This report contains certain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934. Forward-looking statements include statements regarding the goals, beliefs, plans or current expectations of the Fund and JFIMI and their respective representatives, taking into account the information currently available to them. Forward-looking statements include all statements that do not relate solely to current or historical fact. For example, forward-looking statements include the use of words such as “anticipate,” “estimate,” “intend,” “expect,” “believe,” “plan,” “may,” “should,” “would,” or other words that convey uncertainty of future events or outcomes. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Fund to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Factors that could materially and negatively affect the results, performance or achievements of the Fund include changes in economic, political, legal and regulatory conditions in the China Region and elsewhere, changes in interest and exchange rates and related policies and other risks. When evaluating the information included in this report, you are cautioned not to place undue reliance on these forward-looking statements, which reflect the judgment of the Fund, JFIMI or its respective representatives only as of the date hereof. The Fund, JFIMI and their respective representatives undertake no obligation to publicly revise or update these forward-looking statements to reflect events and circumstances that arise after the date hereof.

Dear fellow Stockholder,

Performance

The Greater China markets showed a divergence in performance over the six months to June 30, 2014. China A-shares fell by over 8% during the period given continued macro uncertainty (such as concerns over debt, deleveraging and slower growth) which weighed on the domestic markets. Offshore China markets were flat over the period, although showed signs of a pick-up towards the middle of the year. Hong Kong and Taiwan fared better. The Taiwan market was boosted by the performance of technology stocks, particularly those linked to the Apple supply chain.

Against this backdrop, the Fund’s net asset value (‘NAV’) total return declined 0.2% in the six months to June 30, 2014, underperforming its benchmark which rose by 1.5% over the same period. The underperformance relative to the benchmark was primarily attributable to stock selection in China (particularly in A-shares) and in Hong Kong, further details of which are provided in the Investment Advisor’s Report on pages 5 to 7 of this report. Over the same period, the Fund’s share price rose by 0.2%, which when compared against the Fund’s NAV total return resulted in a narrowing of the discount from 12.3% to 12.0%.

Leverage

On February 25, 2013, the Fund renewed its $17.5m credit facility with Scotiabank (Ireland) Ltd (‘Scotiabank’) for a further two year period. Under this arrangement, Scotiabank provides a secured, committed credit facility which can be utilized at any time. This financing arrangement gives the Investment Advisor the flexibility to manage tactically borrowed monies at its discretion under the close supervision of the Board. Since the beginning of the reporting period and up to June 30, 2014 the

Fund’s equity exposure ranged from 111.0% to 112.5%, and at the time of writing is 111.7%.

Outlook

The macro environment in the Greater China region is expected to continue to stabilise in the third quarter, as the impact of the second quarter’s mini-stimulus measures begins to feed through. On the structural reform front, the Fund Investment Advisor’s expectations have been readjusted, with 2014 now believed to be the preparation — instead of execution — year for deep structural reforms, such as state-owned enterprise reform and the breakup of some monopolies, while those reforms considered to be low-hanging fruits — resource price reforms and cutting government controls — have already been carried out. 2015-16 is expected to be the critical period for these major reforms to be launched, after the new leadership carries out the much-needed anti-corruption campaigns in 2013-14.

The Investment Advisor remains broadly optimistic on its principal portfolio themes. China will sacrifice quantity of growth for quality of growth during a de-leveraging and reform process, while Technology related exporters in Taiwan should continue to see positive earnings revisions. They believe that we are well under way in terms of the healing process of China. Valuations are cheap, earnings have stabilized, news flow is not deteriorating, reform is real and mini-stimulus measures are being introduced to support the overall economy. From a bottom-up stock selection basis, your Board believes that the Fund’s Investment Advisor continues to have interesting ideas that are leveraged to the region’s secular growth and the Chinese government’s reform agenda.

Respectfully submitted

The Rt. Hon. The Earl of Cromer

Chairman

August 28, 2014

In the first half of 2014, the Fund achieved a total return on net assets of -0.2% (in USD terms), underperforming the benchmark return of 1.5% by 1.7%.

During the review period most of the underperformance came from stock selection, whilst country allocation was flat. Stock selection within China A-shares and Hong Kong was the main detractor, whilst Taiwanese stock picks added value.

Our overweight in stocks that support the Apple iPhone supply chain rose strongly on the back of strong order demand. This included names such as optical lens manufacturer Largan Precision and Advanced Semiconductor Engineering.

In China, our position in the recent IPO of e-commerce retailer JD.COM also contributed to performance as the stock moved up sharply upon listing. Tencent, a core holding, rallied further over the period as the mobile and online gaming business continued to drive revenue growth, especially with the launch of new products and services in China.

On the negative side, stock selection in China over the period was weak. Our overweight in China Cinda Asset Management, which is involved in restructuring distressed assets, was a key detractor from performance. The stock fell due to concerns over its exposure to a slowing economy and to a weaker property market. Our holdings in China Oilfield Services and A-share stock Yantai Jereh Oilfield Services were key detractors as the market remained concerned that leasing rates may decline, although recent results showed a strong operating environment. The environmental stocks in the Fund, such as Huaneng Renewables, underperformed over the first half of 2014.

China

Market Performance

Chinese equities fell in the first quarter of 2014, with offshore-listed equities down 5.8%. Most of the

decline took place in January when the US Federal Reserve Board announced the tapering of its quantitative easing programme which renewed concerns about emerging market currencies. The gradual decline in interbank rates from their fourth quarter high did not alleviate market concerns over slowing growth, cases of trust/bond defaults and lack of evidence for solid structural reforms. Economic-sensitive sectors such as financials, consumer discretionary and commodities/industrials lagged, while structural growth sectors such as internet and health care outperformed. On the macro front, growth was negatively affected by a crackdown on the country’s shadow banking system. New total social financing in the first two months was down 3% year on year (‘y/y’), but off-balance sheet credit was down 19% y/y, affecting property developers and Local Government Finance Vehicles who rely heavily on shadow banking for their financing needs. Industrial production growth in the first two months moderated to 8.6% y/y vs. December’s 9.7%, one of the lowest growth rates since the global financial crisis. Retail sales growth in January-February was 11.8% y/y vs. December’s 13.6%. Fixed asset investment in the same period also weakened to 17.9% y/y growth vs. December’s 19.6%. Earnings revisions turned negative vs. the fourth quarter of 2013, led mainly by cyclicals, such as Technology, Transportation and Auto, or reform targets, such as Telecoms and Energy. Upward revisions were in Healthcare or falling cost beneficiaries such as utilities.

Chinese equities rose in the second quarter of 2014, with offshore-listed equities up 3.4%. Markets were volatile, with initial weakness in April due to weak macro data, followed by a recovery, helped by a series of mini stimulus policy measures. Economic-sensitive sectors such as banks, brokerage and autos outperformed, while defensives such as staples and healthcare lagged. Internet stocks rebounded due to strong earnings visibility, after a sharp global style shift led the stock lower in March/April. On the macro front, growth stabilised in the second quarter,

following a weak first quarter. The Chinese government initiated a series of mini-stimulus measures. On the fiscal side, these policies included a rise in railway capex and an acceleration in shantytown renovation through increased funding. On the monetary policy front, they included a targeted reserve requirement ratio cut and loan/deposit ratio relaxation, as well as further tax reliefs for small and medium enterprises. Overall, monetary conditions have improved, with loan growth accelerating to 13.9% y/y in May from 13.7% in April. Industrial production growth rebounded to 8.8% y/y in May after reaching a post-global financial crisis low of 8.7% in April. Retail growth followed a similar pattern, rebounding to 12.5% in May from 11.9% y/y in April. Fixed asset investment, at 17.2% in May and 17.3% in April, reached one of the lowest levels since the global financial crisis, mainly dragged lower by weakness in property fixed asset investment, up 10% y/y in May. Earnings revisions continued their negative trend, led mainly by the staples and materials sectors, which were impacted by the slowing economy, and telecommunications, which was affected by reforms. Upward revisions were seen in information technology and beneficiaries of lower raw material costs, such as utilities.

A-shares

In the first quarter of 2014, the A-share market pulled back, with the CSI 300 Index down 7.9%. Initially the market fell on the back of US tapering announcements, but a weak PMI figure and tightened liquidity led to many cyclical sectors, such as energy and industrials, facing strong headwinds. As the quarter went on the China onshore market continued to fall, as the RMB depreciated and macro leading indicators showed a slowing in the mainland economy. Sectors that had outperformed such as Information Technology and Healthcare were also under pressure of profit taking.

In the second quarter of 2014 the domestic A-share market (CSI 300 Index) finished up 0.9%. It was a volatile start to the quarter, with markets rallying at the start of April, after the long-awaited announcement of the “Shanghai-Hong Kong Stock Connect” program allowing wider mutual participation of investors in these two markets. However, this was soon offset by the worry over a further economic slowdown and slightly weaker than expected corporate earnings in the first quarter of 2014. The government announced several loosening policies but mostly on specific sectors rather than a full scale stimulus plan. As the quarter moved on, the A-share market rallied on the back of improving economic fundamentals, as economic data exceeded expectations while modest loosening continued, including targeted cuts in reserve requirement ratios and incremental relaxation of property restrictions.

Market Outlook

We expect the macro environment to stabilise going into the second half of the year, mildly rebounding from the first-quarter low. This is likely to be underpinned by selective easing recently initiated by the government, such as increased infrastructure spending, a pickup in social housing and tax cuts for small and medium enterprises. Overall, we expect growth to remain at the low end of the 7-8% GDP range when the new leadership carries out structural reforms to improve quality of growth. On the structural reform front, we believe 2014 will see solid progress made on the bold reform proposals set at the Third Plenum in November 2013. Supply-side reforms such as state-owned enterprise reform, breakup of monopoly, tax reduction, interest rate liberalisation and less government controls are needed to support growth, getting it onto a sustainable path, instead of heavily relying on demand-side management such as infrastructure spending or property sector policy swings. The market’s valuation at 8.5x forward one-year price to earnings, with earnings growth in the low teens, is

undemanding (vs. mid-cycle 12x). We believe the market could remain volatile as investors weigh up the impact of the reform-induced slowdown (including the crackdown on shadow banking, selected trust defaults and bond defaults) and the resulting better quality of growth.

Hong Kong

Market Performance

In the first quarter of 2014 Hong Kong equities retreated due to concerns over slowing economic growth in China, including credit bubble worries surrounding trust products and corporate bonds, coupled with talk of earlier-than-expected rate increases in the US. Macau gaming share prices sold off despite strong operating performance. The policy address was largely a non-event while the budget speech reaffirmed a strong fiscal position with only modest scaling back of one-time fiscal stimulus. A comment from the chief executive regarding the cancellation of a land sale programme for local resident buyers only triggered speculation of a roll-back of tightening measures. However, this turned out to be a false alarm as the government has not altered its stance on its property policy. While a couple of select urban land sites fetched higher-than-expected prices, land prices on the whole have fallen significantly year to date, with one site withdrawn due to insufficiently high bids. Moreover, home sellers in the secondary market dropped their asking prices following talk of US rate increases. On the office front, rent levels have stabilised, while vacancy rates have improved modestly. Despite strong quarterly growth in gaming revenues, including 13% growth for March off a high base and 20% growth for the quarter, there was profit-taking in the Macau gaming sector. Hong Kong banks reported generally positive operating results. However, it appears that the Hong Kong Monetary Authority is exerting pressure for banks to bolster their capital in case of a credit downturn. In response, BOC Hong Kong cut its

dividend payout, which proved to be a disappointment to the market. Retail sales growth for January and February combined was up 7% year on year. Apparel, footwear and department store sales growth remained strong, while jewellery and cosmetics sales growth slowed.

Hong Kong equities rebounded sharply in the second quarter, due to a confluence of positive factors, including economic stabilisation in China, the announcement of the mutual market access agreement with the Shanghai stock exchange and a surprising drop in long-term US Treasury yields. Hong Kong equities outperformed Chinese equities as well as regional and global stock markets for the quarter. Transaction volumes in the primary residential market remained buoyant given pent-up demand and the aggressive pricing of new launches at a shrinking premium to secondary prices. Moreover, secondary prices resumed their upward climb, nearing the record-high level reached in March 2013. The retail sector came under pressure due both to weakening sales growth as well as potential policy risk. Retail sales for April and May fell 9.6% and 4.7% respectively, although both were impacted by the high base effect of the “gold rush” in 2013. The Chief Executive mooted the possibility of a 20% reduction in the number of individual tourists from mainland China.

Macau gaming shares suffered a correction, as a series of negative developments culminated in a year-on-year drop in gaming revenue of 4% in June, the first such drop since 2009. In particular, the high-roller segment of the market was hit hard owing to the aftermath of an intermediary that defaulted recently. Stricter enforcement of UnionPay machines and transit visas, as well as a full smoking ban, could also adversely impact growth.

Market Outlook

We are optimistic about the impact of China’s economic stabilization and reform program on Hong

Kong equities. However, there are significant headwinds created by political, policy and rate risks. The electoral reform controversy continues to garner headlines, but with a muted impact on economic activity. However, if the government response to electoral reforms fails to quell popular dissent, then the Occupy Central campaign may affect short-term business activity and long-term investor confidence. On the property front, while further clarification from the government has made it easier for households upgrading their property, there has been no change to the government’s overall stance. In fact, further price increases may force the government into implementing additional tightening measures. While we believe the 20% reduction in individual tourists may be overstated, measures could be introduced that would restrain arrival numbers primarily from lower-spending tourists. However, coupled with the trend of fewer high-spending tourists visiting Hong Kong, retail sales growth will remain under pressure. The long-term structural story of Macau remains healthy. However, the near-term picture remains clouded by slowing top-line growth, policy risks, and labour shortage and cost issues.

Given the current challenges facing domestic Hong Kong companies and the potential for rates to start increasing next year, we are biased towards companies geared towards China and abroad, with specific emphasis on quality of growth due to target market and competitive barriers.

Taiwan

Market Performance

After shrugging off several market shocks, including the collapse of Ukraine’s government, US Federal Reserve chair Janet Yellen’s indication of a possible rate rise in six months and home-grown protests over a trade deal with China, the TSWE Index hit new yearly highs, closing the first quarter of 2014 with a 2.8% gain. Among the major losers were finance stocks, down 5.5% quarter on quarter, as students continued to occupy Taiwan’s parliament,

demanding the withdrawal of the services pact. This is expected to boost access of Taiwanese firms to China’s financial markets. China and Taiwan held government-to-government talks for the first time since 1949. Wang Yu-chi of Taiwan’s Mainland Affairs Council, which oversees the island’s China policy, met with his mainland Chinese counterpart, Zhang Zhijun, of China’s Taiwan Affairs Office. Taiwan’s economic monitoring indicator hit a 32-month high of 25 for February. The government expects it to be between 23-31 in March if the global economy continues to improve.

Despite local protests over free-trade agreement talks with China, protests in Vietnam impacting some Taiwanese companies, and issues in Ukraine, the TWSE Index finished the second quarter up 6% from the first quarter. A surge of liquidity into Taiwan pushed the TWSE Index to its highest level since 2007, as enthusiasm grew over local technology companies and a recovering economy boosted corporate earnings. Several global electronics brands such as Apple will unveil new models later this year, which would boost local suppliers’ shipments. The Technology sector outperformed. The construction sector closed down for the quarter as the government announced expanded measures to control rocketing housing prices by reducing the amount of money banks can lend to home buyers. Students ended their 24-day occupation of the Legislature in April, saying they had seen “critical progress” made in relation to their demands. Legislative speaker Wang Jin-Ping pledged to halt debate on the services trade pact with China until new oversight rules are passed. Benefiting from improving financials, consumption, trading and production, Taiwan’s economic monitoring indicator for April hit a three-year high of 29. The government expects real GDP growth of 3% this year. Taiwan’s consumer price index rose 1.6% y/y to 103.9 in May, while core inflation was up 1.5% y/y, hitting a 15-month high. The central bank left its key interest rates unchanged at its quarterly policymaking meeting.

Market Outlook

The improving global macroeconomic backdrop will be an important catalyst supporting Taiwan’s growth, as exports still equate to 70% of its GDP. Our belief is that US growth in 2014 is likely to be faster than in 2013, Europe is likely to post positive growth, and Japan’s 2014 GDP growth could accelerate from 2013. These three regions account for over 60% of Taiwan’s final export destination. The healthy global macro backdrop will drive earnings growth of another 10%-15% in 2014, following profit growth of 30%-40% in 2013. Overall, fundamentals remain strong and valuations are still modest. We remain overweight in Technology, Industrial and Consumption, and underweight in Financials, Telecoms and Petrochemicals. We expect many of our Technology holdings in Taiwan to benefit from inventory restocking following an inventory correction at the end of last year. The other key themes in Taiwan are a stabilisation in PC orders and a pickup in LCD demand. We should also benefit from an increase in demand for Apple’s products at the expense of Samsung.

Thanks to generally better-than-expected first quarter of 2014 results and positive guidance for the second half of 2014, the TWSE Index should continue to trend higher amid consolidation following strong gains in the first half of 2014. Technology should remain in focus. Sentiment over the Apple-related supply chain should remain healthy as the market widely anticipates restocking demand for the iPhone 6 to kick-in in the third quarter, with iWatch in the pipeline. Other themes that could come into focus include IoT (internet of things), automation and big data. While there are concerns about an inventory build-up in the technology sector, the current inventory level remains healthy. Overall, fundamentals remain strong and valuations are still modest. We remain overweight in technology, industrial and consumption, and underweight in financials, telecommunications and petrochemicals.

JF International Management Inc.

August 28, 2014

NOTES TO SCHEDULE OF PORTFOLIO INVESTMENTS: