a non-diversified closed-end management
investment company.
There are 100,000,000 shares of $.001 par value common stock authorized.
During the first calendar quarter of each year, the Board of Directors of
the fund may, under certain circumstances, conduct a repurchase or tender
offer to repurchase a maximum of ten percent of the fund's outstanding
shares of common stock at a price equal to the net asset value per share at
the time of repurchase.
In April 1997, the fund completed a repurchase offer for ten percent of the
fund's outstanding shares. The repurchase offer resulted in the repurchase
of 844,709 shares of the fund's common stock at a net asset value of $15.86
per share. Such shares are included as authorized but unissued shares of
the fund.
The financial statements have been prepared in conformity with generally
accepted accounting principles which permit management to make certain
estimates and assumptions at the date of the financial statements. The
following summarizes the significant accounting policies of the fund:
SECURITY VALUATION. Securities for which quotations are readily available
are valued at the last sale price, or if no sale price, at the closing bid
price in the principal market in which such securities are normally traded.
Securities (including restricted
securities) for which quotations are not readily available are valued
primarily using dealer-supplied valuations or at their fair value as
determined in good faith under consistently applied procedures under the
general supervision of the Board of Trustees. Short-term securities with
remaining maturities of sixty days or less for which quotations are not
readily available are valued at amortized cost or original cost plus
accrued interest, both of which approximate current value. Equity
securities that have reached the limit for aggregate foreign ownership may
trade at a premium to the local share price. If the broker-quoted premium
is not readily available as a result of limited share activity, the
securities are valued at the last sale price of the local share in the
principal market in which such securities are normally traded.
FOREIGN CURRENCY TRANSLATION. The accounting records of the fund are
maintained in U.S. dollars. Investment securities and other assets and
liabilities denominated in a foreign currency are translated into U.S.
dollars at the prevailing rates of exchange at period end. Income receipts
and expense payments are translated into U.S. dollars at the prevailing
exchange rate on the respective dates of the transactions. Purchases and
sales of securities are translated into U.S. dollars at the contractual
currency exchange rates established at the time of each trade.
Net realized gains and losses on foreign currency transactions represent
net gains and losses from sales and maturities of forward currency
contracts, disposition
1. SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
FOREIGN CURRENCY TRANSLATION - CONTINUED
of foreign currencies, and the difference between the amount of net
investment income accrued and the U.S. dollar amount actually received. The
effects of changes in foreign currency exchange rates on investments in
securities are included with the net realized and unrealized gain or loss
on investment securities.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, the fund is not subject to U.S. federal
income taxes to the extent that it distributes substantially all of its
taxable income for its fiscal year. The fund may be subject to foreign
taxes on income and gains on investments which are accrued based upon the
fund's understanding of the tax rules and regulations that exist in the
markets in which it invests. The schedule of investments includes
information regarding income taxes under the caption "Income Tax
Information."
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date,
except certain dividends from foreign securities where the ex-dividend date
may have passed, are recorded as soon as the fund is informed of the
ex-dividend date. Non-cash dividends included in dividend income, if any,
are recorded at the fair market value of the securities received. Interest
income is accrued as earned. Investment income is recorded net of foreign
taxes withheld where recovery of such taxes is uncertain.
EXPENSES. The fund incurred organization expenses in connection with its
initial issuance of shares. The organization expenses of $191,250 are being
amortized on a straight-line basis for a five-year period beginning at the
commencement of operations of the fund.
In addition, the fund incurred expenses in connection with its repurchase
offer of approximately $114,000 which were paid by the fund and charged to
paid in capital. All of these expenses were offset by redemption fees
collected as part of the repurchase offer and were accounted for as an
addition to paid in capital.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions are recorded on the
ex-dividend date. Certain foreign currency gains (losses) are taxable as
ordinary income and, therefore, increase (decrease) taxable ordinary income
available for distribution.
Pursuant to the fund's Dividend Reinvestment and Cash Purchase Plan (the
Plan), shareholders may elect to have all distributions automatically
reinvested in fund shares. Shareholders who do not participate in the Plan
will receive all distributions in cash paid by check in U.S. dollars. If
the market price per share on the valuation date equals or exceeds net
asset value per share on that date, the fund will issue new shares to
participants at net asset value. If the net asset value is less than 95% of
the market price on the valuation date, then shares will be issued at 95%
of the market price. The valuation date will be the dividend or
distribution payment date or, if that date is not a
1. SIGNIFICANT ACCOUNTING
POLICIES - CONTINUED
DISTRIBUTIONS TO SHAREHOLDERS -
CONTINUED
New York Stock Exchange trading date, the next preceding trading date. If
the net asset value exceeds the market price of the fund shares at such
time, the Plan Agent will purchase shares of stock valued at market price
on the valuation date.
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences, which may result in distribution
reclassifications, are primarily due to differing treatments for foreign
currency transactions, passive foreign investment companies (PFIC), and
losses deferred due to wash sales.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital.
Distributions in excess of net investment income and accumulated
undistributed net realized gain (loss) on investments and foreign currency
transactions may include temporary book and tax basis differences which
will reverse in a subsequent period. Any taxable income or gain remaining
at fiscal year end is distributed in the following year.
SECURITY TRANSACTIONS. Security transactions are accounted for as of trade
date. Gains and losses on securities sold are determined on the basis of
identified cost.
The fund invests in new securities offered by some foreign companies by
making applications in the public offering. Either all, or a portion, of
the issue price is paid at the time of the application and recorded as
application money for new issues. Upon allotment, this amount, plus the
remaining amount of issue price, is recorded as cost of investments.
2. OPERATING POLICIES.
FOREIGN CURRENCY CONTRACTS. The fund generally uses foreign currency
contracts to facilitate transactions in foreign-denominated securities.
Losses may arise from changes in the value of the foreign currency or if
the counterparties do not perform under the contracts' terms. The U.S.
dollar value of foreign currency contracts is determined using contractual
currency exchange rates established at the time of each trade. The cost of
the foreign currency contracts is included in the cost basis of the
associated investment.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the fund, along with other affiliated
entities of Fidelity Management & Research Company (FMR), may transfer
uninvested cash balances into one or more joint trading accounts. These
balances are invested in one or more repurchase agreements for U.S.
Treasury or Federal Agency obligations.
REPURCHASE AGREEMENTS. The underlying U.S. Treasury or Federal Agency
Securities are transferred to an account of the fund, or to the Joint
Trading Account, at a
2. OPERATING POLICIES - CONTINUED
REPURCHASE AGREEMENTS -
CONTINUED
bank custodian. The securities are marked-to-market daily and maintained at
a value at least equal to the principal amount of the repurchase agreement
(including accrued interest). FMR, the fund's investment adviser, is
responsible for determining that the value of the underlying securities
remains in accordance with the market value requirements stated above.
WHEN-ISSUED SECURITIES. The fund may purchase or sell securities on a
when-issued basis. Payment and delivery may take place a month or more
after the date of the transaction. The price of the underlying securities
is fixed at the time the transaction is negotiated. The market values of
the securities purchased on a when-issued or forward commitment basis are
identified as such in the fund's schedule of investments. With respect to
purchase commitments, the fund identifies securities as segregated in its
custodial records with a value at least equal to the amount of the
commitment. The payables and receivables associated with the purchases and
sales of when-issued securities having the same settlement date and broker
are offset. When-issued securities that have been purchased from and sold
to different brokers are reflected as both payables and receivables in the
statement of assets and liabilities under the caption "Delayed delivery."
Losses may arise due to changes
in the market value of the underlying securities, if the counterparty does
not perform under the contract, or if the issuer does not issue the
securities due to political, economic, or other factors.
RESTRICTED SECURITIES. The fund is permitted to invest in securities that
are subject to legal or contractual restrictions on resale. These
securities generally may be resold in transactions exempt from registration
or to the public if the securities are registered. Disposal of these
securities may involve time-consuming negotiations and expense, and prompt
sale at an acceptable price may be difficult. At the end of the period, the
fund had no investments in restricted securities (excluding 144A issues).
3. PURCHASES AND SALES OF INVESTMENTS.
Purchases and sales of securities, other than short-term securities,
aggregated $37,314,488 and $54,263,605, respectively.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment manager, FMR receives a fee that
is computed daily at an annual rate of 1.00% of the fund's average net
assets. The fee is subject to a performance adjustment (up to a maximum of
(plus/minus) .25% of the fund's average net assets over the performance
period) based on the fund's investment performance as compared to the
appropriate index over a specified period of time. For the period, the
management fee was
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
MANAGEMENT FEE - CONTINUED
equivalent to an annualized rate of 1.11% of average net assets after the
performance adjustment.
ADVISER FEE. FMR and the fund entered into an investment advisory agreement
with Fidelity International Investment Advisors (FIIA), an affiliate of
FMR, pursuant to which FIIA is responsible for the management of the fund's
portfolio in accordance with the fund's investment policies and for making
decisions to buy or sell securities. FMR pays FIIA a portion of its
management fee, including any performance adjustment.
SUB-ADVISER FEE. FIIA, on behalf of the fund, has entered into a
sub-advisory agreement with Fidelity Investments Japan Ltd. (FIJ), an
affiliate of FMR, to provide advisory services concerning fund assets
invested in Japanese and other securities. FIIA pays FIJ a portion of its
fee based on the assets managed by FIJ.
ADMINISTRATIVE FEE. Fidelity International Limited (FIL), an affiliate of
FMR, has entered into a Fund Management Agreement with the fund to provide,
or arrange to provide, administrative services to the fund including
maintaining the fund's accounting records. As the fund's administrative
manager, FIL receives a monthly fee at an annual rate of .20% of the fund's
average net assets. FIL has contracted all of these services to Fidelity
Service Company, Inc., a division of FMR.
5. EXPENSE REDUCTIONS.
FMR and its affiliates have directed certain portfolio trades to brokers
who paid a portion of the fund's expenses. For the period, the fund's
expenses were reduced by $4,588 under this arrangement.
In addition, the fund has entered into an arrangement with its custodian
whereby credits realized as a result of uninvested cash balances were used
to reduce a portion of the fund's expenses. During the period, the fund's
custodian fees were reduced by $424 under this arrangement.
DIVIDENDS AND DISTRIBUTIONS
DIVIDEND REINVESTMENT AND CASH PURCHASE PLAN
The fund intends to distribute annually to shareholders substantially all
of its net investment income from dividends and interest earnings and
expects to distribute any net realized capital gains at least annually.
Pursuant to the Dividend Reinvestment and Cash Purchase Plan (the "Plan"),
adopted by the fund, shareholders may elect to have all distributions
automatically reinvested by State Street Bank and Trust Company (the "Plan
Agent") in fund shares, pursuant to the Plan. Shareholders who do not elect
to participate in the Plan will receive all distributions in cash paid by
check in U.S. dollars mailed directly to the shareholder by the Plan Agent.
Shareholders who would like additional information regarding the Plan or
wish to have distributions automatically reinvested should notify the fund,
c/o the Plan Agent for Fidelity Advisor Emerging Asia Fund, Inc., at Two
Heritage Drive, North Quincy, Massachusetts 02171.
The Plan Agent will serve as agent for the shareholders in administering
the Plan. If the Directors of the fund declare an income dividend or a
capital gains distribution payable either in the fund's Common Stock or in
cash, as shareholders may have elected, non-participants in the Plan will
receive cash and participants in the Plan will receive Common Stock, to be
issued by the fund or purchased by the Plan Agent in the open market, as
provided below. If the market price per share on the valuation date equals
or exceeds net asset value per share on that date, the fund will issue new
shares to participants at net asset value or, if the net asset value is
less than 95% of the market price on the valuation date, then new shares
will be issued at 95% of the market price. The valuation date will be the
dividend or distribution payment date or, if that date is not a New York
Stock Exchange trading day, then the next preceding trading day. If net
asset value exceeds the market price of fund shares at such time, or if the
fund should declare a dividend or capital gains distribution payable only
in cash, the Plan Agent will, as agent for the participants, buy fund
shares in the open market on the New York Stock Exchange or elsewhere, with
the cash in respect of such dividend or distribution, for the participant's
account on, or shortly after, the payment date.
Participants in the Plan have the option of making additional payments to
the Plan Agent, annually, in any amount from $100 to $3,000 for investment
in the fund's Common Stock. The Plan Agent will use all such funds received
from participants to purchase fund shares in the open market on or about
February 15 of each year. Any voluntary cash payments received more than
thirty days prior to such date will be returned by the Plan Agent, and
interest will not be paid on any uninvested cash payments. To avoid
unnecessary cash accumulations, and also to allow ample time for receipt
and processing by the Plan Agent, it is suggested that participants send in
voluntary cash payments to be received by the Plan Agent approximately ten
days before an applicable purchase date as specified above. A participant
may withdraw a voluntary cash payment by written notice if the notice is
received by the Plan Agent not less than forty-eight hours before such
payment is to be invested.
The Plan Agent maintains all shareholder accounts in the Plan and furnishes
written confirmations of all transactions in the account, including
information needed by shareholders for personal and tax records. Shares in
the account of each Plan participant will be held by the Plan Agent in
non-certificated form in the name of the participant, and each
shareholder's proxy will include those shares purchased pursuant to the
Plan. In the case of shareholders such as banks, brokers or nominees, which
hold shares for others who are the beneficial owners, the Plan Agent will
administer the Plan on the basis of the number of shares certified from
time to time by the shareholder as representing the total amount registered
in the shareholder's name and held for the account of beneficial owners who
are participating in the Plan.
There is no charge to participants for reinvesting dividends or capital
gains distributions. The Plan Agent's fees for the handling of the
reinvestment of dividends and distributions and voluntary cash payments
will be paid by the fund. There will be no brokerage charges with respect
to shares issued directly by the fund as a result of dividends or capital
gains distributions payable either in stock or in cash. However, each
participant's account will be charged a prorata
share of brokerage commissions incurred with respect to the Plan Agent's
open market purchases in connection with the reinvestment of dividends or
capital gains distributions and voluntary cash payments made by the
participant. Brokerage charges for purchasing small amounts of stock for
individual accounts through the Plan are expected to be less than the usual
brokerage charges for such transactions, because the Plan Agent will be
purchasing stock for all participants in blocks and prorating the lower
commission thus attainable.
The reinvestment of dividends and distributions will not relieve
participants of any income tax which may be payable on such dividends and
distributions.
If your shares are held in your own name and you wish to receive all
dividends and capital gain distributions in cash rather than in shares, you
may withdraw from the Plan without penalty at any time by contacting the
Plan Agent. If your shares are held in nominee name, you should be able to
withdraw from the Plan without penalty at any time by sending written
notice to your nominee. If you withdraw, you will receive a share
certificate for all full shares or, if you wish, the Plan Agent will sell
your shares and send you the proceeds, after the deduction of brokerage
commissions. The Plan Agent will convert any fractional shares to cash at
the then-current market price and send you a check for the proceeds. Please
note that, if you participate in the Plan through a brokerage account, you
may not be able to continue as a participant if you transfer
those shares to another broker. Contact your broker or nominee or the Plan
Agent to see what is the best arrangement for you to participate in the
Plan.
Experience under the Plan may indicate that changes are desirable.
Accordingly, the fund reserves the right to amend or terminate the Plan as
applied to any voluntary cash payment made and any dividend or distribution
paid subsequent to notice of the change sent to members of the Plan at
least 30 days before the record date for such dividend or distribution. The
Plan also may be amended by the fund or Plan Agent by at least 30 days'
written notice to all participants in the Plan. All correspondence
concerning the Plan should be directed c/o the Plan Agent for Fidelity
Advisor Emerging Asia Fund, Inc., at Two Heritage Drive, North Quincy,
Massachusetts 02171.
OTHER FUND INFORMATION
All of the stock of FMR is owned by FMR Corp., its parent organized in
1972. The voting common stock of FMR Corp. is divided into two classes.
Class B is held predominantly by members of the Edward C. Johnson 3d family
and is entitled to 49% of the vote on any matter acted upon by the voting
common stock. Class A is held predominantly by non-Johnson family member
employees of FMR Corp. and its affiliates and is entitled to 51% of the
vote on any such matter. The Johnson family group and all other Class B
shareholders have entered into a shareholders' voting agreement under which
all Class B shares will be voted in accordance with the majority vote of
Class B shares. Under the Investment Company Act of 1940 (1940 Act),
control of a company is presumed where one individual or group of
individuals owns more than 25% of the voting stock of that company.
Therefore, through their ownership of voting common stock and the execution
of the shareholders' voting agreement, members of the Johnson family may be
deemed, under the 1940 Act, to form a controlling group with respect to FMR
Corp.
CUSTODIAN. Brown Brothers Harriman & Co., 40 Water Street, Boston,
Massachusetts 02109, is custodian of the assets of the fund. The custodian
is responsible for the safekeeping of the fund's assets and the appointment
of the subcustodian banks and clearing agencies. The custodian takes no
part in determining the investment policies of the fund or in deciding
which securities are purchased or sold by the fund. However, the fund may
invest in obligations of the custodian and may purchase securities from or
sell securities to the custodian. The Bank
of New York and The Chase Manhattan Bank, each headquartered in New York,
also may serve as a special purpose custodian of certain assets of the fund
in connection with pooled repurchase agreement transactions.
ADDRESS
Fidelity Advisor Emerging
Asia Fund, Inc.
82 Devonshire Street
Boston, MA
1-800-426-5523
INVESTMENT MANAGER
Fidelity Management &
Research Company
Boston, MA
INVESTMENT ADVISER
Fidelity International
Investment Advisors
Pembroke, Bermuda
SUB-ADVISER
Fidelity Investments Japan Limited
Tokyo, Japan
DIRECTORS AND OFFICERS
Edward C. Johnson 3d, Director and President
J. Gary Burkhead, Director and
Senior Vice President
Helmert Frans van den Hoven, Director
Edward H. Malone, Director
Bertram H. Witham, Jr., Director
David L. Yunich, Director
William Ebsworth, Vice President
Peter F. Phillips, Vice President
Arthur S. Loring, Secretary
Kenneth A. Rathgeber, Treasurer
Stuart E. Fross, Assistant Secretary
John H. Costello, Assistant Treasurer
Pradip Darooka, Assistant Treasurer
TRANSFER AGENT, DIVIDEND PAYING AGENT AND REGISTRAR
State Street Bank and Trust Company
Boston, MA
CUSTODIAN
Brown Brothers Harriman & Co.
Boston, MA
LEGAL COUNSEL
Rogers & Wells
New York, NY
INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP
Boston, MA
(REGISTERED TRADEMARK)
