MORGAN STANLEY ASIA PACIFIC FUND INC, N-30B-2, 1999-11-30

MORGAN STANLEY ASIA PACIFIC FUND INC
N-30B-2, 1999-11-30

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<PAGE>

-----------------------------------------------------------
MORGAN STANLEY
DEAN WITTER
ASIA-PACIFIC
FUND, INC.
-----------------------------------------------------------

THIRD QUARTER REPORT
SEPTEMBER 30, 1999
MORGAN STANLEY DEAN WITTER
INVESTMENT MANAGEMENT INC.
INVESTMENT ADVISER

MORGAN STANLEY DEAN WITTER
ASIA-PACIFIC FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
DIRECTORS AND OFFICERS

Barton M. Biggs
CHAIRMAN OF THE BOARD
OF DIRECTORS

Michael F. Klein
PRESIDENT AND DIRECTOR

Peter J. Chase
DIRECTOR

John W. Croghan
DIRECTOR

David B. Gill
DIRECTOR

Graham E. Jones
DIRECTOR

John A. Levin
DIRECTOR

William G. Morton, Jr.
DIRECTOR

Stefanie V. Chang
VICE PRESIDENT

Harold J. Schaaff, Jr.
VICE PRESIDENT

Joseph P. Stadler
VICE PRESIDENT

Mary E. Mullin
SECRETARY

Belinda A. Brady
TREASURER
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- -------------------------------------------------------------------------------
INVESTMENT ADVISER

Morgan Stanley Dean Witter Investment Management Inc.
1221 Avenue of the Americas
New York, New York 10020

- -------------------------------------------------------------------------------
ADMINISTRATOR

The Chase Manhattan Bank
73 Tremont Street
Boston, Massachusetts 02108
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CUSTODIAN

The Chase Manhattan Bank
3 Chase MetroTech Center
Brooklyn, New York 11245
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SHAREHOLDER SERVICING AGENT

American Stock Transfer & Trust Company
40 Wall Street
New York, New York 10005
(800) 278-4353
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LEGAL COUNSEL

Rogers & Wells LLP
200 Park Avenue
New York, New York 10166
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INDEPENDENT ACCOUNTANTS

PricewaterhouseCoopers LLP
1177 Avenue of the Americas
New York, New York 10036
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For additional Fund information, including the Fund's net asset value per share
and information regarding the investments comprising the Fund's portfolio,
please call 1-800-221-6726 or visit our website at
www.msdw.com/institutional/investmentmanagement.

<PAGE>

LETTER TO SHAREHOLDERS
- ---------

For the nine months ended September 30, 1999, the Morgan Stanley Dean Witter
Asia-Pacific Fund, Inc. (the "Fund") had a total return, based on net asset
value per share, of 41.01% compared to 32.41% for its benchmark (described
below). For the period since the Fund's commencement of operations on August 2,
1994 through September 30, 1999, the Fund's total return, based on net asset
value per share, was 3.30% compared with -12.62% for the benchmark. The
benchmark for the Fund is comprised of two Morgan Stanley Capital International
(MSCI) indices; Japan and All-Country Asia-Pacific Free ex-Japan with each index
weighted equally. On September 30, 1999, the closing price of the Fund's shares
on the New York Stock Exchange was $9 7/8, representing a 19.7% discount to the
net asset value per share.

ASIA EX-JAPAN

All of the markets in Asia ex-Japan fell in the third quarter of 1999, with
Indonesia, Thailand and the Philippines performing the worst. Year-to-date,
South Korea has been the strongest individual market, but it too corrected over
the summer. Following a second quarter in which markets were fairly tightly
correlated and strong, third quarter weakness was marked by more differentiation
among the performances of individual markets and stocks.

Key trends common among most of the East Asian markets were positive economic
data releases, signs that interest rates have bottomed for this cycle, a heavy
calendar of new equity issuance and strong electronics exports. Economic growth
expectations have been upgraded significantly across Asia, with Korea leading
the way, although the rate of change of improvement should slow into 2000 as low
base effects drop out and as most observers now expect growth. Interest rates
moved up in a number of markets for internal reasons (e.g. Korea, Singapore) or
external reasons (e.g. Hong Kong). Further material rate reductions are probably
only possible in Indonesia pending a successful resolution of political issues
and a resumption of IMF funding. We expect to see a large deal calendar across
Asia throughout the balance of the year and well into 2000 as Asian companies
attempt to recapitalize or raise equity to fund growth. A few significant deals
have already been cancelled and we believe that only the better deals will be
completed. Currencies were fairly well behaved versus the U.S. dollar, although
the Thai baht, Philippine peso and Korean won all slipped a bit during the third
quarter.

Key external events during the third quarter included two interest rate hikes by
the U.S. Fed, market focus on the growth of the U.S. current account deficit, a
sharp rise in oil prices and continued Japanese market strength. Most Asian
markets have held up well despite the headwinds of rising global interest rates
given this year's limited foreign debt financing needs and healthy domestic
liquidity. The U.S. current account deficit is a significant issue for the
global economy; a best case scenario would be a gradual slowdown in the growth
of U.S. consumption accompanied by accelerated growth in demand in Europe and
throughout Asia. The rise in the price of oil is similar to a tax hike for most
of Asia; Indonesia and Malaysia are the only net beneficiaries of higher prices.
The Japanese market outperformed non-Japan Asia in the third quarter. Japanese
economic recovery is very positive for Asia and Japanese corporate restructuring
opens up new opportunities for outsourcing across a range of manufacturing
industries.

Most countries in the region reported increases in exports of electronics
components during the first three quarters of 1999. This growth has contributed
significantly to GDP growth upgrades in Taiwan, South Korea, Singapore and
Malaysia. Price pressures in the global personal computer industry have forced
PC manufacturers to cut costs, which often means sourcing more from low-cost
Asian producers. The trend towards greater outsourcing, firmly established among
American companies, is being adopted by an increasing number of Japanese
companies. In the past, Japanese manufacturers often built factories in other
Asian countries in an effort to cut costs. An increasing number of Japanese
companies are now turning to outsourcing instead as part of their own
restructuring efforts. Outsourcing allows us to invest directly in the resulting
growth, as we can identify companies winning Japanese orders. The Fund has a
significant exposure to a number of Asian electronics companies in Taiwan,
Korea, Singapore and Thailand, and these investments performed well in the third
quarter as order books gained momentum.

Taiwan suffered from its worst earthquake in 100 years (7.6 on the Richter
scale) during September. The quake killed over 2,500 people, destroyed numerous
buildings and disrupted power supply and transportation. Damage estimates range
as high as $10 billion, or approximately 3% of GDP. The stock market was closed
for 5 days and fell when it reopened, although it stabilized after several days
of decline. We believe that the quake will disrupt electronic shipments for 1 to
2 months. However, most of our portfolio companies reportedly suffered only
limited physical damage. Given the strong demand for electronics components, we
believe that strong growth will resume within several months and that the market
will look through fourth quarter revenue and earnings shortfalls. Exports are a
key driver of the economy but growth should recover soon. The government will
fund most of the rebuilding costs, and public investment will rise sharply. The
Taiwanese government has sufficient financial strength to fund this effort. GDP
growth outlook remains strong for 1999 and 2000. The Taiwanese market

<PAGE>

was also affected earlier in the third quarter by diplomatic wrangling with
China. President Lee of Taiwan attempted to alter the terms of negotiations
between Taiwan and China by redefining relations to be on a "state-to-state"
basis. Most observers believe that Lee was using this issue for domestic
political reasons ahead of the upcoming presidential elections and the resulting
threats from China rattled the market. These tensions have simmered down and
paradoxically the earthquake disaster may have contributed to a cooling of
rhetoric. The market should also be supported by foreign portfolio inflows on
the back of MSCI inclusion of Taiwan at 100% weight in the first quarter of
2000.

The South Korean economy experienced the fastest recovery from the Asian
economic downturn of 1998. Korean industrial production is above pre-crisis
levels and consensus expectations for 1999 and 2000 GDP growth have moved to 8%
and 6%, respectively. The Korean economy benefited from a combination of
positive factors including strong government policy implementation, better
demand and pricing for its exports and a strong recovery in domestic confidence.
The government eased fiscal and monetary policies aggressively from the second
half of 1998 onwards. Interest rates fell rapidly from a crisis high of over 30%
to the 6% - 7% range in June. Interest rates at these levels were at a 20-year
low. As of June, the powerful moves seen in the equity market had pushed Korean
equities near historic highs on measures such as price to book value. Korean
corporations have historically traded at low multiples due to their high
leverage, low returns on equity, opaque corporate structures and poor
disclosure. In the last quarterly letter, we highlighted the need for further
restructuring and growth to sustain these multiples.

The Korean industry is highly concentrated, heavily indebted and dominated by
large groups known as chaebols. Daewoo, one of the largest chaebols, experienced
difficulties in July in rolling over its substantial short-term debt. Daewoo has
aggregate debt, mostly denominated in won, equivalent to over $50 billion. The
group controls a wide range of companies that are typically not the leading
players in their respective industries. Daewoo group companies have
significantly underperformed the market since the crisis began, confirming that
the market was aware that Daewoo was troubled. However, the announcement of
Daewoo's liquidity problems and its follow-on effects halted the Korean equity
rally in mid-July. Daewoo owes money to a wide array of lenders, including
domestic and foreign banks and a variety of bondholders, including life
insurers, other institutions and retail held mutual funds. The Daewoo workout
will be lengthy and losses will have to be split among these stakeholders. Given
the size of the problem, some government bailout will be required. News of the
Daewoo problem led to outflows from domestic mutual funds, disrupting the bond
market and widening credit spreads. The government has responded with a number
of initiatives that treat the symptom of the problem, including support funds to
improve bond market liquidity. However, the problem will not be fully solved
until losses are taken and Daewoo is broken up and the constituent companies'
debts are restructured. This will require political will and time and will be a
restraint on the market in the near term. Several chaebols, notably Samsung and
LG, have aggressively restructured their businesses and recapitalized their
balance sheets, and their group companies have outperformed the market,
consistent with our expectation of differentiated performance at the individual
stock level.

The Hong Kong market pulled back in the third quarter but marginally
outperformed the Index. Hong Kong's adherence to its currency board regime
lengthened its adjustment to the Asian crisis, but the economy bottomed in the
first half of 1999. Without a currency devaluation, Hong Kong companies had to
cut costs by reducing employment and negotiating lower rents, wages and other
costs, leading to deflation. Consumer price indexes are now down almost 6% year
on year. The currency board ties Hong Kong's monetary policy to tightening U.S.
policy, so rates are rising from very high levels in real terms. Banks in Hong
Kong have significantly strengthened their balance sheets during the recession,
and are as liquid as they have been in years. So far they have only grown their
mortgage portfolios but are well positioned to increase other loans when demand
improves.

The Hong Kong property market has remained sluggish in the face of high real
interest rates, a large schedule of new residential development launches and
low, but stabilizing, office rents. Affordability of residential property is now
near the most attractive levels of the past decade, so the residential market
should improve with better consumer confidence when rates stabilize. The Hong
Kong market has traditionally relied on property profits for a significant
portion of market earnings and the market is currently transitioning to new
earnings drivers. The government has created incentives to encourage the
development of technology businesses. Telecom liberalization has led to lower
telecom costs and a profusion of new services, two pre-conditions for the
government's plans for an information age economy. Privatization initiatives are
also likely to improve economic efficiency and create new investment
opportunities. Revitalized Chinese exports are also a strong positive for the
economy. The market has drifted down as the government commences the disposition
of the shares purchased in last year's market support operation. We remain
underweight Hong Kong but may use further weakness to reduce this underweight.

After a very strong second quarter, Chinese shares fell in the third quarter and
underperformed the Index. Chinese

<PAGE>

news flow was mixed during the third quarter. Positives included a rapid
acceleration of Chinese export growth, further government initiatives to reform
state-owned enterprises (SOEs) and the banking sector and some indications that
deflation was easing. Chinese export growth improved due to greater intra-Asian
trade and continued strong exports to the U.S. This export acceleration and U.S.
dollar weakness quelled lingering concerns about currency devaluation. China's
exchange rate adjustment will be part of a move to a managed float and will be
initiated by the government and not the markets. SOE and bank reforms are
positive and necessary reforms but will take a long time to implement. The
consumer price index turned from deflation to modest inflation over the summer,
and Shanghai has tended to lead the national averages. Negative developments
included limited progress on World Trade Organization (WTO) negotiations and the
announcement of a potential $30 billion calendar of new Chinese equity
placements. WTO negotiations need to be concluded by November to succeed before
2001. Markets fluctuated on the latest twists in the 13-year negotiation
process; currently, successful negotiations would be a positive surprise for the
markets. We remain hopeful for WTO membership, as it would lock China onto a
more open, reformist path. The deal calendar threatens to dwarf the value of
currently listed Chinese shares and has created a great deal of pressure on
those stocks.

The MSCI Singapore Index fell slightly during the third quarter but outperformed
the regional indexes. Strong earnings from the electronics and banking sectors
and firm real estate conditions contributed to this outperformance. The merger
of the foreign and local tranches of the bank shares should facilitate bank
mergers in Singapore, which will reduce excess bank capacity and allow major
cost cutting. Singaporean firms seem to be taking a regional lead in working to
create shareholder value. For example, Singapore Airlines received permission to
repurchase and retire up to 1 billion Singapore dollars of stock. This balance
sheet initiative comes on top of a strong cost-cutting program and a stronger
than expected rebound in passenger traffic and yields. Government-linked
corporations are implementing guidance from the government to streamline their
businesses and boost returns on equity. A series of small divestitures have
marked progress in streamlining. The economy remains challenged by a relatively
high cost base and will continue to lose manufacturing jobs to neighboring
countries, but public policy remains focused on improving competitiveness and
attracting financial, communications and technology firms to Singapore.

The Indonesian market slumped during the third quarter due to a scandal
surrounding the misappropriation of funds intended for the bailout of Bank Bali,
one of the country's failed banks, and the tragic mishandling of East Timor's
independence referendum. The World Bank and IMF ceased aid to the country due to
these two events. A proper reckoning of bank support funds, cooperation in the
independence of East Timor and a new government will be needed for aid to
resume. The presidential election process has been accelerated into October.
Successful coalition building, further progress on corporate debt restructuring
and bank recapitalization will be needed to restart the equity rally. On a
positive note, higher oil prices generate hard currency and government revenues
and the currency remains very undervalued on a long-term view.

A collection of bad news in the banking sector, heavy capital calls on the
market and relatively slow economic recovery caused a significant correction in
Thailand in the third quarter. Valuations were ahead of fundamentals in Thailand
when the third quarter began and we were significantly underweight the market.
More capital for the banking sector, implementation of the new bankruptcy and
foreclosure laws and more corporate restructuring will be needed to enhance the
long-term investment attractiveness of Thailand. Although the cyclical economic
recovery is currently accelerating, we remain underweight pending more forceful
structural reforms and more attractive equity valuations.

The Malaysian economy has responded better than we expected to the capital
control regime. The pegged currency rate chosen proved to be undervalued when
competitive currencies appreciated and the U.S. dollar depreciated. Strong
global electronics demand, a competitive currency and a tax holiday have all
boosted exports, very positive for an economy in which exports significantly
exceed GDP. The Japanese were very supportive of the Malaysians via the Miyazawa
initiative, allowing the country to refinance its short-term debt obligations.
Half of a good bank bailout program has been implemented, as the government has
warehoused a significant portion of the non-performing loans in the system. The
next and more difficult part of the program will be NPL liquidation. The capital
controls were relaxed in August and largely replaced by a capital gains tax
system. MSCI will include Malaysia in the main international indexes again from
February 2000. While all of these developments are positive, Malaysia remains a
very difficult market to invest in due to frequent changes in the rules
governing trading. A government mandated program to forcibly merge all of the
banks and finance companies into six groups also highlighted how arbitrary the
government can be. This proposal may be withdrawn due to poor market reaction
but it is cautionary. The government needs to address a succession vacuum
following the upcoming elections to reduce political risks. Very few listed
stocks are direct beneficiaries of the positive electronics export trends. We
currently hold a significant non-index position in Malaysian equities and will
evaluate our relative weights in 2000 prior to the index inclusion.

<PAGE>

The Asian risk factors we continue to monitor include the large supply of
upcoming equity offerings and the danger that economic recovery will lessen the
will to implement needed economic and corporate level reforms. Y2K concerns are
likely to affect fourth quarter liquidity. External risk factors include the
performance of the Japanese economy, import and economic growth in Europe and
America, U.S. monetary policy and global interest rate trends, extreme weakness
in the Euro and the performance of Western equity markets. Upside surprises
could include better than expected economic recovery and bank recapitalization
in Japan, and stronger than expected import demand from the U.S. and Europe.

Sentiment and liquidity drove Asian equity returns in the second quarter. The
third quarter represented a reality check. Some companies and markets had moved
ahead of where they should have been, and much of the overshooting was corrected
in the third quarter. We continue to believe that the best way to drive future
performance will be through stock selection, and note that the importance of
stock selection was reasserted in a less buoyant market environment. We continue
to focus our efforts on identifying companies that are restructuring and
refocusing their businesses around the principle of improving returns on equity.
We have seen a variety of restructuring efforts by Asian companies over the past
year and they continue to perform well in relative and absolute terms. As
mentioned above, restructuring in Japan could also provide enhanced investment
opportunities in non-Japan Asia through outsourcing. We will continue to search
for these opportunities, and build significant positions in companies geared to
the recovery in domestic consumption currently underway in most Asian economies.

JAPAN

The Japanese equity market reflected the second wave of the growing optimism for
economic recovery during the third quarter, rising from foreign and domestic
retail buying. In our view, the first wave and platform for this rise was set
late last year with the Government's use of public funds to address
non-performing loans, a highly accommodative monetary policy and unprecedented
restructuring announcements by leading companies in Japan.

The heart of the second wave was the release of two consecutive quarterly GDP
growth figures; 8% annualized announced in June and 9% in September, both
significantly higher than market expectations. Not only was this viewed by
enthusiastic and record foreign buying but it also caused the yen to sharply
appreciate. The Bank of Japan and Ministry of Finance attempted to slow the rise
by large currency interventions, estimated to be $30 billion or more, but failed
because of the accelerating demand for yen assets. Moreover, the U.S. Treasury
criticized Japan's interventions and strongly encouraged the Japanese government
to revive the economy through domestic led growth. As it became accepted by
market participants that the U.S. would not coordinate joint intervention,
currency dealers, hedge funds and speculators rode the momentum of a surging
yen. Since many investors believed a strong yen would hamper the fledgling
economic recovery, profit taking capped the equity market since its peak in
July.

On a micro basis, restructuring efforts and earnings momentum rewarded many
technology related companies. In particular, Fujitsu, Ricoh, TDK, Mitsumi, Rohm
and SONY rallied to record highs. We believe that the leadership in the market
from these Japanese "Generals" was very significant and supports our view that
investors still need to be highly selective in their investments for Japanese
equities.

In addition, the announced merger by IBJ, DKB and Fuji Bank to create the
world's largest bank in assets (and non-performing loans) by 2002 initiated a
buying frenzy and short covering for bank shares. We are skeptical on this
merger as well as the investment merit for Japanese banks. While such headlines
cause a panic re-evaluation of the sector, we do not see valuations or growth
prospects as compelling, particularly as banks are facing full competition for
the first time.

The Washington G7 meeting in September had a decidedly different tone regarding
dollar/yen. While formally acknowledging that a strong yen was "not in the best
interest for G7," Japan appeared to have pledged they will renew their efforts
for a domestic led recovery including additional supplementary budgets for
infrastructure spending. In particular, we believe that with Japan hosting the
Summit Meeting in Okinawa in 2000 and domestic elections both in the U.S. and
Japan next year, the Japanese Government will likely use these dates as
milestones for achieving respectable and sustainable growth in the economy. If
we are correct in these assumptions, it should lead to a "third wave" of equity
commitments to Japan in the near future as continuing evidence begins to mount
for a sustainable recovery. While global money flows have primarily been to the
U.S. and Europe over the last several years, the recent rally in gold, oil,
Japanese and Asia markets suggests that such flows may now be dispersed away
from Anglo Saxon dominated asset classes for the next several years.

On an individual company level, we believe restructuring efforts, in particular
for the leading companies or "Generals" should produce upward revisions in
earnings, particularly during the next six month period. However, with volatile
foreign exchange markets and Y2K fears during the fourth quarter, returns for
Japanese equities are expected to be modest. Stock picking will remain critical.
During the last several years, most good active managers have added value by
avoiding certain sectors such as

<PAGE>

banking, construction and brokerage because of their challenging fundamentals.
We believe the next wave will witness a polarization within individual stocks
within sectors as winners and losers emerge from recent measures to fully
deregulate domestic industries.

We have begun to consider reducing certain securities such as Nintendo, Fujitsu,
Rohm and SONY because of market appreciation and the subsequent relative high
weightings within our overall portfolio. We are beginning to consider adding
select domestic economic recovery-related sectors such as housing, retailing and
manufacturing. Although we are slightly cautious for the fourth quarter, it may
provide an opportunity for investors to add to their Japanese positions as it is
our view the fourth quarter is the "waiting room" for the 3rd leg of the market
rise which we anticipate to begin in the near future.

On January 23, 1998, the Fund commenced a share repurchase program for purposes
of enhancing shareholder value and reducing the discount at which the Fund's
shares traded from their net asset value. For the nine months ended September
30, 1999, the Fund repurchased 5,040,600 shares of its Common Stock at an
average price per share of $8.23 and an average discount of 15.81% from net
asset value per share. The Fund expects to continue to repurchase its
outstanding shares at such time and in such amounts as it believes will further
the accomplishment of the foregoing objectives, subject to review by the Board
of Directors.

Sincerely,

/s/ Michael F. Klein

Michael F. Klein
PRESIDENT AND DIRECTOR

October 1999

THE INFORMATION CONTAINED IN THIS OVERVIEW REGARDING SPECIFIC SECURITIES IS FOR
INFORMATIONAL PURPOSES ONLY AND SHOULD NOT BE CONSTRUED AS A RECOMMENDATION TO
PURCHASE OR SELL THE SECURITIES MENTIONED.

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DAILY NET ASSET AND MARKET VALUES, AS WELL AS MONTHLY PORTFOLIO INFORMATION FOR
THE FUND, ARE AVAILABLE ON OUR WEBSITE AT
www.msdw.com/institutional/investmentmanagement.

<PAGE>

Morgan Stanley Dean Witter Asia-Pacific Fund, Inc.
Investment Summary as of September 30, 1999 (Unaudited)
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HISTORICAL
INFORMATION

TOTAL RETURN (%)
----------------------------------------------------------------------
MARKET VALUE (1) NET ASSET VALUE (2) INDEX (3)
---------------------- --------------------- ----------------------
AVERAGE AVERAGE AVERAGE
CUMULATIVE ANNUAL CUMULATIVE ANNUAL CUMULATIVE ANNUAL
---------- -------- ---------- ------- ---------- --------
<S> <C> <C> <C> <C> <C> <C>
Fiscal Year to Date 41.07% -- 41.01% -- 32.41% --
One Year 69.89 69.89% 65.68 65.68% 68.16 68.16%
Five Year -5.59 - 1.14 3.81 0.75 -12.25 - 2.58
Since Inception* -17.14 - 3.58 3.30 0.63 -12.62 - 2.58
</TABLE>

PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
- -------------------------------------------------------------------------------
RETURNS AND PER SHARE INFORMATION

[GRAPH]
<TABLE>
<CAPTION>

YEAR ENDED DECEMBER 31,
NINE MONTHS
ENDED
SEPTEMBER 30,
1994* 1995 1996 1997 1998 1999
------- -------- ------- ------- ------ -------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value Per Share... $13.20 $14.34 $11.95 $ 8.77 $ 8.73 $12.31
Market Value Per Share...... $12.25 $13.33 $ 9.75 $ 7.44 $ 7.00 $ 9.88
Premium/(Discount).......... -7.2% -7.0% -18.4% -15.2% -19.8% -19.7%
Income Dividends............ $ 0.04 $ 0.05 $ 0.61 $ 0.02 $ 0.01 --
Capital Gains Distributions. $ 0.01 $ 0.02 -- -- -- --
Fund Total Return (2)....... -5.94% 9.24% -2.87%+ -26.36% -0.34% 41.01%
Index Total Return (3)...... -5.24% 2.88% -3.63% -29.55% -0.30% 32.41%
</TABLE>

(1) Assumes dividends and distributions, if any, were reinvested.
(2) Total investment return based on net asset value per share reflects the
effects of changes in net asset value on the performance of the Fund during
each period, and assumes dividends and distributions, if any, were
reinvested. These percentages are not an indication of the performance of a
shareholder's investment in the Fund based on market value due to
differences between the market price of the stock and the net asset value
per share of the Fund.
(3) The benchmark for investment performance is comprised of two Morgan Stanley
Capital International (MSCI) indices; Japan and All-Country Asia-Pacific
Free ex-Japan with each index weighted equally.
* The Fund commenced operations on August 2, 1994.
+ This return does not include the effect of the rights issued in connection
with the Rights Offering.

<PAGE>

Morgan Stanley Dean Witter Asia-Pacific Fund, Inc.
Portfolio Summary as of September 30, 1999 (Unaudited)
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DIVERSIFICATION OF TOTAL INVESTMENTS

[CHART}

<TABLE>
<S> <C>
Equity Securities (95.7%)
Fixed Income Securities (0.3%)
Short-Term Investments (4.0%)
</TABLE>
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INDUSTRIES

[CHART]

<TABLE>
<S> <C>
Appliances & Household Durables (6.1%)
Automobiles (4.4%)
Banking (5.5%)
Data Processing & Reproduction (6.2%)
Electrical & Electronics (11.3%)
Electronic Components, Instruments (8.0%)
Health & Personal Care (4.6%)
Machinery & Engineering (4.8%)
Real Estate (4.2%)
Recreation, Other Consumer Goods (4.0%)
Other (40.9%)
</TABLE>
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COUNTRY WEIGHTINGS

[CHART]

<TABLE>
<S> <C>
Japan (50.4%)
Australia (9.2%)
Hong Kong (9.2%)
South Korea (6.8%)
Taiwan (5.3%)
India (4.9%)
Singapore (4.6%)
Malaysia (2.1%)
Indonesia (0.9%)
Thailand (1.1%)
Other (5.5%)
</TABLE>
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TEN LARGEST HOLDINGS*

<TABLE>
<CAPTION>
PERCENT OF
NET ASSETS
----------
<S> <C>
1. Sony Corp. (Japan) 2.4%
2. Nintendo Co., Ltd. (Japan) 2.3
3. NEC Corp. (Japan) 2.3
4. Fujitsu Ltd. (Japan) 2.3
5. Samsung Electronics (South Korea) 2.1
6. Hutchinson Whampoa Ltd. (Hong Kong) 2.0
7. Hitachi Ltd. (Japan) 1.8
8. Ricoh Co., Ltd. (Japan) 1.6
9. Toshiba Corp. (Japan) 1.5
10. Yamanouchi Pharmaceutical Co., Ltd. (Japan) 1.5
----
19.8%
----
----
</TABLE>

* Excludes short-term investments.

<PAGE>

FINANCIAL STATEMENTS
- ---------
STATEMENT OF NET ASSETS (UNAUDITED)
- ---------
SEPTEMBER 30, 1999

VALUE
SHARES (000)
- ---------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS (95.9%)
(Unless otherwise noted)
- ---------------------------------------------------------------------------
AUSTRALIA (9.2%)
BANKING
Commonwealth Bank of Australia 458,800 U.S.$ 7,233
National Australia Bank Ltd. 388,350 5,686
Westpac Banking Corp., Ltd. 882,650 5,446
--------------------
18,365
--------------------
BEVERAGES & TOBACCO
Coca-Cola Amatil Ltd. 461,200 1,620
Foster's Brewing Group Ltd. 1,340,000 3,778
--------------------
5,398
--------------------
BROADCASTING & PUBLISHING
News Corp., Ltd. 883,350 6,200
--------------------
BUSINESS & PUBLIC SERVICES
Brambles Industries Ltd. 109,500 3,171
--------------------
DATA PROCESSING & REPRODUCTION
Reckon Ltd. 1,249,700 1,003
--------------------
ENERGY SOURCES
Broken Hill Proprietary Co., Ltd. 665,150 7,663
--------------------
GOLD MINES
Normandy Mining Ltd. 2,501,600 2,221
--------------------
MISC. MATERIALS & COMMODITIES
Rio Tinto Ltd. 592,600 10,052
--------------------
REAL ESTATE
Lend Lease Corp., Ltd. 246,300 3,007
--------------------
TELECOMMUNICATIONS
AAPT Ltd. 710,300 2,271
Macquarie Corporate
Telecommunications
Holdings Ltd. 679,700 733
Telstra Corp., Ltd. 1,422,450 7,374
--------------------
10,378
--------------------
TRANSPORTATION--AIRLINES
Airways Ltd. 932,300 2,921
--------------------
70,379
--------------------
- ---------------------------------------------------------------------------
CHINA (0.4%)
BANKING
Wing Hang Bank Ltd. 194,000 649
--------------------
ENERGY SOURCES
Yanzhou Mining Co., Ltd. 3,769,600 1,456
--------------------
HEALTH & PERSONAL CARE
Hengan International Group
Co., Ltd. 3,199,000 815
--------------------
2,920
--------------------
- ---------------------------------------------------------------------------
HONG KONG (9.2%)
BANKING
Dao Heng Bank Group Ltd. 589,000 2,692
--------------------
BROADCASTING & PUBLISHING
Television Broadcasts Ltd. 779,000 3,329
--------------------
ELECTRICAL & ELECTRONICS
Great Wall Technology Co., Ltd. 2,777,000 1,788
Johnson Electric Holdings Ltd. 249,000 1,208
--------------------
2,996
--------------------
- ---------------------------------------------------------------------------
MULTI-INDUSTRY
Hutchison Whampoa Ltd. 1,617,500 U.S.$ 15,045
Swire Pacific Ltd. 'A' 940,600 4,456
--------------------
19,501
--------------------
REAL ESTATE
Cheung Kong (Holdings) Ltd. 1,118,000 9,319
Kerry Properties Ltd. 542,000 572
New World Development Co., Ltd. 1,029,000 2,259
Sino Land Co. 1,385,000 678
Sun Hung Kai Properties Ltd. 904,000 6,895
--------------------
19,723
--------------------
TELECOMMUNICATIONS
Smartone Telecommunications 790,000 2,431
--------------------
TELECOMMUNICATIONS--INTEGRATED
Asia Satellite Telecom Holdings 524,000 1,335
Hong Kong Telecommunications Ltd. 3,885,700 8,529
--------------------
9,864
--------------------
TELECOMMUNICATIONS--WIRELESS
China Telecom Ltd. 1,004,000 3,095
--------------------
TEXTILES & APPAREL
Yue Yuen Industrial Holdings 288,000 723
--------------------
UTILITIES--ELECTRICAL & GAS
CLP Holdings Ltd. 512,000 2,406
Huaneng Power International,
Inc. 'H' 2,066,400 625
--------------------
3,031
--------------------
WHOLESALE & INTERNATIONAL TRADE
Jardine International
Motor Holdings Ltd. 449,000 218
Li & Fung Ltd. 794,000 2,402
Sime Darby Hong Kong Ltd. 421,400 168
--------------------
2,788
--------------------
70,173
--------------------
- ---------------------------------------------------------------------------
INDIA (4.9%)
AUTOMOBILES
Hero Honda Ltd. 96,556 2,814
--------------------
BANKING
Industrial Finance Corp.,
(India) Ltd. 100 -- @
State Bank of India Ltd. 1,112 5
--------------------
5
--------------------
BEVERAGES & TOBACCO
ITC Ltd. 70,455 1,329
--------------------
BUILDING MATERIALS & COMPONENTS
Associated Cement Co., Ltd. 8,600 41
--------------------
CHEMICALS
Gujarat Narmada Valley
Fertilizers Co., Ltd. GDR 49 -- @
Supreme Industries Ltd. 50 -- @
--------------------
-- @
--------------------
DATA PROCESSING & REPRODUCTION
Aptech Ltd. 82,400 1,605
BFL Software Ltd. 55,600 1,131
Leading Edge Systems Ltd. 34,200 406
- ---------------------------------------------------------------------------
</TABLE>

<PAGE>
<TABLE>
<CAPTION>
VALUE
SHARES (000)
- ---------------------------------------------------------------------------
<S> <C> <C>
INDIA (CONTINUED)
DATA PROCESSING & REPRODUCTION
(CONTINUED)
NIIT Ltd. 26,000 U.S.$ 1,686
Satyam Computer Services Ltd. 40,000 1,034
--------------------
5,862
--------------------
ELECTRICAL & ELECTRONICS
Bharat Heavy Electricals Ltd. 550,200 3,447
Digital Equipment (India) Ltd. 2,200 38
Tata Infotech Ltd. 56,025 903
--------------------
4,388
--------------------
ELECTRONIC COMPONENTS, INSTRUMENTS
Infosys Technology Ltd. 43,150 7,069
--------------------
FINANCIAL SERVICES
Housing Development
Finance Corp., Ltd. 375,410 2,473
ICICI Ltd. - New 765,000 1,536
UTI-MasterShares Ltd. 600 -- @
--------------------
4,009
--------------------
HEALTH & PERSONAL CARE
Reckitt & Coleman of India Ltd. 750 8
--------------------
INDUSTRIAL COMPONENTS
Apollo Tyres Ltd. 13,625 72
--------------------
MACHINERY & ENGINEERING
Punjab Tractors Ltd. 80,900 2,042
--------------------
METALS--STEEL
Tata Iron & Steel Co., Ltd. 2,295 8
--------------------
MULTI-INDUSTRY
(a)Morgan Stanley Dean Witter
Growth Fund 26,049,150 6,068
--------------------
TELECOMMUNICATIONS
Videsh Sanchar Nigam Ltd. 54,455 1,250
--------------------
TEXTILES & APPAREL
J.K. Synthetics Ltd. 674 -- @
Raymond Ltd. 50 -- @
Viniyoga Clothes Ltd. 5,300 -- @
--------------------
-- @
--------------------
TRANSPORTATION--ROAD & RAIL
Container Corp. of India Ltd. 400,000 2,846
--------------------
37,811
--------------------
- ---------------------------------------------------------------------------
INDONESIA (0.9%)
BEVERAGES & TOBACCO
Gudang Garam 1,245,000 2,523
--------------------
BUILDING MATERIALS & COMPONENTS
Semen Gresik 861,500 1,378
--------------------
FOOD & HOUSEHOLD PRODUCTS
Indofood Sukses Makmur 759,500 724
--------------------
METALS--NON FERROUS
Aneka Tambang 1,920,000 335
--------------------
TELECOMMUNICATIONS
Indofood Sukses Makmur
(Foreign) 453,500 432
--------------------
TELECOMMUNICATIONS INTEGRATED
Telekomunikasi Indonesia ADR 273,056 1,894
--------------------
7,286
--------------------
- ---------------------------------------------------------------------------
JAPAN (50.4%)
APPLIANCES & HOUSEHOLD DURABLES
Matsushita Electric
Industrial Co., Ltd. 504,000 U.S.$ 10,692
Sony Corp. 121,000 18,030
--------------------
28,722
--------------------
AUTOMOBILES
Nifco, Inc. 350,000 4,711
Nissan Motor Co. 1,330,000 8,035
Suzuki Motor Co., Ltd. 430,000 6,963
Toyota Motor Corp. 220,000 6,985
--------------------
26,694
--------------------
BROADCASTING & PUBLISHING
Nissha Printing Co., Ltd. 105,000 712
--------------------
BUILDING MATERIALS & COMPONENTS
Fujitec Co., Ltd. 440,000 5,893
Rinnai Corp. 160,700 4,102
Sanwa Shutter Corp., Ltd. 582,000 3,080
Sekisui Chemical Co. 613,000 3,451
--------------------
16,526
--------------------
BUSINESS & PUBLIC SERVICES
Dai Nippon Printing Co., Ltd. 298,000 5,523
--------------------
CHEMICALS
Daicel Chemical Industries Ltd. 1,090,000 3,981
Kaneka Corp. 859,000 11,022
Mitsubishi Chemical Industries 1,060,000 4,041
Shin-Etsu Polymer Co., Ltd. 530,000 3,773
--------------------
22,817
--------------------
CONSTRUCTION & HOUSING
Kyudenko Co., Ltd. 380,000 1,779
Sekisui House Ltd. 530,000 5,967
--------------------
7,746
--------------------
DATA PROCESSING & REPRODUCTION
Canon, Inc. 344,000 9,988
Fujitsu Ltd. 556,000 17,289
Ricoh Co., Ltd. 701,000 12,146
--------------------
39,423
--------------------
ELECTRICAL & ELECTRONICS
Hitachi Ltd. 1,215,000 13,428
Minebea Co., Ltd. 460,000 5,838
Mitsumi Electric Co., Ltd. 336,000 10,070
NEC Corp. 870,000 17,478
Ryosan Co., Ltd. 123,000 3,399
Toshiba Corp. 1,595,000 11,846
--------------------
62,059
--------------------
ELECTRONIC COMPONENTS, INSTRUMENTS
Kyocera Corp. 118,000 8,952
Rohm Co., Ltd. 34,000 7,086
TDK Corp. 98,000 11,317
--------------------
27,355
--------------------
ENERGY EQUIPMENT & SERVICES
Kurita Water Industries Ltd. 274,000 5,543
--------------------
FINANCIAL SERVICES
Hitachi Credit Corp. 293,000 6,051
--------------------
- ---------------------------------------------------------------------------
</TABLE>

<PAGE>

VALUE
SHARES (000)
- ---------------------------------------------------------------------------
<S> <C> <C>
JAPAN (CONTINUED)
FOOD & HOUSEHOLD PRODUCTS
Aiwa Co., Ltd. 105,000 U.S.$ 3,078
Sangetsu Co., Ltd. 137,000 2,938
Yamaha Corp. 332,000 3,094
--------------------
9,110
--------------------
HEALTH & PERSONAL CARE
Ono Pharmaceutical Co., Ltd. 210,000 7,769
Sankyo Co., Ltd. 378,000 11,329
Yamanouchi Pharmaceutical Co., Ltd. 253,000 11,824
--------------------
30,922
--------------------
INDUSTRIAL COMPONENTS
Furakawa Electric Co. 843,000 5,014
--------------------
MACHINERY & ENGINEERING
Amada Co., Ltd. 612,000 4,259
Daifuku Co., Ltd. 596,000 3,796
Daikin Kogyo Co. 573,000 6,923
Fuji Machine Co. 233,000 11,130
Mitsubishi Heavy Industries Ltd. 1,300,000 4,992
Tsubakimoto Chain Co. 832,000 4,005
--------------------
35,105
--------------------
MERCHANDISING
Family Mart Co., Ltd. 113,200 5,958
--------------------
MULTI-INDUSTRY
Lintec Corp. 235,000 2,828
--------------------
REAL ESTATE
Keihanshin Real Estate Co. 164,000 614
Mitsubishi Estate Co., Ltd. 415,000 4,202
--------------------
4,816
--------------------
RECREATION, OTHER CONSUMER GOODS
Casio Computer Co., Ltd. 522,000 3,955
Fuji Photo Film Ltd. 252,000 8,615
Nintendo Co., Ltd. 112,000 17,812
--------------------
30,382
--------------------
TELECOMMUNICATIONS
Nippon Telephone & Telegraph
Corp. 932 11,435
--------------------
WHOLESALE & INTERNATIONAL TRADE
Inabata & Co. 287,000 1,129
--------------------
385,870
--------------------
- ---------------------------------------------------------------------------
MALAYSIA (2.1%)
BANKING
Malayan Banking Bhd 1,138,000 3,534
Public Bank Bhd 1,724,000 1,406
--------------------
4,940
--------------------
BEVERAGES & TOBACCO
Carlsberg Brewery (Malaysia) Bhd 1,082,000 3,047
Rothmans of Pall Mall Bhd 584,000 3,565
--------------------
6,612
--------------------
ELECTRONIC COMPONENTS, INSTRUMENTS
Unisem (M) Bhd 185,000 755
--------------------
FOOD & HOUSEHOLD PRODUCTS
Nestle Bhd 409,000 1,431
--------------------
- ---------------------------------------------------------------------------
LEISURE & TOURISM
Tanjong plc 84,000 U.S.$ 177
--------------------
MULTI-INDUSTRY
Sime Darby Bhd 384,000 445
--------------------
TELECOMMUNICATIONS--INTEGRATED
Telekom Malaysia Bhd 653,000 1,693
--------------------
16,053
--------------------
- ---------------------------------------------------------------------------
NEW ZEALAND (0.5%)
FOREST PRODUCTS & PAPER
Fletcher Challenge Forests 785,700 337
--------------------
TELECOMMUNICATIONS
Telecom Corp. of New Zealand Ltd. 671,100 2,649
--------------------
TRANSPORTATION--AIRLINES
Air New Zealand Ltd. 'B' 505,000 810
--------------------
3,796
--------------------
- ---------------------------------------------------------------------------
PAKISTAN (0.5%)
HEALTH & PERSONAL CARE
Lever Brothers Pakistan Ltd. 235,580 3,698
--------------------
- ---------------------------------------------------------------------------
PHILIPPINES (0.5%)
BEVERAGES & TOBACCO
San Miguel Corp. 'B' 980,320 1,486
--------------------
REAL ESTATE
SM Prime Holdings, Inc. 'B' 8,646,180 1,459
--------------------
TELECOMMUNICATIONS--INTEGRATED
Philippine Long Distance
Telephone Co. 54,730 1,184
--------------------
4,129
--------------------
- ---------------------------------------------------------------------------
SINGAPORE (4.2%)
AEROSPACE & MILITARY TECHNOLOGY
Singapore Technologies
Engineering Ltd. 1,290,000 1,647
--------------------
BANKING
Development Bank of
Singapore 155,842 1,779
Oversea-Chinese Banking Corp.,
Ltd. (Foreign) 274,000 2,128
Overseas Union Bank Ltd. 'F' 291,210 1,293
United Overseas Bank Ltd.
(Foreign) 286,000 2,170
--------------------
7,370
--------------------
BROADCASTING & PUBLISHING
Singapore Press Holdings Ltd. 238,600 3,761
--------------------
ELECTRICAL & ELECTRONICS
Gul Technologies 362,000 341
Natsteel Electronics Ltd. 776,000 2,898
--------------------
3,239
--------------------
ELECTRONIC COMPONENTS, INSTRUMENTS
Omni Industries Ltd. 1,044,000 1,105
Venture Manufacturing Ltd. 549,000 4,780
--------------------
5,885
--------------------
REAL ESTATE
City Developments Ltd. 211,000 1,074
- ---------------------------------------------------------------------------
</TABLE>

<PAGE>

VALUE
SHARES (000)
- ---------------------------------------------------------------------------
<S> <C> <C>

SINGAPORE (CONTINUED)
REAL ESTATE (CONTINUED)
DBS Land 546,000 U.S.$ 1,015
--------------------
2,089
--------------------
TRANSPORTATION--AIRLINES
Singapore Airlines Ltd. 594,000 5,800
--------------------
TRANSPORTATION--SHIPPING
Neptune Orient Lines 864,000 1,037
Sembcorp Logistics Ltd. 335,200 1,025
--------------------
2,062
--------------------
31,853
--------------------
- ---------------------------------------------------------------------------
SOUTH KOREA (6.8%)
APPLIANCES & HOUSEHOLD DURABLES
LG Electronics 51,620 1,731
Samsung Electronics 98,717 15,986
--------------------
17,717
--------------------
AUTOMOBILES
Hyundai Motor Co. 444,000 4,385
--------------------
BANKING
Hana Bank 97,040 719
Housing & Commercial Bank 62,730 1,212
Housing & Commercial Bank,
Korea GDR 7,400 141
Kookmin Bank 56,830 712
Koram Bank 63,140 423
--------------------
3,207
--------------------
CHEMICALS
Korea Chemical Co., Ltd. 13,120 841
L.G. Chemical Ltd. 60,320 1,751
--------------------
2,592
--------------------
DATA PROCESSING & REPRODUCTION
Mirae Co. 112,900 603
--------------------
ELECTRICAL & ELECTRONICS
Samsung Electro-Mechanics Co. 36,931 1,882
--------------------
ELECTRONIC COMPONENTS, INSTRUMENTS
Daeduck Electronics Co. 56,000 621
--------------------
FINANCIAL SERVICES
Daewoo Securities Co. 40,149 593
Good Morning Securities Co., Ltd. 140,420 808
Samsung Securities Co., Ltd. 11,100 360
--------------------
1,761
--------------------
METALS--STEEL
Pohang Iron & Steel Ltd. ADR 156,900 4,913
--------------------
MISC. MATERIALS & COMMODITIES
Hankuk Glass Industry Co., Ltd. 28,020 537
--------------------
TELECOMMUNICATIONS--INTEGRATED
Korea Telecom Corp. ADR 163,400 6,046
--------------------
TELECOMMUNICATIONS--WIRELESS
SK Telecom Co., Ltd. 137,900 1,422
--------------------
UTILITIES--ELECTRICAL & GAS
Korea Electric Power Corp. ADR 402,300 6,462
--------------------
52,148
--------------------
- ---------------------------------------------------------------------------
TAIWAN (5.3%)
BANKING
Bank Sinopac 43,223 U.S.$ 23
International Commercial Bank of
China 1,182,500 1,155
Taishin International Bank 1,103,200 611
--------------------
1,789
--------------------
CHEMICALS
Formosa Plastics Corp. 502,000 973
Nan Ya Plastic Corp. 1,002,290 1,594
--------------------
2,567
--------------------
DATA PROCESSING & REPRODUCTION
Quanta Computer, Inc. 77,000 640
--------------------
ELECTRICAL & ELECTRONICS
Acer, Inc. 374,000 677
Siliconware Precision Industries Co. 845,000 1,411
Taiwan Semiconductor
Manufacturing Co., Ltd. 1,896,000 7,972
--------------------
10,060
--------------------
ELECTRONIC COMPONENTS, INSTRUMENTS
Acer Peripherals, Inc. 124,000 2,253
Advanced Semiconductor
Engineering, Inc. 682,000 1,944
Asustek Computer, Inc. 237,000 2,359
Asustek Computer, Inc. GDR 93,439 1,243
Compal Electronics 400,000 1,266
Compeq Manufacturing Co., Ltd. 299,000 1,412
Hon Hai Precision Industry 508,200 3,329
United Micro Electronics Corp., Ltd. 2,612,000 6,088
--------------------
19,894
--------------------
MERCHANDISING
President Chain Store Corp. 396,000 1,123
--------------------
METALS--STEEL
China Steel Corp. 2,057,000 1,672
--------------------
TEXTILES & APPAREL
Far East Textile 1,147,040 1,629
--------------------
TRANSPORTATION -- SHIPPING
Evergreen Marine Corp. 1,535,640 1,470
--------------------
40,844
--------------------
- ---------------------------------------------------------------------------
THAILAND (1.0%)
BANKING
Thai Farmers Bank Ltd.
(Foreign) 1,234,400 1,454
--------------------
BROADCASTING & PUBLISHING
BEC World Public Co., Ltd.
(Foreign) 143,500 778
--------------------
BUILDING MATERIALS & COMPONENTS
Siam City Cement Public
Co., Ltd. (Foreign) 251,933 775
--------------------
ELECTRICAL & ELECTRONICS
Delta Electronics Public
Co., Ltd. (Foreign) 183,015 1,627
--------------------
- ---------------------------------------------------------------------------
</TABLE>

<PAGE>

VALUE
SHARES (000)
- ---------------------------------------------------------------------------
<S> <C> <C>
THAILAND (CONTINUED)
REAL ESTATE
Golden Land Property
Development Public Co., Ltd. 2,849,000 U.S.$ 1,113
--------------------
TELECOMMUNICATIONS--WIRELESS
Advanced Info. Services
Public Co., Ltd. (Foreign) 146,400 1,673
--------------------
7,420
--------------------
- ---------------------------------------------------------------------------
TOTAL COMMON STOCKS
(Cost U.S.$620,094) 734,380
--------------------
- ---------------------------------------------------------------------------

<CAPTION>
NO. OF
RIGHTS
- ---------------------------------------------------------------------------
<S> <C> <C>
RIGHTS (0.0%)
- ---------------------------------------------------------------------------
INDIA (0.0%)
MATERIALS
Associated Cement Co., Ltd. 8,700 11
--------------------
- ---------------------------------------------------------------------------
TAIWAN (0.0%)
BANKING
Taishin International Bank 985,000 39
--------------------
- ---------------------------------------------------------------------------
TOTAL RIGHTS
(Cost U.S.$--@) 50
--------------------
- ---------------------------------------------------------------------------

NO. OF
WARRANTS
- ---------------------------------------------------------------------------
<S> <C> <C>
WARRANTS (0.2%)
- ---------------------------------------------------------------------------
HONG KONG (0.0%)
BANKING
HSBC Holdings plc,
expiring 10/13/99 1,334,000 201
--------------------
- ---------------------------------------------------------------------------
INDIA (0.0%)
BANKING
Apollo Tyres Ltd. 2,150 -- @
--------------------
- ---------------------------------------------------------------------------
SINGAPORE (0.1%)
BANKING
Oversea-Chinese Banking
Corp. Ltd., expiring 3/28/02 1,653,000 1,186
--------------------
- ---------------------------------------------------------------------------
THAILAND (0.1%)
BANKING
Siam Commercial Bank Public Co., Ltd.,
expiring 5/10/02 1,727,300 496
--------------------
- ---------------------------------------------------------------------------
TOTAL WARRANTS
(Cost U.S.$2,138) 1,883
--------------------
- ---------------------------------------------------------------------------

FACE
AMOUNT VALUE
(000) (000)
- ---------------------------------------------------------------------------
<S> <C> <C>
FIXED INCOME SECURITIES (0.3%)
- ---------------------------------------------------------------------------
SINGAPORE (0.3%)
FINANCIAL SERVICES
Finlayson Global Corp., Ltd.
Zero Coupon, 2/19/04
(Cost U.S. $1,150) U.S.$ 1,150 U.S.$ 2,047
--------------------
- ---------------------------------------------------------------------------
SHORT-TERM INVESTMENTS (1.2%)
- ---------------------------------------------------------------------------
UNITED STATES (1.2%)
REPURCHASE AGREEMENT
Chase Securities, Inc. 5.05%,
dated 9/30/99, due 10/1/99,
to be repurchased at U.S.
$9,500, collateralized by
U.S. $9,330 United States
Treasury Bonds, 6.625%, due
2/15/27, valued at U.S.
$9,578 (Cost U.S.$9,499) 9,499 9,499
--------------------
- ---------------------------------------------------------------------------
FOREIGN CURRENCY ON DEPOSIT WITH CUSTODIAN (2.8%)
Hong Kong Dollar HKD 24,441 3,147
Indian Rupee INR 189 4
Malaysian Ringgit MYR 5,760 1,516
Pakistani Rupee PKR 7,979 149
South Korean Won KRW 460,247 378
Taiwan Dollar TWD 506,255 15,945
Thai Baht THB 80 2
--------------------
(Cost U.S.$21,133) 21,141
--------------------
- ---------------------------------------------------------------------------
TOTAL INVESTMENTS (100.4%)
(Cost U.S.$654,014) 769,000
--------------------
- ---------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES (-0.4%)
Other Assets U.S.$ 18,021
Liabilities (21,044) (3,023)
--------------------
- ---------------------------------------------------------------------------
NET ASSETS (100%)
Applicable to 62,233,974 issued
and outstanding U.S.$0.01
par value shares
(100,000,000 shares authorized) U.S.$ 765,977
--------------------
- ---------------------------------------------------------------------------
NET ASSET VALUE PER SHARE U.S.$ 12.31
--------------------
- ---------------------------------------------------------------------------

</TABLE>

@ - Value is less than U.S.$500.
(a) - The Fund is advised by an affiliate.
ADR - American Depositary Receipt
GDR - Global Depositary Receipt