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: 811-08188
AllianceBernstein Emerging Market Debt Fund, Inc.
(Exact name of registrant as specified in charter)
1345 Avenue of the Americas, New York, New York 10105
(Address of principal executive offices) (Zip code)
Mark R. Manley
Alliance Capital Management, L.P.
1345 Avenue of the Americas
New York, New York 10105
(Name and address of agent for service)
Registrant's telephone number, including area code: (800) 221-5672
Date of fiscal year end: October 31, 2004
Date of reporting period: April 30, 2004
ITEM 1. REPORTS TO STOCKHOLDERS.
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Emerging Market Fixed Income
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[LOGO] ALLIANCEBERNSTEIN (SM)
Investment Research and Management
AllianceBernstein Emerging Market Debt Fund
Semi-Annual Report -- April 30, 2004
Investment Products Offered
- ---------------------------
o Are Not FDIC Insured
o May Lose Value
o Are Not Bank Guaranteed
- ---------------------------
The investment return and principal value of an investment in the Fund will
fluctuate as the prices of the individual securities in which it invests
fluctuate, so that your shares, when redeemed, may be worth more or less than
their original cost. You should consider the investment objectives, risks,
charges and expenses of the Fund carefully before investing. For a free copy of
the Fund's prospectus, which contains this and other information, visit our web
site at www.alliancebernstein.com or call your financial advisor or Alliance at
(800) 227-4618. Please read the prospectus carefully before you invest.
You may obtain performance information current to the most recent month-end by
visiting www.alliancebernstein.com (click on Investors/ Products & Services/
Mutual Funds).
This shareholder report must be preceded or accompanied by the Fund's
prospectus for individuals who are not current shareholders of the Fund.
You may obtain a description of the Fund's proxy voting policies and
procedures, without charge, upon request by visiting Alliance Capital's web
site at www.alliancebernstein.com (click on Investors, then the "proxy voting
policies and procedures" link on the left side of the page), or by going to the
Securities and Exchange Commission's web site at www.sec.gov, or by calling
Alliance Capital at (800) 227-4618.
AllianceBernstein Investment Research and Management, Inc., is an affiliate of
Alliance Capital Management L.P., the manager of the funds, and is a member of
the NASD.
June 21, 2004
Semi-Annual Report
This report provides management's discussion of fund performance for
AllianceBernstein Emerging Market Debt Fund (the "Fund") for the semi-annual
reporting period ended April 30, 2004.
Investment Objectives and Policies
This open-end fund is designed to provide investors with a high level of
current income and, secondarily, capital appreciation. To achieve its
objectives, the Fund invests primarily in a non-diversified portfolio of
sovereign debt obligations and in U.S. and non-U.S. corporate fixed-income
securities. The Fund invests substantially all of its assets in lower-rated
securities.
Investment Results
The following table shows how the Fund performed over the past six- and
12-month periods ended April 30, 2004. For comparison, we have included the
returns for the unmanaged J.P. Morgan Emerging Markets Bond Index Plus (JPM
EMBI+), which provides a broad measure of the performance of a basket of
emerging market debt securities.
- ------------------------------------------------------------
INVESTMENT RESULTS*
Periods Ended April 30, 2004
Returns
---------------------------------
6 Months 12 Months
-------------- --------------
AllianceBernstein
Emerging Market Debt Fund
Class A 2.11% 13.57%
Class B 1.79% 12.67%
Class C 1.66% 12.65%
- ------------------------------------------------------------
J.P. Morgan Emerging
Markets Bond Index Plus 1.48% 9.50%
- ------------------------------------------------------------
* The Fund's investment results are for the periods shown and are based on the
net asset value (NAV) of each class of shares as of April 30, 2004. Performance
assumes reinvestment of distributions and does not account for taxes. All fees
and expenses related to the operation of the Fund have been deducted, but no
adjustment has been made for sales charges that may apply when shares are
purchased or redeemed. Past performance is no guarantee of future results.
The unmanaged J.P. Morgan Emerging Markets Bond Index Plus (JPM EMBI+) does not
reflect fees and expenses associated with the active management of a mutual
fund portfolio. The JPM EMBI+ is comprised of dollar-denominated restructured
sovereign bonds; a large percentage of the JPM EMBI+ Index is made up of Brady
bonds. Investors cannot invest directly in an index, and its results are not
indicative of any specific investment, including AllianceBernstein Emerging
Market Debt Fund.
Additional investment results appear on pages 5-7.
- ------------------------------------------------------------
The Fund outperformed its benchmark, the JPM EMBI+, for both the six- and
12-month periods ended April 30, 2004. The Fund benefited from both its
emerging market debt country weightings and its individual security selection.
The primary contributor to the Fund's outperformance was its underweight-
_______________________________________________________________________________
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 1
ing in Brazilian debt in the latter half of the semi-annual period. Brazil, a
higher beta, more volatile emerging market debt country, sold-off sharply in
April loosing 7.62%, and underperformed relative to the JPM EMBI+. The Fund's
country weighting and security holdings in Mexico also helped relative
performance during the past six months. We have maintained a more defensive
posture in Mexico versus lower rated countries. Security selection in Russia
and Venezuela debt markets was strong and also contributed positively to the
Fund's outperformance. Modestly detracting from the Fund's performance was its
overweight position in Ecuador. Ecuador contributed positively to performance
earlier in the period. However, as we increased the Fund's position in Ecuador,
the country fell victim to the sharp April sell-off. This overweighted position
ultimately resulted in a net negative contribution.
Market Review and Investment Strategy
Emerging market debt posted strong returns in the first five months of the
semi-annual period before a sharp broad-based sell-off in the month of April.
Surprisingly strong employment numbers in the U.S. and less accommodating
comments regarding interest rate policy from the U.S. Federal Reserve led the
markets to prepare for eventual and possibly earlier-than-expected interest
rate hikes. Higher beta countries were the hardest hit by April's sell-off. The
Index spread widened 49 basis points in April alone, with the yield reaching
9.16% at the end of the semi-annual period. Latin countries barely outpaced
non-Latin regions, returning 1.52% and 1.41%, respectively. By country,
Argentina at 10.38%, Ecuador at 7.67%, Nigeria at 5.38%, Colombia at 5.26% and
Venezuela at 5.22% outperformed the Index. Underperforming for the period were
Peru at -2.75%, the Ukraine at 0.80%, Brazil at 0.06% and Russia at 0.34%.
Within the Fund, we maintained its overweight position in Russia, as the
macroeconomic picture remained solid and the Russian government continued to
make progress on structural reforms. Russia's gross domestic product (GDP)
advanced a healthy 8% year-over-year in the first quarter of 2004, helped by
higher oil prices, strong investment and robust consumer demand. Higher oil
prices and stronger GDP have improved Russia's fiscal profile and its ability
to exact transfers to its stabilization fund.
Additionally, we increased the Fund's holdings in Ecuador and Turkey during the
period. Ecuador benefited from higher oil prices and greater output,
significant structural reforms and engagement with the International Monetary
Fund (IMF). Standard & Poor's raised Turkey's rating to B+ from B during the
reporting period, crediting the government's efforts to comply with targets set
by the IMF and its resolve to implement reforms. It was at that time that we
added to the Fund's position in Turkey.
The Fund also held an overweight position in Peru. Peru achieved a durable
improvement in its fiscal accounts with increased revenue collection.
Improvements in tax administration and restruc-
_______________________________________________________________________________
2 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
turing increased the collection rates allowing the government to lower the
budget deficit. Political stability and a new cabinet committed to sound
economic policies were additional positives.
Also overweighted in the Fund were holdings in the Ukraine. The Ukraine
recently received IMF approval for a 12-month stand-by-agreement based on
significant improvement in economic fundamentals and progress on structural
reforms.
Despite European Union accession, the Fund remained underweight in Poland due
to the country's low relative yield, as well as the political and fiscal
uncertainty surrounding an impending general election.
Lastly, we reduced the Fund's duration exposure to Brazil in the first quarter
from an overweight to an underweight position due to political concerns,
inflation worries and the possible inability of Brazil's Central Bank to
continue reducing interest rates. Political scandal and subsequent missteps
have caused the administration of President Lula da Silva to lose much of the
political goodwill it had in 2003. With recent volatility and prospects of
tighter monetary policy, the Fund's investment profile has become more neutral
to the benchmark, and we have maintained an overall underexposure in duration.
_______________________________________________________________________________
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 3
Portfolio Summary
- -------------------------------------------------------------------------------
PORTFOLIO SUMMARY
April 30, 2004 (unaudited)
INCEPTION DATES
Class A Shares
2/25/94
Class B Shares
2/25/94
Class C Shares
2/25/94
PORTFOLIO STATISTICS
Net Assets ($mil): $298.0
SECURITY TYPE*
77.7% Sovereign Debt Obligations
9.4% Corporate Debt Obligations [PIE CHART OMITTED]
12.9% Short-Term
* The Fund's security type breakdown is expressed as a percentage of total
investments and may vary over time.
_______________________________________________________________________________
4 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
Investment Results
- -------------------------------------------------------------------------------
INVESTMENT RESULTS
CLASS A SHARE AVERAGE ANNUAL RETURNS AS OF APRIL 30, 2004
_______________________________________________________________________________
NAV Returns SEC Returns
1 Year 13.57% 8.79%
5 Years 17.64% 16.63%
10 Years 13.68% 13.19%
SEC Yield* 6.31%
SEC AVERAGE ANNUAL RETURNS (WITH SALES CHARGES)
AS OF THE MOST RECENT QUARTER-END (MARCH 31, 2004)
_______________________________________________________________________________
1 Year 24.53%
5 Years 19.56%
10 Years 13.54%
The performance shown above represents past performance and does not guarantee
future results. Current performance may be lower or higher than the performance
information shown. You may obtain performance information current to the most
recent month-end by visiting www.alliancebernstein.com (click on
Investors/Products & Services/Mutual Funds). Returns are for Class A shares and
are annualized for periods longer than one year. All fees and expenses related
to the operation of the Fund have been deducted. NAV returns do not reflect
sales charges; if sales charges were reflected, the Fund's quoted performance
would be lower. SEC returns reflect the 4.25% maximum front-end sales charge
for Class A shares. Performance assumes reinvestment of distributions and does
not account for taxes.
The investment return and principal value of an investment in the Fund will
fluctuate, so that your shares, when redeemed, may be worth more or less than
their original cost. You should consider the investment objectives, risks,
charges and expenses of the Fund carefully before investing. For a free copy of
the Fund's prospectus, which contains this and other information, visit our web
site at www.alliancebernstein.com or call your financial advisor or Alliance at
(800) 227-4618. Please read the prospectus carefully before you invest.
A Word About Risk: The Fund invests a significant amount of its assets in
foreign securities, which may magnify fluctuations and can invest a significant
portion of its assets in the securities of a single issuer, which may present
greater risk than a more diversified portfolio. Price fluctuation in the Fund's
portfolio securities may be caused by changes in interest rates or bond credit
quality ratings. Changes in interest rates have a greater effect on bonds with
longer maturities than on those with shorter maturities. While the Fund invests
principally in bonds and other fixed-income securities, in order to achieve its
investment objectives, the Fund may at times use certain types of investment
derivatives, such as options, futures, forwards and swaps. These instruments
involve risks different from, and in certain cases, greater than the risks
presented by more traditional investments. These risks are fully discussed in
the prospectus.
* SEC yields are calculated based on SEC guidelines for the 30-day period
ended April 30, 2004.
_______________________________________________________________________________
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 5
Investment Results
- -------------------------------------------------------------------------------
INVESTMENT RESULTS
CLASS B SHARE AVERAGE ANNUAL RETURNS AS OF APRIL 30, 2004
_______________________________________________________________________________
NAV Returns SEC Returns
1 Year 12.67% 9.67%
5 Years 16.64% 16.64%
10 Years(a) 13.15% 13.15%
SEC Yield* 5.78%
SEC AVERAGE ANNUAL RETURNS (WITH SALES CHARGES)
AS OF THE MOST RECENT QUARTER-END (MARCH 31, 2004)
_______________________________________________________________________________
1 Year 25.95%
5 Years 19.61%
10 Years(a) 13.50%
The performance shown above represents past performance and does not guarantee
future results. Current performance may be lower or higher than the performance
information shown. You may obtain performance information current to the most
recent month-end by visiting www.alliancebernstein.com (click on
Investors/Products & Services/Mutual Funds). Returns are for Class B shares and
are annualized for periods longer than one year. All fees and expenses related
to the operation of the Fund have been deducted. NAV returns do not reflect
sales charges; if sales charges were reflected, the Fund's quoted performance
would be lower. SEC returns reflect the applicable contingent deferred sales
charge for Class B shares (3% year 1, 2% year 2, 1% year 3, 0% year 4).
Performance assumes reinvestment of distributions and does not account for
taxes.
The investment return and principal value of an investment in the Fund will
fluctuate, so that your shares, when redeemed, may be worth more or less than
their original cost. You should consider the investment objectives, risks,
charges and expenses of the Fund carefully before investing. For a free copy of
the Fund's prospectus, which contains this and other information, visit our web
site at www.alliancebernstein.com or call your financial advisor or Alliance at
(800) 227-4618. Please read the prospectus carefully before you invest.
A Word About Risk: The Fund invests a significant amount of its assets in
foreign securities, which may magnify fluctuations and can invest a significant
portion of its assets in the securities of a single issuer, which may present
greater risk than a more diversified portfolio. Price fluctuation in the Fund's
portfolio securities may be caused by changes in interest rates or bond credit
quality ratings. Changes in interest rates have a greater effect on bonds with
longer maturities than on those with shorter maturities. While the Fund invests
principally in bonds and other fixed-income securities, in order to achieve its
investment objectives, the Fund may at times use certain types of investment
derivatives, such as options, futures, forwards and swaps. These instruments
involve risks different from, and in certain cases, greater than the risks
presented by more traditional investments. These risks are fully discussed in
the prospectus.
* SEC yields are calculated based on SEC guidelines for the 30-day period
ended April 30, 2004.
(a) Assumes conversion of Class B shares into Class A shares after six years.
_______________________________________________________________________________
6 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
Investment Results
- -------------------------------------------------------------------------------
INVESTMENT RESULTS
CLASS C SHARE AVERAGE ANNUAL RETURNS AS OF APRIL 30, 2004
_______________________________________________________________________________
NAV Returns SEC Returns
1 Year 12.65% 11.65%
5 Years 16.62% 16.62%
10 Years 12.79% 12.79%
SEC Yield* 5.78%
SEC AVERAGE ANNUAL RETURNS (WITH SALES CHARGES)
AS OF THE MOST RECENT QUARTER-END (MARCH 31, 2004)
_______________________________________________________________________________
1 Year 27.91%
5 Years 19.58%
10 Years 13.15%
The performance shown above represents past performance and does not guarantee
future results. Current performance may be lower or higher than the performance
information shown. You may obtain month-end performance information current to
the most recent month-end by visiting www.alliancebernstein.com (click on
Investors/Products & Services/Mutual Funds). Returns are for Class C shares and
are annualized for periods longer than one year. All fees and expenses related
to the operation of the Fund have been deducted. NAV returns do not reflect
sales charges; if sales charges were reflected, the Fund's quoted performance
would be lower. SEC returns reflect the applicable contingent deferred sales
charge for Class C shares (1% year 1). Performance assumes reinvestment of
distributions and does not account for taxes.
The investment return and principal value of an investment in the Fund will
fluctuate, so that your shares, when redeemed, may be worth more or less than
their original cost. You should consider the investment objectives, risks,
charges and expenses of the Fund carefully before investing. For a free copy of
the Fund's prospectus, which contains this and other information, visit our web
site at www.alliancebernstein.com or call your financial advisor or Alliance at
(800) 227-4618. Please read the prospectus carefully before you invest.
A Word About Risk: The Fund invests a significant amount of its assets in
foreign securities, which may magnify fluctuations and can invest a significant
portion of its assets in the securities of a single issuer, which may present
greater risk than a more diversified portfolio. Price fluctuation in the Fund's
portfolio securities may be caused by changes in interest rates or bond credit
quality ratings. Changes in interest rates have a greater effect on bonds with
longer maturities than on those with shorter maturities. While the Fund invests
principally in bonds and other fixed-income securities, in order to achieve its
investment objectives, the Fund may at times use certain types of investment
derivatives, such as options, futures, forwards and swaps. These instruments
involve risks different from, and in certain cases, greater than the risks
presented by more traditional investments. These risks are fully discussed in
the prospectus.
* SEC yields are calculated based on SEC guidelines for the 30-day period
ended April 30, 2004.
_______________________________________________________________________________
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 7
Portfolio of Investments
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PORTFOLIO OF INVESTMENTS
April 30, 2004 (unaudited)
Principal
Amount
(000) U.S. $ Value
- -------------------------------------------------------------------------------
SOVEREIGN DEBT OBLIGATIONS-82.9%
Argentina-1.6%
Republic of Argentina FRN
1.234%, 8/03/12 $ 7,304 $ 4,784,120
-------------
Belize-0.4%
Government of Belize
9.50%, 8/15/12 1,125 1,154,045
-------------
Brazil-15.1%
Federal Republic of Brazil
11.00%, 8/17/40(a) 5,822 5,436,293
11.25%, 7/26/07 2,200 2,349,600
C-Bonds
8.00%, 4/15/14 32,333 29,746,635
DCB FRN
Series L
2.125%, 4/15/12 8,918 7,446,263
-------------
44,978,791
-------------
Bulgaria-0.9%
Republic of Bulgaria
8.25%, 1/15/15(b) 2,365 2,717,385
-------------
Colombia-4.5%
Republic of Colombia
10.75%, 1/15/13 5,250 5,775,000
11.75%, 2/25/20 6,640 7,516,480
-------------
13,291,480
-------------
Ecuador-3.9%
Republic of Ecuador
6.00%, 8/15/30(b)(c) 15,601 10,827,094
12.00%, 11/15/12(b) 814 728,530
-------------
11,555,624
-------------
El Salvador-0.4%
Republic of El Salvador
8.50%, 7/25/11(b) 1,000 1,131,500
-------------
Indonesia-0.7%
Republic of Indonesia
6.75%, 3/10/14(b) 2,190 1,987,425
-------------
Jamaica-0.6%
Government of Jamaica
11.75%, 5/15/11(b) 1,180 1,380,600
12.75%, 9/01/07(b) 365 417,925
-------------
1,798,525
-------------
_______________________________________________________________________________
8 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) U.S. $ Value
- -------------------------------------------------------------------------------
Mexico-11.5%
United Mexican States
8.125%, 12/30/19(d) $ 13,635 $ 14,875,785
11.375%, 9/15/16(d) 13,704 19,288,379
-------------
34,164,164
-------------
Morocco-0.4%
Kingdom of Morocco Loan Participation FRN
Series A
2.031%, 1/01/09 1,318 1,291,785
-------------
Panama-1.7%
Republic of Panama
8.875%, 9/30/27 500 505,000
9.375%, 4/01/29 1,375 1,509,063
10.75%, 5/15/20 2,575 3,090,000
-------------
5,104,063
-------------
Peru-3.9%
Republic of Peru
8.375%, 5/3/16 1,800 1,705,500
8.75%, 11/21/33 300 268,500
9.125%, 2/21/12(d) 5,300 5,596,125
9.875%, 2/06/15 3,900 4,212,000
-------------
11,782,125
-------------
Philippines-3.3%
Republic of Philippines
8.25%, 1/15/14 3,975 3,855,750
9.00%, 2/15/13 2,300 2,346,000
9.875%, 1/15/19 1,850 1,896,250
10.625%, 3/16/25 1,550 1,662,375
-------------
9,760,375
-------------
Russia-17.1%
Russian Federation
5.00%, 3/31/30(b)(c) 36,660 33,658,463
Russian Ministry of Finance
Series V
3.00%, 5/14/08 3,850 3,359,125
Series VI
3.00%, 5/14/06(b) 1,250 1,206,250
3.00%, 5/14/06 2,300 2,219,500
Series VII
3.00%, 5/14/11 13,570 10,381,050
-------------
50,824,388
-------------
South Africa-1.0%
Republic of South Africa
7.375%, 4/25/12 2,725 3,004,313
-------------
_______________________________________________________________________________
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 9
Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) U.S. $ Value
- -------------------------------------------------------------------------------
Turkey-5.7%
Republic of Turkey
9.875%, 3/19/08 $ 1,025 $ 1,135,700
11.00%, 1/14/13 3,900 4,512,300
11.50%, 1/23/12 2,475 2,926,688
11.75%, 6/15/10 1,970 2,339,375
11.875%, 1/15/30 2,745 3,575,363
12.375%, 6/15/09 2,125 2,550,000
-------------
17,039,426
-------------
Ukraine-4.2%
Government of Ukraine
6.875%, 3/04/11(b) 1,300 1,254,500
7.65%, 6/11/13(b)(d) 5,804 5,600,860
11.00%, 3/15/07(b) 5,258 5,731,758
-------------
12,587,118
-------------
Uruguay-0.8%
Republic of Uruguay
7.875%, 1/15/33 3,736 2,465,690
-------------
Venezuela-5.2%
Republic of Venezuela
5.375%, 8/07/10 2,570 1,978,900
9.25%, 9/15/27 13,350 11,040,450
DCB FRN
Series DL
2.125%, 12/18/07 2,667 2,499,919
-------------
15,519,269
-------------
Total Sovereign Debt Obligations
(cost $226,730,273) 246,941,611
-------------
CORPORATE DEBT OBLIGATIONS-10.0%
Brazil-0.9%
PF Export Receivables Master Trust
6.436%, 6/01/15(b) 2,586 2,572,048
-------------
Indonesia-0.6%
Freeport-McMoran Copper & Gold
10.125%, 2/01/10 1,550 1,712,750
-------------
Kazakhstan-0.9%
Hurricane Finance
9.625%, 2/12/10(b) 900 976,500
Kazkommerts International BV
8.50%, 4/16/13(b) 650 630,500
Turanalem Finance BV
10.00%, 5/29/07(b) 1,000 1,094,500
-------------
2,701,500
-------------
_______________________________________________________________________________
10 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
Portfolio of Investments
- -------------------------------------------------------------------------------
Shares or
Principal
Amount
(000) U.S. $ Value
- -------------------------------------------------------------------------------
Mexico-1.9%
Innova S de. R.L., SA
9.375%, 9/19/13 $ 3,180 $ 3,470,174
12.875%, 4/01/07 1,115 1,120,240
Monterrey Power SA De C. V.
9.625%, 11/15/09(b) 857 996,499
-------------
5,586,913
-------------
Poland-0.7%
PTC International Finance II, SA
11.25%, 12/01/09 2,000 2,160,000
-------------
Romania-0.4%
MobiFon Holdings BV
12.50%, 7/31/10 1,100 1,259,500
-------------
Russia-4.4%
Gazprom Oao
8.625%, 4/28/34(b) 1,050 1,002,750
9.625%, 3/01/13(b) 4,520 4,666,900
Mobile Telesystems Finance
9.75%, 1/30/08(b) 2,750 2,870,191
10.95%, 12/21/04 730 764,675
Tyumen Oil
11.00%, 11/06/07(b) 3,375 3,829,563
-------------
13,134,079
-------------
South Korea-0.2%
Hanvit Bank, SA
12.75%, 3/01/10(b)(c) 725 783,000
-------------
Total Corporate Debt Obligations
(cost $28,500,906) 29,909,790
-------------
WARRANTS(e)-0.0%
Central Bank of Nigeria
Warrants, expiring 11/15/20 3,250 -0-
Republic of Venezuela
Warrants, expiring 4/15/20 48,195 -0-
-------------
Total Warrants
(cost $0) -0-
-------------
SHORT-TERM INVESTMENT-13.7%
Time Deposit-13.7%
Societe Generale
1.04%, 05/03/04
(cost $40,800,000) $ 40,800 40,800,000
-------------
Total Investments-106.6%
(cost $296,031,179) 317,651,401
Other assets less liabilities-(6.6)% (19,680,142)
-------------
Net Assets-100% $ 297,971,259
=============
_______________________________________________________________________________
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 11
Portfolio of Investments
- -------------------------------------------------------------------------------
CALL OPTION WRITTEN (see Note D)
Exercise Expiration
Description Contracts(f) Price Month U.S. $ Value
- -------------------------------------------------------------------------------
Federal Republic
of Brazil
11.00%, 8/17/40
(premiums received
$44,550) 1,650,000 $95.2 May '04 $(19,800)
CREDIT DEFAULT SWAP CONTRACTS (see Note D)
Notional Unrealized
Swap Counterparty & Amount Interest Termination Appreciation/
Referenced Obligation (000's) Rate Date (Depreciation)
- -------------------------------------------------------------------------------
Buy Contracts:
- --------------
Citigroup Global
Markets, Inc.
Federal Republic
of Brazil
12.25%, 3/06/30 2,450 2.55% 5/20/05 $ 9,678
Citigroup Global
Markets, Inc.
Federal Republic
of Brazil
12.25%, 3/06/30 3,160 5.85 2/20/14 326,112
Citigroup Global
Markets, Inc.
Republic of Hungary
4.50%, 2/06/13 900 0.50 11/26/13 (9,124)
Citigroup Global
Markets, Inc.
Republic of
Philippines
10.625%, 3/16/25 1,410 5.60 3/20/14 (33,168)
Deutsche Bank
Republic of Turkey
11.875%, 1/15/30 2,770 3.25 1/24/09 101,251
Deutsche Bank
Republic of
Venezuela
9.25%, 9/15/27 1,700 3.65 1/20/06 36,796
Goldman Sachs
United Mexican States
11.50%, 5/15/26 2,100 1.99 5/20/14 5,836
JP Morgan Chase
Republic of Ecuador
6.00%, 8/15/30 2,275 3.70 4/30/05 8,531
Sale Contracts:
- ---------------
Citigroup Global
Markets, Inc.
Federal Republic
of Brazil
12.25%, 3/06/30 3,300 6.35 8/20/05 160,302
Citigroup Global
Markets, Inc.
Federal Republic
of Brazil
12.25%, 3/06/30 2,450 4.40 5/20/06 (27,277)
Citigroup Global
Markets, Inc.
Federal Republic
of Brazil
12.25%, 3/06/30 3,160 5.26 2/20/09 (204,585)
Citigroup Global
Markets, Inc.
Republic of Columbia
9.75%, 4/23/09 10,000 5.70 1/30/05 480,198
_______________________________________________________________________________
12 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
Portfolio of Investments
- -------------------------------------------------------------------------------
CREDIT DEFAULT SWAP CONTRACTS (see Note D) (continued)
Notional Unrealized
Swap Counterparty & Amount Interest Termination Appreciation/
Referenced Obligation (000's) Rate Date (Depreciation)
- -------------------------------------------------------------------------------
Sale Contracts: (continued)
- ---------------------------
Citigroup Global
Markets, Inc.
Republic of
Philippines
10.625%, 3/16/25 1,410 4.95% 3/20/09 $ 32,264
Deutsche Bank
Federal Republic
of Brazil
12.25%, 3/06/30 4,150 3.50 4/20/06 (110,690)
Deutsche Bank
Republic of Turkey
11.875%, 1/15/30 3,463 1.50 1/24/05 5,829
Deutsche Bank
Republic of Turkey
11.875%, 1/15/30 2,285 1.80 7/24/05 (2,514)
JP Morgan Chase
Russian Federation
5.00%, 3/31/30 3,300 3.20 6/25/13 81,990
JP Morgan Chase
Russian Federation
5.00%, 3/31/30 3,300 3.20 6/26/13 81,631
JP Morgan Chase
Russian Federation
5.00%, 3/31/30 2,100 2.98 4/29/14 (12,325)
Morgan Stanley
Federal Republic
of Brazil
10.125%, 5/15/27 2,000 17.75 2/13/08 764,889
REVERSE REPURCHASE AGREEMENTS (see Note D)
Interest
Broker Rate Maturity Amount
- -------------------------------------------------------------------------------
JP Morgan Chase 0.10% 5/6/04 $ 9,155,400
JP Morgan Chase 0.75% 5/6/04 9,129,271
JP Morgan Chase 0.75% 12/31/04 3,025,615
JP Morgan Chase 0.75% 12/31/04 2,090,334
------------
$ 23,400,620
============
_______________________________________________________________________________
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 13
Portfolio of Investments
- -------------------------------------------------------------------------------
(a) A position, or portion of the underlying security has been segregated by
the Fund for the written call options outstanding at April 30, 2004. The value
of this security amounted to $1,540,688 at April 30, 2004.
(b) Securities are exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At April 30, 2004,
the aggregate market value of these securities amount to $86,064,741 or 28.9%
of net assets.
(c) Coupon increases periodically based upon a predetermined schedule. Stated
interest rate in effect at April 30, 2004.
(d) Position, or portion thereof, with an aggregate market value of
$23,154,666 has been segregated to collateralize the reverse repurchase
agreement.
(e) Non-income producing security.
(f) One contract relates to principal amount of $1.00.
Glossary of Terms:
DCB - Debt Conversion Bonds
FRN - Floating Rate Note
See notes to financial statements.
_______________________________________________________________________________
14 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
Statement of Assets & Liabilities
- -------------------------------------------------------------------------------
STATEMENT OF ASSETS & LIABILITIES
April 30, 2004 (unaudited)
ASSETS
Investments in securities, at value (cost $296,031,179) $ 317,651,401
Cash 354,539
Unrealized appreciation of swap contracts 2,095,307
Receivable for investment securities sold 52,019,747
Interest receivable 4,881,692
Receivable for capital stock sold 758,024
-------------
Total assets 377,760,710
-------------
LIABILITIES
Outstanding call option written, at value
(premiums received $44,550) 19,800
Due to broker 436,161
Unrealized depreciation of swap contracts 399,683
Payable for investment securities purchased 50,179,719
Reverse repurchase agreements 23,400,620
Payable for capital stock redeemed 4,107,005
Dividend payable 722,041
Distribution fee payable 185,863
Advisory fee payable 141,159
Administrative fee payable 6,596
Accrued expenses 190,804
-------------
Total liabilities 79,789,451
-------------
Net Assets $ 297,971,259
=============
COMPOSITION OF NET ASSETS
Capital stock, at par $ 37,666
Additional paid-in capital 298,543,744
Distributions in excess of net investment income (2,582,865)
Accumulated net realized loss on investment transactions (21,367,882)
Net unrealized appreciation of investments 23,340,596
-------------
$ 297,971,259
=============
CALCULATION OF MAXIMUM OFFERING PRICE
CLASS A SHARES
Net asset value and redemption price per share
($140,964,530 / 17,913,594 shares of
capital stock issued and outstanding) $7.87
Sales charge--4.25% of public offering price .35
-----
Maximum offering price $8.22
=====
CLASS B SHARES
Net asset value and offering price per share
($73,678,959 / 9,277,693 shares of
capital stock issued and outstanding) $7.94
=====
CLASS C SHARES
Net asset value and offering price per share
($83,327,770 / 10,475,119 shares of
capital stock issued and outstanding) $7.95
=====
See notes to financial statements.
_______________________________________________________________________________
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 15
Statement of Operations
- -------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
Six Months Ended April 30, 2004 (unaudited)
INVESTMENT INCOME
Interest $ 12,799,371
EXPENSES
Advisory fee $ 1,224,090
Distribution fee--Class A 226,691
Distribution fee--Class B 440,959
Distribution fee--Class C 434,260
Transfer agency 211,003
Custodian 122,279
Audit and legal 65,808
Administrative 51,400
Printing 29,758
Registration 29,630
Directors' fees 10,123
Miscellaneous 6,861
------------
Total expenses before interest 2,852,862
Interest expense 28,509
------------
Total expenses 2,881,371
Less: expense waived by the Adviser and
the Transfer Agent (see Note B) (276,083)
Less: expense offset arrangement
(see Note B) (20)
------------
Net expenses 2,605,268
------------
Net investment income 10,194,103
------------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENT TRANSACTIONS
Net realized gain on:
Investment transactions 16,751,840
Written options 412,727
Swap contracts 4,901,759
Net change in unrealized
appreciation/depreciation of:
Investments (23,015,161)
Swap contracts (2,903,276)
Written options 1,350
------------
Net loss on investment transactions (3,850,761)
------------
NET INCREASE IN NET ASSETS
FROM OPERATIONS $ 6,343,342
============
See notes to financial statements.
_______________________________________________________________________________
16 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
Statement of Changes in Net Assets
- -------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
Six Months September 1,
Ended 2003 to Year Ended
April 30, 2004 October 31, August 31,
(unaudited) 2003* 2003
============== ============== ==============
INCREASE (DECREASE) IN NET
ASSETS FROM OPERATIONS
Net investment income $ 10,194,103 $ 3,688,269 $ 23,418,959
Net realized gain on
investment transactions 22,066,326 5,180,958 30,010,826
Net change in unrealized
appreciation/depreciation
of investments (25,917,087) 5,198,747 31,800,387
-------------- -------------- --------------
Net increase in net assets
from operations 6,343,342 14,067,974 85,230,172
DIVIDENDS TO
SHAREHOLDERS FROM
Net investment income
Class A (5,659,837) (1,851,590) (10,200,153)
Class B (3,020,340) (1,219,376) (8,446,512)
Class C (2,951,922) (1,034,345) (5,499,918)
CAPITAL STOCK TRANSACTIONS
Net increase (decrease) (2,549,339) 14,129,599 18,645,018
-------------- -------------- --------------
Total increase (decrease) (7,838,096) 24,092,262 79,728,607
NET ASSETS
Beginning of period 305,809,355 281,717,093 201,988,486
-------------- -------------- --------------
End of period (including
distributions in excess
of net investment
income of ($2,582,865),
($1,144,869) and
($1,003,454),
respectively) $ 297,971,259 $ 305,809,355 $ 281,717,093
============== ============== ==============
* The Fund changed its fiscal year end from August 31 to October 31.
See notes to financial statements.
_______________________________________________________________________________
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 17
Notes to Financial Statements
- -------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
April 30, 2004 (unaudited)
NOTE A
Significant Accounting Policies
AllianceBernstein Emerging Market Debt Fund, Inc. (the "Fund") was incorporated
in the state of Maryland on December 2, 1993, as a non-diversified, open-end
management investment company. The Fund offers Class A, Class B and Class C
shares. Class A shares are sold with a front-end sales charge of up to 4.25%
for purchases not exceeding $1,000,000. With respect to purchases of $1,000,000
or more, Class A shares redeemed within one year of purchase may be subject to
a contingent deferred sales charge of 1%. Class B shares are currently sold
with a contingent deferred sales charge which declines from 3% to zero
depending on the period of time the shares are held. Class B shares will
automatically convert to Class A shares six years after the end of the calendar
month of purchase. Class C shares are subject to a contingent deferred sales
charge of 1% on redemptions made within the first year after purchase. All
three classes of shares have identical voting, dividend, liquidation and other
rights, except that each class bears different distribution expenses and has
exclusive voting rights with respect to its distribution plan. The financial
statements have been prepared in conformity with accounting principles
generally accepted in the United States, which require management to make
certain estimates and assumptions that affect the reported amounts of assets
and liabilities in the financial statements and amounts of income and expenses
during the reporting period. Actual results could differ from those estimates.
Additional information about some of the items discussed in these Notes to
Financial Statements is contained in the Fund's Statement of Additional
Information, which is available upon request. The following is a summary of
significant accounting policies followed by the Fund.
1. Security Valuation
In accordance with Pricing Policies adopted by the Board of Directors of the
Fund (the "Pricing Policies") and applicable law, portfolio securities are
valued at current market value or at fair value. The Board of Directors has
delegated to Alliance Capital Management, L.P. (the "Adviser"), subject to the
Board's continuing oversight, certain responsibilities with respect to the
implementation of the Pricing Policies. Pursuant to the Pricing Policies,
securities for which market quotations are readily available are valued at
their current market value. In general, the market value of these securities is
determined as follows:
Securities listed on a national securities exchange or on a foreign securities
exchange are valued at the last sale price at the close of the exchange or
foreign securities exchange. If there has been no sale on such day, the
securities are valued at the mean of the closing bid and asked prices on such
day. If no bid or asked prices are quoted on such day, then the security is
valued in good faith at fair value in accordance with the Pricing Policies.
Securities listed on more than one exchange are valued by reference to the
principal exchange on which the securities are traded; securities not listed on
an exchange but traded on The Nasdaq Stock Market, Inc. ("NASDAQ") are valued
in accordance with the
_______________________________________________________________________________
18 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
Notes to Financial Statements
- -------------------------------------------------------------------------------
NASDAQ Official Closing Price; listed put or call options are valued at the
last sale price. If there has been no sale on that day, such securities will be
valued at the closing bid prices on that day; open futures contracts and
options thereon are valued using the closing settlement price or, in the
absence of such a price, the most recent quoted bid price. If there are no
quotations available for the day of valuations, the last available closing
settlement price is used; securities traded in the over-the-counter market,
(but excluding securities traded on NASDAQ) are valued at the mean of the
current bid and asked prices as reported by the National Quotation Bureau or
other comparable sources; U.S. Government securities and other debt instruments
having 60 days or less remaining until maturity are valued at amortized cost if
their original maturity was 60 days or less, or by amortizing their fair value
as of the 61st day prior to maturity if their original term to maturity
exceeded 60 days; fixed-income securities, including mortgage backed and asset
backed securities, may be valued on the basis of prices provided by a pricing
service or at a price obtained from one or more of the major broker/dealers. In
cases where broker/dealer quotes are obtained, the Pricing Policies provide
that the Adviser may establish procedures whereby changes in market yields or
spreads are used to adjust, on a daily basis, a recently obtained quoted price
on a security; and OTC and other derivatives are valued on the basis of a
quoted bid price or spread from a major broker/dealer in such security.
Securities for which market quotations are not readily available are valued at
fair value in accordance with the Pricing Policies.
2. Taxes
It is the Fund's policy to meet the requirements of the Internal Revenue Code
applicable to regulated investment companies and to distribute all of its
investment company taxable income and net realized gains, if any, to
shareholders. Therefore, no provisions for federal income or excise taxes are
required.
3. Investment Income and Investment Transactions
Interest income is accrued daily. Investment transactions are accounted for on
the date securities are purchased or sold. Investment gains and losses are
determined on the identified cost basis. The Fund accretes discounts as
adjustments to interest income. Additionally, the Fund amortizes premium on
debt securities for financial statement reporting purposes only.
4. Income and Expenses
All income earned and expenses incurred by the Fund are borne on a pro-rata
basis by each settled class of shares, based on the proportionate interest in
the Fund represented by the shares of such class, except that the Fund's Class
B and Class C shares bear higher distribution and transfer agent fees than
Class A shares.
5. Dividends and Distributions
Dividends and distributions to shareholders are recorded on the ex-dividend
date. Income and capital gains distributions are determined in accordance with
_______________________________________________________________________________
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 19
Notes to Financial Statements
- -------------------------------------------------------------------------------
federal tax regulations and may differ from those determined in accordance with
accounting principles generally accepted in the United States. To the extent
these differences are permanent, such amounts are reclassified within the
capital accounts based on their federal tax basis treatment; temporary
differences do not require such reclassification.
6. Change of Fiscal Year End
The Fund changed its fiscal year end from August 31 to October 31. Accordingly,
the statement of changes in net assets and financial highlights include the
period from September 1, 2003 to October 31, 2003.
NOTE B
Advisory Fee and Other Transactions with Affiliates
Under the terms of an investment advisory agreement, the Fund pays the Adviser
an advisory fee at an annual rate of .75% of the average daily net assets of
the Fund. Such fee is accrued daily and paid monthly.
Effective January 1, 2004, the Adviser began waiving a portion of its advisory
fee so as to charge the Fund at the reduced annual rate of .50% of the first
$2.5 billion, .45% of the next $2.5 billion and .40% in excess of $5 billion,
of the average daily net assets of the Fund. Through April 30, 2004, such
waiver amounted to $276,083. The amount of the fee waiver may increase or
decrease as a result of a final, definitive agreement with the New York
Attorney General's Office ("NYAG"). For a more complete discussion of the
Adviser's settlement with the NYAG, please see "Legal Proceedings" below.
Pursuant to the advisory agreement, the Fund paid $51,400 to the Adviser
representing the cost of certain legal and accounting services provided to the
Fund by the Adviser for the six months ended April 30, 2004.
The Fund compensates Alliance Global Investor Services, Inc. (AGIS), a
wholly-owned subsidiary of the Adviser, under a Transfer Agency Agreement for
providing personnel and facilities to perform transfer agency services for the
Fund. Such compensation amounted to $77,041 for the six months ended April 30,
2004.
For the six months ended April 30, 2004 the Fund's expenses were reduced by $20
under an expense offset arrangement with AGIS.
AllianceBernstein Investment Research and Management, Inc. (the "Distributor"),
a wholly-owned subsidiary of the Adviser, serves as the distributor of the
Fund's shares. The Distributor has advised the Fund that it has retained
front-end sales charges of $18,155 from the sale of Class A shares and received
$7,367, $57,237, and $40,821 in contingent deferred sales charges imposed upon
redemptions by shareholders of Class A, Class B and Class C shares,
respectively, for the six months ended April 30, 2004.
_______________________________________________________________________________
20 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
Notes to Financial Statements
- -------------------------------------------------------------------------------
NOTE C
Distribution Services Agreement
The Fund has adopted a Distribution Services Agreement (the "Agreement")
pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under the
Agreement the Fund pays a distribution fee to the Distributor at an annual rate
of up to .30% of the average daily net assets attributable to Class A shares
and 1% of the average daily net assets attributable to Class B and Class C
shares. The fees are accrued daily and paid monthly. The Agreement provides
that the Distributor will use such payments in their entirety for distribution
assistance and promotional activities. The Distributor has advised the Fund
that it has incurred expenses in excess of the distribution costs reimbursed by
the Fund in the amount of $4,669,620 and $2,501,728 for Class B and Class C
shares, respectively; such costs may be recovered from the Fund in future
periods so long as the Agreement is in effect. In accordance with the
Agreement, there is no provision for recovery of unreimbursed distribution
costs, incurred by the Distributor, beyond the current fiscal year for Class A
shares. The Agreement also provides that the Adviser may use its own resources
to finance the distribution of the Fund's shares.
NOTE D
Investment Transactions
Purchases and sales of investment securities (excluding short-term investments)
for the six months ended April 30, 2004, were as follows:
Purchases Sales
============= =============
Investment securities (excluding
U.S. government securities) $ 268,630,572 $ 268,338,203
U.S. government securities -0- -0-
The cost of investments for federal income tax purposes was substantially the
same as the cost for financial reporting purposes. Accordingly, gross
unrealized appreciation and unrealized depreciation (excluding the written
option and swap contracts) are as follows:
Gross unrealized appreciation $ 27,583,311
Gross unrealized depreciation (5,963,089)
-------------
Net unrealized appreciation $ 21,620,222
=============
1. Option Transactions
For hedging and investment purposes, the Fund may purchase and write (sell) put
and call options on U.S. and foreign government securities and foreign
currencies that are traded on U.S. and foreign securities exchanges and
over-the-counter markets.
The risk associated with purchasing an option is that the Fund pays a premium
whether or not the option is exercised. Additionally, the Fund bears the risk
of loss of premium and change in market value should the counterparty not
_______________________________________________________________________________
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 21
Notes to Financial Statements
- -------------------------------------------------------------------------------
perform under the contract. Put and call options purchased are accounted for in
the same manner as portfolio securities. The cost of securities acquired
through the exercise of call options is increased by premiums paid. The
proceeds from securities sold through the exercise of put options are decreased
by the premiums paid.
When the Fund writes an option, the premium received by the Fund is recorded as
a liability and is subsequently adjusted to the current market value of the
option written. Premiums received from written options which expire unexercised
are recorded by the Fund on the expiration date as realized gains from options
written. The difference between the premium received and the amount paid on
effecting a closing purchase transaction, including brokerage commissions, is
also treated as a realized gain, or if the premium received is less than the
amount paid for the closing purchase transaction, as a realized loss. If a
written call option is exercised, the premium received is added to the proceeds
from the sale of the underlying security or currency in determining whether the
Fund has realized a gain or loss. If a written put option is exercised, the
premium received reduces the cost basis of the security or currency purchased
by the Fund. In writing an option, the Fund bears the market risk of an
unfavorable change in the price of the security or currency underlying the
written option. Exercise of an option written by the Fund could result in the
Fund selling or buying a security or currency at a price different from the
current market value.
Transactions in written options for the six months ended April 30, 2004, were
as follows:
Number of Premiums
Contracts Received
============= =============
Options outstanding at
October 31, 2003 1,800,000 $ 32,400
Options written 22,653,176 425,002
Options terminated in closing
purchase transactions (3,100,000) (54,685)
Options expired (19,703,176) (358,167)
------------- -------------
Options outstanding at
April 30, 2004 1,650,000 $ 44,550
============= =============
2. Swap Agreements
The Fund may enter into swaps on sovereign debt obligations to protect itself
from interest rate fluctuations on the underlying debt instruments and for
investment purposes. A swap is an agreement that obligates two parties to
exchange a series of cash flows at specified intervals based upon or calculated
by reference to changes in specified prices or rates for a specified amount of
an underlying asset. The payment flows are usually netted against each other,
with the difference being paid by one party to the other.
Risks may arise as a result of the failure of the counterparty to the swap
contract to comply with the terms of the swap contract. The loss incurred by
the failure of
_______________________________________________________________________________
22 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
Notes to Financial Statements
- -------------------------------------------------------------------------------
a counterparty is generally limited to the net interim payment to be received
by the Fund, and/or the termination value at the end of the contract.
Therefore, the Fund considers the creditworthiness of each counterparty to a
swap contract in evaluating potential credit risk. Additionally, risks may
arise from unanticipated movements in interest rates or in the underlying value
of the securities.
The Fund accrues for the interim payments on swap contracts on a daily basis,
with the net amount recorded within unrealized appreciation/depreciation of
swap contracts on the statement of assets and liabilities. Once the interim
payments are settled in cash, the net amount is recorded as realized gain/loss
on swaps, in addition to realized gain/loss recorded upon the termination of
swaps contracts on the statements of operations. Fluctuations in the value of
swap contracts are recorded as a component of net change in unrealized
appreciation/depreciation of investments.
The Fund may enter into credit default swaps. The Fund may purchase credit
protection on the referenced obligation of the credit default swap ("Buy
Contract") or provide credit protection on the referenced obligation of the
credit default swap ("Sale Contract"). A sale/(buy) in a credit default swap
provides upon the occurrence of a credit event, as defined in the swap
agreement, for the Fund to buy/(sell) from/(to) the counterparty at the
notional amount (the "Notional Amount") and receive/(deliver) the principal
amount of the referenced obligation. If a credit event occurs, the maximum
payout amount for a Sale Contract is limited to the Notional Amount of the swap
contract ("Maximum Payout Amount"). During the term of the swap agreement, the
Fund receives/(pays) semi-annual fixed payments from/(to) the respective
counterparty, calculated at the agreed upon interest rate applied to the
Notional Amount. These interim payments are recorded within unrealized
appreciation/depreciation of swap contracts on the statement of assets and
liabilities.
Credit default swaps may involve greater risks than if a Fund had invested in
the referenced obligation directly. Credit default swaps are subject to general
market risk, liquidity risk, counterparty risk and credit risk. If the Fund is
a buyer and no credit event occurs, it will lose its investment. In addition,
if the Fund is a seller and a credit event occurs, the value of the referenced
obligation received by the Fund coupled with the periodic payments previously
received, may be less than the Maximum Payout Amount it pays to the buyer,
resulting in a loss to the Fund.
At April 30, 2004, the Fund had Sale Contracts outstanding with Maximum Payout
Amounts aggregating $40,918,000, with net unrealized appreciation of $1,249,712
and terms ranging from 1 to 10 years, as reflected in the portfolio of
investments.
In certain circumstances, the Fund may hold Sale Contracts on the same
referenced obligation and with the same counterparty it has purchased credit
protec-
_______________________________________________________________________________
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 23
Notes to Financial Statements
- -------------------------------------------------------------------------------
tion, which may reduce its obligation to make payments on Sale Contracts, if a
credit event occurs. The Fund had Buy Contracts outstanding with a Notional
Amount of $9,790,000 with respect to the same referenced obligations and same
counterparties of certain Sale Contracts outstanding, which reduced its
obligation to make payments on Sale Contracts to $31,128,000 as of April 30,
2004.
3. Reverse Repurchase Agreements
Under a reverse repurchase agreement, the Fund sells securities and agrees to
repurchase them at a mutually agreed upon date and price. At the time the Fund
enters into a reverse repurchase agreement, it will establish a segregated
account with the custodian containing liquid assets having a value at least
equal to the repurchase price.
For the six months ended April 30, 2004, the average amount of reverse
repurchase agreements outstanding was $13,900,755 and the daily weighted
average interest rate was .51%.
NOTE E
Capital Stock
There are 9,000,000,000 shares of $.001 par value capital stock authorized,
divided into three classes, designated Class A, Class B and Class C shares.
Each class consists of 3,000,000,000 authorized shares. Transactions in capital
stock were as follows:
----------------------------------------------
Shares
----------------------------------------------
Six Months Ended September 1,
April 30, 2003 to Year Ended
2004 October 31, August 31,
(unaudited) 2003* 2003
----------------------------------------------
Class A
Shares sold 4,974,381 2,625,192 15,805,963
- -------------------------------------------------------------------------------
Shares issued in reinvestment of
dividends and distributions 400,224 130,057 767,001
- -------------------------------------------------------------------------------
Shares converted from Class B 1,345,093 108,120 1,081,814
- -------------------------------------------------------------------------------
Shares redeemed (6,028,073) (1,005,137) (14,979,291)
- -------------------------------------------------------------------------------
Net increase 691,625 1,858,232 2,675,487
===============================================================================
Class B
Shares sold 1,414,055 461,773 4,004,147
- -------------------------------------------------------------------------------
Shares issued in reinvestment of
dividends and distributions 201,241 78,242 517,733
- -------------------------------------------------------------------------------
Shares converted to Class A (1,333,871) (109,203) (1,070,593)
- -------------------------------------------------------------------------------
Shares redeemed (2,205,289) (709,323) (5,118,893)
- -------------------------------------------------------------------------------
Net decrease (1,923,864) (278,511) (1,667,606)
===============================================================================
* The Fund changed its fiscal year end from August 31 to October 31.
_______________________________________________________________________________
24 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
Notes to Financial Statements
- -------------------------------------------------------------------------------
----------------------------------------------
Shares
----------------------------------------------
Six Months Ended September 1,
April 30, 2003 to Year Ended
2004 October 31, August 31,
(unaudited) 2003* 2003
----------------------------------------------
Class C
Shares sold 2,627,852 617,045 4,327,340
- -------------------------------------------------------------------------------
Shares issued in reinvestment of
dividends and distributions 191,722 62,481 355,635
- -------------------------------------------------------------------------------
Shares redeemed (1,945,950) (477,362) (2,747,810)
- -------------------------------------------------------------------------------
Net increase 873,624 202,164 1,935,165
===============================================================================
* The Fund changed its fiscal year end from August 31 to October 31.
----------------------------------------------
Amount
----------------------------------------------
Six Months Ended September 1,
April 30, 2003 to Year Ended
2004 October 31, August 31,
(unaudited) 2003* 2003
----------------------------------------------
Class A
Shares sold $ 41,415,802 $ 20,797,068 $109,920,861
- -------------------------------------------------------------------------------
Shares issued in reinvestment of
dividends and distributions 3,316,666 1,041,833 5,359,919
- -------------------------------------------------------------------------------
Shares converted from Class B 11,147,980 872,532 7,661,897
- -------------------------------------------------------------------------------
Shares redeemed (49,752,106) (7,987,376) (106,021,261)
- -------------------------------------------------------------------------------
Net increase $ 6,128,342 $ 14,724,057 $ 16,921,416
===============================================================================
Class B
Shares sold $ 11,899,330 $ 3,715,085 $ 28,604,474
- -------------------------------------------------------------------------------
Shares issued in reinvestment of
dividends and distributions 1,682,297 632,968 3,639,603
- -------------------------------------------------------------------------------
Shares converted to Class A (11,147,980) (872,532) (7,661,897)
- -------------------------------------------------------------------------------
Shares redeemed (18,521,554) (5,701,215) (36,999,728)
- -------------------------------------------------------------------------------
Net decrease $(16,087,907) $ (2,225,694) $(12,417,548)
===============================================================================
Class C
Shares sold $ 22,142,984 $ 4,968,163 $ 31,650,442
- -------------------------------------------------------------------------------
Shares issued in reinvestment of
dividends and distributions 1,607,194 506,101 2,514,505
- -------------------------------------------------------------------------------
Shares redeemed (16,339,952) (3,843,028) (20,023,797)
- -------------------------------------------------------------------------------
Net increase $ 7,410,226 $ 1,631,236 $ 14,141,150
===============================================================================
* The Fund changed its fiscal year end from August 31 to October 31.
_______________________________________________________________________________
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 25
Notes to Financial Statements
- -------------------------------------------------------------------------------
NOTE F
Risks Involved in Investing in the Fund
Interest Rate Risk and Credit Risk--Interest rate risk is the risk that changes
in interest rates will affect the value of the Fund's investments in
fixed-income debt securities such as bonds or notes. Increases in interest
rates may cause the value of the Fund's investments to decline. Credit risk is
the risk that the issuer or guarantor of a debt security, or the counterparty
to a derivative contract, will be unable or unwilling to make timely principal
and/or interest payments, or to otherwise honor its obligations. The degree of
risk for a particular security may be reflected in its credit risk rating.
Credit risk is greater for medium quality and lower-rated securities.
Lower-rated debt securities and similar unrated securities (commonly known as
"junk bonds") have speculative elements or are predominantly speculative risks.
Concentration of Risk--Investing in securities of foreign companies and foreign
governments involves special risks which include the possibility of future
political and economic developments which could adversely affect the value of
such securities. Moreover, securities of many foreign companies and foreign
governments and their markets may be less liquid and their prices more volatile
than those of comparable U.S. companies and the United States government. The
Fund invests in the Sovereign Debt Obligations of countries that are considered
emerging market countries at the time of purchase. Therefore, the Fund is
susceptible to governmental factors and economic and debt restructuring
developments adversely affecting the economies of these emerging market
countries. In addition, these debt obligations may be less liquid and subject
to greater volatility than debt obligations of more developed countries.
In the ordinary course of business, the Fund enters into contracts that contain
a variety of indemnifications. The Fund's maximum exposure under these
arrangements is unknown. However, the Fund has not had prior claims or losses
pursuant to those indemnification provisions and expects the risk of loss
thereunder to be remote.
NOTE G
Joint Credit Facility
A number of open-end mutual funds managed by the Adviser, including the Fund,
participate in a $500 million revolving credit facility (the "Facility")
intended to provide short-term financing if necessary, subject to certain
restrictions, in connection with abnormal redemption activity. Commitment fees
related to the Facility are paid by the participating funds and are included in
miscellaneous expenses in the statement of operations. The Fund did not utilize
the Facility during the six months ended April 30, 2004.
_______________________________________________________________________________
26 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
Notes to Financial Statements
- -------------------------------------------------------------------------------
NOTE H
Distributions to Shareholders
The tax character of distributions to be paid for the year ending October 31,
2004 will be determined at the end of the current fiscal year. The tax
character of distributions paid during the period ended October 31, 2003, and
fiscal years ended August 31, 2003 and August 31, 2002 were as follows:
September 1, 2003 Year Ended Year Ended
to October 31, August 31, August 31,
2003 2003 2002
============== ============== ==============
Distributions paid from:
Ordinary income $ 4,105,311 $ 24,146,583 $ 22,411,441(a)
-------------- -------------- --------------
Total taxable
distributions 4,105,311 24,146,583 22,411,441
Tax return of capital -0- -0- 1,929,877
-------------- -------------- --------------
Total distributions
paid $ 4,105,311 $ 24,146,583 $ 24,341,318
============== ============== ==============
As of October 31, 2003, the components of accumulated earnings/(deficit) on a
tax basis were as follows:
Accumulated capital and other losses $ (42,092,690)(b)
Unrealized appreciation/(depreciation) 47,504,925(c)
-------------
Total accumulated earnings/(deficit) $ 5,412,235
=============
(a) Total distributions paid differ from the statement of changes in net
assets because for tax purposes dividends are recognized when actually paid.
(b) On October 31, 2003, the Fund had a net capital loss carryforward for
federal income tax purposes of $42,092,690 of which $24,980,617 expires in the
year 2007, $5,826,966 expires in the year 2008 and $11,285,107 expires in the
year 2009. To the extent future capital gains are offset by capital loss
carryforwards, such gains will not be distributed. During the fiscal year, the
Fund utilized capital loss carryforwards of $5,016,595.
(c) The differences between book-basis and tax-basis unrealized
appreciation/(depreciation) are attributable primarily to the tax deferral of
losses on wash sales and the difference between book and tax amortization
methods for premium.
NOTE I
Legal Proceedings
As has been previously reported in the press, the Staff of the U.S. Securities
and Exchange Commission ("SEC") and the NYAG have been investigating practices
in the mutual fund industry identified as "market timing" and "late trading" of
mutual fund shares. Certain other regulatory authorities have also been
conducting investigations into these practices within the industry and have
requested that Alliance Capital Management L.P. ("Alliance Capital"), the
Fund's Adviser, provide information to them. Alliance Capital has been
cooperating and will continue to cooperate with all of these authorities.
_______________________________________________________________________________
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 27
Notes to Financial Statements
- -------------------------------------------------------------------------------
On December 18, 2003, Alliance Capital confirmed that it had reached terms with
the SEC and the NYAG for the resolution of regulatory claims relating to the
practice of "market timing" mutual fund shares in some of the AllianceBernstein
Mutual Funds. The agreement with the SEC is reflected in an Order of the
Commission ("SEC Order"). The agreement with the NYAG is subject to final,
definitive documentation. Among the key provisions of these agreements are the
following:
(i) Alliance Capital agreed to establish a $250 million fund (the
"Reimbursement Fund") to compensate mutual fund shareholders for the adverse
effects of market timing attributable to market timing relationships described
in the SEC Order. According to the SEC Order, the Reimbursement Fund is to be
paid, in order of priority, to fund investors based on (i) their aliquot share
of losses suffered by the fund due to market timing, and (ii) a proportionate
share of advisory fees paid by such fund during the period of such market
timing;
(ii) Alliance Capital agreed to reduce the advisory fees it receives from some
of the AllianceBernstein long-term, open-end retail funds, commencing January
1, 2004, for a period of at least five years. The determination of which funds
will have their fees reduced and to what degree is subject to the terms of the
definitive agreement with the NYAG; and
(iii) Alliance Capital agreed to implement changes to its governance and
compliance procedures. Additionally, the SEC Order contemplates that Alliance
Capital's registered investment company clients, including the Fund, will
introduce governance and compliance changes.
In anticipation of final, definitive documentation and effective January 1,
2004, the Adviser began waiving a portion of its advisory fee. For a more
complete description of this waiver, please see "Advisory Fee and Other
Transactions with Affiliates" above.
The special committee of Alliance Capital's Board of Directors, comprised of
the members of Alliance Capital's Audit Committee and the other independent
member of the Board, is continuing to direct and oversee an internal
investigation and a comprehensive review of the facts and circumstances
relevant to the SEC's and the NYAG's investigations.
In addition, the Independent Directors of the Fund ("the Independent
Directors") have initiated an investigation of the above-mentioned matters with
the advice of an independent economic consultant and independent counsel. The
Independent Directors have formed a special committee to supervise the
investigation.
_______________________________________________________________________________
28 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
Notes to Financial Statements
- -------------------------------------------------------------------------------
On October 2, 2003, a putative class action complaint entitled Hindo et al. v.
AllianceBernstein Growth & Income Fund et al. (the "Hindo Complaint") was filed
against Alliance Capital; Alliance Capital Management Holding L.P.; Alliance
Capital Management Corporation; AXA Financial, Inc.; certain of the
AllianceBernstein Mutual Funds, including the Fund; Gerald Malone; Charles
Schaffran (collectively, the "Alliance Capital defendants"); and certain other
defendants not affiliated with Alliance Capital. The Hindo Complaint was filed
in the United States District Court for the Southern District of New York by
alleged shareholders of two of the AllianceBernstein Mutual Funds. The Hindo
Complaint alleges that certain of the Alliance Capital defendants failed to
disclose that they improperly allowed certain hedge funds and other
unidentified parties to engage in late trading and market timing of
AllianceBernstein Fund securities, violating Sections 11 and 15 of the
Securities Act, Sections 10(b) and 20(a) of the Exchange Act, and Sections 206
and 215 of the Advisers Act. Plaintiffs seek an unspecified amount of
compensatory damages and rescission of their contracts with Alliance Capital,
including recovery of all fees paid to Alliance Capital pursuant to such
contracts.
Since October 2, 2003, numerous additional lawsuits making factual allegations
similar to those in the Hindo Complaint were filed against Alliance Capital and
certain other defendants, some of which name the Fund as a defendant. All of
these lawsuits seek an unspecified amount of damages.
As a result of the matters discussed above, investors in the AllianceBernstein
Mutual Funds may choose to redeem their investments. This may require the
AllianceBernstein Mutual Funds to sell investments held by those funds to
provide for sufficient liquidity and could also have an adverse effect on the
investment performance of the AllianceBernstein Mutual Funds.
_______________________________________________________________________________
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 29
Financial Highlights
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
Class A
-----------------------------------------------------------------------------------------
Six Months
Ended September 1,
April 30, 2003 to Year Ended August 31,
2004(a) October 31, --------------------------------------------------------------
(unaudited) 2003(b) 2003 2002(c) 2001 2000 1999
----------- ----------- ----------- ----------- ----------- ----------- -----------
Net asset value,
beginning of period $8.00 $7.72 $6.02 $6.37 $7.06 $5.69 $5.05
INCOME FROM INVESTMENT
OPERATIONS
Net investment income(d) .27(e) .11 .69 .69 .85 .75 .71
Net realized and unrealized
gain (loss) on investment
transactions (.09) .28 1.71 (.24) (.76) 1.40 .74
Net increase in net asset
value from operations .18 .39 2.40 .45 .09 2.15 1.45
LESS: DIVIDENDS AND
DISTRIBUTIONS
Dividends from net
investment income (.31) (.11) (.70) (.74) (.78) (.75) (.74)
Tax return of capital -0- -0- -0- (.06) -0- (.03) (.03)
Distributions in excess of
net investment income -0- -0- -0- -0- -0- -0- (.04)
Total dividends and
distributions (.31) (.11) (.70) (.80) (.78) (.78) (.81)
Net asset value,
end of period $7.87 $8.00 $7.72 $6.02 $6.37 $7.06 $5.69
TOTAL RETURN
Total investment return
based on net asset
value(f) 2.11% 5.11% 41.80% 7.38% 1.55% 39.76% 29.40%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $140,964 $137,709 $118,669 $76,397 $66,750 $66,075 $50,540
Ratio to average net
assets of:
Expenses,
net of waivers/
reimbursements 1.22%(g) 1.75%(g) 1.94% 1.88% 2.20% 1.76% 1.59%
Expenses,
before waivers/
reimbursements 1.39%(g) 1.75%(g) 1.94% 1.88% 2.20% 1.76% 1.59%
Expenses, excluding
interest expense 1.20%(g) 1.47%(g 1.46% 1.50% 1.47% 1.51% 1.59%
Net investment
income 7.58%(e)(g) 7.90%(g) 9.73% 11.02% 12.78% 11.59% 12.34%
Portfolio turnover rate 91% 20% 125% 170% 150% 173% 179%
See footnote summary on page 33.
_______________________________________________________________________________
30 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
Financial Highlights
- -------------------------------------------------------------------------------
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
Class B
-----------------------------------------------------------------------------------------
Six Months
Ended September 1,
April 30, 2003 to Year Ended August 31,
2004(a) October 31, --------------------------------------------------------------
(unaudited) 2003(b) 2003 2002(c) 2001 2000 1999
----------- ----------- ----------- ----------- ----------- ----------- -----------
Net asset value,
beginning of period $8.07 $7.80 $6.09 $6.45 $7.14 $5.74 $5.05
INCOME FROM INVESTMENT
OPERATIONS
Net investment income(d) .28(e) .10 .64 .64 .79 .71 .67
Net realized and unrealized
gain (loss) on investment
transactions (.12) .28 1.73 (.24) (.76) 1.40 .76
Net increase in net asset
value from operations .16 .38 2.37 .40 .03 2.11 1.43
LESS: DIVIDENDS AND
DISTRIBUTIONS
Dividends from net
investment income (.29) (.11) (.66) (.70) (.72) (.68) (.68)
Tax return of capital -0- -0- -0- (.06) -0- (.03) (.03)
Distributions in excess of
net investment income -0- -0- -0- -0- -0- -0- (.03)
Total dividends and
distributions (.29) (.11) (.66) (.76) (.72) (.71) (.74)
Net asset value,
end of period $7.94 $8.07 $7.80 $6.09 $6.45 $7.14 $5.74
TOTAL RETURN
Total investment return
based on net asset
value(f) 1.79% 4.84% 40.69% 6.50% .63% 38.41% 28.85%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $73,679 $90,443 $89,571 $80,064 $83,706 $108,075 $110,003
Ratio to average
net assets of:
Expenses,
net of waivers/
reimbursements 1.93%(g) 2.45%(g) 2.64% 2.58% 2.88% 2.45% 2.31%
Expenses,
before waivers/
reimbursements 2.10%(g) 2.45%(g) 2.64% 2.58% 2.88% 2.45% 2.31%
Expenses, excluding
interest expense 1.91%(g) 2.17%(g) 2.17% 2.20% 2.17% 2.21% 2.31%
Net investment
income 8.63%(e)(g) 7.11%(g) 9.07% 10.25% 11.80% 10.85% 11.59%
Portfolio turnover rate 91% 20% 125% 170% 150% 173% 179%
See footnote summary on page 33.
_______________________________________________________________________________
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 31
Financial Highlights
- -------------------------------------------------------------------------------
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
Class C
-----------------------------------------------------------------------------------------
Six Months
Ended September 1,
April 30, 2003 to Year Ended August 31,
2004(a) October 31, --------------------------------------------------------------
(unaudited) 2003(b) 2003 2002(c) 2001 2000 1999
----------- ----------- ----------- ----------- ----------- ----------- -----------
Net asset value,
beginning of period $8.09 $7.82 $6.10 $6.46 $7.15 $5.74 $5.05
INCOME FROM INVESTMENT
OPERATIONS
Net investment income(d) .24(e) .10 .63 .64 .79 .71 .67
Net realized and unrealized
gain (loss) on investment
transactions (.09) .28 1.75 (.24) (.76) 1.41 .76
Net increase in net asset
value from operations .15 .38 2.38 .40 .03 2.12 1.43
LESS: DIVIDENDS AND
DISTRIBUTIONS
Dividends from net
investment income (.29) (.11) (.66) (.70) (.72) (.68) (.68)
Tax return of capital -0- -0- -0- (.06) -0- (.03) (.03)
Distributions in excess of
net investment income -0- -0- -0- -0- -0- -0- (.03)
Total dividends and
distributions (.29) (.11) (.66) (.76) (.72) (.71) (.74)
Net asset value,
end of period $7.95 $8.09 $7.82 $6.10 $6.46 $7.15 $5.74
TOTAL RETURN
Total investment return
based on net asset
value(f) 1.66% 4.83% 40.80% 6.50% .63% 38.58% 28.85%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $83,328 $77,657 $73,477 $45,527 $40,667 $48,960 $39,024
Ratio to average net
assets of:
Expenses,
net of waivers/
reimbursements 1.91%(g) 2.43%(g) 2.63% 2.56% 2.87% 2.45% 2.30%
Expenses,
before waivers/
reimbursements 2.08%(g) 2.43%(g) 2.63% 2.56% 2.87% 2.45% 2.30%
Expenses, excluding
interest expense 1.89%(g) 2.16%(g) 2.16% 2.19% 2.16% 2.20% 2.30%
Net investment
income 7.50%(e)(g) 7.09%(g) 8.91% 10.16% 11.81% 10.78% 11.56%
Portfolio turnover rate 91% 20% 125% 170% 150% 173% 179%
See footnote summary on page 33.
_______________________________________________________________________________
32 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
Financial Highlights
- -------------------------------------------------------------------------------
(a) As of November 1, 2003, the Fund has adopted the method of accounting for
interim payments on swap contracts in accordance with Financial Accounting
Standards Board Statement No. 133. These interim payments are reflected within
net realized and unrealized gain (loss) on swap contracts, however prior to
November 1, 2003, these interim payments were reflected within interest
income/expense on the statement of operations. The effect of this change for
the six months ended April 30, 2004, was to decrease net investment income per
share by $.02 and increase net realized and unrealized gain (loss) on
investment transactions per share by $.02. Consequently, the ratios of net
investment income and expenses to average net assets were decreased by 0.70%
and 0.14% for Class A, 0.71% and 0.15% for Class B and 0.68% and 0.14% for
Class C, respectively.
(b) The Fund changed its fiscal year end from August 31 to October 31.
(c) As required, effective September 1, 2001, the Fund has adopted the
provisions of the AICPA Audit and Accounting Guide, Audits of Investment
Companies, and began amortizing premium on debt securities for financial
statement reporting purposes only. For the year ended August 31, 2002, the
effect of this change to Class A, B and C was to decrease net investment income
per share by $.01 and decrease net realized and unrealized loss on investment
transactions per share by $.01. Consequently, the ratio of net investment
income to average net assets was decreased from 11.10% to 11.02% for Class A,
from 10.34% to 10.25% for Class B and from 10.24% to 10.16% for Class C. Per
share, ratios and supplemental data for periods prior to September 1, 2001 have
not been restated to reflect this change in presentation.
(d) Based on average shares outstanding.
(e) Net of expenses waived/reimbursed by the Adviser.
(f) Total investment return is calculated assuming an initial investment made
at the net asset value at the beginning of the year, reinvestment of all
dividends and distributions at net asset value during the year, and redemption
on the last day of the year. Initial sales charge or contingent deferred sales
charge is not reflected in the calculation of total investment return. Total
return does not reflect the deduction of taxes that a shareholder would pay on
Fund distributions or the redemption of Fund shares. Total investment return
calculated for a period of less than one year is not annualized.
(g) Annualized.
_______________________________________________________________________________
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 33
Board of Directors
- -------------------------------------------------------------------------------
BOARD OF DIRECTORS
William H. Foulk, Jr.(1), Chairman
Marc O. Mayer, President
Ruth Block(1)
David H. Dievler(1)
John H. Dobkin(1)
Clifford L. Michel(1)
Donald J. Robinson(1)
OFFICERS
Paul J. DeNoon(2), Vice President
Mark R. Manley, Secretary
Mark D. Gersten, Treasurer and Chief Financial Officer
Vincent S. Noto, Controller
Principal Underwriter
AllianceBernstein Investment Research and Management, Inc.
1345 Avenue of the Americas
New York, NY 10105
Custodian
The Bank of New York
One Wall Street
New York, NY 10286
Legal Counsel
Seward & Kissel LLP
One Battery Park Plaza
New York, NY 10004
Transfer Agent
Alliance Global Investor Services, Inc.
P.O. Box 786003
San Antonio, TX 78278-6003
Toll-Free (800) 221-5672
Independent Auditors
Ernst & Young LLP
5 Times Square
New York, NY 10036
(1) Member of the Audit Committee.
(2) Mr. DeNoon is the person primarily responsible for the day-to-day
management of the Fund's investment portfolio.
_______________________________________________________________________________
34 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
AllianceBernstein Family of Funds
- -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN FAMILY OF FUNDS
- --------------------------------------------
Wealth Strategies Funds
- --------------------------------------------
Balanced Wealth Strategy
Wealth Appreciation Strategy
Wealth Preservation Strategy
Tax-Managed Balanced Wealth Strategy*
Tax-Managed Wealth Appreciation Strategy
Tax-Managed Wealth Preservation Strategy**
- --------------------------------------------
Blended Style Funds
- --------------------------------------------
U.S. Large Cap Portfolio
International Portfolio
Tax-Managed International Portfolio
- --------------------------------------------
Growth Funds
- --------------------------------------------
Domestic
Growth Fund
Health Care Fund
Mid-Cap Growth Fund
Premier Growth Fund
Small Cap Growth Fund
Technology Fund
Global & International
All-Asia Investment Fund
Global Research Growth Fund
Global Small Cap Fund
Greater China '97 Fund
International Premier Growth Fund
New Europe Fund
Worldwide Privatization Fund
Select Investor Series
Biotechnology Portfolio
Premier Portfolio
Technology Portfolio
- --------------------------------------------
Value Funds
- --------------------------------------------
Domestic
Balanced Shares
Disciplined Value Fund
Growth & Income Fund
Real Estate Investment Fund
Small Cap Value Fund
Utility Income Fund
Value Fund
Global & International
Global Value Fund
International Value Fund
- --------------------------------------------
Taxable Bond Funds
- --------------------------------------------
Americas Government Income Trust
Corporate Bond Portfolio
Emerging Market Debt Fund
Global Strategic Income Trust
High Yield Fund
Multi-Market Strategy Trust
Quality Bond Portfolio
Short Duration Portfolio
U.S. Government Portfolio
- --------------------------------------------
Municipal Bond Funds
- --------------------------------------------
National
Insured National
Arizona
California
Insured California
Florida
Massachusetts
Michigan
Minnesota
New Jersey
New York
Ohio
Pennsylvania
Virginia
- --------------------------------------------
Intermediate Municipal Bond Funds
- --------------------------------------------
Intermediate California
Intermediate Diversified
Intermediate New York
- --------------------------------------------
Closed-End Funds
- --------------------------------------------
All-Market Advantage Fund
ACM Income Fund
ACM Government Opportunity Fund
ACM Managed Dollar Income Fund
ACM Managed Income Fund
ACM Municipal Securities Income Fund
California Municipal Income Fund
National Municipal Income Fund
New York Municipal Income Fund
The Spain Fund
World Dollar Government Fund
World Dollar Government Fund II
We also offer Exchange Reserves,+ which serves as the money market fund
exchange vehicle for the AllianceBernstein mutual funds.
For more complete information on any AllianceBernstein mutual fund, including
investment objectives and policies, sales charges, expenses, risks and other
matters of importance to prospective investors, visit our web site at
www.alliancebernstein.com or call us at (800) 227-4618 for a current
prospectus. Please read the prospectus carefully before you invest or send
money.
* Formerly Growth Investors Fund.
** Formerly Conservative Investors Fund.
+ An investment in the Fund is not a deposit in a bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency. Although the Fund seeks to preserve the value of your investment at
$1.00 per share, it is possible to lose money by investing in the Fund.
_______________________________________________________________________________
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND o 35
NOTES
_______________________________________________________________________________
36 o ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
ALLIANCEBERNSTEIN EMERGING MARKET DEBT FUND
1345 Avenue of the Americas
New York, NY 10105
(800) 221-5672
[LOGO] AllianceBernstein (SM)
Investment Research and Management
(SM) This service mark used under license from
the owner, Alliance Capital Management L.P.
GDGSR0404
ITEM 2. CODE OF ETHICS.
Not applicable when filing a Semi-Annual report to shareholders.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable when filing a Semi-Annual report to shareholders.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable when filing a Semi-Annual report to shareholders.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable to the registrant.
ITEM 6. SCHEDULE OF INVESTMENTS.
Form N-CSR disclosure requirement not yet effective with respect to the
registrant.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable to the registrant.
ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable to the registrant.
ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
On March 17, 2004 the Fund adopted procedures effective April 1, 2004, by
which shareholders may recommend nominees to the Fund's Board of Directors.
Prior thereto, the Fund's Board did not accept shareholder recommendations
for nominees to the Fund's Board.
ITEM 10. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive officer and principal financial
officer have concluded that the registrant's disclosure controls and
procedures (as defined in Rule 30a-2(c) under the Investment Company Act of
1940, as amended) are effective at the reasonable assurance level based on
their evaluation of these controls and procedures as of a date within 90 days
of the filing date of this document.
(b) There were no significant changes in the registrant's internal controls
that could significantly affect these controls subsequent to the date of their
evaluation, including any corrective actions with regard to significant
deficiencies and material weaknesses.
ITEM 11. EXHIBITS.
The following exhibits are attached to this Form N-CSR:
EXHIBIT NO. DESCRIPTION OF EXHIBIT
11 (b) (1) Certification of Principal Executive Officer Pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002
11 (b) (2) Certification of Principal Financial Officer Pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002
11 (c) Certification of Principal Executive Officer and Principal
Financial Officer Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
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): AllianceBernstein Emerging Market Debt Fund, Inc.
By: /s/Marc O. Mayer
--------------------------------
Marc O. Mayer
President
Date: June 30, 2004
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: /s/Marc O. Mayer
--------------------------------
Marc O. Mayer
President
Date: June 30, 2004
By: /s/Mark D. Gersten
-------------------------------
Mark D. Gersten
Treasurer and Chief Financial Officer
Date: June 30, 2004