etf7312009.htm
 
 
UNITED STATES
 
SECURITIES AND EXCHANGE COMMISSION
 
Washington, D.C. 20549
 
 
 
 
 
FORM N-Q
 
 
 
QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED
 
MANAGEMENT INVESTMENT COMPANIES
 
 
 
 
 
     
Investment Company Act file number:    811-08076
   
Exact name of registrant as specified in charter:    The Emerging Markets Telecommunications Fund, Inc.
   
Address of principal executive offices:   
c/o 1735 Market Street, 32nd Floor
 
Philadelphia, PA 19103
 
   
Name and address of agent for service:   
Ms. Megan Kennedy
 
Aberdeen Asset Management Inc.
 
c/o 1735 Market Street, 32nd Floor
 
Philadelphia, PA 19103
 
   
Registrant’s telephone number, including area code:    866-839-5205
   
Date of fiscal year end:    October 31
   
Date of reporting period:    7/31/09

 
 
 
 
Item 1: Schedule of Investments

 
 
 

The Emerging Markets Telecommunications Fund, Inc.
 
Schedule of Investments
 
July 31, 2009 (unaudited)
 

Description
  
No. of
Shares
  
Value
EQUITY OR EQUITY-LINKED SECURITIES-96.06%
 
Equity or Equity-Linked Securities of Telecommunication Companies in  Emerging Countries-95.56%
Asia-0.48%
Diversified Telecommunication Services-0.48%
 
TVG Asian Communications Fund II, L.P. #†‡
(Cost $1,092,526)
3,622,118*
$                                        714,923 
     
 
Brazil-7.76%
Diversified Telecommunication Services-3.32%
 
Brasil Telecom Participações S.A., PN
110,750
  939,515 
Brasil Telecom S.A., PN
81,637
  582,920 
Tele Norte Leste Participações S.A., ADR
97,037
  1,493,399 
Tele Norte Leste Participações S.A., PN
71,477
  1,100,349 
Telemar Norte Leste S.A., PNA
31,191
  844,325 
   
  4,960,508 
   
 
Media-1.06%
NET Servicos de Comunicacao S.A., ADR†
155,927
  1,584,218 
   
 
Wireless Telecommunication Services-3.38%
 
Tim Participações S.A.
910,245
  2,017,754 
Vivo Participações S.A., ADR
132,762
  3,022,991 
   
  5,040,745 
   
Total Brazil
(Cost $9,962,069)
  11,585,471 
 
Chile-1.13%
Diversified Telecommunication Services-1.13%
 
Empresa Nacional de Telecomunicaciones S.A.
(Cost $1,339,857)
123,132
  1,686,880 
     
 
China-16.30%
Diversified Telecommunication Services-4.45%
 
China Communications Services Corp. Ltd.
2,860,173
  1,811,483 
China Telecom Corp. Ltd.
9,238,207
  4,828,022 
   
  6,639,505 
   
 
Wireless Telecommunication Services-11.85%
 
China Mobile Ltd.
1,037,172
  10,910,279 
China Mobile Ltd., ADR
23,920
  1,255,082 
China Unicom Ltd.
3,829,273
  5,521,513 
   
  17,686,874 
   
Total China
(Cost $29,210,078)
  24,326,379 
 
Czech Republic-1.32%
Diversified Telecommunication Services-1.32%
 
Telefonica 02 Czech Republic AS
(Cost $1,578,162)
73,055
  1,971,903 
     
 
Egypt-1.98%
Diversified Telecommunication Services-0.48%
 
Telecom Egypt SAE
225,185
  718,015 
   
 
Wireless Telecommunication Services-1.50%
 
Orascom Telecom Holding SAE†
338,846
  2,243,048 
   
Total Egypt
(Cost $4,640,314)
  2,961,063 
 
India-0.90%
Wireless Telecommunication Services-0.90%
 
Bharti Airtel Ltd.
(Cost $1,362,009)
155,994
  1,344,751 
     
 
Indonesia-4.29%
Diversified Telecommunication Services-4.29%
 
PT Indosat Tbk
1,402,356
  769,539 
PT Telekomunikasi Indonesia Tbk
6,299,954
  5,632,841 
   
  6,402,380 
   
Total Indonesia
(Cost $5,493,984)
  6,402,380 
 
Israel-5.83%
Diversified Telecommunication Services-1.75%
 
Bezeq Israeli Telecommunication Corp. Ltd.
1,311,772
  2,608,254 
   
 
Technology-0.46%
 
SVE Star Ventures Enterprises GmbH & Co. No. IX KG†‡
2,001,470*
  687,045 
   
 
Venture Capital-2.24%
 
BPA Israel Ventures LLC #†‡
1,674,587*
  653,881 
Concord Ventures Fund II, L.P. †‡
4,000,000*
  842,952 
Giza GE Venture Fund III L.P. †‡
2,750,000*
  662,832 
K.T. Concord Venture Fund L.P. †‡
2,000,000*
  221,346 
Neurone Ventures II, L.P. #†‡
686,184*
  192,409 
Walden-Israel Ventures III, L.P.#†‡
1,249,188*
  780,930 
   
  3,354,350 
   
 
Wireless Telecommunication Services-1.38%
 
Cellcom Israel Ltd.
73,556
  2,056,626 
   
Total Israel
(Cost $14,144,561)
  8,706,275 
 
Latin America-0.18%
Venture Capital-0.18%
 
JPMorgan Latin America Capital Partners L.P. #†‡
(Cost $597,379)
2,216,887*
  263,566 
     
Malaysia-0.39%
Diversified Telecommunication Services-0.39%
 
Telekom Malaysia Bhd
(Cost $503,997)
678,361
  575,708 
     
Mexico-12.69%
Diversified Telecommunication Services-1.47%
 
Telefonos de Mexico S.A.B. de C.V., Series L, ADR
138,791
  2,194,286 
   
 
Wireless Telecommunication Services-11.22%
 
América Móvil S.A.B. de C.V., Series L, ADR
389,498
  16,752,309 
   
Total Mexico
(Cost $9,172,728)
  18,946,595 
 
Philippines-1.38%
Diversified Telecommunication Services-1.38%
 
Philippine Long Distance Telephone Co.
(Cost $1,443,714)
39,086
  2,058,999 
     
Poland-1.62%
Diversified Telecommunication Services-1.62%
 
Telekomunikacja Polska S.A.
(Cost $4,429,239)
473,012
  2,411,104 
     
Russia-10.27%
Diversified Telecommunication Services-1.39%
 
Comstar United Telesystems OJSC, GDR†
414,210
  2,071,050 
   
 
Wireless Telecommunication Services-8.88%
 
Mobile Telesystems OJSC, ADR
168,907
  7,092,405 
Vimpel-Communications, ADR†
456,759
  6,170,814 
   
  13,263,219 
   
Total Russia
(Cost $14,968,602)
  15,334,269 
 
South Africa-13.98%
Diversified Telecommunication Services-0.88%
 
Telkom South Africa Ltd.
267,605
  1,319,108 
   
 
Wireless Telecommunication Services-13.10%
 
MTN Group Ltd.
1,076,791
  17,543,123 
Vodacom Group (Pty) Ltd.†
267,605
  2,003,905 
   
  19,547,028 
   
Total South Africa
(Cost $14,829,111)
  20,866,136 
 
South Korea-5.74%
Diversified Telecommunication Services-3.04%
 
KT Corp.
140,672
  4,547,688 
   
 
Wireless Telecommunication Services-2.70%
 
SK Telecom Co., Ltd.
26,658
  4,025,685 
   
Total South Korea
(Cost $9,317,411)
  8,573,373 
 
Taiwan-4.44%
Diversified Telecommunication Services-3.27%
 
Chunghwa Telecom Co., Ltd.
2,434,149
  4,881,950 
   
 
Wireless Telecommunication Services-1.17%
 
Taiwan Mobile Co., Ltd.
1,138,340
  1,741,491 
   
Total Taiwan
(Cost $7,588,261)
  6,623,441 
 
Thailand-1.36%
Wireless Telecommunication Services-1.36%
 
Advanced Info Service Public Co., Ltd.
(Cost $2,484,013)
796,765
  2,025,277 
     
Turkey-2.25%
Wireless Telecommunication Services-2.25%
 
Turkcell Iletisim Hizmet AS
(Cost $3,663,338)
531,287
  3,357,431 
     
Global-1.27%
Diversified Telecommunication Services-0.62%
 
Telesoft Partners II QP, L.P. #†‡
2,280,000*
  923,673 
Telesoft Partners L.P.†‡ 
1,250,000*
  0 
   
  923,673 
Venture Capital-0.65%
Emerging Markets Ventures I, L.P.#†‡
7,248,829*
  973,808 
     
Total Global
(Cost $4,114,762)
  1,897,481 
 
Total Emerging Countries
(Cost $141,936,115)
  142,633,405 
   
Equity Securities of Telecommunication Companies in Developed Countries-0.50%
United States-0.50%
 
 
Internet Software & Services-0.50%
 
NetFlix, Inc. † 
1,321
  58,045 
Technology Crossover Ventures IV, L.P.#†‡
1,937,800*
  681,528 
     
Total United States
(Cost $614,791)
  739,573 
Equity Securities of Companies Providing Other Essential Services in the Development of an Emerging Country's Infrastructure-0.00%
Argentina-0.00%
Investment & Holding Companies-0.00%
Exxel Capital Partners V, L.P. †‡
(Cost $380,481)
1,897,761*
  0 
     
     
Total  Equity or Equity-Linked Securities-96.06%
(Cost $142,931,387)
  143,372,978 
   
     
 
Principal
Amount (000's)
  
     
SHORT-TERM INVESTMENT-2.80%
Grand Cayman-2.80%
Wells Fargo, overnight deposit, 0.03%, 08/03/09
    
(Cost $4,185,000)
$                                                                 4,185
  4,185,000 
     
Total Investments-98.86%
(Cost $147,116,387)    
  147,557,978 
 
Cash and Other Assets, less Liabilities-1.14%
  1,705,252 
 
NET ASSETS-100.00%
$ 149,263,230 
 
 

†
  
Non-income producing security.
‡
  
Restricted security, not readily marketable; security is valued at fair value as determined in good faith by, or under the direction of, the Board of Directors under procedures established by the Board of Directors.
#
  
As of July 31, 2009, the aggregate amount of open commitments for the Fund is $2,809,014.
*
  
Represents contributed capital.
ADR
  
American Depositary Receipts.
GDR
  
Global Depositary Receipts.
PN
  
Preferred Shares.
PNA
  
Preferred Shares, Class A.
 

 
 
 
 
 

Security Valuation - The net asset value of the Fund is determined daily as of the close of regular trading on the New York Stock Exchange, Inc. (the “Exchange”) on each day the Exchange is open for business. Equity investments are valued at market value, which is generally determined using the closing price on the exchange or market on which the security is primarily traded at the time of valuation (the “Valuation Time”). If no sales are reported, equity investments are generally valued at the most recent bid quotation as of the Valuation Time or at the lowest ask quotation in the case of a short sale of securities. Debt securities with a remaining maturity greater than 60 days are valued in accordance with the price supplied by a pricing service, which may use a matrix, formula or other objective method that takes into consideration market indices, yield curves and other specific adjustments. Debt obligations that will mature in 60 days or less are valued on the basis of amortized cost, which approximates market value, unless it is determined that using this method would not represent fair value. Investments in mutual funds are valued at the mutual fund’s closing net asset value per share on the day of valuation. Securities and other assets for which market quotations are not readily available, or whose values have been materially affected by events occurring before the Fund’s Valuation Time, but after the close of the securities’ primary market, are valued at fair value as determined in good faith by, or under the direction of, the Board of Directors under procedures established by the Board of Directors. The Fund may utilize a service provided by an independent third party which has been approved by the Board of Directors to fair value certain securities. When fair-value pricing is employed, the prices of securities used by a fund to calculate its net asset value may differ from quoted or published prices for the same securities. At July 31, 2009, the Fund held 5.09% of its net assets in securities valued at fair value as determined in good faith under procedures established by the Board of Directors with an aggregate cost of $16,168,128 and fair value of $7,598,893. The Fund’s estimate of fair value assumes a willing buyer and a willing seller neither acting under a compulsion to buy or sell. Although these securities may be resold in privately negotiated transactions, the prices realized on such sales could differ from the prices originally paid by the fund or the current carrying values, and the difference could be material.

Restricted Securities - Certain of the Fund’s investments are restricted as to resale and are valued at fair value as determined in good faith by, or under the direction of, the Board of Directors under procedures established by the Board of Directors in the absence of readily ascertainable market values.
 

Security
  
Acquisition Date(s)
  
Cost
    
Fair Value At 7/31/09
 
  
Percent of Net Assets
 
  
Distributions Received
 
Open Commitments
                           
BPA Israel Ventures LLC
  
10/05/00 - 12/09/05
  
 $                    1,160,483
  
 $                           653,881
    
0.44
  
 $                                            97,293
  
 $          625,413
 
                          
Concord Ventures Fund II, L.P.
  
03/29/00 - 12/15/06
  
2,633,194
  
842,952
    
0.56
  
               258,608
  
-
 
                          
Emerging Markets Ventures I, L.P.
  
01/22/98 - 01/10/06
2,790,776
  
973,808
    
0.65
  
            7,129,731
  
851,172
 
                          
Exxel Capital Partners V, L.P.
  
05/11/98 - 12/03/98
  
380,481
  
0
    
0.00
  
               205,185
  
-
 
                          
Giza GE Venture Fund III, L.P.
  
01/31/00 - 11/23/06
  
1,738,836
  
662,832
    
0.44
  
               724,175
  
-
                           
JPMorgan Latin America Capital Partners L.P.
  
04/10/00 - 03/20/08
  
597,379
  
263,566
    
0.18
  
            2,217,354
  
571,535
                           
K.T. Concord Venture Fund L.P.
  
12/08/97 - 09/29/00
  
1,260,856
  
221,346
    
0.15
  
            1,320,492
  
-
                           
Neurone Ventures II, L.P.
  
11/24/00 - 02/24/09
  
193,007
  
192,409
    
0.13
  
               297,649
  
75,000
                           
SVE Star Ventures Enterprises GmbH & Co. No. IX KG
  
12/21/00 - 08/12/08
  
1,624,685
  
687,045
    
0.46
  
380,279
  
-
                           
Technology Crossover Ventures IV, L.P.
  
03/08/00 - 03/30/09
  
612,003
  
681,528
    
0.46
  
            1,772,839
  
62,200
                           
Telesoft Partners L.P.
  
07/22/97 - 06/07/01
  
158,405
  
0
    
0.00
  
            7,203,101
  
-
                           
Telesoft Partners II QP, L.P.
  
07/14/00 - 06/23/09
  
1,165,581
  
923,673
    
0.62
  
            1,109,561
  
120,000
                           
TVG Asian Communications Fund II, L.P.
  
06/07/00 - 10/27/05
  
1,092,526
  
714,923
    
0.48
  
            3,373,636
  
377,882
                           
Walden-Israel Ventures III, L.P.
  
02/23/01 - 09/18/08
  
759,916
  
780,930
    
0.52
  
942,976
  
125,812
                           
Total
      
 $                 16,168,128
  
 $                       7,598,893
    
5.09
  
 $                                    27,032,879
  
 $       2,809,014
                           

The Fund may incur certain costs in connection with the disposition of the above securities.

The Fund adopted Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, Fair Value Measurements (“FAS 157”), effective November 1, 2008. In accordance with FAS 157, fair value is defined as the price that the Fund would receive upon selling an investment in a timely transaction to an independent buyer in the principal or most advantageous market of the investment. FAS 157 established a three-tier hierarchy to maximize the use of observable market data and minimize the use of unobservable inputs and to establish classification of fair value measurements for disclosure purposes. Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability, including assumptions about risk, for example, the risk inherent in a particular valuation technique used to measure fair value including such a pricing model and/or the risk inherent in the inputs to the valuation technique. Inputs may be observable or unobservable. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs are inputs that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The three-tier hierarchy of inputs is summarized in the three broad Levels listed below.

 
Level 1 – quoted prices in active markets for identical investments
 
Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)
 
Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.
 
The following is a summary of the inputs used as of July 31, 2009 in valuing the Fund’s investments carried at value:
 
Investments, at value
  
Quoted Prices in  Active Markets for Identical Investments (Level 1)
  
Significant Other Observable Inputs (Level 2)
  
Significant Unobservable Inputs (Level 3)
  
Balance as of 07/31/2009
Diversified Telecommunication Services
  
$15,794,674
  
$29,252,664
  
        $1,638,596
  
$46,685,934
Internet Software & Services
  
         58,045
  
-
  
    681,528
  
       739,573
Media
  
    1,584,218
  
-
  
-
  
    1,584,218
Wireless Telecommunication Services
  
  42,397,163
  
   46,687,321
  
-
  
   89,084,484
Technology
  
-
  
-
  
   687,045
  
        687,045
Venture Capital
  
-
  
-
  
4,591,724
  
     4,591,724
Short-Term Investments
  
-
  
     4,185,000
  
-
  
     4,185,000
Total
  
 $59,834,100
  
 $80,124,985
  
$7,598,893
  
$147,557,978


Following is a reconciliation of investments in which significant unobservable inputs (Level 3) were used in determining value:

 Investments, at value
  
Balance as of 10/31/2008
  
Accrued discounts/ premiums
  
Realized gain/(loss)
  
Change in unrealized appreciation/
(depreciation)
  
Net purchases (sales)
  
Net transfers in and/or out of Level 3
  
Balance as of 07/31/2009
Diversified Telecommunication Services
  
$           1,808,496
  
$                                 -
  
$                                     -
  
$                                           (289,900)
  
$                       120,000
  
$                                       -
  
$         1,638,596
Venture Capital
  
         5,793,867
  
-
  
(253,485)
  
(829,624)
  
(119,034)
  
-
  
4,591,724
Technology
  
            977,198
  
-
  
-
  
(290,153)
  
-
  
-
  
687,045
Internet Software & Services
  
            701,743
  
-
  
-
  
(29,812)
  
9,597
  
-
  
681,528
Investment & Holding Companies
  
                9,216
  
-
  
(430,457)
  
422,591
  
(1,350)
  
-
  
-
Total
  
$          9,290,520
  
-
  
$                      (683,942)
  
$                                       (1,016,898)
  
$                          9,213
  
-
  
$         7,598,893

 
Federal Income Tax Cost - At July 31, 2009, the identified cost for federal income tax purposes, as well as the gross unrealized appreciation from investments for those securities having an excess of value over cost, gross unrealized depreciation from investments for those securities having an excess of cost over value and the net unrealized appreciation from investments were $147,116,387, $25,522,799, $(25,081,208) and $441,591, respectively.
 
Other information regarding the Fund is available in the Fund’s most recent Report to Shareholders. This information is also available on the website of the Securities and Exchange Commission at www.sec.gov.

 
 
 
 
Item 2: Controls and Procedures
 
 
(a) As of a date within 90 days from the filing date of this report, the principal executive officer and principal financial officer concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the “Act”)), were effective based on their evaluation of the disclosure controls and procedures required by Rule 30a-3(b) under the Act and Rules 13a-15(b) or 15d-15(b) under the Securities and Exchange Act of 1934.
 
 
(b) There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the registrant’s last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.
 
 
Item 3: Exhibits
 
 
1. The certifications of the registrant as required by Rule 30a-2(a) under the Act are exhibits to this report.
 

 
 



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.

The Emerging Markets Telecommunications Fund, Inc.


By:          /s/ Christian Pittard__________
Christian Pittard,
President of
The Emerging Markets Telecommunications Fund, Inc.

     Date: September 29, 2009

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/ Christian Pittard__________
Christian Pittard,
President of
  The Emerging Markets Telecommunications Fund, Inc.

     Date: September 29, 2009


By:          /s/ Megan Kennedy __________
   Megan Kennedy,
Treasurer of
The Emerging Markets Telecommunications Fund, Inc.

     Date: September 29, 2009