1. Baring Asset Management (Asia) Limited 19/F, Edinburgh Tower, 15 Queen’s Road Central, Hong Kong Tel+852 2841 1411 www.barings.com Authorised and regulated by the Financial Services Authority Khiem Do August 14, 2008 The Asia Pacific Fund, Inc. Investment Community Conference Call Asian Investment Outlook www.asiapacificfund.com

2. 1 Table of Contents Page Section 1:Asian Markets Review2 - 5 Section 2:Asian Investment Outlook and Strategy6 - 28

3. Baring Asset Management (Asia) Limited 19/F, Edinburgh Tower, 15 Queen’s Road Central, Hong Kong Tel+852 2841 1411 www.barings.com Authorised and regulated by the Financial Services Authority Section 1 Asian Markets Review

4. 3 Local Currency exchange rate (US$/Local rate) (3 month period to June 30, 2008) 03/31/200806/30/2008Change %* North Asia Chinese Renminbi7.016.852.3 New Taiwan Dollar30.3830.350.1 Hong Kong Dollar7.787.80-0.2 South Korean Won9901,046-5.3 ASEAN Singaporean Dollar1.381.361.4 Indonesian Rupiah9,2059,220-0.2 Malaysian Ringgit3.203.27-2.1 Thai Baht31.4933.44-5.8 Philippines Peso41.7744.90-7.0 Indian Rupee40.1243.03-6.8 VN Dong16,11016,842-4.3 *: + denotes an appreciation of the local currency vs the USD (and vice-versa) Source: Factset, Bloomberg Most Asian currencies corrected vs the USD in the June quarter (except Renminbi and Sing $)

5. 4 Asian Stock Markets: Country Performance (3 month period to June 30, 2008) ‘Growth’ markets of VN and India continued to fall sharply, while Singapore and HK/China fared relatively better Gross return in USD Country - Index (%) North Asia MSCI China Free-3.5 MSCI Hong Kong Free-3.9 MSCI Korea Free-7.6 MSCI Taiwan Free-10.5 ASEAN MSCI Singapore Free-0.9 MSCI Indonesia Free-4.5 MSCI Malaysia Free-9.1 MSCI Thailand Free-11.8 MSCI Philippines Free-24.8 MSCI AC Far East Free Ex Japan Gross-6.4 MSCI India Free-19.7 Vietnam (HCM Local price index)-22.7 Source: Factset, Bloomberg

6. 5 Asian Stock Markets: Sectoral Performance (3 month period to June 30, 2008) Source: Factset MSCI Energy7.7 MSCI Consumer Staples-0.4 MSCI Utilities-2.8 MSCI Financials-5.5 MSCI Materials-6.4 MSCI Information Technology-8.3 MSCI Telecommunication Services-8.8 MSCI Industrials-10.7 MSCI Real Estate-11.4 MSCI Consumer Discretionary-13.0 MSCI Health Care-17.1 Gross return in USD (%) Defensives (Energy, Consumer Staples) led, while Cyclicals (Consumer Disc., Real Estate) lagged

7. Baring Asset Management (Asia) Limited 19/F, Edinburgh Tower, 15 Queen’s Road Central, Hong Kong Tel+852 2841 1411 www.barings.com Authorised and regulated by the Financial Services Authority Section 2 Asian Investment Outlook and Strategy

8. 7 Performance of Global Asset Classes: Extremely challenging environment ! Source: BCA Research (7/2008) 3-Month Risk vs Return * 12-Month Risk vs Return * Only commodities, cash and high quality bonds produced positive returns

9. 8 Global Risk Appetite still Very Weak: Hide in government bonds or be brave and buy cheap equities ? Investors, in general, have been hiding Source: Credit Suisse (7/2008) Risk index Global Risk Appetite Since 1981

10. 9 Risk Appetite: Global Emerging Markets/Asia vs US GEM/Asia at ‘panic’ levels, whereas US has recovered somewhat Source: Credit Suisse (7/2008) GEM/Asia Equity Risk Appetite Index US Equity Risk Appetite Index

11. 10 Significant Flows out of EM Asia: Precursor to Asian recession … or … other reasons? Recent selling likely caused by de-risking by foreign investors and switching out of Asia to other OECD and EM markets Note: EM Asia here includes India, Indonesia, Korea, Taiwan, Thailand and the Philippines. Source: Morgan Stanley (7/2008)

12. 11 Current Concerns in Equity Markets: ‘Perfect storm’ of negative expectations! With so many ‘fears’, is there room for being a contrarian ? Fear of oil prices climbing to $ 200/bbl Fear of economic stagflation Fear of global and regional inflation rates remaining high, inducing OECD Central banks to potentially make a mistake by tightening policy too soon and by too much Fear of further significant capital required to re-capitalise the US and UK/European financial systems > dilution to current shareholders Fear of losing money by investing in equities in the short-term, despite more attractive valuations

13. 12 Asia vs World: Relative performance over past decade (As at June 30, 2008) After this year’s short-term setback, Asia’s out-performance is expected to continue Source: Bloomberg (7/2008) MSCI Price Returns – Annualised (in USD terms)

14. 13 Our Key Long-Term Views: Secular Asian equity bull trend, interrupted Asia – Positive long-term fundamentals remains intact Secular growth driven by domestic demand Supportive liquidity – excess domestic savings, healthy banking system Attractive equity valuations, and lowly-geared corporate balance sheets Short-term issues –1) Have oil prices peaked; and 2) Has the US equity market bottomed ?

15. 14 Barings’ Base Case Scenario: Cautiously optimistic Potential upside risk in equity markets in H2 ? Long-lasting and severe US recession ? Barings forecasts flat growth Asian economies’ GDP growth to slow ? Mid-term cycle correction in long up-cycle, but no recession China’s PBOC to ease off on monetary tightening in H2 ’08 as inflation appeared to have peaked ? Recent signals appear more positive Equities becoming more attractively priced, but risk aversion remained high and excess liquidity allocated towards equities was low: We are looking for a change in sentiment

16. 15 US Financial Crisis: An update of our check-list Positive newsflows still lacking! Conditions for Market Stabilisation Current status in the US Weakening currency Monetary easing Now neutral Bottoming out of housing sector Not quite there yet Re-capitalization, if not nationalization, of financial institutionsNot quite there yet Clearance in credit markets Not quite there yet Share price stabilization on earnings downgrades Not quite there yet

17. 16 Oil Price: Where are we in the long cycle ? It appears that the oil price is close to reaching a long-term peak Source: Credit Suisse (7/2008) Real Oil Price Oil Price (in real terms)

18. 17 World Oil Demand: Who consumes more (or less) in 2008 (mm bbl/day)? Recent slowing of Chinese and other economies, plus substitution effects, are expected to cause slower demand growth for oil Source: JP Morgan (7/2008) 0.41 0.33 0.24 0.12 0.08 0.05 0.01 (0.49) ChinaMiddle East Latin America Other Asia FSUPacific (Japan) AfricaEurope North America 0.50 (0.50) 0.00 Mm bbl/day

19. 18 Global Retail Petrol Prices: China vs rest of world (price in US$/litre) Despite subsidies, pricing gap between China and US is narrowing Source: JP Morgan (7/2008) 0.0 0.5 1.0 1.5 2.0 2.5 3.0 Norway Denmark Germany Britain France Hong Kong South Korea Singapore Brazil Japan Philippines India Thailand US Russia China Indonesia Malaysia UAE Saudi Arabia Iran Venezuela US$/litre

20. 19 China & Asia’s Core vs Headline Inflation: Headline: worrying …………..… Core: still tame Chinese headline inflation appeared to have peaked, but other Asian counterparts still at high levels Source: Morgan Stanley (7/2008) Asia ex-JapanChina 0 1 2 3 4 5 6 7 8 Jan-01Jan-02Jan-03Jan-04Jan-05Jan-06Jan-07Jan-08 YoY % CPICore CPI (2) - 2 4 6 8 10 Jan-01Jan-02Jan-03Jan-04Jan-05Jan-06Jan-07Jan-08 CPINon-food CPI YoY %

21. 20 Inflation in China: Food vs non-food Food price inflation holds the key to China’s inflation Source: JP Morgan (7/2008) CPI - Food CPI – Non-Food YoY%

22. 21 Food Price Inflation in China: Pork price holds the key Pork price still high, but price trend has flattened out Source: JP Morgan (7/2008)

23. 22 China’s Key Macro Variables: Past over-heating periods vs now Current cycle milder than past over-heating episodes: no need for aggressive tightening by PBOC ? Source: JP Morgan (7/2008) 40.0% 35.0% 47.0% 20.0% 29.0% 26.0% 49.0% 40.0% 58.0% 42.0% 76.0% 19.0% 18.0% 15.0% 25.0% 1.7% Money (M2) GrowthLoan GrowthFixed Asset Investment GrowthNon-food Inflation 84-85 88-89 93-94 Now 84-85 88-89 93-94 Now84-85 88-89 93-94 Now 84-85 88-89 93-94 Now 0 10 20 30 40 50 60 70 80 Growth Rate (% p.a.)

24. 23 Profit Outlook of Asia vs US: Fundamental factors continue to favour Asia Stable Asian earnings revisions vs US down trend US: Down revisions still dominateAsia Pacific Ex-Japan: Stable revisions Source : JP Morgan (7/2008) EPS index (2008/09: starting at 100 on base date of February ‘07) 95 100 105 110 115 120 125 130 Feb 07May 07Aug 07Nov 07Feb 08May 08 2008 2009 Index 85 90 95 100 105 110 115 Feb 07May 07Aug 07Nov 07Feb 08May 08 2008 2009 Index

25. 24 Earnings Growth vs Valuations: Consensus expectations for Asia and the World More sustainable earnings growth expected in Asia/EM, yet valuations of the latter still cheaper than US * Excludes Australia Source: Goldman Sachs, IBES (7/2008) World P/E (E)EPS Growth (%)Div. YieldROAE (%) 2008 E2009 E 2008 E 2009 E2008 E 12.210.610.815.63.215.4 US13.811.58.419.92.316.8 Emerging Markets11.510.019.514.63.218.8 Asia Ex-Japan *12.610.99.815.83.115.6

26. 25 Asian Equities vs Asian Bonds: Equities appear very cheap, but …… ….. higher investor confidence and risk appetite needed to close the gap Source: Morgan Stanley (7/2008) APXJ Price -6 -5 -4 -3 -2 0 1 2 3 4 Apr-95Apr-97Apr-99Apr-01Apr-03Apr-05Apr-07 - 100 200 300 400 500 600 700 10Y Bond Yield - Fwd Earnings Yield (%)Avg. -1 Std dev Avg. +1 Std devUS$ Price (Right) (%)

27. 26 Asia Pacific ex Japan Equity Markets: Price and P/E trends Attractive valuation Source: Morgan Stanley (7/2008) MSCI AC Asia Pacific ex Japan (Price Index vs P/E Band) MSCI Price Index 0 100 200 300 400 500 600 700 800 900 Jan-89Jan-92Jan-95Jan-98Jan-01Jan-04 Jan-07 25x 22x 19x 16x 13x

28. 27 Is the US Equity Market Close to the Bottom? Past 150 years’ cycle study say …… ….. probably Yes ! Source: Credit Suisse (7/2008) US Real Equity Returns: Declines from Peak Index of Real Return

29. 28 Asia Pacific Fund’s Portfolio Strategy What has changed? Investors’ risk appetite has weakened further as equity investors were hit by four factors: oil price spike, stagflation, the US financial crisis, and monetary tightening bias in growth economies of BRIC Signs of “capitulation” selling in Asian equities in June/July We have lowered the portfolio’s beta and active risk over the past 6 months What has not changed? Portfolio favoring large caps and stable growth to cyclical growth Portfolio still focused on sectors with a sustainable growth trend, including domestic consumption, infrastructure and asset reflation Portfolio looking to add back selective growth stocks in periods of severe market weakness, as it seems that we are close to an important market low

30. 29 Important Information This document is provided as a service to professional investors/advisers. It is issued in the United Kingdom by Baring Asset Management Limited and/or by its investment adviser affiliates in other jurisdictions. The affiliate serving as the Asia Pacific Fund’s investment adviser is Baring Asset Management (Asia) Limited. In the United Kingdom this document is issued only to persons falling within a permitted category under (i) the FSA’s rules made under section 238(5) of the Financial Services and Markets Act 2000 and (ii) the Financial Services and Markets Act 2000 (Promotion of Collective Investment Schemes) (Exemptions) Order 2001. This is not an offer nor a solicitation to buy or sell any investment referred to in this document. Baring Asset Management group companies, their affiliates and/or their directors, officers and employees may own or have positions in any investment mentioned herein or any investment related thereto and from time to time add to or dispose of any such investment. The contents of this document are based upon sources of information believed to be reliable but no guarantee, warranty or representation, express or implied, is given as to their accuracy or completeness. This document may include forward-looking statements, which are based upon our current opinions, expectations and projections as of the date on the cover hereof. We undertake no obligation to update or revise any forward-looking statements. Actual results could differ materially from those anticipated in the forward-looking statements. The value of any investments and any income generated may go down as well as up and is not guaranteed. Past performance will not necessarily be repeated. Changes in rates of exchange may have an adverse effect on the value, price or income of an investment. There are additional risks associated with investments (made directly or through investment vehicles which invest) in emerging or developing markets. Compensation arrangements under the Financial Services and Markets Act 2000 of the United Kingdom will not be available. Private investors in the Company referred to herein should obtain their own independent financial advise before making investments. This document must not be relied on for purposes of any investment decisions. Before investing in the Company, we recommend that all relevant documents, such as reports and accounts and prospectus should be read, which specify the particular risks associated with investment in the Company, together with any specific restrictions applying and the basis of dealing. The Company may not be available for investment in all jurisdictions. There may also be prohibitions or restrictions on distribution of this document and other material relating to the Company and accordingly recipients of any such documents are advised to inform themselves about and to observe any such restrictions. Ensure Complied Date is added at foot of Disclosure Complied (Boston): August 1, 2008 Disclosure for presentations to PUBLIC