MATTHEWS INTERNATIONAL FUNDS, 497, 1999-12-29

MATTHEWS INTERNATIONAL FUNDS
497, 1999-12-29

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<PAGE> 1

INTRODUCTION
- --------------------------------------------------------------------------------

HOW TO USE THIS DOCUMENT.

This document is called a prospectus. It is intended to explain to you
the information that you need to know so that you may make an informed
decision as to whether an investment in one or more of Matthews
International Funds is right for you.

This prospectus begins with some general information which is then
explained in greater detail further in the document. A second document
called the "Statement of Additional Information" or SAI for short,
provides expanded information and much greater detail than the
prospectus.

The SAI is available to you free of charge. To receive an SAI, please
call 1.800.789.2742, visit our site on the internet at
"www.matthewsfunds.com" or visit the SEC's web site at "www.sec.gov" and
go into the EDGAR database.

Please read this document carefully before you make any investment
decision and if you have any questions, do not hesitate to contact us at
1.800.789.2742. Also, please keep this prospectus with your papers for
future reference.

DEFINITIONS
THE FOLLOWING WORDS HAVE SPECIAL MEANING IN THIS PROSPECTUS:

2. Pacific Tiger refers to certain Asian countries whose economies have
been and are expected to continue to rapidly develop. Those countries
include: China, Hong Kong, Indonesia, Malaysia, the Philippines,
Singapore, South Korea, Taiwan and Thailand, but not Japan.

3. Asia refers to the Pacific Tiger countries plus Japan and India.

4. What is considered to be an "Asian Company?" A company is considered
to be "Asian" or "located" in a particular country in Asia if:

(i) it is organized under the laws of China, Hong Kong, India,
Indonesia, Japan, Malaysia, the Philippines, Singapore, South Korea,
Taiwan or Thailand, or

(ii) it derives at least 50% of its revenues or profits from goods
produced or sold, investments made, services performed, or has at
least 50% of its assets located in one of these countries or

(iii) it has the primary trading markets for its securities in one of
these countries or

(iv) it is a governmental entity or an agency or instrumentality or
political subdivision of such country.

5. Matthews or The Advisor means Matthews International Capital
Management, LLC, the company which manages the money which is invested
into the Funds.

SUMMARY INFORMATION

INVESTMENT GOALS OF THE FUNDS

The investment goal of all six Matthews International Funds is long term
capital appreciation. In addition, Matthews Asian Growth and Income Fund
seeks to provide some current income as well.
<PAGE> 2

MATTHEWS' INVESTMENT STRATEGY
- --------------------------------------------------------------------------------

How Matthews chooses investments for each of the Funds is known as an
investment strategy. The strategy Matthews uses is called "Growth at a
Reasonable Price." This means that the investment team studies the
fundamental characteristics of companies appropriate for each Fund and
from those fundamentals makes a judgment that certain companies are
poised for growth, and at the same time are available to the Funds at a
reasonable price. In addition Matthews may use currency hedging
techniques such as forward foreign currency contracts which help
neutralize the impact of the changes in the value of local Asian
currencies as compared to the U.S. dollar.

Fundamental characteristics of a company include the people who are
running the company, the products it makes, the marketing strategy it is
following and its financial health.

The size of a company, which Matthews measures by its market
capitalization (the number of shares outstanding times the market price
per share) is not considered by Matthews when it decides whether to
include that company's securities in one or more of the Funds.

If Matthews believes that market conditions are developing in a way that
is not good for the shareholders, it may sell all of a Fund's securities
and temporarily invest the Funds' money in U.S. Government securities. As
of the date of this prospectus this has never happened, but if it were to
occur, the investment goals of the Funds may not be achieved.

PRINCIPAL INVESTMENT STRATEGIES OF THE FUNDS
- --------------------------------------------------------------------------------

MATTHEWS ASIAN GROWTH AND INCOME FUND invests a substantial portion of
its assets in the convertible securities of companies located in Asia.
Examples of convertible securities are convertible bonds and debentures
which may under specific circumstances, be converted into the common or
preferred stock of that company.

MATTHEWS ASIAN TECHNOLOGY FUND invests a substantial portion of its
assets in the common and preferred stock of companies located in Asia
which derive a substantial portion of their revenues from the sale of
products or services in technology-related industries and services.

Matthews considers technology related industries and businesses to
include, among others, telecommunications, telecommunications equipment,
computers, semiconductors, semiconductor capital equipment, networking,
internet and on-line service companies, office automation, server
hardware producers, software companies (e.g., design, consumer and
industrial) biotechnology and medical device technology companies, and
companies involved in the distribution and servicing of these products.

MATTHEWS DRAGON CENTURY CHINA FUND invests a substantial portion of its
assets in the common and preferred stock of companies located in China.
China includes Taiwan and Hong Kong.

MATTHEWS JAPAN FUND invests a substantial portion of its assets in the
common and preferred stock of companies located in Japan.

MATTHEWS KOREA FUND invests a substantial portion of its assets in the
common and preferred stock of companies located in South Korea.

MATTHEWS PACIFIC TIGER FUND invests a substantial portion of its assets
in the common and preferred stock of companies located in the Pacific
Tiger countries.
<PAGE> 3

PRINCIPAL RISKS OF INVESTING IN THE FUNDS
- --------------------------------------------------------------------------------

The most important risk to understand is that there is no guarantee that
your investment in the Funds will increase in value. The value of your
investment in the Funds could go down, meaning you could lose money.

The Funds concentrate their investments in Asia. The Asian markets can be
very volatile for many reasons including the size of the local economies
(as compared with the United States) and each country's unique political
structure. This volatility can cause the price of the Funds' shares (the
net asset value or "NAV") to go up or down dramatically. Because of this
volatility, we recommend that you invest in the Funds as a long term
investment only, and only for a portion of your investment portfolio, not
for all of it.

Further, when one of the Funds buys or sells stock on an Asian stock
market, the transaction is made in the local currency. The price that the
Funds must purchase or sell local currency will impact the value of your
shares in the Funds. These and other risks are more fully discussed below
and in the SAI.

The Advisor uses certain hedging techniques to help neutralize the impact
of changes in the value of local Asian currencies. The Advisor's ability
to anticipate changes in the price of foreign currencies is not always
accurate, however, which may limit the full benefit of a currency move in
the Fund's favor, but at the same time may limit the detriment when the
currency moves against the Fund.

The principal investments of all the Funds except the Asian Growth and
Income Fund are common and preferred stocks. The major risk involved with
the ownership of common and preferred stock is that the Fund may lose
money if the value of a stock goes down during the time that the Fund
owns it.

RISKS ASSOCIATED WITH NON-UNITED STATES COMPANIES

Investments by the Funds in the securities of non U.S. issuers involve
investment risks different from those of U.S. issuers. These risks
include:

- Possible political or economic instability of the country of issue
- Predicting international trade patterns incorrectly
- Possibility of currency exchange controls
- Imposition of foreign withholding taxes
- Seizure or nationalization of foreign deposits or assets
- Adoption of adverse foreign government trade restrictions

There may be less publicly available information about a foreign company
than about a domestic company. Sometimes non U.S. companies are subject
to different accounting, auditing and financial reporting standards,
practices and requirements than U.S. companies. There is generally less
government regulation of stock exchanges, brokers and listed companies
abroad than in the United States, and the absence of negotiated brokerage
commissions in certain countries may result in higher brokerage fees.
With respect to certain non U.S. countries, there is a possibility of
expropriation, nationalization, confiscatory taxation, or diplomatic
developments that could affect investments in those countries.
<PAGE> 4

In addition, brokerage commissions, custodian services, withholding
taxes, and other costs relating to investment in foreign markets
generally are more expensive than in the United States.

RISKS ASSOCIATED WITH SMALLER COMPANIES (SO-CALLED "SMALL-CAP" COMPANIES)

The Funds may invest in securities of issuers of various sizes, large or
small. Smaller companies often have limited product lines, markets or
financial resources, and they may be dependent upon one or a few key
people for management. The securities of such companies generally are
subject to more abrupt or erratic market movements and may be less liquid
than securities of larger, more established companies or the market
averages in general.

LONG TERM INVESTING AND VOLATILITY

Dramatic changes (volatility) in the price of an investment can be
dangerous because you may have planned or may need to sell your
investment just at a time when its value has decreased. We recommend an
investment in the Funds only as a long term investment (5 years and
longer) because you will be better able to plan to sell your shares at a
time when this volatility will not be as great a factor in your decision
process.

MATTHEWS ASIAN GROWTH AND INCOME FUND

UNIQUE RISKS: In addition to the "Principal risks" noted above, the
ownership of convertible securities and bonds have different kinds of
risks than those of the ownership of common and preferred stock. These
risks include interest rate risk and principal risk. The principal of a
bond refers to the amount of money that was borrowed when the bond was
issued. This principal could be lost if the borrower cannot make timely
payment on the bond (default). In the event of a default the Fund could
lose money. Further, in the event that market interest rates increase,
the bond's market value will go down, which means that if the Fund sold a
bond during that time it would get less money for it. Also, many Asian
convertible securities and bonds are not rated by rating agencies like
Moody's or Standard & Poor's, or if they are rated, they're rated below
investment grade. These securities are commonly referred to as "junk
bonds" and may have a greater risk of default.

Since this Fund may invest in companies from many different countries,
each country's size, level of economic development and governmental
stability will have an impact on the value of those companies. In
general, the economies of these countries are smaller and less developed
than in the United States. Their stock exchanges and brokerage industries
do not have the level of government oversight as do those in the United
States and sometimes their governments are unstable. Each of these
factors can cause these stock markets to be more volatile. Please read
the SAI for an extensive presentation of these and other risk factors.

MATTHEWS ASIAN TECHNOLOGY FUND

UNIQUE RISKS: In addition to the "Principal Risks" noted above as a
sector fund that invests in technology companies, the Fund is subject to
the risks associated with this sector. This makes the Fund more
vulnerable to price changes of securities of issuers in technology
related industries and factors that affect the technology industry than a
more broadly diversified mutual fund.

Certain technology related companies may face special risks that their
products or services may not prove to be commercially successful.
Technology related companies are also strongly affected by worldwide
scientific or technological developments. As a result, their products may
rapidly become obsolete which could cause a dramatic decrease in the
value of their stock. Such companies are also often subject to
governmental regulation and may therefore be adversely affected by
governmental policies.
<PAGE> 5

MATTHEWS DRAGON CENTURY CHINA FUND

UNIQUE RISKS: In addition to the "Principal Risks" noted above investing
in the regional markets of China and Hong Kong involves risks and
considerations not present when investing in more established securities
markets. Investing in regionally concentrated investment funds should be
considered speculative and thus not appropriate for all investors.

China remains a totalitarian society with the risk of nationalization,
expropriation or confiscation of property. The legal system is still in
its infancy making it more difficult to obtain and/or enforce judgments.

Further, the government could at any time alter or discontinue economic
reform programs implemented since 1978. Military conflicts, either in
response to internal social unrest or conflicts with other countries are
an ever present consideration.

In addition to political risk, investments in China are also subject to
economic risk. There is a potential risk of total loss, including
interest, capital appreciation and principle. There is also a greater
risk involved in currency fluctuations, currency convertibility, interest
rate fluctuations and higher rates of inflation. The emergence of a
domestic consumer class is still at an early stage, making China heavily
dependent on exports.

MATTHEWS JAPAN FUND

UNIQUE RISKS: Japan is the second largest economy in the world, but it
has been in recession lately. The government there has been working to
change certain regulations and policies that could help its economy, but
there is no guarantee that these changes will occur or be effective.

MATTHEWS KOREA FUND

UNIQUE RISKS: In addition to the "Principal Risks" noted above investing
in Korean securities has special risks including:

- substantial government involvement in, and influence on, the economy
and the private sector;
- political, economic and social instability, including the potential
for increasing militarization in North Korea;
- the substantially smaller size and lower trading volume of the
securities markets for Korean equity securities compared to the U.S.
or Japanese securities markets, resulting in a potential lack of
liquidity and increased price volatility;
- that the sale of portfolio securities by the Korean Securities
Stabilization Fund (the "Stabilization Fund"), a fund established in
order to stabilize the Korean securities markets, or other large
Korean institutional investors, may adversely impact the market value
of securities in the Fund's portfolio; and
- heavy concentration of market capitalization and trading volume in a
small number of issuers, which result in potentially fewer investment
opportunities for the Fund.

Risks Associated with North Korea Following World War II, the Korean
peninsula was partitioned. The demilitarized zone at the boundary between
Korea and North Korea was established after the Korean War of 1950-1953
and is supervised by United Nations forces. The United States maintains a
military force in Korea to help deter the ongoing military threat from
North Korean forces. The situation remains a source of tension although
negotiations to ease tensions and resolve the political division of the
Korean peninsula have been carried on from time to time. There also have
been efforts from time to time to increase economic, cultural and
humanitarian contacts between North Korea and Korea. There can be no
assurance that such
<PAGE> 6

negotiations or efforts will continue to occur or will result in an
easing of tension between North Korea and Korea.

Military action or the risk of military action or the economic collapse
of North Korea could have a material adverse effect on Korea, and
consequently, on the ability of the Fund to achieve its investment
objective. Lack of available information regarding North Korea may be the
greatest risk factor.

Risks Associated with the Influence of the Korean Government The Korean
government has historically exercised and continues to exercise
substantial influence over many aspects of the private sector. The Korean
government from time to time has informally influenced the payment of
dividends and the prices of certain products, encouraged companies to
invest or to concentrate in particular industries, induced mergers
between companies in industries suffering from excess capacity and
induced private companies to publicly offer their securities. The Korean
government has sought to minimize excessive price volatility on the KSE
through various steps, including the imposition of limitations on daily
price movements of securities.

Risks Associated with a Non-Diversified Investment Company The Fund is a
"non-diversified" investment company, which means that it may invest a
larger portion of its assets in the securities of a single issuer than a
diversified fund. An investment in the Fund therefore will entail greater
risk than an investment in a diversified investment company because a
higher percentage of investments among fewer issuers may result in
greater fluctuation in the total market value of the Fund's portfolio,
and economic, political or regulatory developments may have a greater
impact on the value of the Fund's portfolio than would be the case if the
portfolio were diversified among more issuers.

MATTHEWS PACIFIC TIGER FUND

UNIQUE RISKS: In addition to the "Principal Risks" noted above and since
this Fund may invest in companies from many different countries, each
country's size, level of economic development and governmental stability
will have an impact on the value of those companies. In general, the
economies of these countries are smaller and less developed than in the
United States. Their stock exchanges and brokerage industries do not have
the level of government oversight as do those in the United States and
sometimes their governments are unstable. Each of these factors can cause
these stock markets to be more volatile. Please read the SAI for an
extensive presentation of these and other risk factors.
<PAGE> 7

PAST PERFORMANCE
- --------------------------------------------------------------------------------

MATTHEWS ASIAN GROWTH AND INCOME FUND
[ANNUAL RETURNS FOR PERIODS ENDED 12/31]

<TABLE>
<CAPTION>
ASIAN GROWTH AND INCOME FUND (%)
--------------------------------
<S> <C>
1995 8.19
1996 13.89
1997 -23.18
1998 1.24
1999
</TABLE>

Best Quarter: 4th - 1998 12.30%
Worst Quarter: 4th - 1997 (25.97%)
Year-to-date Return: 31.85% as of September 30, 1999
AVERAGE ANNUAL TOTAL RETURN FOR PERIODS ENDED DECEMBER 31,
1998

<TABLE>
<CAPTION>
SINCE INCEPTION
1 YEAR SEPTEMBER 12, 1994
-------------------------------
<S> <C> <C>
Matthews Asian Growth and Income Fund 1.24% (1.51%)
*MSCI All Country Far East ex-Japan Index (4.83%) (12.31%)
</TABLE>

---------------------------------
* The MSCI (Morgan Stanley Capital International) All
Country Far East ex-Japan Index is an unmanaged
capitalization-weighted index of stock markets in the
Pacific region excluding Japan.
<PAGE> 8

MATTHEWS KOREA FUND
[ANNUAL RETURNS FOR PERIODS ENDED 12/31]

<TABLE>
<CAPTION>
MATTHEWS KOREA FUND (%)
-----------------------
<S> <C>
1995 -12.73
1996 -31.79
1997 -64.75
1998 96.15
1999
</TABLE>

Best Quarter: 4th - 1998 99.98%
Worst Quarter: 4th - 1997 (64.44%)
Year-to-date Return: 56.86% as of September 30, 1999

AVERAGE ANNUAL TOTAL RETURN FOR PERIODS ENDED DECEMBER 31,
1998

<TABLE>
<CAPTION>
SINCE INCEPTION
1 YEAR JANUARY 3, 1995
-------------------------------
<S> <C> <C>
Matthews Korea Fund 96.15% (19.33%)
*Korea Stock Price Index 98.79% (22.44%)
</TABLE>

---------------------------------
* The Korean Stock Price Index is a
capitalization-weighted index of all common stocks listed
on the Korean Stock Exchange.

MATTHEWS PACIFIC TIGER FUND
[ANNUAL RETURNS FOR PERIODS ENDED 12/31]

<TABLE>
<CAPTION>
PACIFIC TIGER FUND (%)
----------------------
<S> <C>
1995 3.06
1996 24.18
1997 -40.89
1998 -2.86
1999
</TABLE>

Best Quarter: 4th - 1998 38.45%
Worst Quarter: 4th - 1997 (38.17%)
Year-to-date Return: 39.02% as of September 30, 1999
AVERAGE ANNUAL TOTAL RETURN FOR PERIODS ENDED DECEMBER 31,
1998

<TABLE>
<CAPTION>
SINCE INCEPTION
1 YEAR SEPTEMBER 12, 1994
-------------------------------
<S> <C> <C>
Matthews Pacific Tiger Fund (2.86%) (8.03%)
*MSCI All Country Far East ex-Japan Index (4.83%) (12.31%)
</TABLE>

FEES AND EXPENSES
- --------------------------------------------------------------------------------

This table describes the fees and expenses that you may pay if you buy
and hold shares of any of the Funds:

SHAREHOLDER FEES

<TABLE>
<S> <C>
MAXIMUM SALES LOAD IMPOSED ON PURCHASES as a percentage of 0.00%
offering price
MAXIMUM SALES LOAD IMPOSED ON REINVESTED DIVIDENDS as a 0.00%
percentage of offering price
CONTINGENT DEFERRED SALES CHARGE as a percentage of original 0.00%
purchase price
REDEMPTION FEE as a percentage of amount redeemed within 90 2.00%
days of purchase
</TABLE>

<TABLE>
<CAPTION>
OTHER EXPENSES
(INCLUDING TOTAL
MAXIMUM 0.25% ANNUAL FEE REDUCTION NET EXPENSES
MANAGEMENT DISTRIBUTION/ SHAREHOLDER OPERATING AND/OR EXPENSE AFTER
MATTHEWS FUND -- CLASS I FEES 12B-1 FEES SERVICE FEE) EXPENSES REIMBURSEMENT REIMBURSEMENT
----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Asian Growth and Income 1.00% None 1.05% 2.05% 0.15% 1.90%
Asian Technology(1) 1.00% None 2.50% 3.50% 1.50% 2.00%
Dragon Century China 1.00% None 1.09% 2.09% 0.09% 2.00%
Japan 1.00% None 2.45% 3.45% 1.45% 2.00%
Korea 1.00% None 1.02% 2.02% None 2.00%
Pacific Tiger 1.00% None 1.15% 2.15% 0.25% 1.90%
</TABLE>

(1) Estimated; this fund had no operating history.

Under a written agreement between the Funds and the Advisor, the Advisor
agrees to reimburse money to a Fund if its expense ratio exceeds a
certain percentage level as indicated above. In turn, if a Fund's
expenses fall below the level noted above within three years after the
Advisor has made such a reimbursement, a Fund may reimburse the Advisor
up to an amount not to exceed its expense limitation. This agreement will
continue through at least August 31, 2000.

EXAMPLE

Based on the level of expenses listed above, the total expenses relating
to an investment of $10,000 would be as follows, assuming a 5% annual
return, reinvestment of all dividends and distributions and redemption at
the end of each time period.

<TABLE>
<CAPTION>
NAME OF FUND 1 YEAR 3 YEARS 5 YEARS 10 YEARS
-----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Asian Growth and Income Fund $193 $ 628 $1,090 $2,367
Asian Technology Fund $203 $ 935 N/A N/A
Dragon Century China Fund $203 $ 646 $1,115 $2,414
Japan Fund $203 $ 925 $1,669 $3,633
Korea Fund $205 $ 634 $1,088 $2,348
Pacific Tiger Fund $193 $ 649 $1,131 $2,463
</TABLE>

The purpose of this table is to assist the investor in understanding the
various costs and expenses that a shareholder will bear directly or
indirectly. While the example assumes a 5% annual return, each Fund's
actual performance will vary and may result in actual returns greater or
less than 5%. The above example should not be considered a representation
of past or future expenses or performance. Actual expenses of the Funds
will most likely be different than those shown.
<PAGE> 10

THE INVESTMENT PROCESS
- --------------------------------------------------------------------------------

The investment goal of each Fund noted above is fundamental. This means
that it can not be changed without a vote of a majority of the voting
securities of each respective Fund.

The way Matthews attempts to achieve each Fund's investment goals is not
fundamental and may change without shareholder approval. While an
investment policy or restriction may be changed by the Trustees of the
Company without shareholder approval, you will be notified before we make
any material change.

MANAGEMENT OF THE FUNDS
- --------------------------------------------------------------------------------

MATTHEWS INTERNATIONAL CAPITAL MANAGEMENT LLC is the investment advisor
to the Funds. Matthews' address is 456 Montgomery Street, Suite 1200, San
Francisco, California 94104-1245 and can be reached by telephone
toll-free at 1-800-789-2742. The Advisor was founded in 1991 by G. Paul
Matthews who serves as Chief Investment Officer. Each Fund pays an annual
fee of 1% of its total assets to Matthews for the services it provides to
the Funds.

Matthews invests the Funds' assets, manages the Funds' business affairs
and supervises its overall day-to-day operations. Matthews also furnishes
the Funds with office space and certain administrative and clerical
services, and provides the personnel needed by the Funds with respect to
the Advisor's responsibilities under the investment advisory agreement.

PORTFOLIO MANAGERS

<TABLE>
<S> <C>
Asian Growth and Income Fund G. Paul Matthews
Asian Technology Fund Mark W. Headley, G. Paul Matthews and Andrew T. Foster
(assistant)
Dragon Century China Fund G. Paul Matthews, Mark W. Headley and Richard H. Gao
Japan Fund James M. Bogin and Mark W. Headley
Korea Fund Mark W. Headley and G. Paul Matthews
Pacific Tiger Fund Mark W. Headley, G. Paul Matthews and Andrew T. Foster
(assistant)
</TABLE>

G. Paul Matthews: has been actively involved in the Asian financial
markets since 1982. Prior to founding Matthews International Capital
Management in 1991, he served as portfolio manager of G. T. Pacific
Growth Fund from 1982-85. While residing in Hong Kong, Mr. Matthews
oversaw all Asian investment from 1985-88 for G. T. Management Asia. From
1989 to 1991 he was self-employed. Mr. Matthews holds an M.A. in history
and law from Cambridge University in the United Kingdom.

Mark W. Headley: joined Matthews International as managing director and
as senior analyst on the investment team in 1995. He has over 10 years of
experience in the Asian Tiger markets. From 1989 to 1992 he held various
positions at Newport Pacific Management and its subsidiaries. In 1992,
Mr. Headley moved to Hong Kong, where he served as a director of Regent
Fund Management. He returned to San Francisco in 1993 and joined
Litman/Gregory & Co. as director of international investments. Mr.
Headley holds a B.A. in Economics and Politics from the University of
California at Santa Cruz.

James M. Bogin: joined Matthews International in 1998 as a portfolio
manager. Prior to joining Matthews, Mr. Bogin served as senior portfolio
manager from 1993-97 at LGT Asset Management in San Francisco where

<PAGE> 11

he managed Global Developing Markets portfolios. Mr. Bogin began his
investment career in Tokyo where he worked as an equity analyst from
1985-87. In 1987, he moved to Hong Kong where he worked as a portfolio
manager. Mr. Bogin moved back to Tokyo in 1989 as a portfolio manager for
Nomura Investment Management Tokyo where he managed mutual funds
investing in Asian equities. Mr. Bogin is fluent in Japanese. He holds a
masters' degree in International Management, Finances from American
Graduate School of International Management in Glendale Arizona as well
as a B.A. in the Classics from Harvard College in Cambridge
Massachusetts.

Richard H. Gao: joined Matthews International in 1997 as China analyst.
In 1999 he was promoted to portfolio manager of the Dragon Century China
Fund. In 1989 Mr. Gao served as a loan officer at the Bank of China in
the city of Guanzhow, China. He later became a foreign exchange trader at
the Bank of China's Treasury Department in 1991. From 1993 through 1994
he served as assistant manager in charge of foreign exchange trading for
import/export companies at the Bank. Mr. Gao holds an M.B.A. from
Dominican College of San Rafael and is fluent in three Chinese languages:
Mandarin, Cantonese and Shanghaiese.

Andrew T. Foster: joined Matthews International in November 1998 as an
analyst and was promoted to assistant portfolio manager in August 1999.
Prior to joining Matthews, Mr. Foster provided management consulting
services for A.T. Kearney and was based in Singapore from 1996 to 1998.
During the years 1992 through 1996 Mr. Foster attended Stanford
University where he was awarded a dual degree in Public Policy, with
honors, and in Economics.

All members of the investment team travel extensively to Asia to conduct
research relating to those markets.

SHAREHOLDER INFORMATION
- --------------------------------------------------------------------------------

PRICING OF FUND SHARES

The price at which the Funds' shares are bought or sold is call the net
asset value per share or "NAV." The NAV is computed once daily as of the
close of regular trading on the New York Stock Exchange ("NYSE"),
generally 4:00 p.m. Eastern time. In addition to Saturday and Sunday the
NYSE is closed on the days that the following holidays are observed: New
Year's Day, Martin Luther King, Jr. Day, Presidents' Day, Good Friday,
Memorial Day, Independence Day, Labor Day, Thanksgiving Day and Christmas
Day.

The NAV is computed by adding the value of all securities and other
assets of a Fund, deducting any liabilities, and dividing by the total
number of outstanding shares. The Funds' expenses are accounted for by
estimating the total expenses for the year and applying each day's
estimated amount when the NAV calculation is made.

The Funds' equity securities are valued based on market quotations or,
when no market quotations are available, at fair value as determined in
good faith by or under direction of the Board of Trustees. Foreign
securities are valued as of the close of trading on the primary exchange
on which they trade. The value is then converted to U.S. dollars using
current exchange rates.

Securities listed on any U.S. securities exchange are valued at their
last sale price on the exchange where the securities are principally
traded or, if there has been no sale on that date, at the mean between
the last reported bid and asked prices. Securities traded
over-the-counter are priced at the mean of the last bid and asked prices.
Securities are valued through valuations obtained from a commercial
pricing service or at the
<PAGE> 12

most recent mean of the bid and asked prices provided by investment
dealers in accordance with procedures established by the Board of
Trustees.

Short-term fixed-income securities having a maturity of 60 days or less
are valued at amortized cost, which the Board of Trustees believes
represents fair value. When a security is valued at amortized cost, it is
first valued at its purchase price. After it is purchased, it is valued
by assuming a constant amortization to maturity of any discount or
premium (because the Fund will hold the security till it matures and then
receive its face value), regardless of the way of changing interest rates
could change the market value of the instrument.

Foreign currency exchange rates are generally determined prior to the
close of trading on the NYSE. Occasionally, events affecting the value of
foreign investments and such exchange rates occur between the time at
which they are determined and the close of trading on the NYSE. Such
events would not normally be reflected in a calculation of the Funds' net
asset value on that day. If events that materially affect the value of
the Funds' foreign investments or the foreign currency exchange rates
occur during such period, the investments will be valued at their fair
value as determined in good faith by or under the direction of the Board
of Trustees. Foreign securities held by the Funds may be traded on days
and at times when the NYSE is closed. Accordingly, the net asset value of
the Funds may be significantly affected on days when shareholders have no
access to the Funds. For valuation purposes, quotations of foreign
portfolio securities, other assets and liabilities and forward contracts
stated in foreign currency are translated into U.S. dollar equivalents at
the prevailing market rates.

PURCHASE OF SHARES

You may purchase Fund shares directly from the Funds by mail or by wire
without paying any sales charge. The price for each share you buy will be
the NAV calculated after your order is "received" by the Fund. "Received"
means that payment for your purchase and all the information needed to
complete your order must be received by the Fund before your order is
processed. If your order is Received before 4:00 p.m. on a day the Funds'
NAVs are calculated, the price you pay will be that day's NAV. If your
order is Received after 4:00 p.m., the price you will pay will be the
next NAV calculated.

The Funds' shares are sold through an underwriter. The Funds' underwriter
is Provident Distributors, Inc. ("Provident"), a registered
broker-dealer. Provident's address is Four Falls Corporate Center, West
Conshohocken, PA 19428. Shares of the Funds may also be purchased through
various brokers who have arrangements with it. These brokers may charge
you a fee for their services.

You may purchase and sell shares through securities brokers and benefit
plan administrators or their subagents. You should contact them directly
for information regarding how to invest or redeem through them. They may
also charge you service or transaction fees. If you purchase or redeem
shares through them, you will receive the NAV calculated after receipt of
the order by them (generally, 4:00 p.m. Eastern time) on any day the NYSE
is open. If your order is received by them after that time, it will be
purchased or redeemed at the next-calculated NAV. Brokers and benefit
plan administrators who perform shareholder servicing for the Fund may
receive fees from the Funds or Matthews for providing these services.
These brokers may charge you a fee for their services.
<PAGE> 13

<TABLE>
<S> <C>
Minimum Initial Investment (non-retirement plan account): $ 2,500
Subsequent Investments: $ 250
Minimum Initial Investment (*retirement plan account): $ 500
Subsequent Investments: $ 50
</TABLE>

Retirement Plan Accounts include IRAs, 401(k) and 403(b)(7) plans.
* Speak with the Funds' agents for the many retirement plans available

The Funds may reject any purchase order or stop selling shares of the
Funds at any time. Also, the Funds may vary or waive the initial
investment minimum and minimums for additional investments.

<TABLE>
<S> <C> <C>
OPEN AN ACCOUNT ADDING TO AN ACCOUNT
BY MAIL - Complete and sign application - Make check payable to:
- Make check payable to: Matthews (name of Fund)
Matthews (name of Fund) - Mail check with a statement stub to address at
- Mail application and check to: left.
Matthews International Funds
Post Office Box 61767
211 South Gulph Road
King of Prussia, PA 19406

BY PHONE You can not open an account over the When you open your account, you must check the
telephone. box for "Telephone Options." Note that you may
only exchange shares from one Matthews Fund to
another.

*BY WIRE - Complete and sign application - Notify Funds' agent by calling:
- Mail application to: 800-892-0382.
Matthews International Funds - Then wire funds to:
Post Office Box 61767 Boston Safe Deposit & Trust
211 South Gulph Road ABA # 011001234
King of Prussia, PA 19406 Credit:
- Wire funds using instructions at right. [name of specific Matthews Fund]
Account # 000221
FBO: [your name and account number]

BY AUTOMATIC N/A Complete the Automatic Investment Plan section
INVESTMENT of the application. Be sure to sign the
PLAN application and include a voided check when
returning it to the Fund.
</TABLE>

* NOTE THAT WIRE FEES ARE CHARGED BY MOST BANKS.

EXCHANGE OF SHARES

agent by 4 p.m. eastern time on any day the New York Stock Exchange is
open, to receive that day's NAV. Such exchanges may be made by telephone
if you have so authorized on your application. Call 800-892-0382 for full
details. The exchange privilege may be terminated if the management of
the Funds believes it is in the best interest for all shareholders to do
so. Note that redemption fees may apply.

SELLING (REDEEMING) SHARES

You may sell your shares back to the Funds on any day it is open for
business. To receive a specific day's NAV, your request must be received
by the Funds before 4:00 p.m. of that day. If it is received after 4:00
p.m., you will receive the next NAV calculated.

If you used a check to buy your shares and later decide to sell them,
your proceeds from that redemption will be withheld until the Funds are
sure that your check has cleared. This could take as much as 15 days or
more.

If your request to sell your shares is made by telephone, you may have
difficulty getting through to the Funds in times of drastic market
conditions. If the Funds believe that it is in the best interest of all
the shareholders, it may modify or discontinue telephone transactions
without any notice.

TELEPHONE SECURITY

The convenience of using telephone transactions may have a cost in
decreased security. The Funds employ certain security measures as they
process telephone transactions. If these security procedures are used,
the Funds or its agents will not be responsible for any losses that you
incur because of a fraudulent telephone transaction. If the security
measures are not followed and you incur a loss because of a fraudulent
telephone transaction, the Funds or its agents will be responsible for
that loss.
<PAGE> 15

<TABLE>
<S> <C>
SELLING (REDEEMING) SHARES
BY MAIL - Send a letter to the Funds at the following address:
Matthews International Funds
Post Office Box 61767
211 South Gulph Road
King of Prussia, PA 19406
The letter must include your name and account number, the
name of the Fund and the amount you want to sell in dollars
or shares. This letter must be signed by each owner of the
account. For security purposes, a signature guarantee will
be required if:
- your request is for an amount over $100,000; or
- the money is to be paid to anyone other than the
registered owners; or
- the money is to be sent to an address which is different
than the registered address or to a bank account other than
the account which was pre-authorized.

BY PHONE When you opened your account, you must have checked the
appropriate part of the application or after you opened your
account, you have instructed the Funds to allow telephone
transactions. Any such instruction must be made by mail with
signature guarantees. Call 800.892.0382

BY WIRE Same as by phone above.

THROUGH A BROKER Contact your broker directly. Note that your Broker may
charge you a fee.
</TABLE>

REDEMPTION FEE

Please remember that if you sell your shares within 90 days of the day
you bought them, the money you receive will be 2% less than the total
amount redeemed. This 2% fee is retained by the Funds to compensate the
Funds for the extra expense it incurs because of short term trading. In
addition, the Funds hope that the fee will discourage short term trading
of its shares.

REDEMPTION IN KIND

Under certain circumstances, you could receive your redemption proceeds
as a combination of cash and securities. Receiving securities instead of
cash is called "redemption in kind." Even though the Funds are permitted
to do this, the first $250,000 of any redemption must be paid to you in
cash. Note that if you receive securities as well, you will incur
transactions charges if you sell them.

MINIMUM SIZE OF AN ACCOUNT

The Funds are charged by its service providers a fee for each account. If
an account balance falls below $2,500, it becomes too expensive to keep
it open. If this happens to your account we will give you the option of
investing more money into you account, or closing it. You will receive a
letter from the fund discussing your options in the event your account
falls below $2,500.
<PAGE> 16

DISTRIBUTIONS

All of the Funds except Growth and Income will distribute their net
investment income annually in December. Growth and Income will distribute
its net investment income semi-annually in June and December. Any net
realized gain from the sale of portfolio securities and net realized
gains from foreign currency transactions are distributed at least once
each year unless they are used to offset losses carried forward from
prior years.

All such distributions are reinvested automatically in additional shares
at net asset value, unless you elect to receive them in cash. The way you
receive distributions may be changed at any time by writing the Funds.

Any check in payment of dividends or other distributions which cannot be
delivered by the Post Office or which remains uncashed for a period of
more than one year will be reinvested in the shareholder's account at the
then current net asset value and the dividend option changed from cash to
reinvest.

Distributions are treated the same for tax purposes whether received in
cash or reinvested. Please note that shares purchased shortly before the
record date for a dividend or distribution may have the effect of
returning capital although such dividends and distributions are subject
to taxes.

TAXES

An investment in the Funds has certain tax consequences, depending on the
type of account that you have. Distributions are subject to federal
income tax and may also be subject to state and local income taxes.
Distributions are generally taxable when they are paid, whether in cash
or by reinvestment. Distributions declared in October, November or
December, and paid in the following January are taxable as if they were
paid on December 31.

The exchange of one Matthews Fund for another is a "taxable event" which
means that if you have a gain you may be obligated to pay tax on it.

If you have a qualified retirement account, taxes are generally deferred
until distributions are made from the retirement account.

Part of a distribution may include realized capital gains which may be
taxed at different rates depending on how long the fund has held specific
securities.

Make sure you have a social security number or tax I.D. number on file
with the Funds. If you do not, you may be subject to a 31 percent back up
withholding on your distributions.

Speak with your tax counselor for complete information concerning the tax
implications of your ownership of the Funds.
<PAGE> 17

FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------

These financial highlights tables are intended to help you understand the Funds'
financial performance for the past 5 years. Certain information reflects
financial results for a single Fund share. The total returns in the table
represent the rate that an investor would have earned (or lost) on an investment
in the Fund assuming all of the dividends and distributions were reinvested. The
information for the periods through August 31, 1998 was audited by Ernst & Young
LLP. The information for the fiscal year ended August 31, 1999 was audited by
Tait, Weller and Baker.

<TABLE>
<CAPTION>
MATTHEWS PACIFIC TIGER FUND
-------------------------------------------------------
PERIOD
YEAR ENDED AUGUST 31, ENDED
----------------------------------------- AUGUST 31,
1999 1998 1997 1996 1995(1)
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF
PERIOD $ 4.07 $ 11.30 $ 10.81 $ 9.77 $10.00
Income from Investment Operations
Net investment income (loss) 0.21 0.02(2) 0.02 0.01 0.02
Net realized and unrealized gain
(loss) on investments and
foreign currency 6.15 (7.18) 0.50 1.03 (0.23)
-------------------------------------------------------
TOTAL FROM INVESTMENT OPERATIONS 6.36 (7.16) 0.52 1.04 (0.21)
-------------------------------------------------------
Less Distributions from:
Net investment income (0.02) (0.01) (0.01) 0.00 (0.02)
Net realized gains on investments 0.00 (0.06) (0.02) 0.00 0.00
-------------------------------------------------------
TOTAL DISTRIBUTIONS (0.02) (0.07) (0.03) 0.00 (0.02)
NET ASSET VALUE END OF PERIOD $ 10.41 $ 4.07 $ 11.30 $ 10.81 $ 9.77
TOTAL RETURN 156.28% (63.43%) 4.75% 10.64% (2.07%)++
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
000's) $109,936 $31,319 $43,647 $17,148 $1,082
Ratio of expenses to average net
assets before expense waivers 1.90% 2.06% 1.97% 4.35% 25.95%+
Ratio of expenses to average net
assets after expense waivers 1.90% 1.90% 1.90% 1.90% 2.17%+
Ratio of net investment income
(loss) to average net assets
before waivers 3.35% 0.14% 0.20% (2.13%) (23.41%)+
Ratio of net investment income
(loss) to average net assets after
waivers 3.35% 0.30% 0.27% 0.32% 0.36%+
Portfolio turnover 98.74% 73.09% 70.73% 124.69% 92.53%++

<CAPTION>
MATTHEWS ASIAN GROWTH AND INCOME FUND
---------------------------------------------------
PERIOD
YEAR ENDED AUGUST 31, ENDED
------------------------------------- AUGUST 31,
1999 1998 1997 1996 1995(1)
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF
PERIOD $ 6.54 $11.71 $10.53 $ 9.88 $ 10.00
Income from Investment Operations
Net investment income (loss) 0.59 0.13 0.10 0.25 0.23
Net realized and unrealized gain
(loss) on investments and
foreign currency 2.75 (4.15) 1.42 0.75 (0.14)
TOTAL FROM INVESTMENT OPERATIONS 3.34 (4.02) 1.52 1.00 0.09
Less Distributions from:
Net investment income (0.51) (0.10) (0.10) (0.26) (0.21)
Net realized gains on investments 0.00 (1.05) (0.24) (0.09) 0.00
TOTAL DISTRIBUTIONS (0.51) (1.15) (0.34) (0.35) (0.21)
NET ASSET VALUE END OF PERIOD $ 9.37 $ 6.54 $11.71 $10.53 $ 9.88
TOTAL RETURN 52.65% (35.27%) 14.67% 10.24% 0.89%++
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
000's) $10,644 $4,063 $6,166 $3,272 $ 863
Ratio of expenses to average net
assets before expense waivers 2.05% 3.76% 4.45% 8.73% 23.11%+
Ratio of expenses to average net
assets after expense waivers 1.90% 1.90% 1.90% 1.85% 2.26%+
Ratio of net investment income
(loss) to average net assets
before waivers 7.98% (0.36%) (1.55%) (4.13%) (18.68%)+
Ratio of net investment income
(loss) to average net assets after
waivers 8.13% 1.50% 1.00% 2.75% 2.17%+
Portfolio turnover 34.82% 54.67% 50.20% 88.16% 121.63%++
</TABLE>

- ---------------

+ Annualized

++ Not Annualized

(1) The Funds commenced operations on September 12, 1994.

(2) Calculated using the average shares method.

<PAGE> 18

FINANCIAL HIGHLIGHTS CONTINUED
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
MATTHEWS
MATTHEWS DRAGON JAPAN
MATTHEWS KOREA FUND CENTURY CHINA FUND FUND
------------------------------------------------------ ------------------ ----------
PERIOD YEAR ENDED PERIOD
YEAR ENDED AUGUST 31, ENDED AUGUST 31, ENDED
---------------------------------------- AUGUST 31, ------------------ AUGUST 31,
1999 1998 1997 1996 1995(1) 1999 1998(2) 1999(3)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF
PERIOD $ 2.03 $ 6.19 $ 7.23 $ 9.13 $10.00 $ 4.36 $10.00 $ 10.00
----------------------------------------------------------------------------------------------
Income from Investment Operations
Net investment income (loss) 0.03 (0.03) (0.04)(4) (0.07) 0.08 0.12 0.10 (0.04)
Net realized and unrealized
gain (loss) on investments
and foreign currency 5.43 (4.13) (1.00)(4) (1.75) (0.95) 4.11 (5.74) 11.74
----------------------------------------------------------------------------------------------
TOTAL FROM INVESTMENT OPERATIONS 5.46 (4.16) (1.04) (1.82) (0.87) 4.23 (5.64) 11.70
----------------------------------------------------------------------------------------------
Less Distributions from:
Net investment income 0.00 0.00 0.00 0.00 0.00 (0.11) 0.00 0.00
Net realized gains on
investments 0.00 0.00 0.00 (0.08) 0.00 0.00 0.00 0.00
----------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS 0.00 0.00 0.00 (0.08) 0.00 (0.11) 0.00 0.00
NET ASSET VALUE, END OF PERIOD $ 7.49 $ 2.03 $ 6.19 $ 7.23 $ 9.13 $ 8.48 $ 4.36 $ 21.70
TOTAL RETURN 268.97% (67.21%) (14.38%) (20.11%) (8.70%)++ 97.79% (56.40%)++ 117%++
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
000's) $230,846 $66,607 $19,356 $2,721 $ 504 $6,245 $1,576 $24,486
Ratio of expenses to average net
assets before expense waivers 1.77% 2.07% 2.90% 11.36% 42.87%+ 2.09% 7.84%+ 3.45%+
Ratio of expenses to average net
assets after expense waivers 1.77% 2.06% 2.50% 2.23% 0.24%+ 2.00% 2.00%+ 2.00%+
Ratio of net investment income
(loss) to average net assets
before waivers (0.37%) (1.13%) (1.81%) (10.44%) (41.79%)+ 2.93% (3.45%)+ (2.54%)+
Ratio of net investment income
(loss) to average net assets
after waivers (0.37%) (1.12%) (1.41%) (1.31%) 0.84%+ 3.02% 2.38%+ (1.09%)+
Portfolio turnover 57.06% 94.01% 112.68% 139.71% 42.16%++ 40.27% 11.84%++ 28.92%++
</TABLE>

- ---------------

+ Annualized

++ Not Annualized

(1) The Fund commenced operations on January 3, 1995.

(2) The Fund commenced operations on February 19, 1998

(3) The Fund commenced operations on December 31, 1998

(4) Calculated using the average shares method.

<PAGE> 19

GENERAL INFORMATION
- --------------------------------------------------------------------------------

If you wish to know more about Matthews International Funds, You will
find additional information in the following documents.

SHAREOWNER REPORTS

You will receive Semi-Annual Reports dated February 28 and Annual
Reports, audited by independent accountants, dated August 31. These
reports contain a discussion of the market conditions and investment
strategies that significantly affected each Fund's performance during its
last fiscal year.

STATEMENT OF ADDITIONAL INFORMATION (SAI)

The SAI, which is incorporated into this prospectus by reference and
dated December 20, 1999, is available to you without charge. It contains
more detailed information about the Funds.

HOW TO OBTAIN REPORTS

CONTACTING MATTHEWS INTERNATIONAL FUNDS

You can get free copies of the reports and SAI, request other information
and discuss your questions about the Funds by contacting:

Matthews International Funds
P.O. Box 61767, 211 South Gulph Road
King of Prussia, PA 19406
800.789.2742

Web site: www.matthewsfunds.com

OBTAINING INFORMATION FROM THE SEC:

You can visit the SEC's web site at http://www.sec.gov to view the SAI
and other information. You can also view and copy information about the
Funds at the SEC's Public Reference Room in Washington, DC. Also, you can
obtain copies of this information by sending your request and duplication
fee to the SEC's Public Reference Room, Washington DC 20549-6009. To find
out more about the Public Reference Room, you can call the SEC at
202.942.8090. You may also e-mail the SEC at [email protected] to obtain
additional information about a Fund.

Investment Company Act File Number: 811-08510
<PAGE> 20
<TABLE>
<CAPTION>
[LOGO]
<S> <C>
MATTHEWS INTERNATIONAL FUNDS
SPECIALISTS IN ASIAN INVESTING WWW.MATTHEWSFUNDS.COM

NEW ACCOUNT APPLICATION - CLASS I SHARES

==================================================================================================
1 CHOOSE YOUR INVESTMENTS (Minimum initial investment: $2,500 per fund)

Use this application to [ ] Matthews Pacific Tiger Fund (802)......................$_________________
open a nonretirement [ ] Matthews Asian Growth and Income Fund (801)............$_________________
account only. If you wish [ ] Matthews Korea Fund (803) .............................$_________________
to open an IRA account, [ ] Matthews Dragon Century China Fund (804)...............$_________________
please call (800) 789-2742 [ ] Matthews Japan Fund (805)..............................$_________________
and ask for an IRA [ ] Matthews Asian Technology Fund (806)...................$_________________
application. TOTAL INVESTMENT: .....................................$_________________

If you have an existing Matthews Fund account registered exactly as you would
PLEASE COMPLETE AND like your new account(s) registered, please provide the following:
SIGN THIS APPLICATION
AND RETURN IT IN THE _______________________________________________ ____________________________
ENCLOSED POSTAGE-PAID Existing Account Number Fund Name
ENVELOPE.
==================================================================================================
2 INVESTMENT METHOD

It should take only a few [ ] BY CHECK: I have enclosed a check(s), payable to the appropriate Fund(s).
minutes to complete this
application. If you have [ ] BY WIRE: Federal Funds were wired on____________________ for Account No. ________________.
questions, please call us Month/day/year
at (800) 892-0382
between 9:00 a.m. and ==================================================================================================
7:00 p.m. Eastern Time. 3 ACCOUNT REGISTRATION (Please select one)

[ ] INDIVIDUAL OR JOINT ACCOUNT
______________________________________________ _____________________________________________
Owner's Name Joint Owner's Name
______________________________________________ _____________________________________________
Owner's Social Security Number Joint Owner's Social Security Number

Please make your [ ] GIFT OR TRANSFER TO A MINOR
check(s) payable to the
appropriate _____________________________________________ as custodian for__________________________________
Fund(s) and mail, along Custodian Name Minor's Name
with your completed, under the ___________________________________ Uniform Gifts/Transfers to Minors Act.
signed application, to: State
_____________________________________________ ______________________________________________
Minor's Social Security Number Minor's Date of Birth

MATTHEWS INTERNATIONAL [ ] TRUST
FUNDS
C/O PFPC INC. _____________________________________________ as trustee(s) of ________________________________
P.O. Box 61767 Trustee(s) Name(s) Name of Trust Agreement
211 S. GULPH ROAD
KING OF PRUSSIA, PA for the benefit of________________________________________________.
19406-8767 Beneficiary's Name

_____________________________________________ ______________________________________________
Beneficiary's Taxpayer I.D. Number Date of Trust Agreement

[ ] CORPORATION, PARTNERSHIP OR OTHER ENTITY
_____________________________________________ ______________________________________________
Name of Corporation or Other Entity Taxpayer I.D. Number

=================================================================================================
4 MAILING ADDRESS I am a citizen of:
Distributed by ________________________________________ ______________________ [ ] The United States
Provident Distributors, Inc. Street Address or P.O. Box Daytime Phone Number [ ] Other (please specify):
211 S. Gulph Road ________________________________________ ______________________ ____________________________
King of Prussia, PA 19406 City, State, ZIP Code Evening Phone Number

[OVER]

</TABLE>

<PAGE> 21

<TABLE>
<S> <C>
====================================================================================================
5 DIVIDEND OPTIONS (All distributions will be reinvested unless otherwise indicated.)

[ ] Reinvest all dividends and capital gains.
[ ] Pay all dividends and capital gains to me by check.
[ ] Pay all dividends to me by check and reinvest all capital gains

====================================================================================================
6 TELEPHONE EXCHANGE AND REDEMPTION

YOU WILL HAVE THE ABILITY TO EXCHANGE AND REDEEM SHARES BY TELEPHONE UNLESS YOU CHECK BELOW:
IF YOU WANT [ ] Please remove the telephone exchange feature from my account.
REDEMPTION [ ] Please remove the telephone redemption feature from my account.
PROCEEDS WIRED
TO YOUR BANK, YOU Proceeds of telephone redemption requests are paid by check and mailed to the address of record
MUST ENCLOSE A unless a wire to your bank account of record is requested. IF YOU WANT REDEMPTION PROCEEDS WIRED TO
VOIDED CHECK YOUR BANK, YOU MUST ENCLOSE A VOIDED CHECK FROM YOUR BANK ACCOUNT. Exchanges must be between
FROM YOUR BANK identically registered accounts. See the prospectus for details.
ACCOUNT.
====================================================================================================
7 AUTOMATIC INVESTMENT PLAN

This service allows you to automatically invest monthly from your bank account to your Matthews
International Fund account(s). To establish this feature, you must meet the minimum initial
investment of $2,500 per fund. Please specify below the amount you would like deducted from your
bank acount on a monthly basis AND ATTACH A VOIDED CHECK. This plan normally becomes active 20
TO ESTABLISH business days after your application is processed.
AUTOMATIC INVEST-
ING, YOU MUST [ ] Matthews Pacific Tiger Fund (802) ...................$_________________
ENCLOSE A VOIDED [ ] Matthews Asian Growth and Income Fund (801) .........$_________________
CHECK FROM YOUR [ ] Matthews Korea Fund (803) ...........................$_________________
BANK ACCOUNT. [ ] Matthews Dragon Century China Fund (804) ............$_________________
[ ] Matthews Japan Fund (805) ...........................$_________________
[ ] Matthews Asian Technology Fund (806) ................$_________________

Please debit the above amount(s) from my bank account on the [ ] 10th [ ] 15th or [ ] 20th of each
month. ACH debit(s) will be dated on the day of each month indicated above. If that day falls on a
day in which the NYSE is not open for business, the debit will occur on the next available business
day.

====================================================================================================
8 SIGNATURES AND CERTIFICATION

By signing below, I certify that:

- I have received and read the prospectus for the Fund and I agree to its terms.

- If I am a U.S. citizen or resident alien, I certify under penalties of perjury that the Social
Security Number or Taxpayer Identification Number provided on this application is correct (or that
I have applied for a Number and am waiting for it to be issued to me), and that I have not been
notified by the IRS that I am subject to backup withholding.

[ ] I have been notifieded by the IRS that I am subject to backup withholding.

The Internal Revenue Service does not require your consent to any provision of this document
other than the certifications required to avoid backup withholding.

- If I have agreed to telephone exchange or redemption privileges, I (we) authorize PFPC Inc. to
honor telephone instructions for my (our) account. Neither the Fund nor PFPC Inc. will be liable
for properly acting upon telephone instructions believed to be genuine.

- If I have requested participation in the Automatic Investment Plan, I (we) agree that if my (our)
ACH debit is not honored, PFPC Inc. reserves the right to discontinue this service and any share
purchase made upon such deposit will be cancelled. I (we) further agree that if the net asset
value of shares purchased is less when said purchase is cancelled than when the purchase was
made, PFPC Inc. shall be authorized to liquidate other assets or fractions thereof held in my
(our) account to make up the deficiency. This Automatic Investment Plan may be discontinued by
PFPC Inc. upon 30 days written notice or at any time by the investor by written notice to PFPC
Inc., which is received no later than five business days prior to the above-designated
investment date.

________________________________________________________ _______________________
Signature of Owner/Authorized Signer Date

________________________________________________________ _______________________
Signature of Joint Owner/Authorized Signer Date

----------------------------------------------------------------------------------------------------
E-MAIL DELIVERY OPTION: Should it be possible in the future, I would like my shareholder reports
and prospectuses delivered electronically to the following e-mail address:__________________________

I understand that by choosing this option I may be waiving my right to receive paper copies.
---------------------------------------------------------------------------------------------------

</TABLE>

<PAGE> 22

BOARD OF TRUSTEES

Richard K. Lyons
Robert K. Connolly
David FitzWilliam-Lay
Norman W. Berryessa
John H. Dracott, Emeritus

OFFICERS

G. Paul Matthews -- President
Mark W. Headley -- Vice President
Joseph M. O'Donnell -- Secretary
Brian Stableford -- Treasurer

INVESTMENT ADVISOR

Matthews International Capital Management, LLC
456 Montgomery Street, Suite 1200
San Francisco, CA 94104
800.789.ASIA (2742)

UNDERWRITER

Provident Distributors, Inc.
Four Falls Corporate Center
West Conshohocken, PA 19428

SHAREHOLDER SERVICES

PFPC Inc.
211 S. Gulph Road
P.O. Box 61767
King of Prussia, PA 19406
800.892.0382

CUSTODIAN

The Bank of New York
90 Washington Street
New York, NY 10286

LEGAL COUNSEL
Paul, Hastings, Janofsky & Walker LLP
345 California Street
San Francisco, CA 94104-2635

FOR ADDITIONAL INFORMATION ABOUT THE
MATTHEWS INTERNATIONAL FUNDS CALL: 800.789.ASIA (2742)

Investment Company Act File Number: 811-08510

PROSPECTUS - DECEMBER 20, 1999

MATTHEWS
INTERNATIONAL
FUNDS

WWW.MATTHEWSFUNDS.COM

Specialists in Asian Investing
800.789.ASIA (2742)
CLASS I SHARES

LOGO
MATTHEWS ASIAN GROWTH AND INCOME FUND
MATTHEWS ASIAN TECHNOLOGY FUND
MATTHEWS DRAGON CENTURY CHINA FUND
MATTHEWS JAPAN FUND
MATTHEWS KOREA FUND
MATTHEWS PACIFIC TIGER FUND
The U.S. Securities and Exchange Commission (the "SEC") has not
approved of, or disapproved of the Fund or the securities that the Fund sells.
Also, the SEC has not passed upon the adequacy or accuracy of this prospectus.
Anyone who informs you otherwise is committing a crime.

watermark
<PAGE> 23

INTRODUCTION
- --------------------------------------------------------------------------------

HOW TO USE THIS DOCUMENT.

DEFINITIONS
THE FOLLOWING WORDS HAVE SPECIAL MEANING IN THIS PROSPECTUS:

1. Funds means the six individual mutual funds that make up Matthews
International Funds. They are: MATTHEWS ASIAN GROWTH AND INCOME FUND,
MATTHEWS ASIAN TECHNOLOGY FUND, MATTHEWS DRAGON CENTURY CHINA FUND,
MATTHEWS JAPAN FUND, MATTHEWS KOREA FUND, and MATTHEWS PACIFIC TIGER
FUND. THIS PROSPECTUS PERTAINS ONLY TO CLASS A SHARES OF MATTHEWS
DRAGON CENTURY CHINA FUND, MATTHEWS KOREA FUND AND MATTHEWS PACIFIC
TIGER FUND AND ARE AVAILABLE PRIMARILY THROUGH BROKER/DEALERS. FOR A
PROSPECTUS OFFERING CLASS I SHARES FOR ALL OF THE FUNDS, PLEASE CALL
1.800.789.ASIA (2742).

3. Asia refers to the Pacific Tiger countries plus Japan and India.

4. What is considered to be an "Asian Company?" A company is considered
to be "Asian" or "located" in a particular country in Asia if:

(i) it is organized under the laws of China, Hong Kong, India,
Indonesia, Japan, Malaysia, the Philippines, Singapore, South Korea,
Taiwan or Thailand; or

(ii) it derives at least 50% of its revenues or profits from goods
produced or sold, investments made, services performed, or has at
least 50% of its assets located in one of these countries; or

(iii) it has the primary trading markets for its securities in one of
these countries; or

(iv) it is a governmental entity or an agency or instrumentality or
political subdivision of such country.

5. Matthews or The Advisor means Matthews International Capital
Management, LLC, the company which manages the money which is invested
into the Funds.

SUMMARY INFORMATION

INVESTMENT GOALS OF THE FUNDS

The investment goal of all six Matthews International Funds is long term
capital appreciation.
<PAGE> 24

MATTHEWS' INVESTMENT STRATEGY
- --------------------------------------------------------------------------------

Fundamental characteristics of a company include the people who are
running the company, the products it makes, the marketing strategy it is
following and its financial health.

PRINCIPAL INVESTMENT STRATEGIES OF THE FUNDS
- --------------------------------------------------------------------------------

MATTHEWS DRAGON CENTURY CHINA FUND invests a substantial portion of its
assets in the common and preferred stock of companies located in China.
China includes Taiwan and Hong Kong.

MATTHEWS KOREA FUND invests a substantial portion of its assets in the
common and preferred stock of companies located in South Korea.

MATTHEWS PACIFIC TIGER FUND invests a substantial portion of its assets
in the common and preferred stock of companies located in the Pacific
Tiger countries.

PRINCIPAL RISKS OF INVESTING IN THE FUNDS
- --------------------------------------------------------------------------------

The principal investments of all the Funds are common and preferred
stocks. The major risk involved with the ownership of common and
preferred stock is that the Fund may lose money if the value of a stock
goes down during the time that the Fund owns it.

RISKS ASSOCIATED WITH NON-UNITED STATES COMPANIES

Investments by the Funds in the securities of non U.S. issuers involve
investment risks different from those of U.S. issuers. These risks
include:

In addition, brokerage commissions, custodian services, withholding
taxes, and other costs relating to investment in foreign markets
generally are more expensive than in the United States.

RISKS ASSOCIATED WITH SMALLER COMPANIES (SO-CALLED "SMALL-CAP" COMPANIES)

LONG TERM INVESTING AND VOLATILITY

MATTHEWS DRAGON CENTURY CHINA FUND

UNIQUE RISKS: In addition to the "Principal Risks" noted above investing
in the regional markets of China and Hong Kong involve risks and
considerations not present when investing in more established securities
markets. Investing in regionally concentrated investment funds should be
considered speculative and thus not appropriate for all investors.

MATTHEWS KOREA FUND

UNIQUE RISKS: In addition to the "Principal Risks" noted above investing
in Korean securities has special risks including:

MATTHEWS PACIFIC TIGER FUND

PAST PERFORMANCE
- --------------------------------------------------------------------------------

The bar charts and performance table help show some of the risks of
investing in the Funds. The bar charts show each Fund's performance from
prior years. Below the charts you will find the best and worst returns
since each Fund began. You can then compare those returns with that of a
broad based index found next. This information only speaks to the past.
We do not know how the Funds will perform in the future. The performance
below is for the Class I shares which are not offered in this prospectus.
Note that the performance does not take into account distribution fees or
sales charges, but barring these differing expenses, the share classes
have substantially similar annual returns because the shares are invested
in the same portfolio of securities. In that Matthews Dragon Century
China Fund does not have a full calendar year's performance, no
statistics are presented.

MATTHEWS KOREA FUND

<TABLE>
<CAPTION>
MATTHEWS KOREA FUND (%)
-----------------------
<S> <C>
1995 -12.73
1996 -31.79
1997 -64.75
1998 96.15
1999
</TABLE>

Best Quarter: 4th - 1998 99.98%
Worst Quarter: 4th - 1997 (64.44%)
Year-to-date Return: 56.86% as of September 30, 1999
AVERAGE ANNUAL TOTAL RETURN FOR PERIODS ENDED DECEMBER 31,
1998

<TABLE>
<CAPTION>
SINCE INCEPTION
1 YEAR JANUARY 3, 1995
---------------------------
<S> <C> <C>
Matthews Korea Fund 96.15% (19.33%)
*Korea Stock Price Index 98.79% (22.44%)
</TABLE>

---------------------------------

* The Korean Stock Price Index is a
capitalization-weighted index of all common stocks listed
on the Korean Stock Exchange.
<PAGE> 29

MATTHEWS PACIFIC TIGER FUND

<TABLE>
<CAPTION>
PACIFIC TIGER FUND (%)
----------------------
<S> <C>
1995 3.06
1996 24.18
1997 -40.89
1998 -2.86
1999
</TABLE>

Best Quarter: 4th - 1998 38.45%
Worst Quarter: 4th - 1997 (38.17%)
Year-to-date Return: 39.02% as of September 30, 1999

AVERAGE ANNUAL TOTAL RETURN FOR PERIODS ENDED DECEMBER 31,
1998

<TABLE>
<CAPTION>
SINCE INCEPTION
1 YEAR SEPTEMBER 12, 1994
-------------------------------
<S> <C> <C>
Matthew Pacific Tiger Fund (2.86%) (8.03%)
*MSCI All Country Far East ex-Japan Index (4.83%) (12.31%)
</TABLE>

---------------------------------

* The MSCI (Morgan Stanley Capital International) All
Country Far East ex-Japan Index is an unmanaged
capitalization-weighted index of stock markets in the
Pacific region excluding Japan.

FEES AND EXPENSES
- --------------------------------------------------------------------------------

This table describes the fees and expenses that you may pay if you buy and hold
shares of any of the Funds:

SHAREHOLDER FEES

<TABLE>
<S> <C>
MAXIMUM SALES LOAD IMPOSED ON PURCHASES as a percentage of
offering price 4.95%
MAXIMUM SALES LOAD IMPOSED ON REINVESTED DIVIDENDS as a
percentage of offering price 0.00%
CONTINGENT DEFERRED SALES CHARGE as a percentage of original
purchase price 0.00%
REDEMPTION FEE as a percentage of amount redeemed within 90
days of purchase 2.00%
</TABLE>

<TABLE>
<CAPTION>
OTHER EXPENSES
(INCLUDING
0.25% TOTAL
SHAREHOLDER ANNUAL FEE REDUCTION NET EXPENSES
MANAGEMENT DISTRIBUTION/ SERVICING OPERATING AND/OR EXPENSE AFTER
MATTHEWS FUND -- CLASS A FEES 12B-1 FEES FEE) EXPENSES REIMBURSEMENT REIMBURSEMENT
-----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Dragon Century China 1.00% 0.25% 1.09% 2.34% 0.09% 2.25%
Korea 1.00% 0.25% 1.02% 2.27% None 2.27%
Pacific Tiger 1.00% 0.25% 1.15% 2.40% 0.25% 2.15%
</TABLE>
<PAGE> 30

EXAMPLE

<TABLE>
<CAPTION>
NAME OF FUND 1 YEAR 3 YEARS 5 YEARS 10 YEARS
-------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Dragon Century China Fund $712 $1,181 $1,676 $3,032
Korea Fund $714 $1,169 $1,650 $2,971
Pacific Tiger Fund $702 $1,184 $1,691 $3,078
</TABLE>

THE INVESTMENT PROCESS
- --------------------------------------------------------------------------------

The investment goal of each Fund noted above is fundamental. This means
that it can not be changed without a vote of a majority of the voting
securities of each respective Fund.

MANAGEMENT OF THE FUNDS
- --------------------------------------------------------------------------------

PORTFOLIO MANAGERS

<TABLE>
<S> <C>
Dragon Century China Fund G. Paul Matthews, Mark W. Headley and Richard H. Gao
Korea Fund Mark W. Headley and G. Paul Matthews
Pacific Tiger Fund Mark W. Headley, G. Paul Matthews and Andrew T. Foster
(assistant)
</TABLE>

G. Paul Matthews: has been actively involved in the Asian financial
markets since 1982. Prior to founding Matthews International Capital
Management in 1991, he served as portfolio manager of G. T. Pacific
Growth Fund from 1982-85. While residing in Hong Kong, Mr. Matthews
oversaw all Asian investment from 1985-88 for G. T. Management Asia. From
1989 to 1991 he was self-employed. Mr. Matthews holds an M. A. in history
and law from Cambridge University in the United Kingdom.

Mark W. Headley: joined Matthews International as Managing Director and
as Senior Analyst on the investment team in 1995. He has over 10 years of
experience in the Asian Tiger markets. From 1989 to 1992 he held various
positions at Newport Pacific Management and its subsidiaries. In 1992,
Mr. Headley moved to Hong Kong, where he served as a Director of Regent
Fund Management. He returned to San Francisco in 1993 and joined
Litman/Gregory & Co. as Director of International Investments. Mr.
Headley holds a B.A. in Economics and Politics from the University of
California at Santa Cruz.

All members of the investment team travel extensively to Asia to conduct
research relating to those markets.
<PAGE> 32

SHAREHOLDER INFORMATION
- --------------------------------------------------------------------------------

PRICING OF FUND SHARES

The price at which the Funds' shares are bought or sold is called the
Public Offering Price that is equal to the net asset value per share or
"NAV" plus any applicable sales charge. The NAV is computed once daily as
of the close of regular trading on the New York Stock Exchange ("NYSE"),
generally 4:00 p.m. Eastern Time. In addition to Saturday and Sunday the
NYSE is closed on the days that the following holidays are observed: New
Year's Day, Martin Luther King, Jr. Day, Presidents' Day, Good Friday,
Memorial Day, Independence Day, Labor Day, Thanksgiving Day and Christmas
Day.

Foreign currency exchange rates are generally determined prior to the
close of trading on the NYSE. Occasionally, events affecting the value of
foreign investments and such exchange rates occur between the time at
which they are determined and the close of trading on the NYSE. Such
events would not normally be reflected in a calculation of the Funds' net
asset value on that day. If events that materially affect the value of
the Funds' foreign investments or the foreign currency exchange rates
occur during such period, the investments will be valued at their fair
value as determined in good faith by or under the direction of the Board
of Trustees. Foreign securities held by the Funds may be traded on days
and at times when the NYSE is closed. Accordingly, the net asset value of
the Funds may be significantly affected on days when shareholders have no
access to the Funds. For valuation purposes, quotations of foreign
portfolio securities, other assets and liabilities and forward contracts
stated in foreign currency are translated into U. S. dollar equivalents
at the prevailing market rates.
<PAGE> 33

PURCHASE OF SHARES

You may purchase Fund shares directly from the Funds by mail or by wire
or through your broker. The price for each share you buy will be the
Public Offering Price calculated after your order is "received" by the
Fund. "Received" means that payment for your purchase and all the
information needed to complete your order must be received by the Fund
before your order is processed. If your order is Received before 4:00
p.m. on a day the Funds' NAVs are calculated, the price you pay will be
that day's Public Offering Price. If your order is Received after 4:00
p.m., the price you will pay will be the next Public Offering Price
calculated.

USING A BROKER

You may purchase Fund shares through your broker if they have an
agreement with the Funds. Check with your broker to be sure that they
have signed such an agreement.

Shares of the Funds are sold at the Public Offering Price which is
calculated by adding the applicable sales load to the NAV. There is no
sales load charged on the dividends or capital gains paid by the Funds
which are then reinvested. The chart below shows the amount of the sales
load compared to the amount of the Funds purchased and as a percentage of
both the offering price as well as the net amount.

<TABLE>
<CAPTION>
REALLOWANCE
SALES CHARGE SALES CHARGE OF BROKERAGE
AS A AS A AS A
PERCENTAGE OF PERCENTAGE OF PERCENTAGE
CLASS A SHARES PURCHASED OFFERING PRICE NET AMOUNT INVESTED OFFERING PRICE
-------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Less than $50,000 4.95% 5.21% 4.50%
$50,000 or more but less than $100,000 4.25% 4.44% 3.85%
$100,000 or more but less than $250,000 3.25% 3.36% 2.90%
$250,000 or more but less than $500,000 2.50% 2.36% 2.15%
$500,000 or more but less than
$1,000,000 2.00% 2.04% 1.80%
$1,000,000 and over 0.00% 0.00% 0.00%
</TABLE>

SPECIAL SHARE PURCHASE PLANS WHICH WILL REDUCE YOUR SALES LOAD

There are two special plans whereby you will be able to pay less than the
maximum sales loads. They are "Rights of Accumulation" and a "Letter of
Intent." Under Rights of Accumulation, you may be able to aggregate many
purchases which, if made together, would be eligible for a lower sales
load. A Letter of Intent is an agreement that you will purchase a certain
amount of shares of the Funds which, if made all at once, would be
eligible for a lower sales load. Contact the Fund or your broker for all
of the conditions and details.

DISTRIBUTION (RULE 12b-1) PLAN

The Fund is also permitted to pay for certain distribution expenses
through a distribution plan known as a Rule 12b-1 Plan. This rule is part
of the law that regulates the mutual fund industry. Under the Funds' Rule
12b-1 Plan, the Funds may pay up to 1/4(cent) of each dollar in the fund
annually (put another way, an annual rate of 0.25% of the Funds' net
assets) for services such as printing, mailings, or fees charged by
investment professionals who service shareholder accounts.

Please note that these fees are paid out of the Funds on an ongoing basis
and over time, they increase the cost of your investment and may cost you
more that paying other types of sales charges.
<PAGE> 34

Retirement Plan Accounts include IRAs, 401(k) and 403(b)(7) plans.
* Speak with the Funds' agents for the many retirement plans available

The Funds may reject any purchase order or stop selling shares of the
Funds at any time. Also, the Funds may vary or waive the initial
investment minimum and minimums for additional investments.

BY PHONE You cannot open an account over the When you open your account, you must check the
telephone. box for "Telephone Options." Note that you may
only exchange shares from one Matthews Fund to
another.

*BY WIRE - Complete and sign application - Notify Funds' agent by calling:
- Mail application to: 800-892-0382.
Matthews International Funds - Then wire funds to:
Post Office Box 61767 Boston Safe Deposit & Trust
211 South Gulph Road ABA # 011001234
King of Prussia, PA 19406 Credit: [name of specific Matthews Fund]
- Wire funds using instructions at right. Account # 000221
FBO: [your name and account number]

BY AUTOMATIC N/A Complete the Automatic Investment Plan section
INVESTMENT of the application. Be sure to sign the
PLAN application and include a voided check when
returning it to the Fund.
</TABLE>

* NOTE THAT WIRE FEES ARE CHARGED BY MOST BANKS.
<PAGE> 35

EXCHANGE OF SHARES

You may exchange your shares of one Matthews Fund for another provided
that the other fund is registered for sale in your state. Minimum
investment requirements apply. Any request must be received by the Fund's
agent by 4 p.m. eastern time on any day the New York Stock Exchange is
open, to receive that day's NAV. Such exchanges may be made by telephone
if you have so authorized on your application. Call 800-892-0382 for full
details. The exchange privilege may be terminated if the management of
the Funds believes it is in the best interest for all shareholders to do
so. Note that redemption fees may apply.

SELLING (REDEEMING) SHARES

TELEPHONE SECURITY

<TABLE>
<S> <C>
SELLING (REDEEMING) SHARES

BY MAIL - Send a letter to the Funds at the following address:
Matthews International Funds
Post Office Box 61767
211 South Gulph Road
King of Prussia, PA 19406
The letter must include your name and account number, the
name of the Fund and the amount you want to sell in dollars
or shares. This letter must be signed by each owner of the
account. For security purposes, a signature guarantee will
be required if:
- your request is for an amount over $100,000, or
- the money is to be paid to anyone other than the
registered owners or
- the money is to be sent to an address which is different
than the registered address or to a bank account other than
the account which was pre-authorized.

BY WIRE Same as by phone above.

THROUGH A BROKER Contact your broker directly. Note that your Broker may
charge you a fee.
</TABLE>
<PAGE> 36

REDEMPTION FEE

REDEMPTION IN KIND

MINIMUM SIZE OF AN ACCOUNT

DISTRIBUTIONS

TAXES

The exchange of one Matthews Fund for another is a "taxable event" which
means that if you have a gain you may be obligated to pay tax on it.
<PAGE> 37

If you have a qualified retirement account, taxes are generally deferred
until distributions are made from the retirement account.

Part of a distribution may include realized capital gains which may be
taxed at different rates depending on how long the fund has held specific
securities.

Make sure you have a social security number or tax I.D. number on file
with the Funds. If you do not, you may be subject to a 31 percent back up
withholding on your distributions.

Speak with your tax counselor for complete information concerning the tax
implications of your ownership of the Funds.
<PAGE> 38

FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------

These financial highlights tables are intended to help you understand the
Funds' financial performance for the past 5 years. Certain information
reflects financial results for a single Fund share. The total returns in
the table represent the rate that an investor would have earned [or lost]
on an investment in the Fund assuming all of the dividends and
distributions were reinvested. The information for the periods through
August 31, 1998 was audited by Ernst & Young LLP. The information for the
fiscal year ended August 31, 1999 was audited by Tait, Weller and Baker.

<TABLE>
<CAPTION>
MATTHEWS PACIFIC TIGER FUND MATTHEWS KOREA FUND
---------------------------------- ----------------------------------
PERIOD ENDED PERIOD ENDED
YEAR ENDED AUGUST 31, YEAR ENDED AUGUST 31,
AUGUST 31, 1999 1998(4) AUGUST 31, 1999 1998(4)
<S> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF
PERIOD $ 4.07 $10.84 2.01 $ 5.32
Income from Investment Operations
Net investment income (loss) 0.21 0.03(5) 0.01 (0.04)
Net realized and unrealized gain
(loss) on investments and
foreign currency 6.15 (6.73) 5.42 (3.27)
------------------------------------------------------------------------
TOTAL FROM INVESTMENT OPERATIONS 6.36 (6.70) 5.43 (3.31)
------------------------------------------------------------------------
Less Distributions from:
Net investment income (0.02) (0.01) -- --
Net realized gains on investments 0.00 (0.06) -- --
------------------------------------------------------------------------
TOTAL DISTRIBUTIONS (0.02) (0.07) -- --
NET ASSET VALUE END OF PERIOD $10.41 $ 4.07 $ 7.44 $ 2.01
TOTAL RETURN(3) 156.28% (61.87%) 270.15% (62.03%)
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
000's) $1,221 $ 146 $15,281 $4,123
Ratio of expenses to average net
assets before expense waivers 2.15% 11.99%(1) 2.02% 2.97%(1)
Ratio of expenses to average net
assets after expense waivers 1.90% 1.91%(1) 2.02% 2.68%(1)
Ratio of net investment income
(loss) to average net assets
before waivers 3.10% (9.61%)(1) (0.62%) (2.03%)(1)
Ratio of net investment income
(loss) to average net assets
after waivers 3.35% 0.47%(1) (0.62%) (1.74%)(1)
Portfolio turnover 98.74% 73.09% 57.06% 94.01%
</TABLE>

- ---------------

(1) Annualized
(2) Not Annualized
(3) Total Return does not reflect sales load.
(4) The Class A Shares of the Funds commenced operations on October 9, 1997.
(5) Calculated using the average shares method.
<PAGE> 39

GENERAL INFORMATION
- --------------------------------------------------------------------------------

If you wish to know more about Matthews International Funds, You will
find additional information in the following documents.

SHAREOWNER REPORTS

STATEMENT OF ADDITIONAL INFORMATION (SAI)

The SAI, which is incorporated into this prospectus by reference and
dated December 20, 1999, is available to you without charge. It contains
more detailed information about the Funds.

HOW TO OBTAIN REPORTS

CONTACTING MATTHEWS INTERNATIONAL FUNDS

You can get free copies of the reports and SAI, request other information
and discuss your questions about the Funds by contacting:

Matthews International Funds
P.O. Box 61767, 211 South Gulph Road
King of Prussia, PA 19406
800.789.2742

Web site: www.matthewsfunds.com

OBTAINING INFORMATION FROM THE SEC:

Investment Company Act File Number: 811-08510
<PAGE> 40

BOARD OF TRUSTEES

Richard K. Lyons
Robert K. Connolly
David FitzWilliam-Lay
Norman W. Berryessa
John H. Dracott, Emeritus

OFFICERS

G. Paul Matthews -- President
Mark W. Headley -- Vice President
Joseph M. O'Donnell -- Secretary
Brian Stableford -- Treasurer

INVESTMENT ADVISOR

Matthews International Capital Management, LLC
456 Montgomery Street, Suite 1200
San Francisco, CA 94104
800.789.ASIA (2742)

UNDERWRITER

Provident Distributors, Inc.
Four Falls Corporate Center
West Conshohocken, PA 19428

SHAREHOLDER SERVICES

PFPC Inc.
211 S. Gulph Road
P.O. Box 61767
King of Prussia, PA 19406
800.892.0382

CUSTODIAN

The Bank of New York
90 Washington Street
New York, NY 10286

LEGAL COUNSEL
Paul, Hastings, Janofsky & Walker LLP
345 California Street
San Francisco, CA 94104-2635

FOR ADDITIONAL INFORMATION ABOUT THE
MATTHEWS INTERNATIONAL FUNDS CALL: 800.789.ASIA (2742)

Investment Company Act File Number: 811-08510

PROSPECTUS - DECEMBER 20, 1999

MATTHEWS
INTERNATIONAL
FUNDS

WWW.MATTHEWSFUNDS.COM

Specialists in Asian Investing
800.789.ASIA (2742)
CLASS A SHARES

LOGO
MATTHEWS DRAGON CENTURY CHINA FUND
MATTHEWS KOREA FUND
MATTHEWS PACIFIC TIGER FUND
The U.S. Securities and Exchange Commission (the "SEC") has not
approved of, or disapproved of the Fund or the securities that the Fund sells.
Also, the SEC has not passed upon the adequacy or accuracy of this prospectus.
Anyone who informs you otherwise is committing a crime.

watermark