<PAGE>
----------------------------------------------------------
MORGAN STANLEY
DEAN WITTER
ASIA-PACIFIC
FUND, INC.
----------------------------------------------------------
FIRST QUARTER REPORT
MARCH 31, 2000
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
Harold J. Schaaff, Jr.
PRESIDENT AND DIRECTOR
Peter J. Chase
DIRECTOR
John W. Croghan
DIRECTOR
Graham E. Jones
DIRECTOR
John A. Levin
DIRECTOR
William G. Morton, Jr.
DIRECTOR
Stefanie V. Chang
VICE PRESIDENT
Joseph P. Stadler
VICE PRESIDENT
Mary E. Mullin
SECRETARY
Belinda A. Brady
TREASURER
Robin L. Conkey
ASSISTANT 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
CUSTODIAN
The Chase Manhattan Bank
3 Chase MetroTech Center
Brooklyn, New York 11245
SHAREHOLDER SERVICING AGENT
American Stock Transfer & Trust Company
40 Wall Street
New York, New York 10005
(800) 278-4353
LEGAL COUNSEL
Rogers & Wells LLP
200 Park Avenue
New York, New York 10166
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 three months ended March 31, 2000, the Morgan Stanley Dean Witter
Asia-Pacific Fund, Inc. (the "Fund") had a total return, based on net asset
value per share, of 1.11% compared to -0.72% for its benchmark (described
below). For the period from the Fund's commencement of operations on August 2,
1994 through March 31, 2000, the Fund's total return, based on net asset value
per share, was 29.91% compared with 1.41% 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 March 31, 2000, the closing price of the Fund's shares on
the New York Stock Exchange was $10 7/8, representing a 29.5% discount to the
net asset value per share.
ASIA EX-JAPAN
Asia Ex-Japan markets in the first quarter were resilient, albeit with much
higher volatility. The volatility increased due to increased daily correlation
with the NASDAQ, which was extremely volatile. The NASDAQ outperformed the
broader U.S. markets, even in the face of continued Federal Reserve tightening,
reflecting the stark divergence in market performance between technology and
non-technology stocks globally.
Positive macro-economic conditions for Asia ex-Japan witnessed in 1999 continued
in the first quarter of 2000. Overall liquidity conditions are still propitious
for equity markets. Economic growth and earnings growth numbers are surprising
on the upside, especially in North Asian economies. The overall growth outlook
for 2000 has been upgraded. Before the crisis, the Asian growth story was a
top-line growth story. The current phase is predominantly an earnings growth
story as restructuring by large corporates and rapid adoption of new
technologies is enhancing ROEs to a structurally higher level than seen in the
past decade. Asia is likely to post reasonable trade surpluses for a third
consecutive year in 2000 as exports continue to grow aided by secular trends
seen in outsourcing of semiconductor, computer assemblies and telecommunication
equipment. With all-round positive consumer sentiment, Asia's export led
recovery is being supplemented by domestic consumption growth.
Among the large Asian markets Taiwan was the best performing market, despite
heightened investor nervousness around cross-strait relations leading up to the
presidential elections on March 18. Taiwan reaffirmed its position as a vibrant
democracy, with voters electing the DPP candidate, Chen Shui Bian as the new
president, ending 55 years of Nationalist KMT rule. We think that the outcome is
extremely positive for the long term and is indicative of a vote in favor of a
reformist, transparent political framework. Initial remarks from the President
elect have been inspiring. He has delivered a cordial and conciliatory message
to China, expressing eagerness to engage in constructive dialogue to ease
cross-strait tensions.
The underlying fundamentals of the Taiwanese economy continued to stay strong
with most companies announcing first quarter results ahead of consensus
estimates. Liquidity conditions are benign and the New Taiwan dollar has been
appreciating steadily. Export-oriented technology stocks continued to outperform
while domestic demand-related companies and banks underperformed on investors'
worries that the ousted Kuomintang party may want to liquidate its stock market
related assets. Going forward, we expect the market to range trade. Upward
momentum will resume once the new President assumes office in May and is seen
making further efforts to resolve political tensions with China. We continue to
be overweight large cap Taiwan technology stocks - these companies are not only
some of the best-managed companies in Asia but most of these companies have very
strong secular earnings growth and are not subject to "new economy" hype
valuations.
The Korean market has been underperforming broader Asian markets over the last
two quarters, after hitting a high in the middle of 1999. Part of the weak
performance stemmed from the huge amounts of domestic retail money flowing into
the KOSDAQ market, which added over U.S. $75 billion of market cap over the last
12 months. In addition there have been somewhat exaggerated concerns about
inflation and investor caution ahead of the April parliamentary elections.
Nevertheless, the economic fundamentals in Korea are very robust and mainboard
Korean companies offer the cheapest valuations in the region relative to the
underlying growth in operating earnings. A company such as Samsung Electronics,
a global leader in the semi-conductor memory business is trading at a
substantial discount relative to its U.S. peers. We think that its gains in
global market share of the CDMA mobile handset business should see re-ratings of
valuations. We continue to be overweight the Korean market as corporate Korea
becomes more profit-focused rather than revenue-focused as in the past.
The Hong Kong market was surprisingly strong in the first quarter, as it managed
to de-couple from rising U.S. interest rates. The market was buoyed by a
stunning GDP growth of 8.7% for the fourth quarter of 1999. While the market
continued to do well in the first quarter, the breadth was narrow and dominated
by news flow surrounding telecom and media stocks. With strong export numbers
for the first two months of 2000, declining unemployment, easing deflation and
improving consumer sentiment, Hong Kong should see significant upgrades on
growth estimates for 2000. In the recently released budget, the government
prudently did not raise or introduce any taxes.
In China, the macroeconomic picture brightened considerably over the last two
quarters. In the first quarter of this year, export growth was much stronger
than expected. In-
2
<PAGE>
dustrial production in China has accelerated and GDP growth should hit 8% for
the first quarter, up from 6.8% in the fourth quarter of last year. As China
prepares to enter the WTO, the government is embarking on accelerating the
reform process. Continued modest deflation and higher unemployment has allowed
the central bank to retain an easy monetary policy. Beijing has reiterated its
uncompromising unilateral stance on Taiwan's claim for independence and the
rhetoric is likely to continue. However, it is unlikely that China will take an
extreme militant stance, as that would damage stability in East Asia and hurt
its own economic interests. In the medium term, China equities should be
bolstered by MSCI's revision, effective on May 31, 2000. Large cap red chip
stocks like China Telecom, Legend Holdings and CITIC Pacific are to be included
in the benchmark, raising China's overall weighting in Asian indexes by nearly
ten times.
The real economy in Thailand continued to bounce back after two years of deep
recession. Thailand markets were sold down at the beginning of the year as the
investors anxiously awaited the final ruling of the central bankruptcy court on
the solvency of the country's most indebted company, TPI. On March 15th, the
Thai bankruptcy court ruled TPI insolvent. This was a step in the right
direction, showing commitment to enforce bankruptcy law in line with
international practices. Following the ruling the Thailand market rallied
strongly.
The Indian market turned in a very strong performance during the first two
months of the year, primarily driven by software services and media stocks.
However, the budget for the fiscal year 2000-01 presented on February 29th was
disappointing, bringing the markets down quickly, as the government failed to
address India's key problems on rising central and state fiscal deficits.
Investors were disappointed by the lack of more initiatives on privatization.
Government interest payments are nearing 50% of revenue and the rising fiscal
deficit is placing a constraint on India's ability to grow. India, however,
continues to be a strong bottom-up story. The performance of India's software
services sector over the past five years in terms of revenue/profit growth and
market value-added has focused government attention on promoting investments in
knowledge sectors such as telecom, media, technology and pharmaceuticals. The
benign domestic liquidity conditions are an added positive for the markets. With
interest rates lower in nominal terms than they have been for many years, money
has been flowing rapidly into the domestic mutual fund industry.
After a strong performance in 1999, the Singapore stock market underperformed
other Asian indexes in the first quarter of 2000. Most international investors
were already overweight the market and valuations for the overall market were
looking stretched at the beginning of the year. With the changes in MSCI indexes
in second quarter of this year, Singapore's weighting will suffer a relative
decline. The bottom-up restructuring of Singapore companies seems to be losing
momentum. The newly listed semiconductor sector represented by Chartered
Semiconductor and ST Assembly Test Services, are likely to show strong growth in
the coming years as we continue to add these names.
Malaysia was the best performing ASEAN market in the first quarter. While the
exports engine continues to run smoothly, we are seeing a pick up in domestic
consumption. To a large extent, the rise in the Malaysian stock market has been
driven by investors pre-empting MSCI's re-inclusion of Malaysia into its indexes
at end of May 2000. On a purchasing power parity basis, the Malaysian Ringgit is
undervalued by almost 20%, resulting in continuing foreign direct investment.
However, the thriving technology and export sectors are extremely
underrepresented in the listed equity market, leaving very few inspiring
bottom-up stock ideas. The banking and telecom sector heavyweight stocks like
Maybank and Telekom Malaysia are already trading at the higher ends of their
historical valuation ranges.
The outlook for non-Japan Asia as an asset class continues to be positive. While
the risks from a volatile U.S. market and a Fed tightening are well known, Asia
is likely to weather that trend much better. The restructuring undertaken by
Asian companies over the last 2 years should enable the return on equity for the
region to exceed historic levels over the next 3 years. This shift upwards is
more likely to be structural than cyclical. The strategy of focusing on stock
selection, with an emphasis on attractively valued companies that should exceed
consensus expectations, remains unchanged.
JAPAN
Most asset classes globally entered a highly volatile environment during the
first quarter of 2000. In addition, the United States, ECB, UK and Australian
central banks all committed to raising interest rates in order to cool their
respective economies after flushing liquidity into the system during the fourth
quarter 1999 to stem any potential problems related to Y2K.
Markets such as NASDAQ, U.S. Treasuries, oil, the euro and the yen experienced
one of the most dramatic periods of volatility and Japanese equities shifted
focus from the "New Japan" stocks which imploded to "Real Japan" companies. The
market was also able to absorb huge cross-holding sales by institutions during
Japan's fiscal year end during March remarkably well. This was likely because of
the relative stability of the yen, Bank of Japan's "0" interest rate policy and
the fruits of restructuring by large capitalization companies allowing their
free cash flow to be re-invested in information technology. Furthermore, the
economic recovery in Asian economies, where approximately 40% of Japan's exports
go, also began to contribute to chemical, steel and other basic industries'
manufacturing output. Demand for Japanese digital products was also stronger
than supply, which contributed positively to investor sentiment during the first
quarter. In January, hostile
3
<PAGE>
takeover bids were made on three Japanese corporations, another positive
development for "value" investing due to changes in the commercial code which
went into effect in November 1999.
The carnage which hit "New Japan" companies will likely take some time to
recover. Many investors owning Hikari Tsushin or Softbank, the bell-cows of the
new economy, were devastated as they watched (these stocks traded limit down for
many days) their investments implode and were simply unable to sell. On the
other hand, the "Real Japan" companies' outlook appears increasingly promising.
The $180 billion economic stimulus package will begin to be dispersed from April
and larger companies in Japan are experiencing positive cash flow again and will
begin to significantly increase CAPEX spending. While we are cautious for
potential interest rate rises in Japan as the economy improves, it appears
highly unlikely to happen during the second quarter until the July Summit
Meeting in Japan. Fragility in corporate Japan was evidenced by the bankruptcy
by prestigious Nagasakiya and EL Kakuei in the first quarter and the Bank of
Japan will therefore continue to maintain ultra-easy momentary policy for at
least the next several months.
We also believe that restructurings by Japanese companies have allowed
earnings to become highly geared, even with a modest pick-up in sales.
Consumers will see a huge redemption in postal savings during the next
eighteen months and while most of the 10 trillion yen will be re-invested
back to postal savings, some of these funds will likely be spent on both
durable and white goods because of pent up demand. Although Prime Minister
Obuchi's demise from a stroke was truly unfortunate, the new Prime Minister
and cabinet share a similar goal -- revive the economy -- and therefore we
expect little material change in politics.
Our Fund began shifting to deep value and economic sensitive sectors during the
fourth quarter of 1999 including foods, utilities, warehousing and housing
related stocks. During the first quarter, we have reduced positions in certain
high tech companies such as Fujitsu, Sony and Rohm and have added to last year's
purchases with the proceeds.
We believe the shift from "New Japan" to "Real Japan" which occurred during the
first quarter will continue and quality "Real Japan" such as Toyota, NEC,
Hitachi will become leadership stocks in the market for the foreseeable future.
Although the TMT sectors in Japan are yet in early stages of development and
will likely continue to attract investor interest, economic sensitive sectors
and cyclical stocks will become increasing attractive as the economic recovery
gains momentum.
Sincerely,
/s/ Harold J. Schaaff, Jr.*
Harold J. Schaaff, Jr.*
PRESIDENT AND DIRECTOR
April 2000
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.
--------------------------------------------------------------------------------
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.
* HAROLD J. SCHAAFF, JR. WAS ELECTED PRESIDENT AND DIRECTOR OF THE FUND ON MARCH
20, 2000. MR. SCHAAFF JOINED MORGAN STANLEY DEAN WITTER IN 1989 AND IS A
MANAGING DIRECTOR OF MORGAN STANLEY & CO. INCORPORATED AND MORGAN STANLEY DEAN
WITTER INVESTMENT MANAGEMENT INC. HE FORMERLY SERVED AS GENERAL COUNSEL AND
SECRETARY OF MORGAN STANLEY DEAN WITTER INVESTMENT MANAGEMENT INC.
4
<PAGE>
Morgan Stanley Dean Witter Asia-Pacific Fund, Inc.
Investment Summary as of March 31, 2000 (Unaudited)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
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 -7.94% -- 1.11% -- -0.72 % --
One Year 36.39 36.39% 61.94 61.94% 40.06 40.06%
Five Year 22.37 4.12 42.43 7.33 9.69 1.87
Since Inception* -8.44 -1.55 29.91 4.73 1.41 0.25
</TABLE>
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
--------------------------------------------------------------------------------
RETURNS AND PER SHARE INFORMATION
[GRAPH]
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
THREE MONTHS
ENDED
MARCH 31,
1994* 1995 1996 1997 1998 1999 2000
------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value Per Share.... $13.20 $14.34 $11.95 $8.77 $8.73 $15.26 $15.43
Market Value Per Share....... $12.25 $13.33 $ 9.75 $7.44 $7.00 $11.81 $10.88
Premium/(Discount)........... -7.2% -7.0% -18.4% -15.2% -19.8% -22.6% -29.5%
Income Dividends............. $ 0.04 $ 0.05 $ 0.61 $0.02 $0.01 $ 0.04 --
Capital Gains Distributions.. $ 0.01 $ 0.02 -- -- -- -- --
Fund Total Return (2)........ -5.94% 9.24% -2.87%+ -26.36% -0.34% 75.39% 1.11%
Index Total Return (3)....... -5.24% 2.88% -3.63% -29.55% -0.30% 54.79% -0.72%
</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.
5
<PAGE>
Morgan Stanley Dean Witter Asia-Pacific Fund, Inc.
Investment Summary as of March 31, 2000 (Unaudited)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
DIVERSIFICATION OF TOTAL INVESTMENTS
[CHART]
<TABLE>
<S> <C>
Equity Securities (99.2%)
Short-Term Investments (0.8%)
</TABLE>
--------------------------------------------------------------------------------
INDUSTRIES
[CHART]
<TABLE>
<S> <C>
Banks (5.3%)
Chemicals (3.6%)
Computers & Peripherals (9.5%)
Diversified Financials (5.5%)
Diversified Telecommunication Services (5.7%)
Electronic Equipment & Instruments (7.2%)
Household Durables (6.8%)
Machinery (6.2%)
Real Estate (4.1%)
Semiconductor Equipment & Products (9.0%)
Other (37.1%)
</TABLE>
--------------------------------------------------------------------------------
COUNTRY WEIGHTINGS
[CHART]
<TABLE>
<S> <C>
Japan (47.6%)
Hong Kong (11.8%)
Taiwan (8.7%)
South Korea (8.2%)
Australia (7.8%)
India (6.1%)
Singapore (4.4%)
Malaysia (2.2%)
Thailand (1.2%)
New Zealand (0.4%)
Other (1.6%)
</TABLE>
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TEN LARGEST HOLDINGS*
<TABLE>
<CAPTION>
PERCENT OF
NET ASSETS
<S> <C>
1. Samsung Electronics (South Korea) 3.4%
2. Hutchinson Whampoa Ltd. (Hong Kong) 3.0
3. Sony Corp. (Japan) 2.7
4. Cheung Kong (Holdings) Ltd. (Hong Kong) 2.2
5. NEC Corp. (Japan) 2.1
6. Taiwan Semiconductor Manufacturing
Co., Ltd. (Taiwan) 2.0
7. Nintendo Co., Ltd. (Japan) 1.8
8. Fujitsu Ltd. (Japan) 1.7
9. Infosys Technology Ltd. (India) 1.7
10. Toshiba Company (Japan) 1.6
-----
22.2%
=====
</TABLE>
* Excludes short-term investments.
6
<PAGE>
FINANCIAL STATEMENTS
--------
STATEMENT OF NET ASSETS (UNAUDITED)
--------
MARCH 31, 2000
<TABLE>
<CAPTION>
VALUE
SHARES (000)
----------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS(99.0%)
(Unless otherwise noted)
----------------------------------------------------------------------------
AUSTRALIA(7.8%)
AIRLINES
Airways Ltd. 932,300 U.S.$ 1,945
--------------------
BANKS
Commonwealth Bank of Australia 226,700 3,099
National Australia Bank Ltd. 388,350 4,989
Westpac Banking Corp., Ltd. 734,150 4,592
--------------------
12,680
--------------------
BEVERAGES
Coca-Cola Amatil Ltd. 461,200 1,147
Foster's Brewing Group Ltd. 1,340,000 3,324
--------------------
4,471
--------------------
BIOTECHNOLOGY
Sonic Healthcare Ltd. 242,000 873
--------------------
COMMERCIAL SERVICES & SUPPLIES
Davnet Ltd. 1,027,200 3,364
--------------------
DIVERSIFIED FINANCIALS
Lend Lease Corp., Ltd. 246,300 3,181
--------------------
DIVERSIFIED TELECOMMUNICATION SERVICES
AAPT Ltd. 583,798 3,399
Macquarie Corporate
Telecommunications Holdings Ltd. 1,008,000 1,834
Telstra Corp., Ltd. 2,098,950 8,477
--------------------
13,710
--------------------
ELECTRONIC EQUIPMENT & INSTRUMENTS
E.R.G. Ltd. 122,060 840
--------------------
INDUSTRIAL CONGLOMERATES
Brambles Industries Ltd. 109,500 2,783
--------------------
MEDIA
News Corp., Ltd. 883,350 12,333
--------------------
METALS & MINING
Broken Hill Proprietary Co.,
Ltd. 665,150 7,198
Normandy Mining Ltd. 2,501,600 1,320
Rio Tinto Ltd. 592,600 8,415
--------------------
16,933
--------------------
PHARMACEUTICALS
CSL Ltd. 61,350 763
--------------------
SOFTWARE
Solution 6 Holdings Ltd. 201,100 1,299
--------------------
75,175
--------------------
----------------------------------------------------------------------------
CHINA(0.3%)
OIL & GAS
PetroChina Company Ltd. 15,487,000 2,546
--------------------
PERSONAL PRODUCTS
Hengan International Group Co.,
Ltd. 1,549,700 358
--------------------
2,904
--------------------
----------------------------------------------------------------------------
HONG KONG(11.8%)
AIRLINES
Cathay Pacific Airways 1,529,000 U.S.$ 2,268
--------------------
BANKS
Hang Seng Bank Ltd. 226,500 1,978
Wing Hang Bank Ltd. 305,000 764
--------------------
2,742
--------------------
COMMERCIAL SERVICES & SUPPLIES
Cosco Pacific Ltd. 1,472,000 855
--------------------
COMPUTERS & PERIPHERALS
Legend Holdings Ltd. 1,552,000 2,422
--------------------
DISTRIBUTORS
Li & Fung Ltd. 1,100,000 5,100
--------------------
DIVERSIFIED FINANCIALS
China Merchants Holdings
International Co. Ltd. 1,302,000 844
Hutchison Whampoa Ltd. 1,584,500 28,591
Swire Pacific Ltd. 'A' 741,600 3,829
--------------------
33,264
--------------------
DIVERSIFIED TELECOMMUNICATION SERVICES
Hong Kong Telecommunications
Ltd. 3,405,900 8,923
--------------------
ELECTRICAL EQUIPMENT
Johnson Electric Holdings
Ltd. 275,000 1,880
--------------------
ELECTRONIC EQUIPMENT & INSTRUMENTS
Great Wall Technology Co., Ltd. 2,717,000 2,739
TCL International 1,918,000 1,441
--------------------
4,180
--------------------
GAS UTILITIES
Hong Kong & China Gas Co., Ltd. 1,835,000 2,298
--------------------
INTERNET SOFTWARE & SERVICES
Sino-i.com Ltd. 6,295,000 606
SUNeVision Holdings Ltd. 249,585 417
--------------------
1,023
--------------------
IT CONSULTING & SERVICES
Timeless Software Ltd. 1,398,000 893
--------------------
MEDIA
Asia Satellite Telecom Holdings 606,000 2,374
Television Broadcasts Ltd. 382,000 3,397
--------------------
5,771
--------------------
REAL ESTATE
Cheung Kong (Holdings) Ltd. 1,425,000 21,321
Hong Kong Land Holdings Ltd. 572,000 795
Sino Land Co. 2,899,000 1,210
Sun Hung Kai Properties Ltd. 928,546 8,049
--------------------
31,375
--------------------
SEMICONDUCTOR EQUIPMENT & PRODUCTS
ASM Pacific Technology 256,000 868
--------------------
WIRELESS TELECOMMUNICATION SERVICES
China Telecom Ltd. 1,056,000 9,256
Smartone Telecommunications 191,000 698
--------------------
9,954
--------------------
113,816
--------------------
----------------------------------------------------------------------------
7
<PAGE>
<CAPTION>
VALUE
SHARES (000)
----------------------------------------------------------------------------
<S> <C> <C>
INDIA(6.1%)
AUTO COMPONENTS
Apollo Tyres Ltd. 15,875 U.S.$ 43
--------------------
AUTOMOBILES
Hero Honda Ltd. 66,556 1,481
--------------------
BANKS
State Bank of India Ltd. 1,112 5
--------------------
CHEMICALS
Grasim Co. 297,628 2,068
Gujarat Narmada Valley Fertilizers
Co., Ltd. GDR 49 --@
Supreme Industries Ltd. 50 --@
--------------------
2,068
--------------------
COMMUNICATIONS EQUIPMENT
Himachal Futuristic
Communications 10,000 388
--------------------
COMPUTERS & PERIPHERALS
Digital Equipment (India)
Ltd. 100 2
Moser-Baer India Ltd. 98,475 799
--------------------
801
--------------------
CONSTRUCTION & ENGINEERING
Larsen & Toubro Ltd. 140,000 923
--------------------
CONSTRUCTION MATERIALS
Associated Cement Co., Ltd. 8,600 27
Gujarat Ambuja Cements 255,000 1,246
--------------------
1,273
--------------------
DIVERSIFIED FINANCIALS
(b)Morgan Stanley Growth Fund 19,448,100 6,780
--------------------
DIVERSIFIED TELECOMMUNICATION SERVICES
Mahanagar Telephone Nigam Ltd. 468,127 2,523
Videsh Sanchar Nigam Ltd. 75,810 3,200
--------------------
5,723
--------------------
ELECTRIC UTILITIES
BSES Ltd. 258,000 1,407
--------------------
ELECTRICAL EQUIPMENT
Bharat Heavy Electricals
Ltd. 450,200 1,291
Sterlite Industries 73,750 1,320
--------------------
2,611
--------------------
GAS UTILITIES
Gas Authority Of India 135,000 1,019
--------------------
INDUSTRIAL CONGLOMERATES
Ramco Industries Ltd. 8,400 96
--------------------
IT CONSULTING & SERVICES
HCL Technologies Ltd. 34,750 1,386
NIIT Ltd. 26,000 1,223
Ramco Sysytems Ltd. 23,400 1,868
--------------------
4,477
--------------------
MACHINERY
Escorts Ltd. 180,000 611
Punjab Tractors Ltd. 80,900 1,414
--------------------
2,025
--------------------
METALS & MINING
Tata Iron & Steel Co., Ltd. 2,195 6
--------------------
OIL & GAS REFINING & MARKETING
UTI-MasterShares Ltd. 200 --@
--------------------
PHARMACEUTICALS
Ranbaxy Laboratories Ltd. 68,000 1,103
--------------------
Container Corp. of India
Ltd. 375,000 U.S.$ 1,315
--------------------
SOFTWARE
Aptech Ltd. 82,400 3,512
Infosys Technology Ltd. 78,150 15,956
Leading Edge Systems Ltd. 24,600 1,126
SSI Ltd. 130,000 1,872
Tata Infotech Ltd. 25 --@
--------------------
22,466
--------------------
TEXTILES & APPAREL
J.K. Synthetics Ltd. 674 --@
Shopper Stop 324,100 1,189
Viniyoga Clothes Ltd. 5,300 --@
--------------------
1,189
--------------------
TOBACCO
ITC Ltd. 70,455 1,188
--------------------
58,387
--------------------
----------------------------------------------------------------------------
INDONESIA(0.3%)
DIVERSIFIED TELECOMMUNICATION SERVICES
Telekomunikasi Indonesia ADR 208,356 1,980
--------------------
FOOD PRODUCTS
Indofood Sukses Makmur 186,500 142
Indofood Sukses Makmur (Foreign) 453,500 344
--------------------
486
--------------------
TOBACCO
Gudang Garam 294,000 561
--------------------
3,027
--------------------
----------------------------------------------------------------------------
JAPAN(47.6%)
AUTO COMPONENTS
Nifco, Inc. 375,000 3,949
--------------------
AUTOMOBILES
Nissan Motor Co. 1,330,000 5,442
Suzuki Motor Co., Ltd. 430,000 6,555
Toyota Motor Corp. 220,000 11,508
--------------------
23,505
--------------------
BANKS
Bank of Tokyo-Mitsubishi,
Ltd. 85,000 1,215
--------------------
BUILDING PRODUCTS
Sanwa Shutter Corp., Ltd. 642,000 1,957
--------------------
CHEMICALS
Daicel Chemical Industries Ltd. 1,220,000 4,160
Kaneka Corp. 859,000 10,727
Lintec Corp. 383,000 3,649
Mitsubishi Chemical Industries 950,000 3,785
Shin-Etsu Polymer Co., Ltd. 702,000 4,397
--------------------
26,718
--------------------
COMMERCIAL SERVICES & SUPPLIES
Dai Nippon Printing Co., Ltd. 413,000 6,703
Nissha Printing Co., Ltd. 105,000 632
--------------------
7,335
--------------------
----------------------------------------------------------------------------
8
<PAGE>
<CAPTION>
VALUE
SHARES (000)
----------------------------------------------------------------------------
<S> <C> <C>
JAPAN(CONTINUED)
COMPUTERS & PERIPHERALS
Fujitsu Ltd. 528,000 U.S.$ 16,202
Mitsumi Electric Co., Ltd. 336,000 12,307
NEC Corp. 692,000 20,425
Toshiba Corp. 1,545,000 15,743
--------------------
64,677
--------------------
CONSTRUCTION & ENGINEERING
Kurita Water Industries
Ltd. 295,000 5,719
--------------------
DISTRIBUTORS
Nissei Sangyo 129,000 1,468
--------------------
DIVERSIFIED FINANCIALS
Hitachi Credit Corp. 418,400 7,479
--------------------
DIVERSIFIED TELECOMMUNICATION SERVICES
Nippon Telephone &
Telegraph Corp. 932 14,799
--------------------
ELECTRIC UTILITIES
Tokyo Electric Power 182,000 3,989
--------------------
ELECTRICAL EQUIPMENT
Furakawa Electric Co. 385,000 6,469
Kyudenko Co., Ltd. 380,000 1,144
--------------------
7,613
--------------------
ELECTRONIC EQUIPMENT & INSTRUMENTS
Hitachi Ltd. 981,000 11,649
Kyocera Corp. 75,000 12,537
Ryosan Co., Ltd. 173,000 3,291
TDK Corp. 106,000 14,436
--------------------
41,913
--------------------
FOOD & DRUG RETAILING
Family Mart Co., Ltd. 131,200 6,493
--------------------
FOOD PRODUCTS
House Foods Corp. 147,000 2,177
Nippon Meat Packers, Inc. 295,000 3,391
--------------------
5,568
--------------------
HOUSEHOLD DURABLES
Aiwa Co., Ltd. 169,800 2,944
Casio Computer Co., Ltd. 552,000 5,856
Matsushita Electric Industrial
Co., Ltd. 489,000 14,624
Rinnai Corp. 160,700 2,959
Sangetsu Co., Ltd. 137,000 2,642
Sekisui Chemical Co. 1,043,000 3,444
Sekisui House Ltd. 665,000 6,096
Sony Corp. 186,000 26,273
--------------------
64,838
--------------------
LEISURE EQUIPMENT & PRODUCTS
Fuji Photo Film Ltd. 274,000 12,064
Nintendo Co., Ltd. 98,000 17,232
Yamaha Corp. 432,000 3,501
--------------------
32,797
--------------------
MACHINERY
Amada Co., Ltd. 772,000 6,242
Daifuku Co., Ltd. 696,000 6,265
Daikin Kogyo Co. 575,000 10,642
Fuji Machine Co. 193,000 14,345
Fujitec Co., Ltd. 440,000 3,708
Minebea Co., Ltd. 560,000 7,446
Mitsubishi Heavy Industries Ltd. 1,600,000 5,034
Tsubakimoto Chain Co. 832,000 3,485
--------------------
57,167
--------------------
MARINE
Mitsubishi Logistics Corp. 260,000 2,254
--------------------
OFFICE ELECTRONICS
Canon, Inc. 324,000 14,045
Ricoh Co., Ltd. 706,000 15,130
--------------------
29,175
--------------------
PHARMACEUTICALS
Ono Pharmaceutical Co.,
Ltd. 219,000 7,744
Sankyo Co., Ltd. 397,000 9,997
Yamanouchi Pharmaceutical Co., Ltd. 235,000 12,865
--------------------
30,606
--------------------
REAL ESTATE
Keihanshin Real Estate Co. 164,000 492
Mitsubishi Estate Co., Ltd. 457,000 4,955
--------------------
5,447
--------------------
SEMICONDUCTOR EQUIPMENT & PRODUCTS
Rohm Co., Ltd. 31,000 10,781
--------------------
457,462
--------------------
----------------------------------------------------------------------------
MALAYSIA(2.2%)
BANKS
Malayan Banking Bhd 1,138,000 5,001
Public Bank Bhd 1,724,000 1,815
--------------------
6,816
--------------------
BEVERAGES
Carlsberg Brewery (Malaysia) Bhd 1,082,000 4,128
--------------------
DIVERSIFIED TELECOMMUNICATION SERVICES
Telekom Malaysia Bhd 653,000 2,681
--------------------
FOOD PRODUCTS
Nestle Bhd 409,000 1,948
--------------------
HOTELS RESTAURANTS & LEISURE
Tanjong plc 84,000 230
--------------------
INDUSTRIAL CONGLOMERATES
Sime Darby Bhd 651,000 850
--------------------
TOBACCO
British American Tobacco 584,000 4,457
Bhd
--------------------
21,110
--------------------
----------------------------------------------------------------------------
NEW ZEALAND(0.4%)
AIRLINES
Air New Zealand Ltd. 'B' 505,000 584
--------------------
DIVERSIFIED TELECOMMUNICATION SERVICES
Telecom Corp. of New
Zealand Ltd. 671,100 3,032
--------------------
3,616
--------------------
----------------------------------------------------------------------------
PHILIPPINES(0.1%)
MEDIA
ABS-CBN Broadcasting Corp. 834,300 1,176
--------------------
----------------------------------------------------------------------------
9
<PAGE>
<CAPTION>
VALUE
SHARES (000)
----------------------------------------------------------------------------
<S> <C> <C>
SINGAPORE(4.4%)
AIRLINES
Singapore Airlines Ltd. 448,000 U.S.$ 4,187
--------------------
BANKS
DBS Group Holdings Ltd. 629,979 8,316
Oversea-Chinese Banking Corp.,
Ltd. (Foreign) 607,700 3,763
Overseas Union Bank Ltd. 'F' 356,210 1,602
United Overseas Bank Ltd. (Foreign) 298,016 1,828
--------------------
15,509
--------------------
CHEMICALS
Omni Industries Ltd. 594,000 1,395
--------------------
COMPUTERS & PERIPHERALS
Natsteel Electronics Ltd. 532,000 3,480
--------------------
DIVERSIFIED TELECOMMUNICATION SERVICES
Singapore Telecommunications,
Ltd. 1,403,000 2,000
--------------------
ELECTRONIC EQUIPMENT & INSTRUMENTS
Venture Manufacturing Ltd. 279,000 3,830
--------------------
MARINE
Neptune Orient Lines 688,000 607
Sembcorp Logistics Ltd. 378,200 2,673
--------------------
3,280
--------------------
MEDIA
Singapore Press Holdings Ltd. 315,600 5,033
--------------------
REAL ESTATE
City Developments Ltd. 297,000 1,344
--------------------
SEMICONDUCTOR EQUIPMENT & PRODUCTS
Chartered Semiconductor 192,000 1,817
ST Assembly Test Services 99,000 488
--------------------
2,305
--------------------
42,363
--------------------
----------------------------------------------------------------------------
SOUTH KOREA(8.2%)
AUTOMOBILES
(a)Hyundai Motor Co. GDR 5,304 31
--------------------
BANKS
Hana Bank 98,650 602
Housing & Commercial Bank 119,766 2,330
Housing & Commercial Bank GDR 7,400 143
Kookmin Bank 220,851 2,238
--------------------
5,313
--------------------
COMMUNICATIONS EQUIPMENT
Korealink Co Ltd. 11,110 744
LG Information & Communication Ltd. 4,830 607
Opicom Co Ltd. 10,980 854
Teleson Electronics Co., 65,750 988
Ltd.
--------------------
3,193
--------------------
DIVERSIFIED FINANCIALS
Dongwon Securities Co. 43,481 655
Samsung Securities Co., Ltd. 57,670 1,383
--------------------
2,038
--------------------
DIVERSIFIED TELECOMMUNICATION SERVICES
Korea Telecom Corp. ADR 35,500 1,553
--------------------
ELECTRIC UTILITIES
Korea Electric Power Corp. ADR 246,000 3,890
--------------------
ELECTRONIC EQUIPMENT & INSTRUMENTS
Communication Network Interface
Inc. 72,530 U.S.$ 1,053
Daeduck Electronics Co. 81,959 927
Humax Co., Ltd. 92,400 1,371
Pantech Co., Ltd. 50,424 995
Prochips Technology Inc. 62,000 578
Samsung Electro-Mechanics Co. 31,981 2,234
--------------------
7,158
--------------------
EQUITY
Mirae Co. Ltd. ADR 34,600 375
--------------------
FOOD PRODUCTS
Cheil Jedang Corp. 21,674 1,426
Tongyang Confectionery Co. 31,030 870
--------------------
2,296
--------------------
INTERNET & CATALOG RETAIL
LG Home Shopping Inc. 12,250 1,308
--------------------
MEDIA
39 Shopping Corp. 21,850 1,404
Cheil Communications Inc. 13,340 1,653
--------------------
3,057
--------------------
METALS & MINING
Pohang Iron & Steel Ltd.
ADR 112,500 3,094
--------------------
OIL & GAS
Yukong Ltd. (Foreign) 70,410 1,624
--------------------
SEMICONDUCTOR EQUIPMENT & PRODUCTS
Hyundai Electronics Industries
Co. 49,077 1,092
Mirae Co. Ltd. 116,890 656
Samsung Electronics 108,417 32,861
--------------------
34,609
--------------------
WIRELESS TELECOMMUNICATION SERVICES
SK Telecom Co., Ltd. 229,600 8,954
--------------------
78,493
--------------------
----------------------------------------------------------------------------
TAIWAN(8.7%)
BANKS
Chinatrust Commercial Bank 1,278,000 1,247
International Commercial Bank of
China 1,029,500 1,008
Taishin International Bank 1,833,200 1,121
United World Chinese Commercial Bank 962,000 1,157
--------------------
4,533
--------------------
CHEMICALS
Formosa Plastics Corp. 547,000 1,231
Nan Ya Plastic Corp. 1,265,290 2,932
--------------------
4,163
--------------------
COMMUNICATIONS EQUIPMENT
Microelectronics Technology 308,000 1,508
--------------------
COMPUTERS & PERIPHERALS
Acer Peripherals Inc. 748,960 3,766
Acer, Inc. 1,289,000 3,622
Advantech Co. Ltd. 161,000 1,407
Asustek Computer, Inc. 539,000 6,748
Compal Electronics 116,587 485
Compeq Manufacturing Co., Ltd. 268,000 1,761
----------------------------------------------------------------------------
10
<PAGE>
<CAPTION>
VALUE
SHARES (000)
----------------------------------------------------------------------------
<S> <C> <C>
COMPUTERS & PERIPHERALS (CONTINUED)
Ritek Incorporation 85,000 U.S.$ 782
Wyse Technology Taiwan Ltd. 451,000 1,586
--------------------
20,157
--------------------
ELECTRONIC EQUIPMENT & INSTRUMENTS
Ambit Microsystems Corp. 85,000 1,003
Delta Electronic Industrial 361,000 1,981
Hon Hai Precision Industry 475,200 5,513
Universal Scientific IND 174,000 869
--------------------
9,366
--------------------
FOOD & DRUG RETAILING
President Chain Store Corp. 411,000 1,918
--------------------
INTERNET SOFTWARE & SERVICES
GigaMedia Ltd. 9,100 494
--------------------
METALS & MINING
China Steel Corp. 1,691,000 1,217
--------------------
SEMICONDUCTOR EQUIPMENT & PRODUCTS
Advanced Semiconductor
Engineering, Inc. 706,000 2,668
ASE Test Ltd. 30,800 893
Macronix International 322,000 921
Siliconware Precision Industries Co. 926,000 2,069
Taiwan Semiconductor Manufacturing
Co., Ltd. 2,843,000 19,153
United Micro Electronics Corp., Ltd. 3,153,000 12,226
--------------------
37,930
--------------------
TEXTILES & APPAREL
(a)Far Eastern Textile Ltd. 941,040 1,948
Far Eastern Textile Ltd. GDR 7,100 186
--------------------
2,134
--------------------
83,420
--------------------
----------------------------------------------------------------------------
THAILAND(1.1%)
BANKS
Thai Farmers Bank Ltd. (Foreign) 1,611,600 1,779
--------------------
CONSTRUCTION MATERIALS
Siam City Cement Public Co.,
Ltd. (Foreign) 251,933 846
--------------------
ELECTRONIC EQUIPMENT & INSTRUMENTS
Delta Electronics Public Co.,
Ltd. (Foreign) 183,015 2,313
--------------------
MEDIA
BEC World Public Co., Ltd.
(Foreign) 143,500 1,070
--------------------
REAL ESTATE
Golden Land Property
Development Public Co., Ltd. 2,849,000 746
--------------------
WIRELESS TELECOMMUNICATION SERVICES
Advanced Info. Services Public
Co., Ltd. (Foreign) 231,000 3,481
--------------------
10,235
--------------------
----------------------------------------------------------------------------
TOTAL COMMON STOCKS
(Cost U.S.$694,068) 951,184
--------------------
<CAPTION>
NO. OF VALUE
RIGHTS (000)
----------------------------------------------------------------------------
<S> <C> <C>
RIGHTS (0.0%)
----------------------------------------------------------------------------
SOUTH KOREA
DIVERSIFIED FINANCIALS
Dongwon Securities Co.
(Cost U.S.$--) 41,410 U.S.$ 16
--------------------
----------------------------------------------------------------------------
<CAPTION>
NO. OF
WARRANTS
----------------------------------------------------------------------------
<S> <C> <C>
WARRANTS(0.1%)
----------------------------------------------------------------------------
INDIA(0.0%)
AUTO COMPONENTS
Apollo Tyres Ltd. 2,150 --@
--------------------
----------------------------------------------------------------------------
THAILAND(0.1%)
BANKS
Siam Commercial Bank
Public Co., Ltd.,
expiring 5/10/02 1,727,300 468
--------------------
----------------------------------------------------------------------------
TOTAL WARRANTS
(Cost U.S.$140) 468
--------------------
----------------------------------------------------------------------------
<CAPTION>
FACE
AMOUNT
(000)
----------------------------------------------------------------------------
<S> <C> <C>
SHORT-TERM INVESTMENTS(0.2%)
----------------------------------------------------------------------------
UNITED STATES(0.2%)
REPURCHASE AGREEMENT
Chase Securities, Inc.,
5.90%, dated 3/31/00,
due 4/03/00, to be
repurchased at U.S.
$1,618, collateralized
by U.S. $1,635 United
States Federal Home Loan
Note, 5.75%, due 7/15/03
(Cost U.S.$1,617) U.S.$ 1,617 1,617
--------------------
----------------------------------------------------------------------------
FOREIGN CURRENCY ON DEPOSIT WITH
CUSTODIAN(0.6%)
Hong Kong Dollar HKD 7 1
Indian Rupee INR 59 1
Malaysian Ringgit MYR 5,104 1,343
Pakistani Rupee PDR 257,982 4,772
South Korean Won KRW 3,871 4
Taiwan Dollar TWD 1,146 38
--------------------
(Cost U.S.$6,160) 6,159
--------------------
----------------------------------------------------------------------------
11
<PAGE>
<CAPTION>
AMOUNT VALUE
(000) (000)
----------------------------------------------------------------------------
<S> <C> <C>
TOTAL INVESTMENTS(99.9%)
(Cost U.S.$701,985) U.S.$ 959,444
--------------------
----------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES (0.1%)
Other Assets U.S.$ 7,480
Liabilities (6,518) 962
--------------------- --------------------
----------------------------------------------------------------------------
NET ASSETS (100%)
Applicable to 62,233,974 issued and outstanding
U.S.$0.01 par value shares (100,000,000
shares authorized) U.S.$ 960,406
--------------------
----------------------------------------------------------------------------
NET ASSET VALUE PER SHARE U.S.$ 15.43
--------------------
----------------------------------------------------------------------------
</TABLE>
(a) -- 144A Security--certain conditions for public sale may exist.
(b) -- The Fund is advised by an affiliate.
@ -- Value is less than U.S.$500.
GDR -- Global Depositary Receipt.
ADR -- American Depositary Receipt.
