ITEM 1. REPORTS TO STOCKHOLDERS.
The Funds annual report transmitted to shareholders pursuant to Rule
30e-1 under the Investment Company Act of 1940 is as follows:
|
|
2007 Annual Report
|
|
|
|
|
|
December 31, 2007
|
The Thai Fund, Inc.
Morgan
Stanley
Investment
Management Inc.
Investment
Adviser
|
|
The Thai Fund, Inc.
|
|
|
|
|
|
Overview (unaudited)
|
Letter to Stockholders
Performance
For
the year ended December 31, 2007, The Thai Fund, Inc. (the Fund)
had total returns, based on net asset value and market price per share
(including reinvestment of distributions), of 45.65%, net of fees and 21.02%,
respectively, compared to its benchmark, the Securities Exchange of Thailand
(SET) Index (the Index) expressed in U.S. dollars which returned 35.46%. On December 31,
2007, the closing price of the Funds shares on the New York Stock Exchange was
$13.05, representing a 1.6% premium to the Funds net asset value per share.
Past performance is no guarantee of future results.
Factors Affecting Performance
·
2007
was a difficult year for the Thai economy. The government installed by the
military after the coup was initially more focused on political agendas than on
the economy. As a result, much-anticipated economic stimulus did not happen,
further dampening investor and consumer sentiment. Fortunately, exports
continued to grow, which led to an overall real gross domestic product (GDP)
growth of 4.5% (based on consensus estimates). This compared with real GDP
growth of 5.1% in 2006.
·
In
2007, the Index rose by 35.5% in U.S. dollar terms. Performance was strongest
in the energy sector, which benefited from rising oil and coal prices. Stocks
with exposure to the domestic economy, such as property and banks, did not
perform as well. Telecommunication and media stocks also suffered from
regulatory uncertainty, as the interim government attempted to undo many
policies of the previous government, which had a significant impact on the
earnings of those stocks.
·
The
country held elections on December 23 to restore democracy. Most investors
were initially optimistic that with the return to democracy, both investor
sentiment and the economy would improve. However, the initial election results
continued to reflect the deep polarization in the country. The Peoples Power
Party (PPP), which was endorsed by ousted Prime Minister Thaksin Shinawatra,
won a surprising 233 seats in the Thai parliament. On the other hand, the
Democrat Party managed to win 165 of the 480 seats, much to the surprise of
many observers.
·
At
the end of the period, it remained uncertain whether the PPP would be endorsed
as the new government, given a pending court case to annul the election
results. This uncertainty has the potential to delay any reversal of sentiment,
although there were signs of increasing business activity in the fourth
quarter.
Management Strategies
·
The
Fund was overweighted in the energy sector during 2007. This positioning
benefited from the outperformance of this sector, and bolstered the Funds
returns. An overweighted position in banks also helped performance, though to a
lesser extent.
·
An
overweighted position in property stocks held back returns, as consumers
refrained from real estate transactions in the uncertain economic environment.
·
The
Fund increased its overweight in shipping stocks during the year, which hurt
performance as these stocks underperformed in the final quarter of the year.
·
The
Fund seeks long-term capital appreciation and integrates top-down sector
allocation and bottom-up stock selection with a growth bias. The team utilizes
a rigorous fundamental research approach that considers dynamics, valuation,
and sentiment and focuses on companies with strong management and solid
earnings.
Sincerely,
|
|
|
|
|
|
|
|
Ronald
E. Robison
|
|
President
and Principal Executive Office
r
|
|
January 2008
2
|
|
The Thai Fund, Inc.
|
|
|
|
|
|
December 31, 2007
|
Portfolio of Investments
|
|
Shares
|
|
Value
(000)
|
|
THAI INVESTMENT PLAN (96.1%)
|
|
|
|
|
|
THAI
COMMON STOCKS (96.1%)
(Unless Otherwise Noted)
|
|
|
|
|
|
Airlines (2.2%)
|
|
|
|
|
|
Thai Airways International PCL
|
|
3,863,300
|
|
$
|
4,484
|
|
Beverages (0.6%)
|
|
|
|
|
|
Serm Suk PCL
|
|
2,252,600
|
|
1,231
|
|
Building Products (0.5%)
|
|
|
|
|
|
Dynasty Ceramic PCL
|
|
2,335,500
|
|
1,072
|
|
Capital Markets (0.9%)
|
|
|
|
|
|
Kim Eng Securities Thailand PCL
|
|
2,508,900
|
|
1,877
|
|
Chemicals (4.7%)
|
|
|
|
|
|
Aromatics Thailand PCL
|
|
4,879,400
|
|
9,488
|
|
Commercial Banks (20.4%)
|
|
|
|
|
|
Bangkok Bank PCL
|
|
3,453,050
|
|
12,075
|
|
Bank of Ayudhya PCL
|
|
8,499,300
|
|
6,562
|
|
Kasikornbank PCL
|
|
3,376,700
|
|
8,635
|
|
Krung Thai Bank PCL
|
|
(a)4,235,700
|
|
1,261
|
|
Siam Commercial Bank PCL
|
|
5,167,100
|
|
13,126
|
|
|
|
|
|
41,659
|
|
Construction Materials (2.9%)
|
|
|
|
|
|
Siam Cement PCL
|
|
863,100
|
|
5,911
|
|
Consumer Finance (0.3%)
|
|
|
|
|
|
Krungthai Card PCL
|
|
742,200
|
|
681
|
|
Diversified Telecommunication Services
(1.1%)
|
|
|
|
|
|
Shin Satellite PCL
|
|
(a)7,737,800
|
|
2,332
|
|
Food & Staples Retailing (3.3%)
|
|
|
|
|
|
CP ALL PCL
|
|
11,126,200
|
|
3,565
|
|
Siam Makro PCL
|
|
1,087,600
|
|
3,176
|
|
|
|
|
|
6,741
|
|
Hotels, Restaurants & Leisure
(5.9%)
|
|
|
|
|
|
Minor International PCL
|
|
22,225,700
|
|
12,060
|
|
Household Durables (8.3%)
|
|
|
|
|
|
Asian Property Development PCL
|
|
42,358,400
|
|
7,980
|
|
Golden Land Property PCL
|
|
(a)9,352,900
|
|
2,110
|
|
Lalin Property PCL
|
|
6,141,800
|
|
595
|
|
Land & Houses PCL
|
|
25,872,700
|
|
5,705
|
|
Quality House PCL
|
|
6,852,000
|
|
432
|
|
|
|
|
|
16,822
|
|
Insurance (0.9%)
|
|
|
|
|
|
Bangkok Insurance PCL
|
|
228,065
|
|
1,848
|
|
Marine (5.0%)
|
|
|
|
|
|
Precious Shipping PCL
|
|
4,502,900
|
|
$
|
3,829
|
|
Thoresen Thai Agencies PCL
|
|
4,640,000
|
|
6,427
|
|
|
|
|
|
10,256
|
|
Media (3.4%)
|
|
|
|
|
|
BEC World PCL
|
|
8,175,100
|
|
6,980
|
|
Multiline Retail (1.8%)
|
|
|
|
|
|
Big C Supercenter PCL
|
|
2,605,700
|
|
3,604
|
|
Oil, Gas & Consumable Fuels (28.6%)
|
|
|
|
|
|
Banpu PCL
|
|
727,300
|
|
8,509
|
|
PTT Exploration & Production
|
|
|
|
|
|
PCL
|
|
4,238,400
|
|
20,423
|
|
PTT PCL
|
|
2,649,700
|
|
29,431
|
|
|
|
|
|
58,363
|
|
Real Estate (1.6%)
|
|
|
|
|
|
Amata Corp. PCL
|
|
2,353,800
|
|
1,227
|
|
MBK PCL
|
|
937,800
|
|
1,949
|
|
|
|
|
|
3,176
|
|
Textiles, Apparel & Luxury Goods
(0.0%)
|
|
|
|
|
|
Thai Rung Textile Co., Ltd.
|
|
(a)(b)(c)(d)958
|
|
|
|
Wireless Telecommunication Services (3.7%)
|
|
|
|
|
|
Advanced Info Service PCL
|
|
2,657,400
|
|
7,573
|
|
TOTAL COMMON STOCKS
|
|
|
|
|
|
(Cost $121,909)
|
|
|
|
196,158
|
|
|
|
No. of
|
|
|
|
|
|
Rights
|
|
|
|
RIGHTS (0.0%)
|
|
|
|
|
|
Diversified Telecommunication Services
(1.1%)
|
|
|
|
|
|
True Corp. PCL (Cost $@)
|
|
(a)(c)(d)721,421
|
|
|
|
|
|
No. of
|
|
|
|
|
|
Warrants
|
|
|
|
WARRANTS (0.0%)
|
|
|
|
|
|
Commercial Banks (0.0%)
|
|
|
|
|
|
Quality House PCL,
|
|
|
|
|
|
expiring 9/11/08
|
|
|
|
|
|
(Cost $@)
|
|
(a)1,370,400
|
|
36
|
|
TOTAL THAI INVESTMENT PLAN (96.1%)
|
|
|
|
|
|
(Cost $121,909)
|
|
|
|
196,194
|
|
|
The accompanying notes are an integral part of the financial
statements.
|
3
|
|
|
The Thai Fund, Inc.
|
|
|
|
|
|
December 31, 2007
|
Portfolio of Investments (contd)
|
|
|
|
Value
|
|
|
|
Shares
|
|
(000)
|
|
SHORT-TERM INVESTMENT (0.2%)
|
|
|
|
|
|
Investment Company (0.2%)
|
|
|
|
|
|
Morgan Stanley Institutional
|
|
|
|
|
|
Liquidity Money Market
|
|
|
|
|
|
Portfolio Institutional Class
|
|
|
|
|
|
(Cost $275)
|
|
(e)274,819
|
|
$
|
275
|
|
TOTAL INVESTMENTS (96.3%)
|
|
|
|
|
|
(Cost $122,184)
|
|
|
|
(f) 196,469
|
|
OTHER ASSETS IN EXCESS OF LIABILITIES
(3.7%)
|
|
|
|
7,599
|
|
NET ASSETS (100%)
|
|
|
|
$
|
204,068
|
|
(a)
|
|
Non-income
producing security.
|
(b)
|
|
Restricted
security not registered under the Securities Act of 1993. Acquired 4/89 at a
cost of $49,000. At December 31, 2007, this security had a market value
of less than $500, representing less than 0.05% of net assets.
|
(c)
|
|
Security
has been deemed illiquid at December 31, 2007.
|
(d)
|
|
Security
was valued at fair value At December 31, 2007, the Fund held less than
$500 of fair valued securities, representing less than 0.05% of net assets.
|
(e)
|
|
See
Note G within the Notes to Financial Statements regarding investments in
Morgan Stanley Institutional Liquidity Money Market Portfolio Institutional
Class.
|
(f)
|
|
The
approximate market value and percentage of the investments, $186,670,000 and
95.0%, respectively, represent the securities that have been fair valued
under the fair valuation policy for international investments as described in
Note A within the Notes to Financial Statements
.
|
@
|
|
Value
is less than $500.
|
Graphic Presentation of Portfolio Holdings
The
following graph depicts the Funds holdings by industry and/or security type,
as a percentage of total investments.
*
Industries
which do not appear in the above graph, as well as those which represent less
than 5% of total investments, if applicable, are included in the category
labeled Other.
4
|
The accompanying notes are an integral part of the financial
statements.
|
|
|
|
The Thai Fund, Inc.
|
|
|
|
|
|
Financial Statements
|
Statement of Assets and Liabilities
|
|
December 31, 2007
(000)
|
|
Assets:
|
|
|
|
Investments in Securities of Unaffiliated
Issuers, at Value (Cost $121,909)
|
|
$196,194
|
|
Investment in Security of Affiliated
Issuer, at Value (Cost $275)
|
|
275
|
|
Total Investments in Securities, at Value
(Cost $122,184)
|
|
196,469
|
|
Foreign Currency, at Value (Cost $11,601)
|
|
11,558
|
|
Interest Receivable
|
|
1
|
|
Receivable from Affiliate
|
|
@
|
|
Other Assets
|
|
5
|
|
Total Assets
|
|
208,033
|
|
Liabilities:
|
|
|
|
Payable For:
|
|
|
|
Dividend Declared
|
|
3,360
|
|
Thai Repatriation Tax
|
|
341
|
|
U.S. Investment Advisory Fees
|
|
114
|
|
Thai Investment Advisory Fees
|
|
62
|
|
Custodian Fees
|
|
26
|
|
Administration Fees
|
|
6
|
|
Directors Fees and Expenses
|
|
1
|
|
Other Liabilities
|
|
55
|
|
Total Liabilities
|
|
3,965
|
|
Net Assets
|
|
|
|
Applicable to 15,885,571, Issued and
Outstanding $0.01
|
|
|
|
Par Value Shares (30,000,000 Shares
Authorized)
|
|
$204,068
|
|
Net Asset Value Per Share
|
|
$ 12.85
|
|
Net Assets Consist of:
|
|
|
|
Common Stock
|
|
$ 159
|
|
Paid-in Capital
|
|
140,548
|
|
Undistributed (Distributions in Excess of)
Net Investment Income
|
|
23
|
|
Accumulated Net Realized Gain (Loss)
|
|
(10,975
|
)
|
Unrealized Appreciation (Depreciation) on
Investments and Foreign Currency Translations
|
|
74,313
|
|
Net Assets
|
|
$204,068
|
|
@ Amount is less than $500.
|
|
|
|
|
The accompanying notes are an integral part of the financial
statements.
|
5
|
|
|
The Thai Fund, Inc.
|
|
|
|
|
|
Financial Statements
|
Statement of
Operations
|
|
Year Ended
December 31, 2007
(000)
|
|
Investment Income
|
|
|
|
Dividends from Securities of Unaffiliated
Issuers
|
|
$ 5,569
|
|
Dividends from Security of Affiliated
Issuer
|
|
33
|
|
Interest from Securities of Unaffiliated
Issuers
|
|
67
|
|
Total Investment Income
|
|
5,669
|
|
Expenses
|
|
|
|
U.S. Investment Advisory Fees (Note B)
|
|
1,170
|
|
Thai Repatriation Tax Expense
|
|
588
|
|
Thai Investment Advisory Fees (Note B)
|
|
472
|
|
Custodian Fees (Note D)
|
|
152
|
|
Administration Fees (Note C)
|
|
140
|
|
Professional Fees
|
|
81
|
|
Stockholder Reporting Expenses
|
|
21
|
|
Stockholder Servicing Agent Fees
|
|
10
|
|
Directors Fees and Expenses
|
|
3
|
|
Other Expenses
|
|
35
|
|
Total Expenses
|
|
2,672
|
|
Waiver of Administration Fees (Note C)
|
|
(73
|
)
|
Expense Offset (Note D)
|
|
(1
|
)
|
Rebate from Morgan Stanley Affiliated Cash
Sweep (Note G)
|
|
(1
|
)
|
Net Expenses
|
|
2,597
|
|
Net Investment Income (Loss)
|
|
3,072
|
|
Net Realized Gain (Loss) on:
|
|
|
|
Investments
|
|
14,855
|
|
Foreign Currency Transactions
|
|
313
|
|
Net Realized Gain (Loss)
|
|
15,168
|
|
Change in Unrealized Appreciation
(Depreciation) on:
|
|
|
|
Investments
|
|
46,786
|
|
Foreign Currency Translations
|
|
(144
|
)
|
Change in Unrealized Appreciation
(Depreciation)
|
|
46,642
|
|
Net Realized Gain (Loss) and Change in
Unrealized Appreciation (Depreciation)
|
|
61,810
|
|
Net Increase (Decrease) in Net Assets
Resulting from Operations
|
|
$64,882
|
|
6
|
The accompanying notes are an integral part of the financial
statements.
|
|
|
|
The Thai Fund, Inc.
|
|
|
|
|
|
Financial Statements
|
Statements of
Changes in Net Assets
|
|
Year Ended
December 31, 2007
(000)
|
|
Year Ended
December 31, 2006
(000)
|
|
Increase (Decrease) in Net Assets
|
|
|
|
|
|
Operations:
|
|
|
|
|
|
Net Investment Income (Loss)
|
|
$ 3,072
|
|
$ 3,460
|
|
Net Realized Gain (Loss)
|
|
15,168
|
|
12,202
|
|
Change in Unrealized Appreciation
(Depreciation)
|
|
46,642
|
|
(120
|
)
|
Net Increase (Decrease) in Net Assets
Resulting from Operations
|
|
64,882
|
|
15,542
|
|
Distributions from and/or in Excess of:
|
|
|
|
|
|
Net Investment Income
|
|
(3,747
|
)
|
(4,073
|
)
|
Capital Share Transactions:
|
|
|
|
|
|
Common Stock Issued Through Rights Offering
(2,596,336 shares in 2006,
|
|
|
|
|
|
net of expenses of $275,000)
|
|
|
|
20,937
|
|
Reinvestment of Distributions (6,662 and
3,820 shares, respectively)
|
|
54
|
|
41
|
|
Net Increase (Decrease) in Net Assets
Resulting from Capital Share Transactions
|
|
54
|
|
20,978
|
|
Total Increase (Decrease)
|
|
61,189
|
|
32,447
|
|
Net Assets:
|
|
|
|
|
|
Beginning of Period
|
|
142,879
|
|
110,432
|
|
End of Period (Including Undistributed
(Distributions in Excess of) Net Investment Income
of $23 and $385,
respectively)
|
|
$204,068
|
|
$142,879
|
|
|
The accompanying notes are an integral part of the financial
statements.
|
7
|
|
|
The Thai Fund, Inc.
|
|
|
|
|
|
Financial Highlights
|
Selected Per Share Data and Ratios
|
|
Year Ended December 31,
|
|
|
2007
|
|
2006
|
|
2005
|
|
2004
|
|
2003
|
|
Net Asset Value, Beginning of Period
|
|
$ 9.00
|
|
$ 8.32
|
|
$ 8.32
|
|
$ 8.93
|
|
$ 4.02
|
|
Net Investment Income (Loss)
|
|
0.19
|
|
0.24
|
|
0.23
|
|
0.13
|
|
0.06
|
|
Net Realized and Unrealized Gain (Loss) on
Investments
|
|
3.90
|
|
0.76
|
|
(0.01
|
)
|
(0.62
|
)
|
4.94
|
|
Total from Investment Operations
|
|
4.09
|
|
1.00
|
|
0.22
|
|
(0.49
|
)
|
5.00
|
|
Distributions from and/or in Excess of:
Net Investment Income
|
|
(0.24
|
)
|
(0.26
|
)
|
(0.22
|
)
|
(0.12
|
)
|
(0.09
|
)
|
Dilutive Effect of Shares Issued through
Rights Offering and Offering Costs
|
|
|
|
(0.06
|
)
|
|
|
|
|
|
|
Net Asset Value, End of Period
|
|
$ 12.85
|
|
$ 9.00
|
|
$ 8.32
|
|
$ 8.32
|
|
$ 8.93
|
|
Per Share Market Value, End of Period
|
|
$ 13.05
|
|
$ 11.00
|
|
$ 9.49
|
|
$ 8.95
|
|
$ 10.40
|
|
TOTAL INVESTMENT RETURN:
|
|
|
|
|
|
|
|
|
|
|
|
Market Value
|
|
21.02
|
%
|
18.97
|
%
|
8.26
|
%
|
(12.91
|
)%
|
201.95
|
%
|
Net Asset Value (1)
|
|
45.65
|
%
|
11.03
|
%
|
2.10
|
%
|
(5.71
|
)%
|
124.42
|
%
|
RATIOS, SUPPLEMENTAL DATA:
|
|
|
|
|
|
|
|
|
|
|
|
Net Assets, End of Period (Thousands)
|
|
$204,068
|
|
$142,879
|
|
$110,432
|
|
$110,396
|
|
$118,480
|
|
Ratio of Expenses to Average Net Assets
(2)
|
|
1.49
|
%+
|
1.74
|
%
|
1.76
|
%
|
1.73
|
%
|
1.92
|
%
|
Ratio of Net Investment Income (Loss) to
Average Net Assets
(2)
|
|
1.76
|
%+
|
2.66
|
%
|
2.79
|
%
|
1.62
|
%
|
1.18
|
%
|
Portfolio Turnover Rate
|
|
24
|
%
|
43
|
%
|
26
|
%
|
36
|
%
|
32
|
%
|
(2)
Supplemental
Information on the Ratios to Average Net
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
Ratios Before Expenses Waived by
Administrator:
|
|
|
|
|
|
|
|
|
|
|
|
Ratio of Expenses to Average Net Assets
|
|
1.53
|
%+
|
1.78
|
%
|
1.79
|
%
|
1.74
|
%
|
N/A
|
|
Ratio
of Net Investment Income (Loss) to Average Net Assets
|
|
1.72
|
%+
|
2.62
|
%
|
2.76
|
%
|
1.61
|
%
|
N/A
|
|
(1)
|
|
Total investment return
based on net asset value per share reflects the effects of changes in net
asset value on the performance of the Fund during each period, and assumes
dividends and distributions, if any, were reinvested. This percentage is not
an indication of the performance of a stockholders investment in the Fund
based on market value due to differences between the market price of the
stock and the net asset value per share of the Fund.
|
|
|
Per share amounts are based on average shares outstanding.
|
+
|
|
Reflects rebate of certain
Fund expenses in connection with the investments in Morgan Stanley
Institutional Liquidity Money Market Portfolio Institutional
Class during the period. As a result of such rebate, the expenses as a
percentage of its net assets were effected by less than 0.005%.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The accompanying notes are an integral part of the financial
statements.
8
|
|
The Thai Fund, Inc.
|
|
|
|
|
|
December 31, 2007
|
|
|
|
Notes to Financial
Statements
|
|
|
The
Thai Fund, Inc. (the Fund) was incorporated on June 10, 1987 and is
registered as a non-diversified, closed-end management investment company under
the Investment Company Act of 1940, as amended (the 1940 Act). The Funds
investment objective is long-term capital appreciation through investment
primarily in equity securities of companies organized under the laws of the
Kingdom of Thailand. The Fund makes its investments in Thailand through the
Thai Investment Plan (the Plan) established in conformity with Thai law. The
Fund is the sole unit holder of the Plan. The accompanying financial statements
are prepared on a consolidated basis and present the financial position and
results of operations of the Plan and the Fund.
A.
Accounting Policies:
The following significant accounting policies are in conformity with
U.S. generally accepted accounting principles. Such policies are consistently
followed by the Fund in the preparation of its financial statements. U.S.
generally accepted accounting principles may require management to make
estimates and assumptions that affect the reported amounts and disclosures in
the financial statements. Actual results may differ from those estimates.
1.
Security Valuation:
Securities listed on a foreign exchange are
valued at their closing price. Unlisted securities and listed securities not
traded on the valuation date for which market quotations are readily available
are valued at the mean between the current bid and asked prices obtained from
reputable brokers. Equity securities listed on a U.S. exchange are valued at
the latest quoted sales price on the valuation date. Equity securities listed
or traded on NASDAQ, for which market quotations are available, are valued at
the NASDAQ Official Closing Price. Debt securities purchased with remaining
maturities of 60 days or less are valued at amortized cost, if it approximates
value.
All
other securities and investments for which market values are not readily
available, including restricted securities, and those securities for which it
is inappropriate to determine prices in accordance with the aforementioned
procedures, are valued at fair value as determined in good faith under procedures
adopted by the Board of Directors (the Directors), although the actual
calculations may be done by others. Factors considered in making this
determination may include, but are not limited to, information obtained by
contacting the issuer, analysts, or the appropriate stock exchange (for
exchange-traded securities), analysis of the issuers financial statements or
other available documents and, if necessary, available information concerning
other securities in similar circumstances.
Most
foreign markets close before the New York Stock Exchange (NYSE). Occasionally,
developments that could affect the closing prices of securities and other
assets may occur between the times at which valuations of such securities are
determined (that is, close of the foreign market on which the securities trade)
and the close of business on the NYSE. If these developments are expected to
materially affect the value of the securities, the valuations may be adjusted
to reflect the estimated fair value as of the close of the NYSE, as determined
in good faith under procedures established by the Directors.
2.
Repurchase Agreements:
The Fund may enter into repurchase agreements
under which the Fund lends excess cash and takes possession of securities with
an agreement that the counterparty will repurchase such securities. In
connection with transactions in repurchase agreements, a bank as custodian for
the Fund takes possession of the underlying securities (collateral), with a
market value at least equal to the amount of the repurchase transaction,
including principal and accrued interest. To the extent that any repurchase
transaction exceeds one business day, the value of the collateral is
marked-to-market on a daily basis to determine the adequacy of the collateral.
In the event of default on the obligation to repurchase, the Fund has the right
to liquidate the collateral and apply the proceeds in satisfaction of the
obligation. In the event of default or bankruptcy by the counterparty to the
agreement, realization and/or retention of the collateral or proceeds may be
subject to legal proceedings.
The
Fund, along with other affiliated investment companies, may utilize a joint
trading account for the purpose of entering into one or more repurchase
agreements. At December 31, 2007, the Fund did not have any outstanding
repurchase agreements.
3.
Foreign Currency Translation:
The books and records of the Fund are
maintained in U.S. dollars. Amounts denominated in Thai Baht are translated
into U.S. dollars at the mean of the bid and asked prices of such currency
against U.S. dollars last quoted by a major bank as follows:
·
investments, other assets and liabilities at
the prevailing rate of exchange on the valuation date;
·
investment transactions and investment income
at the prevailing rate of exchange on the dates of such transactions.
Although
the net assets of the Fund are presented at the foreign exchange rate and
market values at the close of the period, the Fund does not isolate that
portion of the results of operations arising as a result of changes in the
foreign exchange rate from the fluctuations arising from changes in the market
prices of the securities held at period end. Similarly, the Fund does not
isolate the effect of
9
|
|
The Thai Fund, Inc.
|
|
|
|
|
|
December 31, 2007
|
|
|
|
Notes to Financial
Statements (contd)
|
|
|
changes
in the foreign exchange rate from the fluctuations arising from changes in the
market prices of securities sold during the period. Accordingly, realized and
unrealized foreign currency gains (losses) due to securities transactions are
included in the reported net realized and unrealized gains (losses) on
investment transactions and balances.
Net
realized gains (losses) on foreign currency transactions represent net foreign
exchange gains (losses) from sales and maturities of foreign currency exchange
contracts, dispositions of foreign currency, currency gains or losses realized
between the trade and settlement dates on securities transactions, and the
difference between the amount of investment income recorded on the Funds books
and the U.S. dollar equivalent amounts actually received or paid. Net
unrealized currency gains (losses) from valuing foreign currency denominated
assets and liabilities at period end exchange rates are reflected as a
component of unrealized appreciation (depreciation) on investments and foreign
currency translations in the Statement of Assets and Liabilities. The change in
net unrealized currency gains (losses) on foreign currency translations for the
period is reflected in the Statement of Operations.
A
significant portion of the Funds net assets consist of investments in Thai
equity securities, which may be subject to greater price volatility, lower
liquidity and less diversity than equity securities of companies based in the
United States. In addition, Thai equity securities may be subject to
substantial governmental involvement in the economy and greater social,
economic and political uncertainty.
Prior
governmental approval for foreign investments may be required under certain
circumstances in some countries, and the extent of foreign investments in
domestic companies may be subject to limitation in other countries. Foreign
ownership limitations also may be imposed by the charters of individual
companies to prevent, among other concerns, violations of foreign investment
limitations. As a result, an additional class of shares (identified as Foreign
in the Portfolio of Investments) may be created and offered for investment. The
local and foreign shares market values may differ. In the absence of
trading of the foreign shares in such markets, the Fund values the foreign
shares at the closing exchange price of the local shares. Such securities, if
any, are identified as fair valued in the Portfolio of Investments.
4.
Derivatives:
The Fund may use derivatives to achieve its investment objectives. The
Fund may engage in transactions in futures contracts on foreign currencies,
stock indices, as well as in options, swaps and structured products. Consistent
with the Funds investment objectives and policies, the Fund may use
derivatives for non-hedging as well as hedging purposes.
Following
is a description of derivative instruments that the Fund has utilized and their
associated risks:
Foreign
Currency Exchange Contracts: The Fund may enter into foreign currency exchange
contracts generally to attempt to protect securities and related receivables
and payables against changes in future foreign exchange rates and, in certain
situations, to gain exposure to a foreign currency. A foreign currency exchange
contract is an agreement between two parties to buy or sell currency at a set
price on a future date. The market value of the contract will fluctuate with
changes in currency exchange rates. The contract is marked-to-market daily and
the change in market value is recorded by the Fund as unrealized gain or loss.
The Fund records realized gains or losses when the contract is closed equal to
the difference between the value of the contract at the time it was opened and
the value at the time it was closed. Risk may arise upon entering into these
contracts from the potential inability of counterparties to meet the terms of
their contracts and is generally limited to the amount of unrealized gain on
the contracts, if any, at the date of default. Risks may also arise from unanticipated
movements in the value of a foreign currency relative to the U.S. dollar. At December 31,2007,
the Fund did not have any outstanding foreign currency exchange contracts.
5.
Restricted Securities:
The Fund may invest in unregistered or
otherwise restricted securities. The term restricted securities refers to
securities that are unregistered or are held by control persons of the issuer
and securities that are subject to contractual restrictions on their resale. As
a result, restricted securities may be more difficult to value and the Fund may
have difficulty disposing of such assets either in a timely manner or for a
reasonable price. In order to dispose of an unregistered security, the Fund,
where it has contractual rights to do so, may have to cause such security to be
registered. A considerable period may elapse between the time the decision is
made to sell the security and the time the security is registered so that the
Fund could sell it. Contractual restrictions on the resale of securities vary in
length and scope and are generally the result of a negotiation between the
issuer and acquiror of the securities. The Fund would, in either case, bear
market risks during that period.
6.
New Accounting
Pronouncement
:
In September 2006, Statement of Financial
Accounting Standards No. 157,
Fair Value Measurements
(SFAS 157), was issued and is
10
|
|
The Thai Fund, Inc.
|
|
|
|
|
|
December 31, 2007
|
|
|
|
Notes to Financial
Statements (contd)
|
|
|
effective
for fiscal years beginning after November 15, 2007. SFAS 157 defines fair
value, establishes a framework for measuring fair value and expands disclosures
about fair value measurements. As of December 31, 2007, the Adviser does
not believe the adoption of SFAS 157 will impact the amounts reported in the
financial statements, however, additional disclosures will be required about
the inputs used to develop the measurements of fair value and the effect of
certain measurements reported in the Statement of Operations for a fiscal
period.
7.
Other:
Security
transactions are accounted for on the date the securities are purchased or
sold. Realized gains and losses on the sale of investment securities are
determined on the specific identified cost basis. Interest income is recognized
on the accrual basis. Dividend income and distributions are recorded on the
ex-dividend date (except certain dividends which may be recorded as soon as the
Fund is informed of such dividends) net of applicable withholding taxes.
B.
Investment Advisory Fees:
Morgan Stanley Investment
Management Inc. (the U.S. Adviser or MS Investment Management) provides
investment advisory services to the Fund under the terms of an Investment
Advisory Agreement (the Agreement). Under the Agreement, the U.S. Adviser is
paid a fee computed weekly and payable monthly at an annual rate of 0.90% of
the Funds first $50 million of average weekly net assets, 0.70% of the Funds
next $50 million of average weekly net assets and 0.50% of the Funds average
weekly net assets in excess of $100 million.
MFC
Asset Management Public Company Limited (the Thai Adviser) provides
investment advisory services to the Fund under the terms of a contract. Under
the contract, the Thai Adviser is paid a fee computed weekly and payable
monthly at an annual rate of 0.40% of the Funds first $50 million of average
weekly net assets, 0.25% of the Funds next $50 million of average weekly net
assets and 0.20% of the Funds average weekly net assets in excess of $100
million.
C.
Administration Fees:
MS Investment Management also
serves as Administrator to the Fund pursuant to an Administration Agreement.
Effective July 1, 2007 the Administration Agreement has been amended to
0.08% of the Funds average weekly net assets. Prior to July 1, 2007, under the Administration Agreement, the
administration fee was 0.08% of the Funds average daily net assets. MS
Investment Management has agreed to limit the administration fee so that it
will be no greater than the previous administration fee of 0.02435% of the Funds
average weekly net assets plus $24,000 per annum. This waiver is voluntary and
may be terminated at any time. For the year ended December 31, 2007,
$73,000 of administration fees were waived pursuant to this arrangement. Under
a sub-administration agreement between the Administrator and JPMorgan Investor
Services Co. (JPMIS), a corporate affiliate of JPMorgan Chase Bank, N.A.,
JPMIS provides certain administrative services to the Fund. For such services,
the Administrator pays JPMIS a portion of the fee the Administrator receives
from the Fund. Administration costs (including out-of-pocket expenses) incurred
in the ordinary course of providing services under the administration
agreement, except pricing services and extraordinary expenses, are covered
under the administration fee.
D.
Custodian Fees:
JPMorgan Chase Bank, N.A. (the Custodian)
serves as Custodian for the Funds assets held in the United States. The
Custodian holds cash, securities, and other assets of the Fund as required by
the 1940 Act. Custody fees are payable monthly based on assets held in custody,
investment purchases and sales activity and account maintenance fees, plus
reimbursement for certain out-of-pocket
expenses. The Plans assets in Thailand are held by Kasikornbank Public Company
Limited.
The
Fund has entered into an arrangement with its Custodian whereby credits
realized on uninvested cash balances were used to offset a portion of the Funds
expenses. These custodian credits are shown as Expense Offset on the
Statement of Operations.
E.
Federal Income Taxes:
It is the Funds intention to
continue to qualify as a regulated investment company and distribute all of its
taxable income. Accordingly, no
provision for Federal income taxes is required in the financial statements. The
Fund files tax returns with the U.S. Internal Revenue Service and various
states. Generally, the tax authorities can examine all tax returns filed for
the last three years.
Distributions
of income from the Plan to the Fund are subject to Thai income tax at a rate of
10% of the distribution amount, which is withheld at the time of distribution.
All distributions from the Plan to the Fund must be approved by The Bank of
Thailand (BOT) pursuant to the laws of The Kingdom of Thailand. For financial
statement purposes, the Fund accrues and allocates the Thai income tax to net
investment income, net realized gains and net unrealized appreciation on the
basis of their relative amounts. For U.S. Federal income tax purposes, the Thai
income tax is deducted, when paid, from net investment income.
The
Fund adopted the provisions of the Financial Accounting Standards Boards (FASB)
Interpretation number 48
Accounting for
Uncertainty in Income Taxes (the Interpretation),
on June 30,
2007. The Interpretation is to be applied to all open tax years as of the date
of effectiveness. As of December 31, 2007, this did not result in an
impact to the Funds financial statements.
11
|
|
The Thai Fund, Inc.
|
|
|
|
|
|
December 31, 2007
|
|
|
|
Notes to Financial
Statements (contd)
|
|
|
The
tax character of distributions paid may differ from the character of
distributions shown on the Statements of Changes in Net Assets due to
short-term capital gains being treated as ordinary income for tax purposes. The
tax character of distributions paid during 2007 and 2006 were as follows:
2007 Distributions
|
|
2006 Distributions
|
Paid From:
|
|
Paid From:
|
(000)
|
|
(000)
|
|
|
Long-term
|
|
|
|
Long-term
|
Ordinary
|
|
Capital
|
|
Ordinary
|
|
Capital
|
Income
|
|
Gain
|
|
Income
|
|
Gain
|
$3,747
|
|
$
|
|
$4,073
|
|
$
|
The
amount and character of income and capital gain distributions to be paid by the
Fund are determined in accordance with Federal income tax regulations, which
may differ from U.S. generally accepted accounting principles. These book/tax
differences are considered either temporary or permanent in nature.
Temporary
differences are generally due to differing book and tax treatments for the
timing of the recognition of gains (losses) on certain investment transactions
and the timing of the deductibility of certain expenses.
Permanent
differences, primarily due to differing treatments of gains (losses) related to
foreign currency transactions, resulted in the following reclassifications among
the components of net assets at December 31, 2007:
Increase (Decrease)
|
Accumulated
|
|
|
|
|
Undistributed
|
|
|
|
|
(Distributions in
|
|
|
|
|
Excess of) Net
|
|
Accumulated
|
|
|
Investment
|
|
Net
Realized
|
|
Paid-in
|
Income (Loss)
|
|
Gain (Loss)
|
|
Capital
|
(000)
|
|
(000)
|
|
(000)
|
$313
|
|
$(313
|
)
|
$
|
At December 31, 2007, the components of distributable earnings on
a tax basis were as follows:
Undistributed
|
|
Undistributed
|
Ordinary Income
|
|
Long-term Capital Gain
|
(000)
|
|
(000)
|
$26
|
|
$
|
At
December 31, 2007, the U.S. Federal income tax cost basis of investments
was $122,332,000 and, accordingly, net unrealized appreciation for U.S. Federal
income tax purposes was $74,137,000 of which $79,050,000 related to appreciated
securities and $4,913,000 related to depreciated securities.
At
December 31, 2007, the Fund had a capital loss carryforward for U.S.
Federal income tax purposes of approximately $10,828,000 available to offset
future gains of which $6,799,000 will expire on December 31, 2009 and
$4,029,000 will expire on December 31, 2010. During the year ended December 31,
2007, the Fund utilized capital loss carryforwards for U.S. Federal income tax
purposes of approximately $13,657,000.
To
the extent that capital loss carryforwards are used to offset any future
capital gains realized during the carryforward period as provided by U.S.
Federal income tax regulations, no capital gains tax liability will be incurred
by the Fund for gains realized and not distributed. To the extent that capital
gains are offset, such gains will not be distributed to the stockholders.
F.
Contractual Obligations:
The Fund enters into contracts
that contain a variety of indemnifications. The Funds maximum exposure under
these arrangements is unknown. However, the Fund has not had prior claims or
losses pursuant to these contracts and expects the risk of loss to be remote.
G.
Security Transactions and Transactions with Affiliates:
The Fund invests in the Institutional Class of
the Morgan Stanley Institutional Liquidity Money Market Portfolio, an open-end
management investment company managed by the Adviser. Investment Advisory fees
paid by the Fund are reduced by an amount equal to its pro-rata share of
advisory and administration fees paid by the Morgan Stanley Institutional
Liquidity Money Market Portfolio. For the year ended December 31, 2007,
advisory fees paid were reduced by approximately $1,000 relating to the Funds
investment in the Morgan Stanley Institutional Liquidity Money Market
Portfolio.
A
summary of the Funds transactions in shares of the affiliated issuer during
the year ended December 31, 2007 is as follows:
Market Value
|
|
|
|
|
|
|
|
Market Value
|
|
December31,
|
|
Purchases
|
|
Sales
|
|
Dividend
|
|
December 31,
|
|
2006
|
|
at Cost
|
|
Proceeds
|
|
Income
|
|
2007
|
|
(000)
|
|
(000)
|
|
(000)
|
|
(000)
|
|
(000)
|
|
$
|
|
$1,633
|
|
$1,358
|
|
$33
|
|
$275
|
|
During
the year ended December 31, 2007, the Fund made purchases and sales
totaling approximately $39,566,000 and $45,557,000 respectively, of investment
securities other than long-term U.S. Government securities and short-term investments.
There were no purchases or sales of long-term U.S. Government securities.
H.
Other:
On May 30, 2006, the Fund commenced a
rights offering and issued to stockholders of record as of May 23, 2006
one right for each share of common stock held. The rights were not transferable
and, consequently, were not listed on any exchange. The rights entitled holders
to subscribe for an aggregate of 3,320,650 shares of the Funds common stock.
In addition, the Fund had the option of issuing additional shares in an amount
up to 25% of the shares that were available in the
12
|
|
The Thai Fund, Inc.
|
|
|
|
|
|
December 31, 2007
|
|
|
|
Notes to Financial
Statements (contd)
|
|
|
primary
offering, or 830,160 shares, for an aggregate total of 4,150,810 shares. The
offer expired on July 20, 2006. Pursuant to this offering, the Fund sold
2,596,336 shares at the subscription price per share of $8.17 (representing 95%
of the average of the last reported sales price of the Funds common stock on
the New York Stock Exchange on the date the offer expired and the four
preceding trading days). The total proceeds of the rights offering were
$21,212,065 and the Fund incurred costs associated with the offering estimated
at $275,000.
On
June 19, 2007, the Directors approved a procedure whereby the Fund may,
when appropriate, purchase shares in the open market or in privately negotiated
transactions at a price not above market value or net asset value, whichever is
lower at the time of the purchase. During the year ended December 31,
2007, the Fund did not repurchase any if its shares.
On
July 1, 2007, the Stockholder Servicing Agent changed from American Stock
Transfer & Trust Company to Computershare Trust Company, N.A. Requests
for information or any correspondence concerning the Dividend Reinvestment and
Cash Purchase Plan after July 1, 2007 should be directed to Computershare
Trust Company, N.A., P.O. Box 43010, Providence, Rhode Island 02940-3010,
1 (800) 231-2608.
On
December 14, 2007, the Officers of the Fund, pursuant to authority granted
by the Directors, declared a distribution of $0.2115 per share, derived from
net investment income, payable on January 7, 2008, to stockholders of
record on December 21, 2007.
I. Supplemental Proxy
Information (unaudited):
On June 19, 2007, an annual meeting
of the Funds stockholders was scheduled for the purpose of voting on the
following matter, the results of which were as follows:
Election
of Directors by all stockholders:
|
|
For
|
|
Withhold
|
|
Frank L. Bowman
|
|
9,605,998
|
|
315,077
|
|
James F. Higgins
|
|
9,583,776
|
|
337,299
|
|
Manuel H. Johnson
|
|
9,581,798
|
|
339,277
|
|
|
|
|
|
|
|
Federal Income Tax Information (unaudited)
|
|
|
|
|
|
For
Federal income tax purposes, the following information is furnished with respect
to the Funds earnings for its taxable year ended December 31, 2007.
When
distributed, certain earnings may be subject to a maximum tax rate of 15% as
provided for the Jobs and Growth Tax Relief Reconciliation Act of 2003. The
Fund designated up to a maximum of $3,747,000 as taxable at this lower rate.
In
January, the Fund provides tax information to stockholders for the preceding
calendar year.
13
|
|
The Thai Fund, Inc.
|
|
|
|
|
|
December 31, 2007
|
|
|
|
Notes to Financial
Statements (contd)
|
|
|
For More Information About Portfolio Holdings (unaudited)
The
Fund provides a complete schedule of portfolio holdings in its semi-annual and
annual reports within 60 days of the end of the Funds second and fourth fiscal
quarters. The semi-annual reports and the annual reports are filed
electronically with the Securities and Exchange Commission (SEC) on Form N-CSRS
and Form N-CSR, respectively. Morgan Stanley also delivers the semi-annual
and annual reports to Fund stockholders and makes these reports available on
its public website, www.morganstanley.com/msim. Each Morgan Stanley fund also
files a complete schedule of portfolio holdings with the SEC for the Funds
first and third fiscal quarters on Form N-Q. Morgan Stanley does not
deliver the reports for the first and third fiscal quarters to stockholders,
nor are the reports posted to the Morgan Stanley public website. You may,
however, obtain the Form N-Q filings (as well as the Form N-CSR and
N-CSRS filings) by accessing the SECs website, http://www.sec.gov. You may
also review and copy them at the SECs public reference room in Washington, DC.
Information on the operation of the SECs Public Reference Room may be
obtained by calling the SEC at 1(800) SEC-0330. You can also request copies of
these materials, upon payment of a duplicating fee, by electronic request at
the SECs
e-mail address (publicinfo@sec.gov) or by writing the public reference section
of the SEC, Washington, DC 20549-0102.
In
addition to filing a complete schedule of portfolio holdings with the SEC each
fiscal quarter, the Fund makes portfolio holdings information available by
periodically providing the information on its public website,
www.morganstanley.com/msim.
The
Fund provides a complete schedule of portfolio holdings on the public website
on a calendar-quarter basis approximately 31 calendar days after the close of
the calendar quarter. The Fund also provides Top 10 holdings information on the
public website approximately 15 business days following the end of each month.
You may obtain copies of the Funds monthly or calendar-quarter website
postings, by calling 1(800) 231-2608.
Proxy Voting Policy and Procedures and Proxy Voting Record
(unaudited)
A
copy of (1) the Funds policies and procedures with respect to the voting
of proxies relating to the Funds portfolio securities; and (2) how the
Fund voted proxies relating to portfolio securities during the most recent
twelve-month period ended June 30, is available without charge, upon request,
by calling 1 (800) 548-7786 or by visiting our website at www.morganstanley.com/msim.
This information is also available on the SECs web site at www.sec.gov.
14
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|
The Thai Fund, Inc.
|
|
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|
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|
December 31, 2007
|
|
|
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Report of Independent
Registered Public
Accounting Firm
|
|
|
|
|
|
To the Stockholders and Board of Directors of
The Thai Fund, Inc.
|
|
|
We
have audited the accompanying statement of assets and liabilities of The Thai
Fund, Inc. (the Fund), including the portfolio of investments, as of December 31,
2007, and the related statement of operations for the year then ended, the
statements of changes in net assets for each of the two years in the period
then ended, and the financial highlights for each of the five years in the
period then ended. These financial statements and financial highlights are the
responsibility of the Funds 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 the standards of the Public Company
Accounting Oversight Board (United States). 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. We were not engaged to perform an audit of the Funds internal
control over financial reporting. Our audits included consideration of internal
control over financial reporting as a basis for designing audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Funds internal control over financial
reporting. Accordingly, we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements and financial highlights, assessing the accounting
principles used and significant estimates made by management, and evaluating
the overall financial statement presentation. Our procedures included
confirmation of securities owned as of December 31, 2007, by
correspondence with the custodian. 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 The
Thai Fund, Inc. at December 31, 2007, the results of its operations
for the year then ended, the changes in its net assets for each of the two
years in the period then ended, and the financial highlights for each of the
five years in the period then ended, in conformity with U.S. generally accepted
accounting principles.
Boston,
Massachusetts
February 19, 2008
15
|
|
The Thai Fund, Inc.
|
|
|
|
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December 31, 2007
|
Director and Officer
Information (unaudited)
Independent
Directors:
Name, Age and Address of
Independent Director
|
|
Position(s)
Held with
Registrant
|
|
Length of
Time
Served*
|
|
Principal Occupation(s) During Past 5 Years
|
|
Number of
Portfolios in
Fund
Complex
Overseen
by
Independent
Director**
|
|
Other Directorships Held by
Independent Director
|
Frank L. Bowman (63)
c/o Kramer Levin Naftalis &
Frankel LLP
Counsel to the Independent
Directors
1177 Avenue of the
Americas
New York, NY 10036
|
|
Director
|
|
Since
August
2006
|
|
President and Chief Executive Officer, Nuclear Energy
Institute (policy organization) (since February 2005); Director or Trustee of
various Retail Funds and Institutional Funds (since August 2006); Chairperson
of the Insurance Sub-Committee of the Insurance, Valuation and Compliance
Committee (since February 2007); formerly, variously, Admiral in the
U.S. Navy, Director of Naval Nuclear Propulsion Program and Deputy
Administrator Naval Reactors in the National Nuclear Security Administration
at the U.S. Department of Energy (1996-2004). Honorary Knight Commander of
the Most Excellent Order of the British Empire.
|
|
180
|
|
Director of the National Energy Foundation, the U.S.
Energy Association, the American Council for Capital Formation and the Armed
Services YMCA of the USA.
|
|
|
|
|
|
|
|
|
|
|
|
Michael Bozic (66)
c/o Kramer Levin Naftalis &
Frankel LLP Counsel to the Independent Directors
1177 Avenue of the
Americas
New York, NY 10036
|
|
Director
|
|
Since
April
2004
|
|
Private Investor;
Chairperson of the Insurance, Valuation and Compliance Committee (since
October 2006); Director or Trustee of the Retail Funds (since
April 1994) and the Institutional Funds (since July 2003);
formerly, Chairperson of the Insurance Committee
(July 2006-September 2006), Vice Chairman of Kmart Corporation
(December 1998-October 2000), Chairman and Chief Executive Officer
of Levitz Furniture Corporation (November 1995-November 1998) and
President and Chief Executive Officer of Hills Department Stores (May
1991-July 1995); variously Chairman, Chief Executive Officer, President
and Chief Operating Officer (1987-1991) of the Sears Merchandise Group of
Sears, Roebuck & Co.
|
|
182
|
|
Director of various
business
organizations.
|
|
|
|
|
|
|
|
|
|
|
|
Kathleen A. Dennis (54)
c/o Kramer Levin Naftalis & Frankel LLP
Counsel to the Independent
Directors
1177 Avenue of the
Americas
New York, NY 10036
|
|
Director
|
|
Since
August
2006
|
|
President, Cedarwood
Associates (mutual fund and investment management) (since July 2006);
Chairperson of the Money Market and Alternatives Sub-Committee of the
Investment Committee (since October 2006) and Director or Trustee of
various Retail Funds and Institutional Funds (since August 2006);
formerly, Senior Managing Director of Victory Capital Management (1993-2006).
|
|
180
|
|
Director of various
non-profit organizations.
|
16
|
|
The Thai Fund, Inc.
|
|
|
|
|
|
December 31, 2007
|
Director and Officer
Information (contd)
Independent Directors (contd):
Name, Age and Address of
Independent Director
|
|
Position(s)
Held with
Registrant
|
|
Length of
Time
Served*
|
|
Principal Occupation(s) During Past 5 Years
|
|
Number of
Portfolios in
Fund
Complex
Overseen
by
Independent
Director**
|
|
Other Directorships Held by
Independent Director
|
Dr. Manuel H.
Johnson (58)
c/o Johnson Smick
Group, Inc.
888 16th Street, N.W.
Suite 740
Washington, D.C. 20006
|
|
Director
|
|
Since July
1991
|
|
Senior Partner, Johnson
Smick International, Inc. (consulting firm); Chairperson of the Investment
Committee (since October 2006) and Director or Trustee of the Retail
Funds (since July 1991) and the Institutional Funds (since
July 2003); Co-Chairman and a founder of the Group of Seven Council
(G7C) international economic commission; formerly, Chairperson of the Audit
Committee (July 1991-September 2006); Vice Chairman of the Board of
Governors of the Federal Reserve System and Assistant Secretary of the U.S.
Treasury.
|
|
182
|
|
Director of
NVR, Inc. (home construction); Director of Evergreen Energy.
|
|
|
|
|
|
|
|
|
|
|
|
Joseph J. Kearns (65)
c/o Kearns & Associates
LLC
PMB754
23852 Pacific Coast
Highway
Malibu, CA 90265
|
|
Director
|
|
Since August
1994
|
|
President,
Kearns & Associates LLC (investment consulting); Chairperson of the
Audit Committee (since October 2006) and Director or Trustee of the
Retail Funds (since July 2003) and the Institutional Funds (since
August 1994); formerly Deputy Chairperson of the Audit Committee
(July 2003-September 2006) and Chairperson of the Audit Committee of
the Institutional Funds (October 2001- July 2003); CFO of the J.
Paul Getty Trust.
|
|
183
|
|
Director of Electro Rent
Corporation (equipment leasing) and The Ford Family Foundation.
|
|
|
|
|
|
|
|
|
|
|
|
Michael F. Klein (49)
c/o Kramer Levin Naftalis &
Frankel LLP
Counsel to the
Independent Directors
1177 Avenue of the
Americas
New York, NY 10036
|
|
Director
|
|
Since August 2006
|
|
Managing
Director, Aetos Capital, LLC (since March 2000) and Co-President, Aetos
Alternatives Management, LLC (since January 2004); Chairperson of the
Fixed-Income Sub-Committee of the Investment Committee (since
October 2006) and Director or Trustee of various Retail Funds and
Institutional Funds (since August 2006); formerly, Managing Director,
Morgan Stanley & Co., Inc. and Morgan Stanley Dean Witter
Investment Management, President, Morgan Stanley Institutional Funds
(June 1998-March 2000) and Principal, Morgan Stanley &
Co., Inc. and Morgan Stanley Dean Witter Investment Management (August
1997-December 1999).
|
|
180
|
|
Director of certain
investment funds managed or sponsored by Aetos Capital LLC; Director of
Sanitized AG and Sanitized Marketing AG (specialty chemicals).
|
|
|
|
|
|
|
|
|
|
|
|
Michael E. Nugent (71)
c/o Triumph Capital, L.P.
445 Park Avenue
New York, NY 10022
|
|
Chairman
of the
Board and
Director
|
|
Chairman
of the
Boards
since July
2006 and
Trustee
since July
1991
|
|
General Partner
of Triumph Capital, L.P. (private investment partnership); Chairman of the
Boards of the Retail Funds and Institutional Funds (since July 2006);
Director or Trustee of the Retail Funds (since July 1991) and the
Institutional Funds (since July 2001); formerly, Chairperson of the
Insurance Committee (until July 2006).
|
|
182
|
|
None.
|
17
|
|
The Thai Fund, Inc.
|
|
|
|
|
|
December 31, 2007
|
Director and Officer
Information (contd)
Independent
Directors (contd):
Name, Age and Address of
Independent Director
|
|
Position(s)
Held with
Registrant
|
|
Length of
Time
Served*
|
|
Principal Occupation(s) During Past 5 Years
|
|
Number of
Portfolios in
Fund
Complex
Overseen
by
Independent
Director**
|
|
Other Directorships Held by
Independent Director
|
W. Allen Reed
(60)
c/o Kramer Levin Naftalis &
Frankel LLP
Counsel to the
Independent Directors
1177 Avenue of the
Americas
New York, NY 10036
|
|
Director
|
|
Since August 2006
|
|
Chairperson of the
Equity Sub-Committee of the Investment Committee (since October 2006)
and Director or Trustee of various Retail Funds and Institutional Funds
(since August 2006); formerly, President and CEO of General Motors Asset
Management; Chairman and Chief Executive Officer of the GM Trust Bank and
Corporate Vice President of General Motors Corporation
(July 1994-December 2005).
|
|
180
|
|
Director of
Temple-Inland Industries (packaging and forest products); Director of Legg
Mason and Director of the Auburn University Foundation.
|
|
|
|
|
|
|
|
|
|
|
|
Fergus Reid (75)
c/o Lumelite Plastics
Corporation
85 Charles Coleman Blvd.
Pawling, NY 12564
|
|
Director
|
|
Since June 1992
|
|
Chairman of
Lumelite Plastics Corporation; Chairperson of the Governance Committee and
Director or Trustee of the Retail Funds (since July 2003) and the
Institutional Funds (since June 1992).
|
|
183
|
|
Trustee and
Director of certain investment companies in the JPMorgan Funds complex
managed by JP Morgan Investment Management Inc.
|
Interested Directors:
Name, Age and Address of
Interested Director
|
|
Position(s)
Held with
Registrant
|
|
Term of
Office and
Length of
Time
Served*
|
|
Principal Occupation(s) During Past 5 Years
|
|
Number of
Portfolios in
Fund
Complex
Overseen
by
Interested
Director**
|
|
Other Directorships Held by
Interested Director
|
James F. Higgins
(59)
c/o Morgan Stanley Trust
Harborside Financial Center
Plaza Two
Jersey City, NJ 07311
|
|
Director
|
|
Since June 2000
|
|
Director or
Trustee of the Retail Funds (since June 2000) and the Institutional Funds
(since July 2003); Senior Advisor of Morgan Stanley (since
August 2000).
|
|
181
|
|
Director of AXA
Financial, Inc. and The Equitable Life Assurance Society of the United
States (financial services).
|
|
|
|
|
|
|
|
|
|
|
|
*
|
This is the earliest
date the Director began serving the Retail Funds or Institutional Funds. Each
Director serves an indefinite term, until his or her successor is elected.
|
**
|
The Fund Complex
includes all open-end and closed-end funds (including all of their
portfolios) advised by the Adviser and any funds that have an investment
adviser that is an affiliated person of the Adviser (including, but not
limited to, Morgan Stanley Investment Management, Inc.).
|
|
|
|
|
|
|
|
|
|
|
|
|
18
|
|
The Thai Fund, Inc.
|
|
|
|
|
|
December 31, 2007
|
Director and Officer
Information (contd)
Executive
Officers:
Name, Age and Address of Executive Officer
|
|
Position(s) Held
with Registrant
|
|
Term of Office
and Length of
Time Served*
|
|
Principal Occupation(s) During Past 5 Years
|
Ronald E. Robison (68)
Morgan Stanley Investment Management Inc.
522 Fifth Avenue
New York, NY 10036
|
|
President and
Principal
Executive
Officer
|
|
President since
September 2005
and Principal
Executive Officer since May 2003
|
|
President (since
September 2005) and Principal Executive Officer (since May 2003) of
funds in the Fund Complex; President (since September 2005) and Principal
Executive Officer (since May 2003) of the Van Kampen Funds; Managing
Director, Director and/or Officer of the Adviser and various entities affiliated
with the Adviser; Director of Morgan Stanley SICAV (since May 2004).
Formerly, Executive Vice President (July 2003 to September 2005) of
funds in the Fund Complex and the Van Kampen Funds; President and Director of
the Institutional Funds (March 2001 to July 2003); Chief
Administrative Officer of Morgan Stanley Investment Advisors Inc.; Chief
Administrative Officer of Morgan Stanley Services Company Inc.
|
|
|
|
|
|
|
|
J. David Germany (53)
Morgan Stanley Investment Management Limited
20 Bank Street
Canary Wharf
London, England
E144AD
|
|
Vice President
|
|
Since February 2006
|
|
Managing Director and
(since December 2005) Chief Investment Officer Global Fixed Income of
Morgan Stanley Investment Management; Managing Director and Director of
Morgan Stanley Investment Management Limited; Vice President of the Retail
Funds and Institutional Funds (since February 2006).
|
|
|
|
|
|
|
|
Dennis F. Shea (54)
Morgan Stanley Investment Management Inc.
522 Fifth Avenue
New York, NY 10036
|
|
Vice President
|
|
Since February 2006
|
|
Managing Director and
(since February 2006) Chief Investment Officer Global Equity of Morgan
Stanley Investment Management; Vice President of the Retail Funds and
Institutional Funds (since February 2006). Formerly, Managing Director
and Director of Global Equity Research at Morgan Stanley.
|
|
|
|
|
|
|
|
Amy R. Doberman (45)
Morgan Stanley Investment Management Inc.
522 Fifth Avenue
New York, NY 10036
|
|
Vice President
|
|
Since
July 2004
|
|
Managing Director and
General Counsel, U.S. Investment Management of Morgan Stanley Investment
Management (since July 2004); Vice President of the Retail Funds and
Institutional Funds (since July 2004); Vice President of the Van Kampen
Funds (since August 2004); Secretary (since February 2006) and
Managing Director (since July 2004) of the Adviser and various entities
affiliated with the Adviser. Formerly, Managing Director and General Counsel
Americas, UBS Global Asset Management (July 2000-July 2004).
|
|
|
|
|
|
|
|
Carsten Otto (44)
Morgan Stanley Investment Management Inc.
522 Fifth Avenue
New York, NY 10036
|
|
Chief Compliance
Officer
|
|
Since October 2004
|
|
Managing Director and
Global Head of Compliance for Morgan Stanley Investment Management (since
April 2007); and Chief Compliance Officer of Morgan Stanley Retail Funds
and Institutional Funds (since October 2004). Formerly, U.S. Director of
Compliance (October 2004 - April 2007) and Assistant Secretary and
Assistant General Counsel of the Retail Funds.
|
|
|
|
|
|
|
|
Stefanie V. Chang Yu
(41)
Morgan Stanley Investment Management Inc.
522 Fifth Avenue
New York, NY 10036
|
|
Vice President
|
|
Since December 1997
|
|
Managing Director of the
Adviser and various entities affiliated with the Adviser; Vice President of
the Retail Funds (since July 2002) and the Institutional Funds (since
December 1997). Formerly, Secretary of various entities affiliated with
the Adviser.
|
19
|
|
The Thai Fund, Inc.
|
|
|
|
|
|
December 31, 2007
|
Director and Officer
Information (contd)
Executive
Officers (contd):
Name, Age and Address of Executive Officer
|
|
Position(s) Held
with Registrant
|
|
Term of Office
and Length of
Time Served*
|
|
Principal Occupation(s) During Past 5 Years
|
Mary E. Mullin (40)
Morgan Stanley Investment Management Inc.
522 Fifth Avenue
New York, NY 10036
|
|
Secretary
|
|
Since June 1999
|
|
Executive Director of
the Adviser and various entities affiliated with the Adviser; Secretary of
the Retail Funds (since July 2003) and the Institutional Funds (since
June 1999).
|
|
|
|
|
|
|
|
James W. Garrett (39)
Morgan Stanley Investment Management Inc.
522 Fifth Avenue
New York, NY 10036
|
|
Treasurer and Chief
Financial Officer
|
|
Treasurer since
February 2002 and Chief Financial Officer
since July 2003
|
|
Head of Global Fund
Administration; Managing Director of the Adviser and various entities
affiliated with the Adviser; Treasurer and Chief Financial Officer of the
Institutional Funds. Formerly with PriceWaterhouse LLP (now
PricewaterhouseCoopers LLP).
|
* This
is the earliest date the Officer began serving the Retail Funds or
Institutional Funds. Each Officer serves an indefinite term, until his or her
successor is elected.
In accordance with Section 303A. 12(a) of the
New York Stock Exchange Listed Company Manual, the Funds Annual CEO
Certification certifying as to compliance with NYSEs Corporate Governance
Listing Standards was submitted to the Exchange on August 8, 2007.
The Funds Principal Executive Officer and Principal
Financial Officer Certifications required by Section 302 of the
Sarbanes-Oxley Act of 2002 were filed with the Funds N-CSR and are available
on the Securities and Exchange Commissions Website at http://www.sec.gov.
20
Dividend Reinvestment and
Cash Purchase Plan
Pursuant
to the Dividend Reinvestment and Cash Purchase Plan (the Plan), each
stockholder will be deemed to have elected, unless Computershare Trust Company,
N.A. (the Plan Agent) is otherwise instructed by the stockholder in writing,
to have all distributions automatically reinvested in Fund shares. Participants
in the Plan have the option of making additional voluntary cash payments to the
Plan Agent, annually, in any amount from $100 to $3,000, for investment in Fund
shares.
Dividend
and capital gain distributions will be reinvested on the reinvestment date in
full and fractional shares. If the market price per share equals or exceeds net
asset value per share on the reinvestment date, the Fund will issue shares to
participants at net asset value or, if net asset value is less than 95% of the
market price on the reinvestment date, shares will be issued at 95% of the
market price. If net asset value exceeds the market price on the reinvestment
date, participants will receive shares valued at market price. The Fund may
issue shares of its Common Stock in connection with dividend reinvestment
requirements at the discretion of the Board of Directors. Should the Fund
declare a dividend or capital gain distribution payable only in cash, the Plan
Agent will purchase Fund shares for participants in the open market as agent
for the participants.
The
Plan Agents fees for the reinvestment of dividends and distributions will be
paid by the Fund. However, each participants account will be charged a pro
rata share of brokerage commissions incurred on any open market purchases
effected on such participants behalf. A participant will also pay brokerage
commissions incurred on purchases made by voluntary cash payments. Although
stockholders in the Plan may receive no cash distributions, participation in
the Plan will not relieve participants of any income tax which may be payable
on such dividends or distributions.
In
the case of stockholders, such as banks, brokers or nominees, that hold shares
for others who are the beneficial owners, the Plan Agent will administer the
Plan on the basis of the number of shares certified from time to time by the
stockholder as representing the total amount registered in the stockholders
name and held for the account of beneficial owners who are participating in the
Plan.
Stockholders
who do not wish to have distributions automatically reinvested should notify
the Plan Agent in writing. There is no penalty for non-participation or
withdrawal from the Plan, and stockholders who have previously withdrawn from
the Plan may rejoin at any time. Requests for additional information or any
correspondence concerning the Plan should be directed to the Plan Agent at:
The
Thai Fund, Inc.
Computershare
Trust Company, N.A. P.O. Box 43078
Providence,
Rhode Island 02940-3078
1(800)
231-2608
21
Morgan Stanley
Institutional Closed-End Funds
An Important Notice
Concerning Our
U.S. Privacy Policy
(unaudited)
We
are required by federal law to provide you with a copy of our Privacy Policy
annually.
The
following Policy applies to current and former individual investors in Morgan
Stanley Institutional closed-end funds. This Policy is not applicable to
partnerships, corporations, trusts or other non-individual clients or account
holders. Please note that we may amend this Policy at any time, and will inform
you of any changes to this Policy as required by law.
We Respect Your Privacy
We
appreciate that you have provided us with your personal financial information.
We strive to maintain the privacy of such information while we help you achieve
your financial objectives. This Policy describes what non-public personal
information we collect about you, why we collect it, and when we may share it
with others. We hope this Policy will help you understand how we collect and
share non-public personal information that we gather about you. Throughout this
Policy, we refer to the non-public information that personally identifies you
or your accounts as personal information.
1. What Personal Information Do We Collect About You?
To
serve you better and manage our business, it is important that we collect and
maintain accurate information about you. We may obtain this information from
applications and other forms you submit to us, from your dealings with us, from
consumer reporting agencies, from our Web sites and from third parties and
other sources.
For
example:
·
We may
collect information such as your name, address, e-mail address, telephone/fax
numbers, assets, income and investment objectives through applications and
other forms you submit to us.
·
We may
obtain information about account balances, your use of account(s) and the
types of products and services you prefer to receive from us through your
dealings and transactions with us and other sources.
·
We may
obtain information about your creditworthiness and credit history from consumer
reporting agencies.
·
We may
collect background information from and through third-party vendors to verify
representations you have made and to comply with various regulatory
requirements.
·
If you
interact with us through our public and private Web sites, we may collect information
that you provide directly through online communications (such as an e-mail
address). We may also collect information about your Internet service provider,
your domain name, your computers operating system and Web browser, your use of
our Web sites and your product and service preferences, through the use of cookies.
Cookies recognize your computer each time you return to one of our sites, and
help to improve our sites content and personalize your experience on our sites
by, for example, suggesting offerings that may interest you. Please consult the
Terms of Use of these sites for more details on our use of cookies.
2. When Do We Disclose Personal Information We Collect About
You?
To
provide you with the products and services you request, to serve you better and
to manage our business, we may disclose personal information we collect about
you to our affiliated companies and to non-affiliated third parties as required
or permitted by law.
A. Information We Disclose to Our Affiliated Companies.
We do not disclose personal information that
we collect about you to our affiliated companies except to enable them to
provide services on our behalf or as otherwise required or permitted by law.
22
Morgan Stanley
Institutional Closed-End Funds
An Important Notice
Concerning Our
U.S. Privacy Policy (contd)
B. Information We Disclose to Third Parties.
We do not disclose personal information that
we collect about you to non-affiliated third parties except to enable them to
provide services on our behalf, to perform joint marketing agreements with
other financial institutions, or as otherwise required or permitted by law. For
example, some instances where we may disclose information about you to
nonaffiliated third parties include: for servicing and processing transactions,
to offer our own products and services, to protect against fraud, for
institutional risk control, to respond to judicial process or to perform
services on our behalf. When we share personal information with these
companies, they are required to limit their use of personal information to the
particular purpose for which it was shared and they are not allowed to share
personal information with others except to fulfill that limited purpose.
3. How Do We Protect the Security and Confidentiality of
Personal Information We Collect About You?
We
maintain physical, electronic and procedural security measures to help
safeguard the personal information we collect about you. We have internal
policies governing the proper handling of client information. Third parties
that provide support or marketing services on our behalf may also receive
personal information, and we require them to adhere to confidentiality
standards with respect to such information.
23
The
Thai Fund, Inc.
Directors
|
|
Michael
E. Nugent
|
J.
David Germany
|
|
Vice President
|
Frank
L. Bowman
|
|
|
Dennis
F. Shea
|
Michael
Bozic
|
Vice President
|
|
|
Kathleen
A. Dennis
|
Amy
R. Doberman
|
|
Vice President
|
James
F. Higgins
|
|
|
Stefanie
V. Chang Yu
|
Dr. Manuel
H. Johnson
|
Vice President
|
|
|
Joseph
J. Kearns
|
James
W. Garrett
|
|
Treasurer and Chief
|
Michael
F. Klein
|
Financial Officer
|
|
|
W.
Allen Reed
|
Carsten Otto
|
|
Chief Compliance Officer
|
Fergus
Reid
|
|
|
|
Officers
|
|
Michael
E. Nugent
|
Mary
E. Mullin
|
Chairman of the Board and
|
Secretary
|
Director
|
|
|
|
Ronald
E. Robison
|
|
President and Principal
Executive Officer
|
|
U.S. Investment Adviser and Administrator
Morgan
Stanley Investment Management Inc.
522
Fifth Avenue
New
York, New York 10036
Thai Investment Adviser
MFC
Asset Management Public Company Limited
Ground
Floor and 21st-23rd Floors, Column Tower
199
Ratchadaphisek Road
Khlongtoey,
Bangkok 10110 Thailand
Custodians
Kasikornbank
Public Company Limited
1
Soi Kasikornthai
Ratburana
Road
Bangkok
10140, Thailand
JPMorgan
Chase Bank, N.A.
270
Park Avenue
New
York, New York 10017
Stockholder Servicing Agent
Computershare
Trust Company, N.A.
250
Royall Street
Canton,
Massachusetts 02021
Legal Counsel
Clifford
Chance US LLP
31
West 52
nd
Street
New
York, New York 10019-6131
Independent Registered Public Accounting Firm
Ernst &
Young LLP
200
Clarendon Street
Boston,
Massachusetts 02116
For
additional Fund information, including the Funds net asset value per share and
information regarding the investments comprising the Funds portfolio, please
call 1(800) 231-2608 or visit our website at www.morganstanley.com/msim. All
investments involve risks, including the possible loss of principal.
©
2008 Morgan Stanley
|
CETTFANN
|
IU08-00735I-Y12/07
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