THE TAIWAN FUND, INC.
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

February 1, 2004
Date of report (Date of earliest event reported)

The Taiwan Fund, Inc.

(Exact Name of Registrant as Specified in Charter)
         
Delaware   811-04893   042942862
(State or Other Jurisdiction
of Incorporation) 		  (Commission
File Number) 		  (IRS Employer
Identification Number)
         
225 Franklin Street, Boston, Massachusetts   02110
(Address of Principal Executive Offices)   (Zip Code)

(800) 426-5523
(Registrant’s telephone number, including area code)

 

TABLE OF CONTENTS

Item 9. Regulation FD Disclosure.
SIGNATURES

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Item 9. Regulation FD Disclosure.

     Pursuant to Regulation FD Rules 100-103, The Taiwan Fund, Inc. (the “Fund”) furnishes the February 2004 Monthly Review of the Fund’s performance by the Fund’s investment adviser.

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SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

         
     
Dated: April 30, 2004  By:   /s/Carol Wang    
    Name:   Carol Wang   
    Title:   Secretary and Treasurer   

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THE TAIWAN FUND, INC. REVIEW

February 2004

     
HSBC Asset Management (Taiwan) Limited
24/F No. 99, Tunhwa S. Rd., Sec. 2
Taipei 106, Taiwan		   Tel: (8862) 2325-7888
Fax: (8862) 2706-5371

Portfolio Review

     The TAIEX registered a gain of 6.20% in US dollar terms in February. The recent increase in domestic consumption continued in February and produced strong performance for sectors such as food, tourism, and banking, which each increased over 10% in NT dollar terms during the month. Other sectors that prospered in February included iron & steel, paper & forest products, wire & cable, automobiles, tires & accessories, cement and textiles & apparel. The only three sectors that lagged the market were chemicals, electronics, and plastics. The market’s average daily turnover rose 30% in February following January’s 96% surge, indicating strong market liquidity and rising investor enthusiasm.

     In US dollar terms, the Fund returned 4.40% in February. Most of our underperformance can be attributed to the Fund’s focus on higher quality stocks, as the market’s February gain was driven primarily by lower quality stocks that were playing catch-up. In addition, the Fund’s slightly overweight position in the semiconductor sector negatively affected the Fund’s performance. Conversely, our overweight position in the steel sector positively affected the performance of the Fund.

     For March, we expect the market to continue its upward move, as strong liquidity and the improving economic outlook maintain the market’s current momentum. The upcoming presidential election should not put too much pressure on the market as investors aggressively position themselves for any dip. Our view of Taiwan’s market remains positive and we expect to see the market continue moving upward in the foreseeable future.

Total Fund Sector Allocation

                 
  % of    
As of 02/29/04
   Total Fund
   % of TAIEX
Semiconductor
     21.50       20.05  
Finance
     17.90       19.37  
PC & Peripherals
     12.60       13.65  
Electronics
     10.50       10.55  
Plastics
     6.40       9.13  
Telecommunications
     6.30       6.19  
Iron & Steel
     4.50       3.40  
Shipping
     3.70       2.85  
Automobiles, Tires & Accessories
     3.70       1.32  
Textiles & Apparel
     1.60       1.84  
Electrical Equipment
     1.40       1.29  
Chemicals
     0.60       1.37  
Cement
     0.70       0.94  
Retail
     0.70       0.85  
Wire & Cable
     0.60       0.80  
Others & Miscellaneous
     5.40       6.40  
Total
     98.10       100.00  
Cash
     1.90          
Tech
     50.90       50.96  
Non-Tech
     29.30       29.67  
Financial
     17.90       19.37  
Total Net Asset: US$248.44Million
                

Top 10 Holdings of Total Fund Portfolio

         
As of 02/29/04
 % of Total Portfolio
Taiwan Semiconductor Manufacturing Co.
     7.01  
Cathay Financial Holding Co. Ltd.
     4.67  
United Microelectronics Corp. Ltd.
     3.85  
Au Optronics Corp.
     3.73  
China Steel Corp.
     3.62  
Hon Hai Precision Industry Co. Ltd.
     3.37  
Chinatrust Financial Holding Co. Ltd.
     2.97  
Advanced Semiconductor Engineering, Inc.
     2.73  
Chunghwa Telecom Co. Ltd.
     2.66  
MediaTek, Inc.
     2.53  
NAV: US$15.18           Price: US$13.61      Discount: -10.34%
        
No. of Shares: 16.4Million
        

Returns in US$ (%)*

                 
    The Taiwan Fund, Inc.
   Taiwan Stock Exchange Index
One Month
     4.40       6.20  
Fiscal Year to Date**
     18.39       22.77  
One Year
     53.79       59.15  
Three Years
     1.16       4.99  
Five years
     0.82       1.21  
Ten Years
     1.73       –0.07  
Since Inception
     10.70       11.94  

*   Returns for the Fund are historical total returns that reflect changes in net asset value per share during each period and assume that dividends and capital gains, if any, were reinvested. Returns for the Taiwan Stock Exchange Index are not total returns and reflect only changes in share price but do not assume that cash dividends, if any, were reinvested, and thus are not strictly comparable to the Fund returns. Past performance is not indicative of future results of the Fund. Returns are annualized, except for periods of less than one year which are not annualized.
 
**   The Fund’s fiscal year commences on September 1.

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Premium/Discount of TWN

(TAIWAN FUND GRAPH)

Market Data

                 
    As of 01/31/04
   As of 02/29/04
TAIEX
     6375.38       6750.54  
% change in NTD terms
     8.23       5.88  
% change in USD terms
     10.18       6.20  
NTD Daily avg. trading volume (In Billions)
     123.08       160.48  
USD Daily avg. trading volume (In Billions)
     3.69       4.83  
NTD Market Capitalization (In Billions)
     13429.22       14701.97  
USD Market Capitalization (In Billions)
     402.68       442.16  
FX Rate: (US$/NT$)
     33.35       33.25  

    Disclaimer: This report is based on information believed by us to be reliable. No representation is made that it is accurate or complete. The figures in the report are unaudited. This report is not an offer to buy or sell or a solicitation of an offer to buy or sell any securities mentioned.

The daily NAV of the Fund is available from Lipper and CDA Weisenberger, or you may obtain it by calling toll free (800) 636-9242.

Lead Fund Manager: Victor Shih
Deputy Fund Manager: Jovi Chen

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