UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number 811-06686
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JF China Region Fund, Inc.
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(Exact name of registrant as specified in charter)
301 Bellevue Parkway
Wilmington, DE 19809
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(Address of principal executive offices) (Zip code)
Cleary, Gottlieb, Steen & Hamilton
1 Liberty Plaza
New York, NY 10006
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(Name and address of agent for service)
Registrant's telephone number, including area code: 800-441-9800
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Date of fiscal year end: December 31, 2004
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Date of reporting period: June 30, 2004
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Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO STOCKHOLDERS.
The Report to Shareholders is attached herewith.
[Graphic Omitted] JF CHINA REGION FUND, INC.
(formerly JARDINE FLEMING CHINA REGION FUND, INC.)
--------------------------------------------------------------------
SEMI-ANNUAL REPORT
JUNE 30, 2004
[Graphic Omitted]
THIS REPORT, INCLUDING THE FINANCIAL STATEMENTS HEREIN, IS SENT TO THE
STOCKHOLDERS OF THE FUND FOR THEIR INFORMATION. IT IS NOT A PROSPECTUS, CIRCULAR
OR REPRESENTATION INTENDED FOR USE IN THE PURCHASE OR SALE OF SHARES OF THE FUND
OR OF ANY SECURITIES MENTIONED IN THIS REPORT.
[Graphic Omitted]
JF CHINA REGION FUND, INC.
CONTENTS
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PAGE
Objectives 1
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Management 1
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Market Information 1
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Highlights 2
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Chairman's Statement 3
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Major Holdings 4
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Investment Portfolio 6
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Statement of Assets and Liabilities 13
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Statement of Operations 14
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Statements of Changes in Net Assets 15
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Financial Highlights 16
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Notes to Financial Statements 17
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Results of the Annual Stockholders Meeting 22
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Other Information 22
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Dividend Reinvestment and Cash Purchase Plan 23
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Directors and Administration 24
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[Graphic Omitted]
JF CHINA REGION FUND, INC.
OBJECTIVES
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JF China Region Fund, Inc. (formerly known as Jardine Fleming China Region
Fund, Inc.) (the "Fund") seeks to achieve long-term capital appreciation through
investments primarily in equity securities of companies with substantial assets
in, or revenues derived from, the People's Republic of China (PRC or China),
Hong Kong, Taiwan and Macau--collectively, the China Region.
The Fund provides investors with an opportunity to participate in the
growing economies of the China Region, especially that of the PRC, although
investments are expected to be predominantly in securities listed on the Stock
Exchange of Hong Kong. Hong Kong enterprises have made substantial investments
in the PRC, in Guangdong Province in particular, where abundant labor and land
are available. Hong Kong is also the largest trading partner of the PRC.
The economies of the PRC, Hong Kong, Taiwan and Macau have become
increasingly linked over the past 10 years and are becoming further integrated
now that Hong Kong and Macau have reverted to Chinese sovereignty. Investments
made by the Fund will seek to take advantage of opportunities resulting from
this linkage among the China Region markets.
MANAGEMENT
- --------------------------------------------------------------------------------
JF International Management Inc. ("JFIM") (formerly Jardine Fleming
International Management Inc.) is the investment management company appointed to
advise and manage the Fund's portfolio. JFIM is part of J.P. Morgan Chase & Co.
("JPMC"), one of the world's premier financial services institutions. In asset
management, JPMC operates globally under the name of JPMorgan Fleming Asset
Management ("JPMFAM"), although in Asia it uses the sub-brand JF Asset
Management. Funds under management for the global asset management business of
JPMFAM were US $788 billion as of June 30, 2004.
Chung Man Wing is the portfolio manager of the Fund. Mr. Chung joined
JPMFAM in late 2000 as head of the Greater China team. Previously, he was chief
investment officer at HSBC Asset Management (Asia).
MARKET INFORMATION
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THE FUND IS LISTED ON THE NEW YORK STOCK EXCHANGE (SYMBOL JFC). THE SHARE PRICE
IS PUBLISHED IN
- --------------------------------------------------------------------------------
o The Wall Street Journal (daily)
o The Asian Wall Street Journal (daily)
o Reuters (page JFC)
THE NET ASSET VALUE IS PUBLISHED IN
- --------------------------------------------------------------------------------
o The Wall Street Journal under "Closed-End Funds" (every Monday)
o The Asian Wall Street Journal under "Closed-End Funds" (every Monday)
o Reuters (page JFC)
-1-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
HIGHLIGHTS
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JUNE 30, 2004 December 31, 2003
US$ US$
- --------------------------------------------------------------------------------
Net Assets $56.7 million $63.9 million
Net Asset Value Per Share $12.37 $13.93
MARKET DATA
Share Price on the
New York Stock Exchange $11.37 $18.08
(Discount)/Premium to Net Asset Value (8.1%) 29.8%
TOTAL RETURN FOR THE PERIOD ENDED JUNE 30, 2004
- --------------------------------------------------------------------------------
Net Asset Value -11.2%
Share Price -37.1%
JFC Benchmark Index* -2.9%
MSCI Hong Kong Index (Total) 1.7%
BNP Prime Peregrine China Index -9.2%
Taiwan Weighted Index 0.04%
NET ASSET VALUE AND SHARE PRICE VS. BENCHMARK INDEX
[EDGAR REPRESENTATION OF PLOT POINTS USED IN PRINTED GRAPHIC]
Net Asset JF China Share JFC Benchmark
Value Price Index*
7/16/92 100 100 100
7/27/92 99.78 98.33 89.81
8/28/92 100.43 94.2 91.11
9/30/92 100.94 80 79.15
10/30/92 108.6 92.53 90.31
11/30/92 111.05 96.67 91.95
12/31/92 109.29 93.02 90.21
1/29/93 110.16 96.37 87.65
2/26/93 117.49 98.85 97.55
3/31/93 120.54 108.9 94.28
4/30/93 125.48 118.95 97.84
5/28/93 129.84 122.3 92.05
6/30/93 122.35 120.09 83.13
7/30/93 120.67 116.73 77.96
8/27/93 124.75 129.29 82.27
9/30/93 128.39 126.81 84.74
10/29/93 147.17 150.32 102.63
11/26/93 156.34 166.71 113.9
12/31/93 188.96 187.39 128.98
1/28/94 175.52 183.65 111.34
2/25/94 158.91 148.41 103.16
3/31/94 136.56 136.08 91.08
4/29/94 132.14 134.18 87.3
5/27/94 136.06 148.41 90.89
6/30/94 123.99 123.29 82.84
7/29/94 130.78 126.47 87.48
8/26/94 130.78 135.83 92.18
9/30/94 132.98 129.56 94.14
10/28/94 132.34 126.47 89.14
11/23/94 124.35 110.76 80.63
12/30/94 115.72 94.29 72.23
1/27/95 101.37 90.1 62.02
2/24/95 108.27 98.48 66.92
3/31/95 109.37 94.29 67.13
4/30/95 105.33 90.1 63.43
5/26/95 113.68 107.01 70.35
6/30/95 111.93 92.33 69.32
7/28/95 116.08 95.51 73.64
8/31/95 108.89 88.13 69.66
9/30/95 112.85 94.42 68.82
10/31/95 110.46 89.22 67.02
11/30/95 104.65 85.02 64.06
12/29/95 103.54 84.52 63.34
1/31/96 112.35 107.76 72.64
2/29/96 113.37 95.08 73.99
3/31/96 110.12 95.08 70.65
4/30/96 111.7 96.18 68.52
5/31/96 112.25 94.07 71.64
6/30/96 111.98 87.73 71.47
7/31/96 110.21 81.39 71.69
8/30/96 110.68 84.52 73.69
9/30/96 112.16 85.62 74.73
10/31/96 113.18 83.51 77.45
11/29/96 125.79 90.86 89.15
12/31/96 132.84 95.25 97.43
1/31/97 135.63 99.49 99.27
2/28/97 138.13 99.49 100.73
3/27/97 133.96 99.49 99.65
4/30/97 148.44 106.94 106.53
5/31/97 159.48 115.41 111.06
6/30/97 170.35 124.89 114.45
7/31/97 178.89 130.22 117.43
8/31/97 187.33 126.5 121.24
9/30/97 167.65 124.38 116.19
10/31/97 124.12 87.29 88.5
11/28/97 107.96 84.67 82.92
12/31/97 110 82.89 83.73
1/30/98 85.88 79.75 70.48
2/28/98 114.29 88.25 86.61
3/31/98 107.58 80.77 83.66
4/30/98 98.27 74.9 76.62
5/29/98 83.74 60.57 69.04
6/30/98 72.75 54.24 63.53
7/31/98 57.28 44.1 56.17
8/31/98 51.32 29.76 50.16
9/30/98 60.82 40.91 56.88
10/30/98 70.51 50.48 65.12
11/30/98 72.47 53.14 64.68
12/31/98 69.86 46.76 61.44
1/29/99 63.27 45.7 55.92
2/26/99 63.43 44.63 56.22
3/31/99 69.67 47.82 62.49
4/30/99 82.25 62.17 74.33
5/31/99 76.94 57.39 69.97
6/30/99 90.35 74.39 80.74
7/30/99 84.95 60.57 75.8
8/31/99 88.77 61.11 78.44
9/30/99 84.11 56.86 73.92
10/29/99 87.65 59.51 75.69
11/30/99 99.29 68.01 82.85
12/31/99 110.11 72.07 90.38
1/31/00 108.99 69.94 90.33
2/29/00 113.38 73.68 91.87
3/31/00 118.43 75.28 96.89
4/28/00 100.86 64.07 87.24
5/31/00 94.69 62.46 82.27
6/30/00 98.52 66.73 85.48
7/31/00 102.07 69.94 89.73
8/31/00 103.94 71.54 88.73
9/29/00 95.34 66.73 79.73
10/31/00 87.4 64.07 72.78
11/30/00 83 61.93 68.48
12/29/00 87.3 60.33 71.12
1/31/01 95.81 71.33 78.24
2/28/01 91.42 67.57 76.15
3/30/01 84.59 60.73 69.8
4/30/01 86.09 63.89 69.03
5/31/01 87.12 66.46 67.29
6/29/01 84.69 66.2 65.3
7/31/01 78.98 60.22 61.21
8/31/01 73.1 54.24 57.47
9/28/01 66.37 50.83 48.34
10/31/01 71.51 51.34 51.1
11/30/01 76.18 55.95 57.64
12/31/01 76.09 56.12 63.41
1/31/02 75.34 55.52 63.09
2/28/02 75.53 57.92 60.84
3/28/02 81.23 63.64 65.43
4/30/02 80.95 64.92 66.68
5/31/02 81.88 65.18 64.55
6/28/02 76.65 58.94 60.36
7/31/02 73.94 54.24 57.39
8/30/02 70.29 53.39 54.89
9/30/02 65.71 49.71 49.3
10/31/02 68.42 52.96 52.07
11/29/02 70.48 55.78 54.34
12/31/02 69.82 55.52 50.92
1/31/03 77.58 62.36 53.73
2/28/03 77.3 66.63 50.72
3/31/03 73.94 64.41 48.9
4/30/03 73.75 63.21 48.38
5/30/03 82.63 65.43 53.24
6/30/03 86.93 73.46 55.68
7/31/03 96.93 80.3 60.86
8/29/03 104.13 88.58 66.88
9/30/03 106.37 86.87 68.73
10/31/03 120.3 116.09 73.75
11/28/03 119.37 114.63 72.11
12/31/03 130.21 154.44 75.7
1/30/04 134.88 129.5 80.89
2/27/04 143.95 141.97 84.25
3/31/04 135.35 123.01 79.74
4/30/04 115.81 91.4 73.82
5/31/04 118.43 104.47 74.32
6/30/04 115.63 97.12 73.49
* JFC Benchmark: MSCI Golden Dragon Index (Total)
Prior to March 2001: 25% Taiwan Weighted Index, 20% BNP Prime Peregrine
China Index, 50% MSCI Hong Kong Index, 5% HSBC
Prior to March 1999: 60% Hong Kong All Ordinaries Index, 30% Credit
Lyonnais Securities Asia All China B Index, 10% Taiwan
Weighted Index
Prior to January 1997: Peregrine Greater China Index
** Commencement of operations
Source: JPMorgan Fleming Asset Management
-2-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
CHAIRMAN'S STATEMENT
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Dear Fellow Stockholders,
After the encouraging returns enjoyed in the markets of the China Region in
2003, their performance in the first half of 2004 came as a disappointment with
the marked outperformance of the Fund against its benchmark, the MSCI Golden
Dragon Index (Total), in 2003 reversed. The share price suffered to a greater
degree as a result of its move from a significant premium of 29.8% to net asset
value ('NAV') per share at the year-end to a discount of 8.1% at June 30, 2004.
Both the share price and NAV do however remain ahead of benchmark over the
period since inception, as can be seen from the chart on page 2.
In China, share prices fell on profit taking, triggered by concerns over
large equity fund raisings as well as efforts by the People's Bank of China to
slow the domestic economy. These falls accelerated in the second half of the
period under review as the Chinese government intensified its efforts to
restrain investment in overheated sectors. The Hong Kong market suffered from a
sharp correction in March 2004 and was thereafter clouded by external factors
such as rising US interest rates, higher oil prices and the risk of a hard
landing in China. Taiwan proved something of a roller coaster ride, prompted by
an uncertain election victory from President Chen.
The volatility to which I referred in the Fund's Annual Report proved more
severe than was thought likely at the time of writing. The Directors are acutely
aware of the additional impact on stockholders of both the volatility and
absolute level of discount at which the shares now trade to their underlying NAV
per share and continue to monitor this position. The Directors do however remain
positive about the long-term growth prospects of the Greater China region
although it is probable that volatility will continue to persist in the short
term.
Respectfully submitted,
/s/ The Rt. Hon. The Earl of Cromer
- --------------------------------------
The Rt. Hon. The Earl of Cromer
Chairman
August 19, 2004
-3-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
MAJOR HOLDINGS
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AT JUNE 30, 2004
- --------------------------------------------------------------------------------
% of Net
Assets
- --------------------------------------------------------------------------------
CHINA TELECOM 'H' 4.1
China Telecom Corporation Limited, through its subsidiaries,
provides wireline telephone, data, and Internet, as well as leased
line services in China.
SUNG HUNG KAI PROPERTIES 3.0
Sung Hung Kai Properties Limited, through its subsidiaries,
develops and invests in properties. The company also operates hotels,
manages properties, car parking and transportation infrastructure. In
addition, Sun Hung Kai operates logistics business, construction,
financial services, telecommunication Internet infrastructure and
enabling services.
CHINA MENGNIU DAIRY 2.6
China Mengniu Dairy Company Limited, through its subsidiaries,
manufactures dairy products in China. The principal products are
liquid milk, ice cream, and other dairy products, such as milk
powder, milk tea powder, and milk tablets. The company markets its
products under its primary MENGNIU trademark.
COFCO INTERNATIONAL 2.6
COFCO International Limited, through its subsidiaries, operates
food processing businesses. The company processes and refines edible
oil and fats and produces confectionery products, wine and beverage
as well as flour, including wheat and other grain products. In
addition, COFCO International Limited trades food products.
CHINA INTERNATIONAL MARINE CONTAINERS 'B' 2.6
China International Marine Containers Company Limited designs
and manufactures containers, airport facilities, internal combustion
power-generating equipment, and trailers. The company also operates
in the timber industry and real estate development.
CATHAY FINANCIAL HOLDING GDR 2.3
Cathay Financial Holding Company Limited is a holding company.
Through its subsidiaries, the company provides traditional life,
health care, and accident insurances, as well as banking, security
underwriting, and brokerage services.
-4-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
MAJOR HOLDINGS (CONTINUED)
- --------------------------------------------------------------------------------
AT JUNE 30, 2004
- --------------------------------------------------------------------------------
% of Net
Assets
- --------------------------------------------------------------------------------
SINGAMAS CONTAINER HOLDINGS 2.3
Singamas Container Holdings Limited, through its subsidiaries,
manufactures containers and related parts, operates container depot
businesses, and provides container storage, repair and trucking as
well as mid-stream services.
SYNNEX TECHNOLOGY INTERNATIONAL 2.3
Synnex Technology International Corporation markets personal
computers, computer peripherals, multi-media products, network
products, computer application software, electronic parts, and
telecommunication products.
SKYWORTH DIGITAL HOLDINGS 2.2
Skyworth Digital Holdings Limited, through its subsidiaries,
designs, manufactures, and sells color televisions and audio-visual
products.
SINOPEC SHANGHAI PETROCHEMICAL 2.2
Sinopec Shanghai Petrochemical Company Limited processes crude
oil into a broad range of synthetic fibers, resins and plastics,
intermediate petrochemical products and petroleum products.
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TOTAL MAJOR HOLDINGS 26.2
-5-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
INVESTMENT PORTFOLIO
- --------------------------------------------------------------------------------
AT JUNE 30, 2004 (UNAUDITED)
- --------------------------------------------------------------------------------
Holdings Market
(in shares Value
Description or par) (in US$)
- --------------------------------------------------------------------------------
COMMON STOCKS (UNLESS OTHERWISE NOTED)
- --------------------------------------------------------------------------------
CHINA (30.4%)
- --------------------------------------------------------------------------------
AIR FREIGHT & COURIERS (0.5%)
Sinotrans 'H' 786,000 282,163
- --------------------------------------------------------------------------------
AUTO COMPONENTS (0.5%)
Weifu High-Technology 'B' 344,000 295,938
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AUTOMOBILES (2.0%)
Chongqing Changan Automobile 'B' 1,684,500 1,114,397
- --------------------------------------------------------------------------------
BIOTECHNOLOGY (1.0%)
Tong Ren Tang Technologies 'H' 262,000 559,287
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CHEMICALS (4.1%)
Sinopec Beijing Yanhua Petrochemical 'H' 3,308,000 1,070,893
Sinopec Shanghai Petrochemical 'H' 3,732,000 1,244,040
- --------------------------------------------------------------------------------
2,314,933
- --------------------------------------------------------------------------------
COMMERCIAL SERVICES & SUPPLIES (0.2%)
* CCID Consulting 'H' 4,300,000 108,606
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DIVERSIFIED TELECOMMUNICATION SERVICES (4.1%)
China Telecom 'H' 6,670,000 2,330,299
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HOUSEHOLD DURABLES (1.0%)
* Guangdong Kelon Electrical Holdings 'H' 1,650,000 581,750
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INSURANCE (1.0%)
* PICC Property and Casualty 'H' 1,480,000 569,249
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MACHINERY (4.0%)
China International Marine Containers 'B' 1,124,296 1,451,541
Shanghai Zhenhua Port Machinery 'B' 600,000 432,600
* Weichai Power 'H' 219,000 369,223
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2,253,364
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-6-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
INVESTMENT PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
AT JUNE 30, 2004 (UNAUDITED)
- --------------------------------------------------------------------------------
Holdings Market
(in shares Value
Description or par) (in US$)
- --------------------------------------------------------------------------------
MARINE (1.3%)
* China Shipping Container 'H' 673,000 241,598
China Shipping Development 'H' 846,000 504,362
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745,960
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METALS & MINING (1.0%)
Yanzhou Coal Mining 'H' 554,000 603,737
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OIL & GAS (5.7%)
China Petroleum and Chemical 'H' 2,938,000 1,073,534
PetroChina 'H' 2,416,000 1,115,113
Sinopec Zhenhai Refining and Chemical 'H' 1,084,000 1,042,341
- --------------------------------------------------------------------------------
3,230,988
- --------------------------------------------------------------------------------
PAPER & FOREST PRODUCTS (1.0%)
* Shandong Chenming Paper Holdings 'B' 848,700 566,906
- --------------------------------------------------------------------------------
PHARMACEUTICALS (0.6%)
Hua Han Bio-Pharmaceutical Holdings 'H' 2,828,000 344,447
- --------------------------------------------------------------------------------
TEXTILES, APPAREL & LUXURY GOODS (1.6%)
Weiqiao Textile 'H' 616,500 905,019
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TRANSPORTATION INFRASTRUCTURE (0.8%)
Hainan Meilan International Airport 'H' 597,000 455,419
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TOTAL CHINA 17,262,462
- --------------------------------------------------------------------------------
HONG KONG (44.7%)
- --------------------------------------------------------------------------------
COMMERCIAL BANKS (1.4%)
CITIC International Financial Holdings 2,094,000 765,140
- --------------------------------------------------------------------------------
COMPUTERS & PERIPHERALS (1.9%)
TPV Technology 1,478,000 1,061,162
- --------------------------------------------------------------------------------
CONSTRUCTION & ENGINEERING (0.9%)
* COSCO International Holdings 4,300,000 529,248
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-7-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
INVESTMENT PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
AT JUNE 30, 2004 (UNAUDITED)
- --------------------------------------------------------------------------------
Holdings Market
(in shares Value
Description or par) (in US$)
- --------------------------------------------------------------------------------
CONTAINERS & PACKAGING (3.3%)
Hung Hing Printing Group 790,000 592,519
Singamas Container Holdings 2,500,000 1,298,119
- --------------------------------------------------------------------------------
1,890,638
- --------------------------------------------------------------------------------
DISTRIBUTORS (0.8%)
China Resources Enterprises 364,000 441,014
- --------------------------------------------------------------------------------
DIVERSIFIED TELECOMMUNICATION SERVICES (1.4%)
* PCCW 1,165,000 791,628
- --------------------------------------------------------------------------------
ELECTRONIC EQUIPMENT & INSTRUMENTS (0.8%)
Digital China Holdings 1,704,000 464,246
- --------------------------------------------------------------------------------
FOOD PRODUCTS (6.3%)
* China Mengniu Dairy 2,287,000 1,495,394
COFCO International 2,900,000 1,487,227
Global Bio-chem Technology Group 840,000 608,481
* Global Bio-chem Technology Group Warrants -
expire 05/31/2007 150,250 9,825
- --------------------------------------------------------------------------------
3,600,927
- --------------------------------------------------------------------------------
HEALTHCARE EQUIPMENT & SUPPLIES (1.4%)
Hengan International Group 1,200,000 769,255
- --------------------------------------------------------------------------------
HOUSEHOLD DURABLES (5.2%)
Alco Holdings 1,600,000 451,296
Skyworth Digital Holdings 4,756,456 1,250,134
TCL International Holdings 1,676,000 521,081
Techtronic Industries 472,000 753,409
- --------------------------------------------------------------------------------
2,975,920
- --------------------------------------------------------------------------------
INSURANCE (1.1%)
China Insurance International Holdings 1,428,000 631,636
- --------------------------------------------------------------------------------
LEISURE EQUIPMENT & PRODUCTS (0.2%)
* Li Ning 354,000 107,792
- --------------------------------------------------------------------------------
-8-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
INVESTMENT PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
AT JUNE 30, 2004 (UNAUDITED)
- --------------------------------------------------------------------------------
Holdings Market
(in shares Value
Description or par) (in US$)
- --------------------------------------------------------------------------------
MACHINERY (0.5%)
Fong's Industries 368,000 287,804
- --------------------------------------------------------------------------------
MEDIA (1.2%)
Oriental Press Group 1,886,000 677,047
- --------------------------------------------------------------------------------
MISCELLANEOUS (0.0%)
* Health Asia MediCentres Beijing++ 1,000,000 0
- --------------------------------------------------------------------------------
MULTILINE RETAIL (2.3%)
Aeon Stores (Hong Kong) 1,000,000 692,330
* Lifestyle International Holdings 482,000 590,160
- --------------------------------------------------------------------------------
1,282,490
- --------------------------------------------------------------------------------
OIL & GAS (1.0%)
CNOOC 1,303,000 551,287
- --------------------------------------------------------------------------------
REAL ESTATE (6.8%)
Silver Grant International Industries 4,060,000 874,489
Sung Hung Kai Properties 206,000 1,690,310
Swire Pacific 'A' 86,000 556,813
Wharf (Holdings) 251,000 720,844
- --------------------------------------------------------------------------------
3,842,456
- --------------------------------------------------------------------------------
TEXTILES, APPAREL & LUXURY GOODS (1.1%)
Fountain Set (Holdings) 410,000 273,342
* Titan Petrochemicals Group 5,500,000 366,678
- --------------------------------------------------------------------------------
640,020
- --------------------------------------------------------------------------------
TRANSPORTATION INFRASTRUCTURE (5.1%)
China Merchants Holdings International 456,000 613,866
Cosco Pacific 638,000 887,503
GZI Transport 2,150,000 585,756
Hopewell Holdings 400,000 805,154
- --------------------------------------------------------------------------------
2,892,279
- --------------------------------------------------------------------------------
-9-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
INVESTMENT PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
AT JUNE 30, 2004 (UNAUDITED)
- --------------------------------------------------------------------------------
Holdings Market
(in shares Value
Description or par) (in US$)
- --------------------------------------------------------------------------------
WIRELESS TELECOMMUNICATION SERVICES (2.0%)
China Mobile (Hong Kong) 373,500 1,130,113
- --------------------------------------------------------------------------------
TOTAL HONG KONG 25,332,102
- --------------------------------------------------------------------------------
SINGAPORE (1.0%)
- --------------------------------------------------------------------------------
CONTAINERS & PACKAGING (1.0%)
Full Appex Holdings 2,000,000 563,233
- --------------------------------------------------------------------------------
TOTAL SINGAPORE 563,233
- --------------------------------------------------------------------------------
SOUTH KOREA (1.2%)
- --------------------------------------------------------------------------------
MARINE (1.2%)
Hanjin Shipping 45,000 689,312
- --------------------------------------------------------------------------------
TOTAL SOUTH KOREA 689,312
- --------------------------------------------------------------------------------
TAIWAN (17.4%)
- --------------------------------------------------------------------------------
AIRLINES (0.0%)
EVA Airways 662 277
- --------------------------------------------------------------------------------
COMMERCIAL BANKS (3.0%)
Bank of Kaohsiung 1,050,000 743,529
Chinatrust Financial Holding 768,000 856,888
* First Financial Holding 157,000 113,978
- --------------------------------------------------------------------------------
1,714,395
- --------------------------------------------------------------------------------
ELECTRONIC EQUIPMENT & INSTRUMENTS (2.3%)
Synnex Technology International 800,000 1,297,233
- --------------------------------------------------------------------------------
INSURANCE (2.3%)
* Cathay Financial Holding GDR 74,000 1,325,340
- --------------------------------------------------------------------------------
-10-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
INVESTMENT PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
AT JUNE 30, 2004 (UNAUDITED)
- --------------------------------------------------------------------------------
Holdings Market
(in shares Value
Description or par) (in US$)
- --------------------------------------------------------------------------------
LEISURE EQUIPMENT & PRODUCTS (0.8%)
Premier Image Technology 359,000 437,935
- --------------------------------------------------------------------------------
METALS & MINING (0.5%)
China Steel 301,000 284,790
- --------------------------------------------------------------------------------
PAPER & FOREST PRODUCTS (1.0%)
Chung Hwa Pulp 1,250,000 595,061
- --------------------------------------------------------------------------------
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT (3.1%)
* Powerchip Semiconductor 293,000 236,248
Taiwan Semiconductor Manufacturing 527,184 759,170
* United Microelectronics 404,000 300,506
* Windbond Electronics 1,001,000 458,655
- --------------------------------------------------------------------------------
1,754,579
- --------------------------------------------------------------------------------
SOFTWARE (0.8%)
Soft-World International 175,000 447,783
- --------------------------------------------------------------------------------
SPECIALTY RETAIL (1.3%)
Hotai Motor 500,000 722,999
- --------------------------------------------------------------------------------
TEXTILES, APPAREL & LUXURY GOODS (0.0%)
Pou Chen 816 762
- --------------------------------------------------------------------------------
WIRELESS TELECOMMUNICATION SERVICES (2.3%)
Far EasTone Telecommunications 569,000 521,428
Taiwan Cellular 823,000 783,577
- --------------------------------------------------------------------------------
1,305,005
- --------------------------------------------------------------------------------
TOTAL TAIWAN 9,886,159
- --------------------------------------------------------------------------------
TOTAL COMMON STOCK (Cost $50,042,848) 53,733,268
- --------------------------------------------------------------------------------
-11-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
INVESTMENT PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
AT JUNE 30, 2004 (UNAUDITED)
- --------------------------------------------------------------------------------
Holdings Market
(in shares Value
Description or par) (in US$)
- --------------------------------------------------------------------------------
UNITED STATES (4.1%)
- --------------------------------------------------------------------------------
SHORT-TERM INVESTMENT (4.1%)
Citibank Time Deposit, 0.85%, 07/02/04 2,300,858 2,300,858
- --------------------------------------------------------------------------------
TOTAL UNITED STATES (Cost $2,300,858) 2,300,858
- --------------------------------------------------------------------------------
TOTAL INVESTMENTS
(98.8% of Net Assets) (Cost $52,343,706) 56,034,126
================================================================================
Other assets in excess of liabilities (1.2%
of Net Assets) 695,199
================================================================================
NET ASSETS (100.0%) 56,729,325
================================================================================
Aggregate cost for Federal income tax
purposes is $52,422,319. The aggregate
unrealized gain for all securities is as
follows:
Excess of market value over cost 7,212,033
Excess of cost over market value (3,600,226)
- --------------------------------------------------------------------------------
Net unrealized gain 3,611,807
================================================================================
B - Chinese security traded on Beijing Stock Exchange.
H - Chinese security traded on Hong Kong Stock Exchange.
GDR - Global Depository Receipts
* Non-income producing security.
++ At fair value as determined under the supervision of the Board of
Directors.
See accompanying notes to financial statements.
-12-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------------
AT JUNE 30, 2004 (UNAUDITED)
- --------------------------------------------------------------------------------
(in US$)
- --------------------------------------------------------------------------------
ASSETS
- --------------------------------------------------------------------------------
Investments at value (cost $52,343,706) 56,034,126
Cash (including foreign currencies with a cost of $573,339 and
value of $573,299) 704,128
Receivable for securities sold 357,551
Dividend receivable 216,690
Interest receivable 54
Prepaid expenses 25,858
- --------------------------------------------------------------------------------
TOTAL ASSETS 57,338,407
- --------------------------------------------------------------------------------
LIABILITIES
- --------------------------------------------------------------------------------
Payable for securities purchased 308,126
Due to Investment Advisor 45,804
Accrued expenses payable 255,152
- --------------------------------------------------------------------------------
TOTAL LIABILITIES 609,082
- --------------------------------------------------------------------------------
NET ASSETS 56,729,325
================================================================================
NET ASSETS CONSIST OF:
Common stock, $0.01 par value (100,000,000 shares authorized;
4,585,160 shares issued and outstanding) 45,852
Paid-in capital 96,142,005
Accumulated net investment income 148,882
Accumulated realized loss on investments and foreign currency
transactions (43,297,746)
Accumulated net unrealized appreciation on investments,
and foreign currency holdings, and other assets
and liabilities denominated in foreign currencies 3,690,332
- --------------------------------------------------------------------------------
NET ASSETS 56,729,325
================================================================================
NET ASSET VALUE PER SHARE ($56,729,325 / 4,585,160) 12.37
================================================================================
See accompanying notes to financial statements.
-13-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
STATEMENT OF OPERATIONS
- --------------------------------------------------------------------------------
SIX MONTHS ENDED JUNE 30, 2004 (UNAUDITED)
- --------------------------------------------------------------------------------
(in US$)
- --------------------------------------------------------------------------------
INVESTMENT INCOME (LOSS)
- --------------------------------------------------------------------------------
Dividends (net of foreign withholding tax of $19,479) 844,383
Interest (net of foreign withholding tax of $127) 3,636
- --------------------------------------------------------------------------------
TOTAL INVESTMENT INCOME 848,019
- --------------------------------------------------------------------------------
EXPENSES
- --------------------------------------------------------------------------------
Investment advisory fees 314,986
Administration and accounting fees 68,623
Legal fees 68,458
Directors' fees and expenses 60,620
Custodian fees 54,334
Stockholder service fees 41,212
Insurance 26,226
Stockholder report expenses 19,423
Audit fees 17,388
NYSE listing fee 12,432
Other expenses 6,454
- --------------------------------------------------------------------------------
TOTAL EXPENSES 690,156
- --------------------------------------------------------------------------------
NET INVESTMENT INCOME 157,863
================================================================================
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS,
FOREIGN CURRENCY HOLDINGS AND OTHER ASSETS AND
LIABILITIES DENOMINATED IN FOREIGN CURRENCIES
- --------------------------------------------------------------------------------
NET REALIZED GAIN
Investments 8,232,618
Foreign currency transactions 11,589
NET CHANGE IN UNREALIZED DEPRECIATION
Investments and foreign currency holdings and other assets and
liabilities denominated in foreign currencies (15,555,380)
- --------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED LOSS ON INVESTMENTS,
FOREIGN CURRENCY HOLDINGS AND OTHER ASSETS AND LIABILITIES
DENOMINATED IN FOREIGN CURRENCIES (7,311,173)
- --------------------------------------------------------------------------------
DECREASE IN NET ASSETS RESULTING FROM OPERATIONS (7,153,310)
================================================================================
See accompanying notes to financial statements.
-14-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
Six Months Ended
June 30, 2004 Year Ended
(in US$) December 31, 2003
(unaudited) (in US$)
- -------------------------------------------------------------------------------------------------
INCREASE (DECREASE) IN NET ASSETS
Operations
Net investment income (loss) 157,863 (89,574)
Net realized gain on investment transactions 8,232,618 11,397,110
Net realized gain on foreign currency transactions 11,589 12,285
Net change in unrealized appreciation (depreciation)
on investments, foreign currency holdings and
other assets and liabilities denominated in
foreign currencies (15,555,380) 18,324,290
- -------------------------------------------------------------------------------------------------
Net (decrease)/increase in net assets
resulting from operations (7,153,310) 29,644,111
- -------------------------------------------------------------------------------------------------
CAPITAL SHARES REPURCHASED -- (10,191)
=================================================================================================
TOTAL (DECREASE)/INCREASE IN NET ASSETS (7,153,310) 29,633,920
Net Assets:
Beginning of period 63,882,635 34,248,715
- -------------------------------------------------------------------------------------------------
End of period (including undistributed
net investment income of $148,882
at June 30, 2004) 56,729,325 63,882,635
=================================================================================================
See accompanying notes to financial statements.
-15-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
For the
Six Months
Ended For the For the For the For the For the
June 30, Year Ended Year Ended Year Ended Year Ended Year Ended
2004 December 31, December 31, December 31, December 31, December 31,
(in US$) 2003 2002 2001 2000 1999
(unaudited) (in US$) (in US$) (in US$) (in US$) (in US$)
- ---------------------------------------------------------------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD:
- ---------------------------------------------------------------------------------------------------------------------
Net asset value,
beginning of period 13.93 7.47 8.14 9.34 11.78 7.50
=====================================================================================================================
Net investment income
(loss) 0.03 (0.02) (0.04) (0.11) (0.06) 0.03
Net realized and
unrealized gain (loss)
on investment and
foreign currency-
related transactions (1.59) 6.48 (0.66) (1.31) (2.73) 4.29
- ---------------------------------------------------------------------------------------------------------------------
Total from investment
operations (1.56) 6.46 (0.70) (1.42) (2.79) 4.32
=====================================================================================================================
Dividends from net
investment income -- -- -- -- -- (0.04)
=====================================================================================================================
Dilutive Effect of Capital
shares repurchased -- --* 0.03 0.22 0.35 --
=====================================================================================================================
NET ASSET VALUE, END OF
PERIOD 12.37 13.93 7.47 8.14 9.34 11.78
=====================================================================================================================
Market value, end of
period 11.37 18.08 6.50 6.57 7.06 8.44
=====================================================================================================================
TOTAL INVESTMENT RETURN
Per share market value (37.1%) 178.2% (1.1%) (6.9%) (16.3%) 54.2%
Per share net asset
value (11.2%) 86.5% (8.2%) (12.8%) (20.7%) 57.6%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period 56,729,325 63,882,635 34,248,715 38,169,881 56,150,319 107,250,954
Ratios of total expenses
to average net assets 2.19%++ 2.54% 2.62% 3.51%+ 2.02% 2.28%
Ratios of net investment
income (loss) to
average net assets 0.50%++ (0.19%) (0.44%) (1.25%) (0.36%) 0.37%
Portfolio turnover rate 84.8% 162.5% 245.0% 212.1% 94.8% 90.8%
Number of shares
outstanding at end of
period (in thousands) 4,585 4,585 4,587 4,689 6,012 9,101
* Less than $0.01 per share.
+ The ratio of total expenses to average net assets for the year ended
December 31, 2001 is higher than that of previous years as a result of the
expenses incurred in relation to a tender offer and share repurchases that
decreased the size of the Fund following similar actions in the previous
year.
++ Annualized.
See accompanying notes to financial statements.
-16-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
JUNE 30, 2004
- --------------------------------------------------------------------------------
1. ORGANIZATION AND CAPITAL
JF China Region Fund, Inc. (formerly known as Jardine Fleming China Region
Fund, Inc.) (the "Fund") was incorporated in the State of Maryland on May
22, 1992, and is registered as a non-diversified, closed-end management
investment company under the Investment Company Act of 1940. The Fund
commenced operations on July 16, 1992.
2. SIGNIFICANT ACCOUNTING POLICIES
The following significant accounting policies, which are in conformity with
accounting principles generally accepted in the United States of America
for investment companies, are consistently followed by the Fund in the
preparation of its financial statements.
The preparation of financial statements in accordance with accounting
principles generally accepted in the United States of America ("GAAP")
requires management to make estimates and assumptions that affect the
reported amounts and disclosures in the financial statements. Actual
results could differ from these estimates.
i) SECURITY VALUATION
All securities for which market quotations are readily available are
valued at the last sales price prior to the time of determination, or,
if no sales price is available at that time, at the mean between the
last current bid and asked prices. Securities that are traded
over-the-counter are valued, if bid and asked quotations are
available, at the mean between the current bid and asked prices.
Investments in short-term debt securities having a maturity of 60 days
or less are valued at amortized cost. All other securities and assets
are valued at fair value as determined in good faith by the Board of
Directors. In valuing the Fund's assets, quotations of foreign
securities in a foreign currency are translated to U.S. dollar
equivalents at the exchange rate in effect on the valuation date.
ii) U.S. FEDERAL INCOME TAXES
No provision for federal income taxes is required since the Fund
intends to continue to qualify as a regulated investment company under
subchapter M of the Internal Revenue Code and distribute substantially
all of its taxable income.
-17-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
- --------------------------------------------------------------------------------
At December 31, 2003, the components of net assets (excluding paid-in capital)
on a tax basis were as follows:
Tax basis Ordinary Income ....................... $ 0
Plus/Less: cumulative timing differences ........ (8,981)
------------
Accumulated net investment loss ................. $ (8,981)
------------
Tax basis capital loss carryover ................ $(51,359,412)
Plus/Less: cumulative timing differences ........ (182,541)
------------
Accumulated capital loss ........................ $(51,541,953)
------------
Book unrealized foreign exchange gain ........... 1,636
------------
Tax unrealized appreciation ..................... $ 19,061,535
Plus/Less: cumulative timing differences ........ 182,541
------------
Unrealized appreciation ......................... 19,244,076
------------
Net assets (excluding paid-in capital) .......... $(32,305,222)
============
The difference between book and tax basis unrealized appreciation is primarily
attributable to wash sales. The cumulative timing difference for the capital
loss carryover is due to wash sales. The timing difference for ordinary income
is due to post-October foreign exchange losses.
Net Asset Value ................................................ $ 63,882,635
Paid-in Capital ................................................ (96,187,857)
------------
Net assets (excluding paid in capital) ......................... $(32,305,222)
============
As of December 31, 2003, the Fund had capital loss carryforwards for federal
income tax purposes of $51,359,412, of which $32,292,614 expires in 2006,
$11,676,567 expires in 2007, $3,780,058 expires in 2009 and $3,610,173 expires
in 2010. The Fund intends to retain gains realized in future periods that may be
offset by available capital loss carryforward.
During the year ended December 31, 2003, the Fund reclassified $12,285 from
accumulated net realized loss on investments to accumulated net investment loss
as a result of permanent book and tax differences relating primarily to realized
foreign currency losses. The Fund also reclassified $68,307 from accumulated net
investment loss to paid-in capital as a result of permanent tax differences
relating to the net operating loss for the year ended December 31, 2003. Net
assets were not affected by the reclassifications. The Fund's realized foreign
exchange losses incurred after October 31, 2003, but before December 31, 2003,
are deemed to arise on the first business day of the following year. The Fund
incurred and elected to defer such realized foreign exchange losses of $8,981.
-18-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
- --------------------------------------------------------------------------------
iii) FOREIGN CURRENCY TRANSLATION
The books and records of the Fund are maintained in United States
dollars. Foreign currency amounts are translated into U.S. dollars at
the mid-market price of such currencies against U.S. dollars as
follows:
o investments, other assets, and liabilities at the prevailing
rates of exchange on the valuation date;
o investment transactions and investment income at the
prevailing rates of exchange on the dates of such
transactions.
Although the net assets of the Fund are presented at the foreign
exchange rates 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 rates 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 changes in foreign exchange rates from the fluctuations
arising from changes in the market prices of securities sold during
the period. Accordingly, realized and unrealized foreign currency
gains (losses) are included in the reported net realized and
unrealized gains (losses) on investments.
Unrealized currency gains (losses) from valuing foreign currency
denominated assets and liabilities at period-end exchange rates are
reflected as a component of accumulated net unrealized gain (loss) on
investments, foreign currency holdings, and other assets and
liabilities denominated in foreign currencies.
iv) DISTRIBUTION OF INCOME AND GAINS
The Fund intends to distribute to stockholders, at least annually,
substantially all of its net investment income and expects to
distribute annually any net long-term capital gains in excess of net
short-term capital losses. An additional distribution may be made to
the extent necessary to avoid the payment of a 4% federal excise tax.
Income and capital gain distributions are determined in accordance
with federal income tax regulations and may differ from those
determined in accordance with generally accepted accounting
principles.
v) OTHER
Security transactions are accounted for on trade date. Realized gains
and losses on the sale of investment securities are determined on the
identified cost basis. Interest income is recognized on the accrual
basis. Dividend income and distributions to shareholders are recorded
on the ex-dividend date. Portfolio turnover rate is calculated by
dividing the lesser of purchases or sales of investment securities
having maturities greater than one year at the time of acquisition by
the average monthly market value of those investment securities.
-19-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
- --------------------------------------------------------------------------------
3. INVESTMENT TRANSACTIONS
Consistent with its investment objective, the Fund engages in the following
transactions practices. The investment objective, policies, program, and
risk factors of the Fund are described more fully in the Fund's Prospectus.
i) FOREIGN TRANSACTIONS
Foreign security and currency transactions may involve certain
considerations and risks not typically associated with those of U.S.
dollar denominated transactions as a result of, among other factors,
the level of governmental supervision and regulation of foreign
securities markets and the possibility of political or economic
instability.
ii) OTHER
During the six months ended June 30, 2004, the Fund made purchases of
$50,762,848 and sales of $52,225,193 of investment securities other
than short-term investments. There were no purchases or sales of U.S.
government securities.
4. RELATED PARTIES
i) JF International Management Inc. (formerly Jardine Fleming
International Management Inc.) (the "Adviser"), an indirect
wholly-owned subsidiary of J.P. Morgan Chase & Co., provides
investment advisory services to the Fund under the terms of an
investment advisory agreement. The Advisor is paid a fee, computed
weekly and payable monthly, at the annual rate of 1.00% of the Fund's
weekly net assets.
ii) During the six months ended June 30, 2004, the Fund paid $29,743 in
brokerage commissions to J.P. Morgan Chase Group companies and
affiliated brokers/dealers.
iii) OTHER SERVICE PROVIDERS
PFPC Inc. (the "Administrator") provides administrative and accounting
services to the Fund under an Administrative and Accounting Services
Agreement. The Administrator receives a fee, payable monthly, at an
annual rate of 0.135% of the first $100 million, 0.095% of the next
$50 million, 0.08% of the next $50 million and 0.065% of the excess
over $200 million of the Fund's average weekly net assets, subject to
a minimum annual fee of $138,000, plus reimbursement for certain
out-of-pocket expenses.
iv) RISKS AND UNCERTAINTIES
In the normal course of business, the Fund may enter into contracts
that provide general indemnifications. The maximum exposure under
these arrangements is dependent on future claims that may be made
against the Fund and, therefore, cannot be estimated; however, based
on experience, the risk of any loss from such claims is considered
remote.
-20-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
- --------------------------------------------------------------------------------
5. CAPITAL SHARE TRANSACTIONS
The Fund's Board of Directors authorized the Fund to purchase shares of its
common stock from Fund stockholders, as described below. When shares trade
at a discount to net asset value, any purchase of shares by the Fund has
the effect of increasing the net asset value per share of the Fund's
remaining shares outstanding. All shares purchased by the Fund are
thereafter considered authorized and unissued.
i) SHARE REPURCHASE PROGRAM
The Fund is authorized to repurchase up to 458,516 shares (10% of its
issued and outstanding shares) in the open market through September 9,
2004. Repurchases can be made only when the Fund's shares are trading
at less than net asset value and at such times and amounts as it is
believed to be in the best interest of the Fund's stockholders.
During the year ended December 31, 2003, the Fund paid $10,191 to
repurchase 1,550 shares at a per-share weighted average discount to
net asset value of 13.07%.
-21-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
RESULTS OF THE ANNUAL STOCKHOLDERS MEETING (UNAUDITED)
- --------------------------------------------------------------------------------
The Fund held its annual stockholders meeting on May 13, 2004. At this meeting,
stockholders elected the following nominees to the Fund's Board of Directors.
Stockholders also voted on a proposal to change the Fund's fundamental policies
to permit the Fund to borrow up to 20% of the Fund's net assets (not including
the amount borrowed) for investment purposes, which was not approved.
I) ELECTION OF DIRECTORS
NOMINEE VOTES FOR VOTES ABSTAINED NON-VOTING SHARES TOTAL VOTING SHARES
------- --------- --------------- ----------------- -------------------
A. Douglas Eu 3,126,637 97,542 1,360,981 4,585,160
Simon J. Crinage 3,126,534 97,645 1,360,981 4,585,160
II) PROPOSAL TO APPROVE A CHANGE IN THE FUND'S FUNDAMENTAL POLICIES TO
PERMIT THE FUND TO BORROW UP TO 20% OF THE FUND'S NET ASSETS (NOT INCLUDING
THE AMOUNT BORROWED) FOR INVESTMENT PURPOSES
VOTES FOR VOTES AGAINST VOTES ABSTAINED NON-VOTING SHARES TOTAL VOTING SHARES
--------- ------------- --------------- ----------------- -------------------
1,034,859 386,219 241,099 2,922,983 4,585,160
OTHER INFORMATION
- --------------------------------------------------------------------------------
On July 15, 2002, the Board of Directors amended the Fund's investment policy to
require that, under normal circumstances, at least 80% of the Fund's net assets,
plus the amount of any borrowings for investment purposes, be invested in equity
securities issued by China Region companies or China Region associated companies
(the policy previously had a 65% requirement).
-22-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
DIVIDEND REINVESTMENT AND CASH PURCHASE PLAN
- --------------------------------------------------------------------------------
THE FUND OPERATES AN OPTIONAL DIVIDEND REINVESTMENT AND CASH PURCHASE PLAN (THE
"PLAN") WHEREBY:
a) shareholders may elect to receive dividend and capital gain
distributions in the form of additional shares of the Fund (the Share
Distribution Plan).
b) shareholders may make optional payments (any amount between $100 and
$3,000) which will be used to purchase additional shares in the open
market (the Share Purchase Plan).
FOR A COPY OF THE PLAN BROCHURE, AS WELL AS A DIVIDEND REINVESTMENT
AUTHORIZATION CARD, PLEASE CONTACT THE PLAN AGENT:
EquiServe Trust Company N.A.
P. O. Box 43010
Providence, RI 02940-3010
Telephone No: 800-426-5523 (toll-free)
The following should be noted with respect to the Plan:
If you participate in the Share Distribution Plan, whenever the Board of
Directors of the Fund declares an income dividend or net capital gain
distribution, you will automatically receive your distribution in newly issued
shares (cash will be paid in lieu of fractional shares) if the market price of
the shares on the date of the distribution is at or above the net asset value of
the shares. The number of shares to be issued to you by the Fund will be
determined by dividing the amount of the cash distribution to which you are
entitled (net of any applicable withholding taxes) by the greater of the net
asset value (NAV) per share on such date or 95% of the market price of a share
on such date. If the market price of the shares on such a distribution date is
below the NAV, the Plan Agent will, as agent for the participants, buy shares on
the open market, on the New York Stock Exchange or elsewhere, for the
participant's account on, or after, the payment date. There is no service charge
for purchases under this Plan.
For U.S. federal income tax purposes, shareholders receiving newly issued shares
pursuant to the Share Distribution Plan will be treated as receiving income or
capital gains in an amount equal to the fair market value (determined as of the
distribution date) of the shares received and will have a cost basis equal to
such fair market value. Shareholders receiving a distribution in the form of
shares purchased in the open market pursuant to the Plan will be treated as
receiving a distribution of the cash distribution that such shareholder would
have received had the shareholder not elected to have such distribution
reinvested and will have a cost basis in such shares equal to the amount of the
distribution.
There will be no brokerage charge to participants for shares issued directly by
the Fund under the Plan. Each participant will pay a pro rata share of brokerage
commissions incurred with respect to the Plan Agent's open market purchases of
shares in connection with the Plan. The Fund will pay the fees of the Plan Agent
for handling the Plan.
You may terminate your account under the Share Distribution Plan by notifying
the Plan Agent in writing. The Plan may be terminated by the Plan Agent or the
Fund with notice to you at least 30 days prior to any record date for the
payment of any distribution by the Fund. Upon any termination, the Plan Agent
will deliver a certificate or certificates for the full shares held for you
under the Plan and a cash adjustment for any fractional shares.
You also have the option of instructing the Plan Agent to make semiannual cash
purchases of shares in the open market. There is a service charge of $1.25 for
each purchase under this Share Purchase Plan.
-23-
[Graphic Omitted]
JF CHINA REGION FUND, INC.
DIRECTORS AND ADMINISTRATION
- --------------------------------------------------------------------------------
OFFICERS AND DIRECTORS THE RT. HON. THE EARL OF CROMER - DIRECTOR AND
CHAIRMAN OF THE BOARD
A. Douglas Eu - Director and Treasurer
Simon J. Crinage - Director and President
Alexander R. Hamilton - Director
Julian M. I. Reid - Director
Philip Jones - Secretary
INVESTMENT ADVISER JF INTERNATIONAL MANAGEMENT INC.
P.O. Box 3151
Road Town, Tortola
British Virgin Islands
ADMINISTRATOR PFPC INC.
301 Bellevue Parkway
Wilmington, Delaware 19809
U.S.A.
CUSTODIAN CITIBANK N.A.
NEW YORK:
111 Wall Street, 16th Floor
New York, New York 10005
U.S.A.
HONG KONG:
Citibank Tower
Citibank Plaza
3 Garden Road
Hong Kong
INDEPENDENT AUDITORS PRICEWATERHOUSECOOPERS LLP
Two Commerce Square
2001 Market Street
Philadelphia, Pennsylvania 19103
U.S.A.
LEGAL COUNSEL CLEARY, GOTTLIEB, STEEN & HAMILTON
NEW YORK:
1 Liberty Plaza
New York, New York 10006
U.S.A.
HONG KONG:
Bank of China Tower
1 Garden Road
Hong Kong
REGISTRAR, TRANSFER AGENT, AND EQUISERVE TRUST COMPANY N.A.
DIVIDEND PAYING AGENT P. O. Box 43010
Providence, RI 02940-3010
U.S.A.
NOTICE IS HEREBY GIVEN IN ACCORDANCE WITH SECTION 23(C) OF THE INVESTMENT
COMPANY ACT OF 1940, AS AMENDED, THAT FROM TIME TO TIME THE FUND MAY PURCHASE
SHARES OF ITS COMMON STOCK IN THE OPEN MARKET.
WWW.JPMORGANFLEMING.COM/JFCHINAREGION
-24-
ITEM 2. CODE OF ETHICS.
Not applicable.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. SCHEDULE OF INVESTMENTS
Not yet applicable.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
REGISTRANT PURCHASES OF EQUITY SECURITIES
(C) TOTAL NUMBER OF SHARES (OR (D) MAXIMUM NUMBER (OR APPROXIMATE
(A) TOTAL NUMBER (B) AVERAGE UNITS) PURCHASED AS PART OF DOLLAR VALUE) OF SHARES (OR UNITS) THAT
OF SHARES (OR PRICE PAID PER PUBLICLY ANNOUNCED PLANS OR MAY YET BE PURCHASED UNDER THE PLANS
PERIOD UNITS) PURCHASED SHARE (OR UNIT) PROGRAMS OR PROGRAMS (1)
- ------------------------------------------------------------------------------------------------------------------------------------
Month #1
1/1/04-1/31/04 NONE NONE NONE 458,516 shares
- ------------------------------------------------------------------------------------------------------------------------------------
Month #2
2/1/04-2/29/04 NONE NONE NONE 458,516 shares
- ------------------------------------------------------------------------------------------------------------------------------------
Month #3
3/1/04-3/31/04 NONE NONE NONE 458,516 shares
- ------------------------------------------------------------------------------------------------------------------------------------
Month #4
4/1/04-4/30/04 NONE NONE NONE 458,516 shares
- ------------------------------------------------------------------------------------------------------------------------------------
Month #5
5/1/04-5/31/04 NONE NONE NONE 458,516 shares
- ------------------------------------------------------------------------------------------------------------------------------------
Month #6
6/1/04-6/30/04 NONE NONE NONE 458,516 shares
- ------------------------------------------------------------------------------------------------------------------------------------
Total NONE NONE NONE
- ------------------------------------------------------------------------------------------------------------------------------------
<FN>
(1) On May 12 2004, the Fund's Board of Directors approved that a 10% share repurchase program that authorized the Fund to
repurchase up to 458,516 shares in the open market from July 23, 2003 through July 22, 2004 be extended to September 9 2004.
</FN>
ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There have been no material changes to the procedures by which the shareholders
may recommend nominees to the registrant's board of directors, where those
changes were implemented after the registrant last provided disclosure in
response to the requirements of Item 7(d)(2)(ii)(G) of Schedule 14A (17 CFR
240.14a-101), or this Item.
ITEM 10. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive and principal financial officers,
or persons performing similar functions, have concluded that the
registrant's disclosure controls and procedures (as defined in Rule
30a-3(c) under the Investment Company Act of 1940, as amended (the
"1940 Act") (17 CFR 270.30a-3(c))) are effective, as of a date within
90 days of the filing date of the report that includes the disclosure
required by this paragraph, based on their evaluation of these controls
and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR
270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities
Exchange Act of 1934, as amended (17 CFR 240.13a-15(b) or
240.15d-15(b)).
(b) There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17
CFR 270.30a-3(d)) that occurred during the registrant's last fiscal
half-year (the registrant's second fiscal half-year in the case of an
annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial
reporting.
ITEM 11. EXHIBITS.
(a)(1) Not applicable.
(a)(2) Certifications pursuant to Rule 30a-2(a) under the 1940 Act and Section
302 of the Sarbanes-Oxley Act of 2002 are attached hereto.
(a)(3) Not applicable.
(b) Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
is attached hereto.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(registrant) JF China Region Fund, Inc.
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By (Signature and Title)* /s/ Simon Crinage
--------------------------------------------------------
Simon Crinage, President
(principal executive and principal financial officer)
Date August 10, 2004
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Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)* /s/ Simon Crinage
--------------------------------------------------------
Simon Crinage, President
(principal executive and principal financial officer)
Date August 10, 2004
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By (Signature and Title)* /s/ Douglas Eu
--------------------------------------------------------
Douglas Eu, Treasurer
(principal executive and principal financial officer)
Date August 10, 2004
----------------------------------------------------------------------------
* Print the name and title of each signing officer under his or her signature.