Message to Shareholders


July 1, 2009

Dear Valued Shareholders,

I would like to inform you of some recent changes at Matthews International Capital Management, LLC (“Matthews”).

Paul Matthews and I have worked long and hard to build a team with depth and diversity to cover an Asia that has changed and evolved since we started working on these markets. As part of the ongoing evolution of the firm, I recently assumed the role of Chairman of the Board of Directors of Matthews and will continue to serve as a Co-Manager of the Matthews Pacific Tiger and Matthews Korea Funds. William J. Hackett has succeeded me as the firm’s Chief Executive Officer and Robert J. Horrocks, PhD, has been appointed Chief Investment Officer.

Bill has served as President of Matthews since 2007 and now as Chief Executive Officer will oversee all areas of the firm, with the exception of investment management. Robert joined Matthews in August 2008 as our Director of Research. As Chief Investment Officer, he will oversee the firm’s investment process and investment professionals and set the research agenda for the investment team. Robert is also Co-Manager of the Matthews Asian Growth and Income Fund.

Both Bill and Robert bring extensive experience in Asian markets and proven leadership skills to their roles. I look forward to continuing to work with them to develop and enhance Matthews’ position as a leader in Asian asset management.

Since January 2008, Andrew Foster served as Matthews’ acting Chief Investment Officer. Robert’s appointment as Chief Investment Officer enables Andrew to focus on his primary role as Portfolio Manager. Andrew is Lead Manager of the Matthews Asian Growth and Income Fund and Co-Manager of the Matthews Asia Pacific Equity Income, Matthews China and Matthews India Funds. During his tenure as acting Chief Investment Officer, Andrew helped navigate Matthews and our investment team through some of modern history’s most challenging financial conditions. We are grateful to Andrew for stepping in to fill this role when needed and his ongoing contributions to Matthews.

Paul and I will continue to be closely involved with the strategic direction of Matthews and mentor, support and work with the members of the investment team. Paul remains a Director of Matthews and a Trustee of the Matthews Asia Funds. We continue to remain optimistic about the long-term growth prospects in Asia, and are confident in the team of professionals that we have brought together at Matthews. As always, we appreciate the opportunity to serve you.

Yours truly,
Mark W. Headley
Chairman
Matthews International Capital Management, LLC