KEYSTONE STRATEGIC DEVELOPMENT FUND, N-30D, 1997-05-30

KEYSTONE STRATEGIC DEVELOPMENT FUND
N-30D, 1997-05-30

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<PAGE>
PAGE 1
KEYSTONE GLOBAL RESOURCES AND DEVELOPMENT FUND
SEEKS CAPITAL GROWTH BY INVESTING IN COMPANIES INVOLVED IN THE NATURAL RESOURCES
AND ENERGY INDUSTRIES,
WITH A SECONDARY INTEREST IN COMPANIES BENEFITING FROM INFRASTRUCTURE
DEVELOPMENT.

Dear Shareholder:

We are writing to report to you on the performance of Keystone Global Resources
and Development Fund for the twelve-month period which ended March 31, 1997.

PERFORMANCE

For the twelve-month period which ended March 31, 1997, your Fund produced the
following total returns.
Class A shares returned 12.76%.
Class B shares returned 11.96%.
Class C shares returned 11.96%.
The Standard & Poor's 500 Index-- a widely recognized benchmark of stock price
performance-- returned 19.8% for the twelve-month period. The Morgan Stanley
Capital International World Index, representing the performance of stocks from
more than 20 countries including the U.S., returned 9.36% for the twelve-month
period.
We believe your Fund performed well in a challenging market environment for
world stock markets in general, and natural resources stocks in particular.

THE MARKET ENVIRONMENT

Market conditions presented a study in contrasts during the year. In the U.S.,
the stock market rose fairly steadily, reaching new highs in February before
correcting rather sharply during the last weeks of the period. In foreign
markets, however, slow economic recovery in Japan, slowing growth rates in other
parts of Asia and delayed recovery in Europe all contributed to a reduction in
the demand for natural resources, especially metals. Overall, stronger gains in
oil and energy stocks helped offset weaker returns in metals stocks.

SEEKING OPPORTUNITIES FROM WORLD GROWTH

As we indicated in the last report dated September 30, 1996, the Fund's revised
strategy emphasizes investments in energy and resources companies-- firms that
provide the raw materials needed for economic growth and development all over
the world. We believe the natural resources area offers excellent opportunities
for broad diversification by industry, company size and country.
At the end of the period, 11 different countries were represented in your
Fund's portfolio. Over the course of the year we increased our exposure to
natural resources to 77% of holdings from 55% at the beginning of the period and
reduced infrastructure stocks from 43% to 20%. We continue to believe that the
complementary nature of these two sectors provides balance for the portfolio.

CONSERVATIVE INVESTMENT STYLE

It is important to remember, however, that due to their dependence on less
stable economies, these stocks often experience greater price fluctuations than
larger U.S. stocks. We monitor your Fund's holdings closely with an eye to
enhancing potential returns and limiting risk, reallocating assets as needed to
take advantage of new opportunities created by changing world market conditions.

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PAGE 2
KEYSTONE GLOBAL RESOURCES AND DEVELOPMENT FUND

OUTLOOK

We believe the prospect of continued modest growth in the U.S. and improvements
in the European economy are positive indicators for your Fund. We also think
that metals markets are likely to have a better year ahead after the strong
corrections of the past twelve months. We will continue to favor the oil sector,
which we view as the engine of growth for all world economies. The most positive
scenario for your Fund would be a synchronized worldwide economic recovery,
which would provide attractive opportunities for the stocks in which your Fund
invests.
We appreciate your continued support of Evergreen Keystone Funds. If you have
any questions or comments, please feel free to write us.

Sincerely,
(Signature of Albert H. Elfner, III)
Albert H. Elfner, III
CHAIRMAN
KEYSTONE INVESTMENT MANAGEMENT COMPANY

(Signature of George S. Bissell)
George S. Bissell
CHAIRMAN OF THE BOARD
KEYSTONE FUNDS

May 1997

<PAGE>
PAGE 3

A Discussion With
Your Fund Manager

(picture of John C. Madden, Jr.)

JOHN C. MADDEN, JR. IS A VICE PRESIDENT AND SENIOR PORTFOLIO MANAGER OF
KEYSTONE GLOBAL RESOURCES AND DEVELOPMENT FUND AND KEYSTONE PRECIOUS METAL
HOLDINGS, INC. A CHARTERED FINANCIAL ANALYST, MR. MADDEN HAS MORE THAN 30
YEARS OF EXPERIENCE IN INVESTMENT RESEARCH AND MANAGEMENT, SPECIALIZING IN
PRECIOUS METALS, NATURAL RESOURCES AND ENERGY. HE HOLDS A BA
FROM YALE UNIVERSITY.

(Q) WHAT ARE THE ADVANTAGES OF INVESTING IN KEYSTONE GLOBAL RESOURCES AND
DEVELOPMENT FUND?

(A) Your Fund seeks capital growth by investing in companies in the natural
resources and energy industries, with secondary emphasis on companies related to
infrastructure development. We believe both types of investments offer strong
growth potential because they benefit directly from growing world markets and
rising standards of living. Natural resources and energy company stocks,
including companies in the metals, mining, oil and gas industries, account for
the bulk of the portfolio.
Although these sectors can be volatile, we mitigate a great deal of the
volatility through our relatively conservative investment style. Key components
of this conservative style include maintaining a portfolio that is
well-diversified geographically, and focusing on companies we believe are world
leaders in their industries. We believe this approach provides Fund investors
substantial upside potential while limiting downside risk.

(Q) HOW DID THESE MARKETS PERFORM DURING THE TWELVE-MONTH PERIOD?

(A) It was a positive period for stocks in general, but less favorable for
companies in the resources and development sectors. Bright spots included
selected energy and infrastructure stocks. Strong oil prices throughout most of
the year had a generally positive influence on the profitability of oil-related
companies, which accounted for more than one-fifth of your Fund's holdings. In
Brazil, the privatization of state-owned companies and a strong local stock
market helped our holding of Telebras, the Brazilian telephone company which
more than doubled.
The biggest negative factor during the year was the disappointing level of
metals prices. Aluminum and copper both hit two-to-three year lows, and their
stock prices declined accordingly. Copper fell to $0.80 a pound in the spring of
1996 on the news of a trading scandal at Sumitomo Metals. Copper has recovered
since then,

FUND PROFILE

OBJECTIVE: Seeks capital growth by investing in companies involved in natural
resources, energy and infrastructure development.
COMMENCEMENT OF OPERATIONS: October 7, 1994
COUNTRIES: 11
NET ASSETS: $26.2 million
NEWSPAPER LISTING: "GloRes"

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PAGE 4
KEYSTONE GLOBAL RESOURCES AND DEVELOPMENT FUND

Diversification by Region
AS OF MARCH 31, 1997

North America 51%
Latin America 15%
Asia/Pacific 17%
Europe 15%
Other 2%

but still stands well below the peak of $1.47 a pound reached in the summer of
1995. The steel, gold and forest products sectors also underperformed the
market.

(Q) WHAT CHANGES DID YOU MAKE TO THE PORTFOLIO DURING THE PERIOD?

(A) We made significant adjustments to the allocation of the Fund's holdings. We
increased the percentage devoted to the resource area. Uneven performance across
the oil sector created some good buying opportunities, and we added positions in
domestic and foreign oil and oil service companies. At the end of the period,
resources stocks accounted for 77% of the portfolio.
In the infrastructure area, we sold or reduced our position in several
stocks, taking profits on Bolivian Power and the Argentinean company Central
Costanera. We also made some purchases in the infrastructure area, notably
Nokia, the Finnish telecommunications company, which made a positive
contribution to Fund performance during the year.

(Q) PLEASE DESCRIBE SOME OF THE FUND'S ENERGY HOLDINGS.

(A) We have increased and diversified our holdings of energy stocks. One of the
Fund's largest holdings, FX Energy, is a small U.S.-based production company
with exploration acreage onshore in Poland. It was the best performing stock in
the portfolio during the period, gaining more than 200%. New purchases included
a variety of oil companies here and abroad, such as UNOCAL, Pennzoil and Repsol.
UNOCAL is in the process of transforming itself from a domestic integrated oil
company to a very large independent exploration and production company. It plans
to sell its refining and marketing operations for $2 billion and concentrate on
promising production activities on the U.S. Gulf Coast and in Southeast Asia.
Cash flow in the range of $7.00 to $8.00 per share could help the stock price
move to $50 over the next year or two from the recent level in the mid-$30s.

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PAGE 5

Overseas, we have started a position in Repsol, the Spanish oil company now
completing the privatization process. Repsol has a small but growing exploration
and production operation centered in Latin America and North Africa. It also
holds the dominant position in downstream operations in Spain. The stock has
been selling at a discount relative to other international oil companies. Given
the strong earnings growth we expect for the company, we believe this represents
good value.

(Q) HOW DID THE GEOGRAPHIC MIX OF THE FUND'S HOLDINGS CHANGE DURING THE PERIOD?

(A) We made some modifications over the course of the year. Between March 31,
1996 and March 31, 1997 we increased our exposure to North American stocks from
43% to 51% of the portfolio. We also added to our European holdings to
capitalize on signs of economic recovery. We cut back on holdings in Asia and
Latin America, selling the Hong Kong construction company Kumagai Gumi, KEPKO
(Korean Electric) and TMM, a Mexican transportation company.

(Q) WHAT IS YOUR OUTLOOK?

(A) We are optimistic about the world economic outlook long-term, but do not
necessarily expect big changes soon. We are encouraged by prospects for
continuing growth in the U.S. and the potential for economic recovery in Europe.
We expect to see improvement in the metals sector in the coming year after the
lows of the past twelve months, which should benefit many of the holdings in
your Fund's portfolio.
*

THIS COLUMN IS INTENDED TO ANSWER
QUESTIONS ABOUT YOUR FUND.
IF YOU HAVE A QUESTION YOU WOULD LIKE ANSWERED, PLEASE WRITE TO:
EVERGREEN KEYSTONE INVESTMENT SERVICES, INC.
ATTN: SHAREHOLDER COMMUNICATIONS, 22ND FLOOR
200 BERKELEY STREET, BOSTON, MASSACHUSETTS 02116-5034.

ASSET ALLOCATION
(AS PERCENTAGE OF PORTFOLIO ASSETS)

3/31/97 3/31/96
Natural resources and energy stocks 77% 55%
Infrastructure stocks 20% 43%

TOP 10 HOLDINGS
AS OF MARCH 31, 1997

PERCENTAGE OF
STOCK (COUNTRY) INDUSTRY NET ASSETS
Western Mining (Australia) Metals/Mining 3.5
AGCO (U.S.) Agriculture 3.2
FX Energy (U.S.) Oil 3.1
Potash Corp. (Canada) Agriculture 3.1
Alcan Aluminum (Canada) Metals/Mining 2.9
Schlumberger Ltd. (U.S.) Oil Services 2.8
Diamond Offshore (U.S.) Oil Services 2.7
Savage Resources (Australia) Metals/Mining 2.7
Caterpillar Inc. (U.S.) Machinery 2.6
RTZ Corporation (U.K.) Metals/Mining 2.5

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PAGE 6
KEYSTONE GLOBAL RESOURCES AND DEVELOPMENT FUND

Your Fund's
Performance

Growth of an investment in Keystone Global
Resources and Development Fund Class A.

(picture of graph
Total Value $11,535)

A $10,000 INVESTMENT IN KEYSTONE GLOBAL RESOURCES AND DEVELOPMENT FUND
CLASS A MADE ON OCTOBER 17, 1994 WITH ALL DISTRIBUTIONS REINVESTED WAS WORTH
$11,535 ON MARCH 31, 1997. PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.

Class A, Class B, and Class C shares began operations on October 7, 1994. Class
A share performance is reported at the current maximum front-end sales charge of
4.75%.
Class B shares purchased after January 1, 1997 are subject to a contingent
deferred sales charges (CDSC) that declines from 5% to 1% over six years after
the month purchased. Performance assumes that shares were redeemed after the end
of a one-year holding period and reflects the deduction of a 5% CDSC.
Class C shares are subject to a 1% contingent deferred sales charge for 12
months after the month purchased.

TWELVE-MONTH PERFORMANCE AS OF MARCH 31, 1997

CLASS A CLASS B CLASS C
Total return* 12.76% 11.96% 11.96%
Net asset value 3/31/96 $10.74 $10.62 $10.62
3/31/97 $12.11 $11.89 $11.89
Dividends None None None
Capital gains None None None

* BEFORE DEDUCTING FRONT-END OR CONTINGENT DEFERRED SALES CHARGE (CDSC), IF
APPLICABLE.

HISTORICAL RECORD AS OF MARCH 31, 1997

CUMULATIVE TOTAL
RETURNS CLASS A CLASS B CLASS C
1-year
w/o sales charge 12.76% 11.96% 11.96%
with sales charge 7.40% 6.96% 10.96%
Life of Class 15.35% 15.90% 18.90%
AVERAGE ANNUAL TOTAL
RETURN
1-year
w/o sales charge 12.76% 11.96% 11.96%
with sales charge 7.40% 6.96% 10.96%
Life of Class 5.98% 6.19% 7.30%

Performance assumes that shares were redeemed after the end of a one-year
holding period and reflects the deduction of a 1% CDSC.
The investment return and principal value will fluctuate so that your shares,
when redeemed, may be worth more or less than the original cost.
You may exchange your shares by phone or in writing. You may also exchange
funds using the Evergreen Keystone Express Line. The Fund reserves the right to
change or terminate the exchange offer.

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PAGE 7

Growth Of
An Investment

Comparison of change in value of a $10,000 investment in Keystone
Global Resources and Developement Fund, the Standard & Poor's 500
Index and the Morgan Stanley Capital International World Index

(graph legend)

PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. THE PERFORMANCE OF EACH
CLASS MAY VARY BASED ON DIFFERENCES IN LOADS AND FEES PAID BY THE SHAREHOLDER
INVESTING IN THE DIFFERENT CLASSES. THE STANDARD & POORS 500 STOCK INDEX AND
THE MORGAN STANLEY CAPITAL INTERNATIONAL WORLD INDEX ARE FROM SEPTEMBER 30,
1994.

This chart graphically compares your Fund's total return performance to certain
investment indexes. It is the result of fund performance guidelines issued by
the Securities and Exchange Commission. The intent is to provide investors with
more information about their investment.

COMPONENTS OF THE CHART

The chart is composed of three lines that represent the accumulated value of an
initial $10,000 investment for the period indicated. The lines illustrate a
hypothetical investment in:

1. KEYSTONE GLOBAL RESOURCES AND DEVELOPMENT FUND
Your Fund seeks capital growth by investing in companies involved in industrial
and infrastructure development. The return is quoted after deducting sales
charges (if applicable), fund expenses and transaction costs and assumes
reinvestment of all distributions.

2. STANDARD & POOR'S 500 INDEX (S&P 500)
The S&P 500 is a broad-based unmanaged index of common stock prices. It is
comprised of stocks of the largest U.S. companies. These stocks are selected and
compiled by Standard & Poor's Corporation according to criteria that may be
unrelated to your Fund's investment objective.

3. MORGAN STANLEY CAPITAL INTERNATIONAL WORLD INDEX (MSCIWI)
MSCIWI is a broad-based securities market index of about 1500 securities from
major developed markets around the world. The index is unmanaged and includes
North America, Europe and the Pacific Rim.
These indexes do not include transaction costs associated with buying and
selling securities, and do not hold cash to meet redemptions. It would be
difficult for most individual investors to duplicate these indexes.

UNDERSTANDING WHAT THE CHART MEANS

The chart demonstrates your Fund's total return performances in relation to well
known investment indexes. It is important to understand what the chart shows and
does not show.
This illustration is useful because it charts Fund and index performance over
the same time frame and over a long period. Long-term performance is a more
reliable and useful measure of performance than measurements of short-term
returns or temporary swings in the market. Your financial adviser can help you
evaluate fund performance in conjunction with the other important financial
considerations such as safety, stability and consistency.

LIMITATIONS OF THE CHART

The chart, however, limits the evaluation of fund performance in several ways.
Because the measurement is based on total returns over an extended period of
time, the comparison often favors those funds which emphasize

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PAGE 8
KEYSTONE GLOBAL RESOURCES AND DEVELOPMENT FUND

capital appreciation when the market is rising. Likewise, when the market is
declining, the comparison usually favors those which take less risk.

PERFORMANCE CAN BE DISTORTED

Funds which are more conservative in their orientation and which place an
emphasis on capital preservation will tend to compare less favorably when the
market is rising. In addition, funds which have income as one of their
objectives also will tend to compare less favorably to relevant indexes.
Indexes may also reflect the performance of some securities which a fund may
be prohibited from buying. A bond fund, for example, may be limited to
investments in only high quality bonds, or a stock fund may only be able to buy
stocks that have been traded on a stock exchange for a minimum number of years
or of a certain company size. Indexes usually do not have the same investment
restrictions as your Fund.

INDEXES DO NOT INCLUDE COSTS OF INVESTING

The comparison is further limited in its utility because the index does not take
into account any deductions for sales charges, transaction costs or other fund
expenses. Your Fund's performance figures do reflect such deductions. Sales
charges-- whether up-front or deferred-- pay for the cost of the investment
advice of your financial adviser. Transaction costs pay for the cost of buying
and selling securities for your Fund's portfolio. Fund expenses pay for the
costs of investment management and various shareholder services. None of these
costs are reflected in index total returns. The comparison is not completely
realistic because an index cannot be duplicated by an investor-even an unmanaged
index-- without incurring some charges and expenses.

ONE OF SEVERAL MEASURES

The chart is one of several tools you can use to understand your investment. It
should be read in conjunction with the Fund's prospectus, and annual and
semiannual reports. Also, your financial adviser, who understands your personal
financial situation, can best explain the features of your Keystone fund and how
it applies to your financial needs.

FUTURE RETURNS MAY BE DIFFERENT

Shareholders also should be mindful that the long-run performance of either the
Fund or the indexes is not representative of what shareholders should expect to
receive from their Fund investment in the future; it is presented to illustrate
only past performance and is not a guarantee of future returns.

<PAGE>
PAGE 9

SCHEDULE OF INVESTMENTS-- MARCH 31, 1997

<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
COMMON STOCKS (89.1%)
AUSTRALIA (15.7%)
OIL (3.8%)
Santos Ltd. 88,000 $ 347,695
Woodside Petroleum 86,800 639,228
986,923
IRON AND STEEL (4.3%)
Broken Hill Proprietary Co. Ltd. 43,787 583,552
CRA Limited 38,055 562,651
1,146,203
METALS AND MINING (7.6%)
QNI Limited (b) 200,000 380,997
Savage Resources (b) 669,981 698,553
Western Mining Corp. Ltd. 145,022 916,335
1,995,885
TOTAL AUSTRALIA 4,129,011
BRAZIL (2.1%)
TELECOMMUNICATIONS (2.1%)
Telecomunicacoes Brasilieros S.A. ADR 5,500 563,063
CANADA (14.8%)
AGRICULTURE (3.1%)
Potash Corp. of Saskatchewan Inc. 10,500 800,867
OIL SERVICES (1.0%)
Arakis Energy Corp. (b) 64,600 272,531
OIL (1.8%)
Canadian Occidental Petroleum Ltd. 25,100 462,297
METALS AND MINING (7.4%)
Alcan Aluminum Ltd. 22,200 749,621
Inco Ltd. 19,300 624,514
TECK Corp. 26,200 572,445
1,946,580
</TABLE>

(CONTINUED ON NEXT PAGE)

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PAGE 10
KEYSTONE GLOBAL RESOURCES AND DEVELOPMENT FUND

SCHEDULE OF INVESTMENTS--MARCH 31, 1997

<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
PRECIOUS METALS (1.5%)
TVX Gold Inc. (b) 38,200 $ 267,635
Repadre Corp. (b) 25,000 137,234
404,869
TOTAL CANADA 3,887,144
FINLAND (1.8%)
TELECOMMUNICATIONS (1.8%)
Nokia Corp. ADR 8,000 466,000
FRANCE (5.7%)
CONSTRUCTION (1.8%)
Lafarge 6,900 479,049
OIL (3.9%)
Societe Nationale Elf Aquitaine 5,000 513,848
Total S.A. 5,944 515,475
1,029,323
TOTAL FRANCE 1,508,372
MEXICO (3.3%)
CONSTRUCTION (0.9%)
Apasco S.A. 34,000 230,254
PRECIOUS METALS (2.4%)
Industrias Penoles S.A. de C.V. 130,000 639,385
TOTAL MEXICO 869,639
PERU (1.7%)
METALS AND MINING (1.7%)
Minas Buenaventura 47,370 445,015
SPAIN (0.8%)
ENERGY SOURCES (0.8%)
Repsol S.A. 5,000 208,813
SWEDEN (2.4%)
ELECTRICAL PRODUCTS (2.4%)
AAB, Series B 5,521 625,655
</TABLE>

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PAGE 11

SCHEDULE OF INVESTMENTS-- MARCH 31, 1997

<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
UNITED KINGDOM (4.5%)
IRON AND STEEL (2.0%)
British Steel PLC 192,000 $ 514,906
METALS AND MINING (2.5%)
RTZ Corp. 41,539 658,145
TOTAL UNITED KINGDOM 1,173,051
UNITED STATES (36.3%)
AGRICULTURE (3.2%)
AGCO Corp. 30,600 845,325
CONSTRUCTION (1.6%)
Fluor Corp. 8,200 430,500
MACHINERY (4.3%)
Caterpillar Inc. 8,400 674,100
Deere and Co. 5,000 217,500
Lindsay Manufacturing Co. 7,500 241,875
1,133,475
ELECTRICAL COMPONENTS (2.5%)
UCAR International Inc. (b) 16,300 645,888
IRON & STEEL (1.8%)
Nucor Corp. 10,000 457,500
METALS AND MINING (2.1%)
Aluminum Company of America 8,000 544,000
PRECIOUS METALS (1.3%)
Homestake Mining Co. 10,000 151,250
Newmont Mining Corp. 5,000 193,750
345,000
OIL (7.9%)
FX Energy Inc. (b) 75,000 801,563
Occidental Petroleum Corp. 9,000 221,625
Pennzoil Co. 7,500 388,125
Triton Energy Corp. Ltd. (b) 5,500 213,125
Unocal Corp. 12,000 457,500
2,081,938
</TABLE>

(CONTINUED ON NEXT PAGE)

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PAGE 12
KEYSTONE GLOBAL RESOURCES AND DEVELOPMENT FUND

SCHEDULE OF INVESTMENTS-- MARCH 31, 1997

<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
OIL SERVICES (10.3%)
BJ Services Co. (b) 9,000 $ 430,875
Diamond Offshore Drilling Inc. (b) 10,500 719,250
Halliburton Co. 4,000 271,000
Schlumberger Ltd. 6,900 740,025
Tidewater Inc. 11,500 529,000
2,690,150
FOREST PRODUCTS (1.3%)
Weyerhaeuser Co. 7,600 339,150
TOTAL UNITED STATES 9,512,926
TOTAL COMMON STOCKS (COST-- $18,628,142) 23,388,689
PREFERRED STOCKS (7.5%)
BRAZIL (7.5%)
IRON AND STEEL (3.1%)
Vale do Rio Doce Navegacao S.A. 23,588 536,648
Caemi Min E Metal (b) 5,000,000 264,326
800,974
OIL (2.1%)
Petrol Brasileiros 2,830,000 562,367
UTILITIES (2.3%)
Electrobras 1,390,000 598,357
TOTAL BRAZIL 1,961,698
TOTAL PREFERRED STOCKS (COST-- $1,477,278) 1,961,698
</TABLE>

<TABLE>
<CAPTION>
MATURITY MARKET
VALUE VALUE
<S> <C> <C>
REPURCHASE AGREEMENTS (1.5%)
Investments in repurchase agreements, in a joint trading account, purchased 3/31/97,
6.466%, maturing 4/1/97 (a) 397,071 397,000
TOTAL REPURCHASE AGREEMENTS (COST-- $397,000) 397,000
</TABLE>

<PAGE>
PAGE 13

SCHEDULE OF INVESTMENTS--MARCH 31, 1997

<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
INVESTMENT COMPANY (1.3%)
AUSTRALIA (1.3%)
First Resources Development Fund (b) 600,000 $ 329,257
TOTAL INVESTMENT COMPANY (COST-- $464,864) 329,257
OPTIONS, PURCHASED (0.1%)
AUSTRALIA (0.1%)
Savage Resources, options, expire November 1998 (b) 66,400 17,178
First Resources Development Fund, options, expire December 1997 (b) 600,000 11,759
TOTAL OPTIONS (COST-- $12,905) 28,937
TOTAL INVESTMENTS (COST-- $20,980,189) (C) 26,105,581
FOREIGN CURRENCY HOLDINGS (0.0%) (COST-- $9,530) 9,285
OTHER ASSETS AND LIABILITIES-- NET (0.5%) 122,256
NET ASSETS (100.0%) $26,237,122
</TABLE>

(a) The repurchase agreements are fully collateralized by U.S. government and/or
agency obligations based on market prices at March 31, 1997.

(b) Non-income-producing security.

(c) The cost of investments for federal income tax purposes is $20,980,189.
Gross unrealized appreciation and depreciation based on identified tax cost,
at March 31, 1997 are as follows:

Gross unrealized appreciation $5,609,122
Gross unrealized depreciation (483,730)
Net unrealized appreciation $5,125,392

FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS

<TABLE>
<CAPTION>
U.S. $ VALUE
EXCHANGE AT IN EXCHANGE UNREALIZED
DATE MARCH 31, 1997 FOR U.S. $ APPRECIATION
<S> <C> <C> <C> <C> <C>
Forward Foreign Currency Exchange Contracts
to Sell
Contracts to Deliver
04/09/97 2,807,253 Australian Dollar 2,200,459 2,217,000 $ 16,541
05/06/97 7,042,927 French Franc 1,257,489 1,274,000 16,511
Unrealized Appreciation on Forward Foreign Currency Exchange Contracts $ 33,052
</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS

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PAGE 14
KEYSTONE GLOBAL RESOURCES AND DEVELOPMENT FUND

FINANCIAL HIGHLIGHTS-- CLASS A SHARES
(FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR)

<TABLE>
<CAPTION>
PERIOD FROM OCTOBER 7, 1994
YEAR ENDED MARCH 31, (COMMENCEMENT OF OPERATIONS)
1997 1996 TO MARCH 31, 1995
<S> <C> <C> <C>
Net asset value beginning of year $10.74 $ 9.02 $10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (0.04) (0.04) 0.00(d)
Net realized and unrealized gain (loss) on investments and foreign
currency related transactions 1.41 1.76 (0.98)
Total income from investment operations 1.37 1.72 (0.98)
NET ASSET VALUE END OF YEAR $12.11 $10.74 $ 9.02
TOTAL RETURN(A) 12.76% 19.07% (9.80%)
RATIOS/SUPPLEMENTAL DATA
Ratios to average net assets:
Total expenses 2.40%(b) 2.38%(b) 2.77%(c)
Net investment loss (0.45%) (0.41%) (0.07%)(c)
Portfolio turnover rate 39% 40% 13%
Average commission rate paid $0.0023 $0.0025 N/A
Net assets, end of year (thousands) $ 4,462 $ 4,574 $4,890
</TABLE>

(a) Excluding applicable sales charges.

(b) Ratio of total expenses to average net assets for the years ended March 31,
1997 and 1996 includes indirectly paid expenses. Excluding indirectly paid
expenses the expense ratio would have been 2.39% and 2.37% for the years
ended March 31, 1997 and 1996, respectively.

(d) Represents less than $0.01 per share.

SEE NOTES TO FINANCIAL STATEMENTS.

<PAGE>
PAGE 15

FINANCIAL HIGHLIGHTS-- CLASS B SHARES
(FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR)

<TABLE>
<CAPTION>
PERIOD FROM OCTOBER 7, 1994
YEAR ENDED MARCH 31, (COMMENCEMENT OF OPERATIONS)
1997 1996 TO MARCH 31, 1995
<S> <C> <C> <C>
Net asset value beginning of year $10.62 $ 8.99 $10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (0.14) (0.13) (0.03)
Net realized and unrealized gain (loss) on investments and foreign
currency related transactions 1.41 1.76 (0.98)
Total income from investment operations 1.27 1.63 (1.01)
NET ASSET VALUE END OF YEAR $11.89 $10.62 $ 8.99
TOTAL RETURN(A) 11.96% 18.13% (10.10%)
RATIOS/SUPPLEMENTAL DATA
Ratios to average net assets:
Total expenses 3.16%(b) 3.13%(b) 3.55%(c)
Net investment loss (1.22%) (1.16%) (0.80%)(c)
Portfolio turnover rate 39% 40% 13%
Average commission rate paid $0.0023 $0.0025 N/A
Net assets, end of year (thousands) $17,208 $15,161 $14,688
</TABLE>

(a) Excluding applicable sales charges.

(b) Ratio of total expenses to average net assets for the years ended March 31,
1997 and 1996 includes indirectly paid expenses. Excluding indirectly paid
expenses the expense ratio would have been 3.15% and 3.12% for the years
ended March 31, 1997 and 1996, respectively.

SEE NOTES TO FINANCIAL STATEMENTS.

<PAGE>
PAGE 16
KEYSTONE GLOBAL RESOURCES AND DEVELOPMENT FUND

FINANCIAL HIGHLIGHTS-- CLASS C SHARES
(FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR)

<TABLE>
<CAPTION>
PERIOD FROM OCTOBER 7, 1994
YEAR ENDED MARCH 31, (COMMENCEMENT OF OPERATIONS)
1997 1996 TO MARCH 31, 1995
<S> <C> <C> <C>
Net asset value beginning of year $10.62 $ 8.99 $10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (0.10) (0.10) (0.03)
Net realized and unrealized gain (loss) on investments and foreign
currency related transactions 1.37 1.73 (0.98)
Total income from investment operations 1.27 1.63 (1.01)
NET ASSET VALUE END OF YEAR $11.89 $10.62 $ 8.99
TOTAL RETURN(A) 11.96% 18.13% (10.10%)
RATIOS/SUPPLEMENTAL DATA
Ratios to average net assets:
Total expenses 3.13%(b) 3.13%(b) 3.51%(c)
Net investment loss (1.27%) (1.16%) (.93%)(c)
Portfolio turnover rate 39% 40% 13%
Average commission rate paid $0.0023 $0.0025 N/A
Net assets, end of year (thousands) $ 4,567 $ 2,023 $1,393
</TABLE>

(a) Excluding applicable sales charges.

(b) Ratio of total expenses to average net assets for the years ended March 31,
1997 and 1996 includes indirectly paid expenses. Excluding indirectly paid
expenses the expense ratio would have been 3.12% and 3.12% for the years
ended March 31, 1997 and 1996, respectively.

SEE NOTES TO FINANCIAL STATEMENTS.

<PAGE>
PAGE 17

STATEMENT OF ASSETS AND LIABILITIES MARCH 31, 1997

ASSETS:
Investments at market value
(identified cost-- $20,980,189) $26,105,581
Foreign currency holdings (identified
cost-- $9,530) 9,285
Cash 479
Receivable for:
Dividends and interest 71,944
Fund shares sold 82,480
Net unrealized appreciation on forward foreign
currency exchange contracts 33,052
Deferred organization expense 20,918
Prepaid expenses 4,796
Foreign taxes receivable 2,057
Total assets 26,330,592

LIABILITIES:
Payable for:
Fund shares redeemed 53,361
Foreign taxes withheld 2,815
Other accrued expenses 37,294
Total liabilities 93,470

NET ASSETS $26,237,122
NET ASSETS REPRESENTED BY:
Paid-in-capital $20,749,887
Accumulated net investment loss (33,055)
Accumulated net realized gains on investments
and foreign currency related transactions 361,698
Net unrealized appreciation on investments and
foreign currency related transactions 5,125,540
Net unrealized appreciation on forward foreign
currency exchange contracts 33,052
Total net assets $26,237,122

NET ASSET VALUE PER SHARE:
Class A Shares
Net assets of $4,461,6054368,381 shares
outstanding $ 12.11
Offering price per share ($12.1140.9525)
(based on sales charge of 4.75% of the
offering price on March 31, 1997) $ 12.71
Class B Shares
Net assets of $17,208,06541,446,817 shares
outstanding $ 11.89
Class C Shares
Net assets of $4,567,4524383,981 shares
outstanding $ 11.89

SEE NOTES TO FINANCIAL STATEMENTS.

STATEMENT OF OPERATIONS
YEAR ENDED MARCH 31, 1997

INVESTMENT INCOME
Interest $ 41,483
Dividends (net of withholding taxes of $33,367) 426,023
Total income 467,506

EXPENSES
Management fee 243,022
Shareholder services 86,335
Accounting, auditing and legal 56,400
Custodian fees 46,864
Printing 30,507
Distribution plan expenses 206,046
Registration fees 44,810
Amortization of organization expense 13,158
Miscellaneous expenses 5,392
Total expenses 732,534
Less: Expenses paid indirectly (3,073)
Net expenses 729,461
NET INVESTMENT LOSS (261,955)

NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCY RELATED
TRANSACTIONS:
Realized gain (loss) on:
Investment transactions 1,236,594
Foreign currency related transactions (140,097)
Net realized gain on investments and foreign
currency related transactions 1,096,497
Net change in unrealized appreciation on
investments, foreign currency related
transactions and forward foreign currency
exchange contracts 1,919,418
Net gain on investments, foreign currency
related transactions and forward foreign
currency exchange contracts 3,015,915
Net increase in net assets resulting from
operations $2,753,960

<PAGE>
PAGE 18
KEYSTONE GLOBAL RESOURCES AND DEVELOPMENT FUND

STATEMENTS OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
YEAR ENDED MARCH 31,
1997 1996
<S> <C> <C>
OPERATIONS:
Net investment loss $ (261,955) $ (217,769)
Net realized gain on investments and foreign currency related transactions 1,096,497 131,912
Net change in unrealized appreciation on investments, foreign currency related
transactions and forward foreign currency exchange contracts 1,919,418 3,775,333
Net increase in net assets resulting from operations 2,753,960 3,689,476
CAPITAL SHARE TRANSACTIONS (NOTE 2):
Proceeds from shares sold:
Class A Shares 1,149,694 1,145,130
Class B Shares 4,494,545 2,628,135
Class C Shares 3,596,943 672,747
Payments for shares redeemed:
Class A Shares (1,830,659) (2,328,932)
Class B Shares (4,250,880) (4,711,542)
Class C Shares (1,433,936) (308,032)
Net increase (decrease) in net assets resulting from capital share
transactions 1,725,707 (2,902,494)
Total increase in net assets 4,479,667 786,982
NET ASSETS:
Beginning of year 21,757,455 20,970,473
End of year (Including accumulated net investment loss of ($33,055) at
March 31, 1997 and undistributed net investment income of $3,718 at
March 31, 1996) $26,237,122 $21,757,455
</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS.

<PAGE>
PAGE 19

NOTES TO FINANCIAL STATEMENTS

1. SIGNIFCANT ACCOUNTING POLICIES

Keystone Global Resources and Development Fund formerly Keystone Strategic
Development Fund (the "Fund") is a Massachusetts business trust for which
Keystone Investment Management Company ("Keystone") is the Investment Adviser
and Manager. Keystone was formerly a wholly-owned subsidiary of Keystone
Investments, Inc. ("KII") and is currently a subsidiary of First Union Keystone,
Inc. First Union Keystone, Inc. is a wholly-owned subsidiary of First Union
National Bank of North Carolina which in turn is a wholly-owned subsidiary of
First Union Corporation ("First Union"). The Fund is registered under the
Investment Company Act of 1940, as amended (the "1940 Act"), as a diversified,
open-end investment company. The Fund offers several classes of shares. The
Fund's investment objective is to achieve long term capital growth by investing
primarily in equity securities.
Equitilink International Management Limited ("EIML") acts as a subadviser to
the Fund. EIML provides Keystone with investment research and advice. In
addition, subject to the supervision of the Fund's Board of Trustees and
Keystone, EIML may provide investment supervision and furnish an investment
program for certain assets of the Fund.
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. The
policies are in conformity with generally accepted accounting principles, which
require management to make estimates and assumptions that affect amounts
reported herein. Although actual results could differ from these estimates, any
such differences are expected to be immaterial to the net assets of the Fund.

A. VALUATION OF SECURITIES

Investments, including American Depositary Receipts ("ADR's") are valued at the
closing sales price or, in the absence of sales and for over-the-counter
securities, the mean of bid and asked quotations. Management values the
following securities at prices it deems in good faith to be fair by or under the
direction of the Board of Trustees: (a) securities (including restricted
securities) for which complete quotations are not readily available and (b)
listed securities if, in the opinion of management, the last sales price does
not reflect a current value or if no sale occurred. ADR's, which are
certificates representing shares of foreign securities deposited in domestic and
foreign banks, are traded and valued in United States dollars.
Short-term investments with remaining maturities of 60 days or less are
carried at amortized cost, which approximates market value. Short-term
securities with greater than 60 days to maturity are valued at market value.

B. REPURCHASE AGREEMENTS

Pursuant to an exemptive order issued by the Securities and Exchange Commission,
the Fund, along with certain other Keystone funds, may transfer uninvested cash
balances into a joint trading account. These balances are invested in one or
more repurchase agreements that are fully collateralized by U.S. Treasury and/or
Federal Agency obligations.
Securities pledged as collateral for repurchase agreements are held by the
custodian on the Fund's behalf. The Fund monitors the adequacy of the collateral
daily and will require the seller to provide additional collateral in the event
the market value of the securities pledged falls below the carrying value of the
repurchase agreement.

C. FOREIGN CURRENCY

The books and records of the Fund are maintained in United States (U.S.)
dollars. Foreign currency amounts are translated into United States dollars as
follows: market value of investments, assets and liabilities at the daily rate
of exchange; purchases and sales of investments, income and expenses at the rate
of exchange prevailing on the respective dates of such transactions. Net
unrealized foreign exchange gain (loss) resulting from changes in foreign
currency exchange rates is a component of net unrealized appreciation
(depreciation)

<PAGE>
PAGE 20

KEYSTONE GLOBAL RESOURCES AND DEVELOPMENT FUND

on investments and foreign currency related transactions. Net realized foreign
currency gains and losses resulting from changes in exchange rates include
foreign currency gains and losses between trade date and settlement date on
investment securities transactions, foreign currency transactions and the
difference between the amounts of interest and dividends recorded on the books
of the Fund and the amount actually received. The portion of foreign currency
gains and losses related to fluctuations in exchange rates between the initial
purchase trade date and subsequent sale trade date is included in realized gain
(loss) on foreign currency related transactions.

D. FUTURES CONTRACTS

In order to gain exposure to or protect against changes in security values, the
Fund may buy and sell futures contracts.
The initial margin deposited with a broker when entering into a futures
transaction is subsequently adjusted by daily payments or receipts as the value
of the contract changes. Such changes are recorded as unrealized gains or
losses. Realized gains or losses are recognized on closing the contract.
Risks of entering into futures contracts include (i) the possibility of an
illiquid market for the contract, (ii) the possibility that a change in the
value of the contract may not correlate with changes in the value of the
underlying instrument or index, and (iii) the credit risk that the other party
will not fulfill their obligations under the contract. Futures contracts also
involve elements of market risk in excess of the amount reflected in the
statement of assets and liabilities.

E. FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS

The Fund may enter into forward foreign currency exchange contracts ("forward
contracts") to settle portfolio purchases and sales of securities denominated in
a foreign currency and to hedge certain foreign currency assets or liabilities.
Forward contracts are recorded at the forward rate and marked-to-market daily.
Realized gains and losses arising from such transactions are included in net
realized gain (loss) on foreign currency related transactions. The Fund bears
the risk of an unfavorable change in the foreign currency exchange rate
underlying the forward contract and is subject to the credit risk that the other
party will not fulfill their obligations under the contract. Forward contracts
involve elements of market risk in excess of the amount reflected in the
statement of assets and liabilities.

F. SECURITY TRANSACTIONS AND INVESTMENT INCOME

Securities transactions are accounted for no later than one business day after
the trade date. Realized gains and losses are computed on the identified cost
basis. Interest income is recorded on the accrual basis and dividend income is
recorded on the ex-dividend date.

G. ORGANIZATION EXPENSES

The Fund's organization expenses are amortized to operations over a five-year
period on a straight-line basis. In the event any of the initial shares of the
Fund are redeemed by First Union during the five-year amortization period,
redemption proceeds will be reduced by any unamortized organization expenses in
the same proportion as the number of initial shares being redeemed bears to the
number of initial shares outstanding at the time of redemption.

H. FEDERAL INCOME TAXES

The Fund has qualified and intends to qualify in the future as a regulated
investment company under the Internal Revenue Code of 1986, as amended (the
"Code"). Thus, the Fund is relieved of any federal income tax liability by
distributing all of its net taxable investment income and net taxable capital
gains, if any, to its shareholders. The Fund also intends to avoid excise tax
liability by making the required distributions under the Code. Accordingly, no
provision for federal income taxes is required.

I. DISTRIBUTIONS

The Fund distributes net investment income and net capital gains, if any, at
least annually. Distributions to shareholders are recorded at the close of
business on the ex-dividend date.

<PAGE>
PAGE 21

Income and capital gains distributions to shareholders are determined in
accordance with income tax regulations, which may differ from generally accepted
accounting principles. Distributions from taxable net investment income and net
capital gains can exceed book basis net investment income and net capital gains.

J. CLASS ALLOCATIONS

Effective January 1, 1997, Class A shares are currently offered at a public
offering price which includes a maximum sales charge of 4.75% payable at the
time of purchase. Prior to January 1, 1997, Class A shares were offered at a
public offering price which included a maximum sales charge of 5.75% payable at
the time of purchase.
Class B shares are sold subject to a contingent deferred sales charge that is
payable upon redemption and decreases depending on how long the shares have been
held. Class B shares purchased on or after January 1, 1997 will convert to Class
A shares after seven years. Class B shares purchased prior to January 1, 1997
retain their existing conversion features.
Class C shares are sold subject to a contingent deferred sales charge payable
on shares redeemed within one year after the month of purchase.
Income, expenses (other than class specific expenses) and realized and
unrealized gains and losses are prorated among the classes based on the relative
net assets of each class. Currently, class specific expenses are limited to
expenses incurred under the Distribution Plans for each class.

2. CAPITAL SHARE TRANSACTIONS

The Fund's Declaration of Trust authorizes the issuance of an unlimited number
of shares of beneficial interest with no par value. Shares of beneficial
interest of the Fund are currently divided into Class A, Class B and Class C.
Transactions in shares of the Fund were as follows:

YEAR ENDED MARCH 31,

1997 1996
CLASS A
Shares sold 99,899 114,080
Shares redeemed (157,432) (230,445)
Net decrease (57,533) (116,365)

CLASS B
Shares sold 391,020 263,001
Shares redeemed (371,723) (469,950)
Net increase (decrease) 19,297 (206,949)

CLASS C
Shares sold 317,784 65,799
Shares redeemed (124,231) (30,391)
Net increase 193,553 35,408

3. SECURITIES TRANSACTIONS

Cost of purchases and proceeds from sales of investment securities (excluding
short-term securities) for the year ended March 31, 1997 were $10,614,219 and
$9,140,457, respectively.

<PAGE>
PAGE 22

KEYSTONE GLOBAL RESOURCES AND DEVELOPMENT FUND

4. DISTRIBUTION PLANS

The Fund bears some of the costs of selling its shares under Distribution Plans
adopted for its Class A, B and C shares pursuant to Rule 12b-1 under the 1940
Act. Under the Distribution Plans, the Fund pays its principal underwriter
amounts which are calculated and paid monthly.
The Fund entered into a principal underwriting agreement with Evergreen
Keystone Distributor, Inc. (formerly, Evergreen Funds Distributor, Inc.)
("EKD"), a wholly-owned subsidiary of The BISYS Group Inc. Evergreen Keystone
Investment Services, Inc. (formerly Keystone Investment Distributors Company)
("EKIS"), a wholly-owned subsidiary of Keystone, previously served as the Fund's
principal underwriter.
The Class A Distribution Plan provides for expenditures, which are currently
limited to 0.25% annually of the average daily net assets of the Class A shares,
to pay expenses related to the distribution of Class A shares.
Pursuant to the Fund's Class B and Class C Distribution Plans, the Fund pays a
distribution fee which may not exceed 1.00% annually of the average daily net
assets of Class B and Class C shares, respectively. Of that amount, 0.75% is
used to pay distribution expenses and 0.25% is used to pay service fees.
During the year ended March 31, 1997 amounts paid to EKD or EKIS pursuant to
the Fund's Class A, Class B and Class C Distribution Plans were $11,027,
$162,397 and $32,622 respectively.
Each of the Distribution Plans may be terminated at any time by vote of the
Independent Trustees or by vote of a majority of the outstanding voting shares
of the respective class. However, after the termination of any Distribution
Plan, and subject to the discretion of the Independent Trustees, payments to
EKIS and/or EKD may continue as compensation for services which had been earned
while the Distribution Plan was in effect.
EKD intends, but is not obligated, to continue to pay distribution costs that
exceed the current annual payments from the Fund. EKD intends to seek full
payment of such distribution costs from the Fund at such time in the future as,
and to the extent that, payment thereof by the Class B or Class C shares would
be within permitted limits.
At March 31, 1997 total unpaid distribution costs were $1,099,994 for Class B
shares and $301,041 for Class C shares.
Contingent deferred sales charges paid by redeeming shareholders are paid to
EKD or its predecessor.

5. INVESTMENT MANAGEMENT AGREEMENT AND OTHER AFFILIATED TRANSACTIONS

Under an investment advisory and management agreement with the Fund, Keystone
provides the Fund with investment advisory and management services. In return,
Keystone is paid a management fee, computed daily and paid monthly, at an annual
rate of 1.00% of the aggregate net asset value of the Fund. Keystone has entered
into a Sub-Investment Advisory Agreement with EIML, dated December 11, 1996,
under which EIML provides Keystone with investment research and advice and may
provide investment supervision or furnish an investment program for certain
assets of the Fund. For its services, EIML receives from Keystone a monthly fee
equal to (1) 20% of Keystone's net fee for such month for services rendered in a
non-discretionary capacity, plus (2) 10% of Keystone's net fee for such month
for services rendered in a discretionary capacity.
For the year ended March 31, 1997 the Fund paid or accrued to Keystone
Investment management and administrative services fees of $243,022, which
represented 1.00% of the Fund's average daily net assets on an annualized basis.
For the year ended March 31, 1997, Keystone paid or accrued to EIML $59,477 for
its services rendered in a non-discretionary capacity.
During the year ended March 31, 1997, the Fund paid or accrued to Evergreen
Keystone Service Company (formerly Keystone Investor Resource Center, Inc.), a
wholly-owned subsidiary of Keystone, $86,335 for services rendered as the Fund's
transfer and dividend

<PAGE>
PAGE 23

disbursing agent. The Fund paid or accrued $29,463 to Keystone for certain
accounting services.
Officers of the Fund and affiliated Trustees receive no compensation directly
from the Fund.

6. EXPENSE OFFSET ARRANGEMENT

The Fund has entered into an expense offset arrangement with its custodian. For
the year ended March 31, 1997, the Fund incurred total custody fees of $46,864
and received a credit of $3,073 pursuant to this expense offset arrangement,
resulting in a net custody expense of $43,791 The assets deposited with the
custodian under this expense offset arrangement could have been invested in
income-producing assets.

<PAGE>
PAGE 24

KEYSTONE GLOBAL RESOURCES AND DEVELOPMENT FUND

INDEPENDENT AUDITORS' REPORT

THE TRUSTEES AND SHAREHOLDERS OF
KEYSTONE GLOBAL RESOURCES AND DEVELOPMENT FUND

We have audited the accompanying statement of assets and liabilities of the
Keystone Global Resources and Development Fund (formerly Keystone Strategic
Development Fund) including the schedule of investments, as of March 31, 1997,
and the related statement of operations for the year then ended, the statements
of changes in net assets for each of the years in the two-year period then
ended, and the financial highlights for each of the years in the two-year period
then ended and for the period from October 7, 1994 (commencement of operations)
to March 31, 1995 for Class A, Class B, and Class C shares. These financial
statements and financial highlights are the responsibility of the Fund's
management. Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of March
31, 1997 by correspondence with the custodian. An audit also includes assessing
the accounting principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Keystone Global Resources and Development Fund as of March 31, 1997, the results
of its operations for the year then ended, the changes in its net assets for
each of the years in the two-year period then ended, and the financial
highlights for each of the years in the two-year period then ended and for the
period from October 7, 1994 to March 31, 1995 in conformity with generally
accepted accounting principles.

KPMG PEAT MARWICK LLP

Boston, Massachusetts
May 2, 1997

<PAGE>
PAGE 25

ADDITIONAL INFORMATION
(UNAUDITED)

Shareholders of the Fund considered and acted upon the proposals listed below at
a special meeting of shareholders held Monday, December 9, 1996. Below are the
results of that vote:

1. TO ELECT THE FOLLOWING DIRECTORS:

AFFIRMATIVE WITHHELD

Frederick Amling 457,258 14,300
Laurence B. Ashkin 457,258 14,300
Charles A. Austin III 457,258 14,300
Foster Bam 457,027 14,531
George S. Bissell 457,258 14,300
Edwin D. Campbell 457,258 14,300
Charles F. Chapin 457,258 14,300
K. Dun Gifford 457,258 14,300
James S. Howell 457,258 14,300
Leroy Keith, Jr. 457,258 14,300
F. Ray Keyser, Jr. 457,258 14,300
Gerald M. McDonell 457,258 14,300
Thomas L. McVerry 457,258 14,300
William Walt Pettit 457,258 14,300
David M. Richardson 457,258 14,300
Russell A. Salton, III MD 457,258 14,300
Michael S. Scofield 457,258 14,300
Richard J. Shima 457,258 14,300
Andrew J. Simons 457,258 14,300

2. TO APPROVE AN INVESTMENT ADVISORY AND MANAGEMENT AGREEMENT BETWEEN THE FUND
AND KEYSTONE INVESTMENT MANAGEMENT COMPANY.

Affirmative 440,652
Against 6,228
Abstain 24,678

3. TO APPROVE A SUB INVESTMENT ADVISORY AGREEMENT BETWEEN THE FUND AND
EQUITILINK INTERNATIONAL MANAGEMENT LIMITED.

Affirmative 439,756
Against 6,229
Abstain 25,574

<PAGE>
PAGE 26

KEYSTONE GLOBAL RESOURCES AND DEVELOPMENT FUND

Glossary of
Mutual Fund Terms

MUTUAL FUND-- A company which combines the investment money of many people
whose fnancial goals are similar, and invests that money in a variety of
securities. A mutual fund allows the smaller investor the benefts of
diversifcation, professional management and constant supervision usually
available only to large investors.

PORTFOLIO MANAGER-- An investment professional who is responsible for managing
a portfolio's assets prudently and making appropriate investment decisions, such
as which securities to buy, hold and sell, based on the investment objectives of
the portfolio.

STOCK-- Equity or ownership interest in a corporation, which represents a
claim on the corporation's assets and earnings.

BOND-- Security issued by a government or corporation to those from whom it
has borrowed money. A bond usually promises to pay interest income to the
bondholder at regular intervals and to repay the entire amount borrowed at
maturity date.

CONVERTIBLE SECURITY-- A corporate security (usually preferred stock or bonds)
that is exchangeable for a set number of another security type (usually common
stocks) at a pre-stated price.

MONEY MARKET FUND-- A mutual fund whose assets are invested in a diversifed
portfolio of short-term securities, including commercial paper, bankers'
acceptances, certifcates of deposit and other short-term instruments. The fund
pays income which can fluctuate daily. Liquidity and safety of principal are
primary objectives.

NET ASSET VALUE (NAV) PER SHARE-- The value of one share of a mutual fund. The
NAV per share is determined by subtracting a fund's total liabilities from its
total assets, and dividing that amount by the number of fund shares outstanding.

DIVIDEND-- A per share distribution of the income earned from the fund's
portfolio holdings. When a dividend distribution is made, the fund's net asset
value drops by the amount of the distribution because the distribution is no
longer considered part of the fund's assets.

CAPITAL GAIN-- The proft from the sale of securities, less any losses. Capital
gains are paid to fund shareholders on a per share basis. When a capital gain
distribution is made, the fund's net asset value drops by the amount of the
distribution because the distribution is no longer considered part of the fund's
assets.

YIELD-- The annualized rate of income as measured against the current net
asset value of fund shares.

TOTAL RETURN-- The change in value of a fund investment over a specifed period
of time, taking into account the change in a fund's market price and the
reinvestment of all fund distributions.

SHORT-TERM-- An investment with a maturity of one year or less.

LONG-TERM-- An investment with a maturity of greater than one year.

AVERAGE MATURITY-- The average number of days until the notes, drafts,
acceptances, bonds or other debt instruments in a portfolio become due and
payable.

OFFERING PRICE-- The offering price of a share of a mutual fund is the price
at which the share is sold to the public.

<PAGE>
KEYSTONE AMERICA
FAMILY OF FUNDS

Balanced Fund II
California Tax Free Fund
Capital Preservation and Income Fund
Florida Tax Free Fund
Fund for Total Return
Fund of the Americas
Global Opportunities Fund
Global Resources and Development Fund
Government Securities Fund
Hartwell Emerging Growth Fund, Inc.
Intermediate Term Bond Fund
Massachusetts Tax Free Fund
Missouri Tax Free Fund
New York Tax Free Fund
Omega Fund
Pennsylvania Tax Free Fund
Small Company Growth Fund II
Strategic Income Fund
Tax Free Income Fund
World Bond Fund

This report was prepared primarily for the information of the Fund's
shareholders. It is authorized for distribution if preceded or accompanied by
the Fund's current prospectus. The prospectus contains important information
about the Fund including fees and expenses. Read it carefully before you invest
or send money. For a free prospectus on other Keystone funds, contact your
financial adviser or call Keystone.

(Evergreen Keystone FUNDS Logo)
P.O. Box 2121
Boston, Massachusetts 02106-2121

GRD-REV01 5/97
8.8M (recycle logo)

KEYSTONE

(Keystone Logo)

GLOBAL RESOURCES
AND
DEVELOPMENT FUND

(Evergreen Keystone FUNDS Logo)

ANNUAL REPORT
MARCH 31, 1997