Total Return for the 12 Months Ended December 31, 2020
Class A			Class L			Class I			Class C			Bloomberg Barclays U.S. Government/ Mortgage Index¹			Lipper General U.S. Government Funds Index²
	5.55	%		5.21	%		5.77	%		4.69	%		6.36	%		7.66	%

The performance of Morgan Stanley U.S. Government Securities Trust's (the "Fund") four share classes varies because each has different expenses. The Fund's total returns assume the reinvestment of all distributions but do not reflect the deduction of any applicable sales charges. Such costs would lower performance. See Performance Summary for standardized performance and benchmark information.

Market Conditions

2020 began with a "risk-off" sentiment in the markets as a military escalation between the U.S. and Iran as well as the coronavirus outbreak in China weighed on investors. However, by the beginning of March, this risk-off sentiment quickly became full-blown panic as the COVID-19 epidemic engulfed the rest of the world in a global pandemic, leading to rapidly rising deaths and infections, lockdowns of populations and closing of economies.

In March 2020, stock markets crashed, oil prices plunged and unemployment soared. The global financial system experienced panic unlike anything seen since 2008. But, instead of a run on banks, we had a run on stocks, bonds and money market funds. There was a global rush to U.S. dollar cash, resulting in a market

PORTFOLIO COMPOSITION as of 12/31/20
Agency Fixed Rate Mortgages	32.1	%
Municipal Bonds	12.2
Short-Term Investments	11.1
U.S. Treasury Securities	10.9
Mortgages — Other	8.6
Collateralized Mortgage Obligations — Agency Collateral Series	7.3
U.S. Agency Securities	7.3
Agency Bonds — Sovereign (U.S. Government Guaranteed)	4.2
Commercial Mortgage-Backed Securities	3.4
Asset-Backed Securities	2.1
Agency Adjustable Rate Mortgages	0.5
Agency Bonds — Finance (U.S. Government Guaranteed)	0.3

* Does not include open long/short futures contracts with a value of $52,747,477 and net unrealized appreciation of $88,915.

Subject to change daily. Provided for informational purposes only and should not be deemed as a recommendation to buy or sell the types of securities mentioned above. All percentages for portfolio composition are stated as a percentage of total investments.

Morgan Stanley is a full-service securities firm engaged in securities trading and brokerage activities, investment banking, research and analysis, financing and financial advisory services.

Average Annual Total Returns—Period Ended December 31, 2020 (unaudited)

Symbol

Class A Shares*
(since 07/28/97)
USGAX

Class L Shares**
(since 07/28/97)
USGCX

Class I Shares***
(since 07/28/97)
USGDX

Class C Shares^†(since 04/30/15)
MSGVX

1 Year

5.55
2.14 ⁴

%³

5.21
—

%³

5.77
—

%³

4.69
3.69 ⁴

%³

5 Years

3.38 ³2.71 ⁴

3.11 ³—

3.73 ³—

2.57 ³2.57 ⁴

10 Years

3.16 ³2.82 ⁴

2.82 ³—

3.47 ³—

—
—

Since Inception

3.89 ³3.75 ⁴

3.47 ³—

4.17 ³—

2.07 ³2.07 ⁴

Performance data quoted represents past performance, which is no guarantee of future results and current performance may be lower or higher than the figures shown. For most recent month-end performance figures, please visit www.morganstanley.com/im/shareholderreports or speak with your Financial Advisor. Investment returns and principal value will fluctuate and fund shares, when redeemed, may be worth more or less than their original cost. The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Performance for Class A, Class L, Class I and Class C shares will vary due to differences in sales charges and expenses. See the Fund's current prospectus for complete details on fees and sale charges.

* The maximum front-end sales charge for Class A is 3.25%.

** Class L has no sales charge. Class L shares are closed for new investments.

*** Class I has no sales charge.

† The maximum contingent deferred sales charge for Class C is 1.0% for shares redeemed within one year of purchase.

(1) The Bloomberg Barclays U.S. Government/Mortgage Index includes Treasuries, government-related issues, and agency mortgage-backed pass-through securities issued by Ginnie Mae (GNMA), Fannie Mae (FNMA), and Freddie Mac (FHLMC). The Index is unmanaged and its returns do not include any sales charges or fees. Such costs would lower performance. It is not possible to invest directly in an index.

(2) The Lipper General U.S. Government Funds Index is an equally weighted performance index of the largest qualifying funds (based on net assets) in the Lipper General U.S. Government Funds classification. The Index, which is adjusted for capital gains distributions and income dividends, is unmanaged and should not be considered an investment. There are currently 10 funds represented in this Index. The Fund was in the Lipper General U.S. Government Funds classification as of the date of this report.

(3) Figure shown assumes reinvestment of all distributions and does not reflect the deduction of any sales charges.

(4) Figure shown assumes reinvestment of all distributions and the deduction of the maximum applicable sales charge. See the Fund's current prospectus for complete details on fees and sales charges.

‡ Ending value assuming a complete redemption on December 31, 2020.

As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments; and (2) ongoing costs, which may include advisory fees, administration fees, distribution and shareholder services (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

This example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period 07/01/20 – 12/31/20.

Actual Expenses

The first line of the table on the following page provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The second line of the table on the following page provides information about hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing cost of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads). Therefore, the second line of the table is useful in comparing ongoing costs, and will not help you determine the relative total cost of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

	Beginning Account Value		Ending Account Value		Expenses Paid During Period⁽¹⁾
	07/01/20		12/31/20		07/01/20 – 12/31/20
Class A
Actual (0.57% return)	$	1,000.00	$	1,005.70	$	4.29
Hypothetical (5% annual return before expenses)	$	1,000.00	$	1,020.86	$	4.32
Class L
Actual (0.43% return)	$	1,000.00	$	1,004.30	$	5.64
Hypothetical (5% annual return before expenses)	$	1,000.00	$	1,019.51	$	5.69
Class I
Actual (0.62% return)	$	1,000.00	$	1,006.20	$	2.62
Hypothetical (5% annual return before expenses)	$	1,000.00	$	1,022.52	$	2.64
Class C
Actual (0.17% return)	$	1,000.00	$	1,001.70	$	8.20
Hypothetical (5% annual return before expenses)	$	1,000.00	$	1,016.94	$	8.26

(1) Expenses are equal to the Fund's annualized expense ratios of 0.85%, 1.12%, 0.52% and 1.63% for Class A, Class L, Class I and Class C shares, respectively, multiplied by the average account value over the period and multiplied by 184/366 (to reflect the one-half year period). If the Fund had borne all of its expenses, the annualized expense ratios would have been 0.98%, 1.27%, 0.75% and 1.76% for Class A, Class L, Class I and Class C shares, respectively.

PRINCIPAL AMOUNT (000)			COUPON RATE			MATURITY DATE	VALUE
		Agency Adjustable Rate Mortgages (0.6%)
		Federal Home Loan Mortgage Corporation, Conventional Pools:
$	113	12 Month USD LIBOR + 1.74%		2.23	%	11/01/36	$	118,378
	291	12 Month USD LIBOR + 1.905%		2.405		10/01/36		307,267
	950	12 Month USD LIBOR + 1.816%		3.026		06/01/43		995,788
	111	Federal National Mortgage Association, Conventional Pools:, 12 Month USD LIBOR + 1.57%		2.445		05/01/44		113,254
	659			5.127		03/01/38		752,508
		Total Agency Adjustable Rate Mortgages (Cost $2,269,514)						2,287,195
		Agency Bond - Finance (U.S. Government Guaranteed) (0.3%)
	1,127	Washington Aircraft 1 Co., DAC (Ireland) (Cost $1,126,858)		2.637		09/15/26		1,195,613
		Agency Bonds - Sovereign (U.S. Government Guaranteed) (4.6%)
	14,175	Israel Government AID Bond (Israel)		5.50		09/18/23		16,146,900
	2,288	Petroleos Mexicanos (Mexico)		2.46		12/15/25		2,398,192
		Total Agency Bonds - Sovereign (U.S. Government Guaranteed) (Cost $17,864,407)						18,545,092
		Agency Fixed Rate Mortgages (36.0%)
		Federal Home Loan Mortgage Corporation, Conventional Pools:
	311			3.00		12/01/49		321,307
	785			4.00		04/01/49		837,999
	596			4.50		11/01/48		645,302
		Gold Pools:
	3,741			3.00		03/01/47 - 06/01/49		3,934,625
	7,066			3.50		08/01/42 - 04/01/49		7,717,146
	2,812			4.00		12/01/41 - 10/01/45		3,073,214
	569			5.00		01/01/40		661,997
	786			5.50		11/01/39		911,709
	146			6.50		03/01/29 - 09/01/32		165,155
	182			7.50		05/01/35		214,976
	118			8.00		08/01/32		141,196
	125			8.50		08/01/31		150,493

PRINCIPAL AMOUNT (000)			COUPON RATE			MATURITY DATE	VALUE
		Federal National Mortgage Association, Conventional Pools:
$	765			2.50	%	02/01/50	$	805,804
	8,576			3.00		06/01/40 - 11/01/49		9,009,431
	14,661			3.50		12/01/42 - 07/01/49		15,855,679
	17,410			4.00		11/01/41 - 09/01/48		19,098,798
	6,785			4.50		01/01/25 - 09/01/48		7,565,522
	2,023			5.00		05/01/35 - 02/01/41		2,338,118
	1,870			5.50		03/01/35 - 10/01/35		2,196,560
	26			6.50		06/01/29 - 02/01/33		29,791
	1			7.00		05/01/31		966
	290			7.50		08/01/37		357,403
	236			8.00		04/01/33		289,777
	235			8.50		10/01/32		289,263
		February TBA:
	23,425	(a)		2.00		02/01/51		24,294,389
		January TBA:
	4,525	(a)		1.50		01/01/51		4,572,194
	19,975	(a)		2.50		01/01/51		21,058,019
	775	(a)		3.00		01/01/51		812,055
		Government National Mortgage Association, Various Pools:
	4,941			3.50		08/20/45 - 07/20/49		5,343,149
	5,995			4.00		11/20/42 - 05/20/49		6,466,452
	306			4.50		04/20/49		328,034
	630			5.00		01/20/40 - 02/20/49		703,903
	36			5.125		11/20/37		39,004
	489			5.25		04/20/36 - 09/20/39		552,162
	840			5.375		02/20/36 - 08/20/40		946,627
	1,047			6.00		02/15/28 - 09/20/34		1,200,530
	64			7.00		03/20/26 - 07/20/29		75,085
	253			8.00		11/15/21 - 08/15/31		260,741
	269			8.50		07/15/30		294,711
	11			9.00		02/15/21 - 02/15/25		10,904
		Total Agency Fixed Rate Mortgages (Cost $139,306,240)						143,570,190

PRINCIPAL AMOUNT (000)			COUPON RATE			MATURITY DATE	VALUE
		Asset-Backed Securities (2.4%)
$	1,090	Ajax Mortgage Loan Trust (b)		1.698	%	05/25/59	$	1,101,066
	1,500	AMSR 2019-SFR1 Trust (b)		2.774		01/19/39		1,593,140
	1,372	Invitation Homes Trust, 1 Month USD LIBOR + 1.00% (b)		1.153	(c)	07/17/37		1,376,584
	751	Navient Private Education Refi Loan Trust (b)		1.22		07/15/69		759,563
	204	North Carolina State Education Assistance Authority, 3 Month USD LIBOR + 0.80%		1.015	(c)	07/25/25		203,687
		United States Small Business Administration
	1,243			2.42		06/01/32		1,313,461
	2,938			2.67		04/01/32		3,089,249
		Total Asset-Backed Securities (Cost $9,032,502)						9,436,750
		Collateralized Mortgage Obligations - Agency Collateral Series (8.2%)
		Federal Home Loan Mortgage Corporation
	5,600			2.373		05/25/22		5,732,581
	4,700			2.682		10/25/22		4,864,882
	3,850			3.208		02/25/26		4,297,066
	4,000			3.32		02/25/23		4,235,102
	3,429			3.527	(c)	10/25/23		3,710,368
	3,200			3.69		01/25/29		3,828,269
	2,760			3.90	(c)	08/25/28		3,323,309
		IO
	32,651			0.326	(c)	11/25/27		705,269
	20,194			0.433	(c)	08/25/27		537,166
		IO REMIC
	2,978	6.00% - 1 Month USD LIBOR		5.841	(d)	11/15/43		512,307
	422	6.05% - 1 Month USD LIBOR		5.891	(d)	04/15/39		4,492
		Federal National Mortgage Association
	431			3.763		06/25/21		434,081
		IO REMIC
	2,507			3.50		02/25/39		37,137
	3,451	6.55% - 1 Month USD LIBOR		6.402	(d)	08/25/41		392,024
	415	Government National Mortgage Association, IO		5.00		02/16/41		74,929
		Total Collateralized Mortgage Obligations - Agency Collateral Series (Cost $29,638,362)						32,688,982

PRINCIPAL AMOUNT (000)			COUPON RATE			MATURITY DATE	VALUE
		Commercial Mortgage-Backed Securities (3.8%)
$	1,014	Bancorp Commercial Mortgage Trust, 1 Month USD LIBOR + 1.05% (b)		1.209	(c)%	09/15/36	$	1,013,092
	6,973	BANK 2019-BNK21, IO		0.873	(c)	10/17/52		436,683
	9,957	Barclays Commercial Mortgage Trust, IO		1.345	(c)	05/15/52		910,619
	600	CAMB Commercial Mortgage Trust, 1 Month USD LIBOR + 1.07% (b)		1.229	(c)	12/15/37		603,135
		Citigroup Commercial Mortgage Trust, IO
	5,200			0.778	(c)	11/10/48		148,949
	13,757			0.887	(c)	09/10/58		483,891
	8,256			1.027	(c)	11/10/46		203,503
	6,915	COMM Mortgage Trust, IO		1.112	(c)	08/10/46		168,277
	23,136	Commercial Mortgage Pass-Through Certificates, IO		0.58	(c)	02/10/47		359,968
		GS Mortgage Securities Trust, IO
	9,026			1.023	(c)	11/10/46		221,787
	13,956			1.038	(c)	04/10/47		356,418
	14,441			1.222	(c)	10/10/48		689,852
	1,300	Hawaii Hotel Trust, 1 Month USD LIBOR + 1.15% (b)		1.309	(c)	05/15/38		1,293,414
	8,513	JP Morgan Chase Commercial Mortgage Securities Trust, IO		0.68	(c)	12/15/49		224,341
		JPMBB Commercial Mortgage Securities Trust, IO
	22,745			0.743	(c)	01/15/47		428,962
	4,875			1.05	(c)	11/15/45		120,441
	1,400	Mortgage Trust, 1 Month USD LIBOR + 1.20% (b)		1.359	(c)	12/15/35		1,407,287
	1,300	SG Commercial Mortgage Securities Trust (b)		4.163		02/15/41		1,505,463
	1,305	VMC Finance LLC, 1 Month USD LIBOR + 1.10% (b)		1.253	(c)	09/15/36		1,289,564
		Wells Fargo Commercial Mortgage Trust
	800	1 Month USD LIBOR + 1.01% (b)		1.169	(c)	02/15/37		773,516
	800	1 Month USD LIBOR + 1.14% (b)		1.299	(c)	01/15/35		786,668
		WFRBS Commercial Mortgage Trust, IO
	11,741			0.407	(c)	08/15/46		102,044

PRINCIPAL AMOUNT (000)			COUPON RATE			MATURITY DATE	VALUE
$	7,284			0.963	(c)%	03/15/46	$	169,461
	13,579			1.072	(c)	12/15/46		344,312
	1,100	Worldwide Plaza Trust (b)		3.526		11/10/36		1,228,272
		Total Commercial Mortgage-Backed Securities (Cost $14,467,998)						15,269,919
		Mortgages - Other (9.7%)
	1,339	BRAVO Residential Funding Trust (b)		3.50	(c)	10/25/44		1,403,786
	1,315	Bunker Hill Loan Depositary Trust (b)		1.724	(c)	02/25/55		1,331,221
	1,008	Cascade Funding Mortgage Trust (b)		4.00	(c)	10/25/68		1,043,456
	807	CIM Trust (b)		3.00	(c)	04/25/57		824,900
	844	COLT 2020-1R Mortgage Loan Trust (b)		1.255	(c)	09/25/65		846,507
		Federal Home Loan Mortgage Corporation
	126	1 Month USD LIBOR + 1.20%		1.348	(c)	10/25/29		125,865
	3,282			3.00		09/25/45 - 05/25/47		3,325,053
	2,484			3.50		05/25/45 - 05/25/47		2,546,333
	116			4.00		05/25/45		121,530
		Galton Funding Mortgage Trust
	821	(b)		3.50	(c)	06/25/59		843,466
	855	(b)		4.00	(c)	11/25/57 - 02/25/59		888,068
	1,211	GCAT Trust (b)		1.555		04/25/65		1,220,398
		New Residential Mortgage Loan Trust
	1,717	(b)		3.75	(c)	11/26/35 - 08/25/55		1,833,736
	2,845	(b)		4.00	(c)	02/25/57 - 09/25/57		3,086,484
	421	OBX 2020-EXP1 Trust (b)		3.50	(c)	02/25/60		435,516
	1,120	Oceanview Mortgage Loan Trust (b)		1.733	(c)	05/28/50		1,131,807
		Seasoned Credit Risk Transfer Trust
	12,636			3.00		07/25/56 - 05/25/60		13,568,706
	1,165			4.00		08/25/58 - 02/25/59		1,290,621
	2,426			4.50		06/25/57		2,671,405
		Total Mortgages - Other (Cost $36,684,676)						38,538,858
		Municipal Bonds (13.7%)
	3,615	Bay Area Toll Authority		6.263		04/01/49		6,246,142
	3,875	City of New York, NY, Series G-1		5.968		03/01/36		5,643,472
	3,060	City of San Francisco, CA, Public Utilities Commission Water Revenue		6.00		11/01/40		4,379,631

PRINCIPAL AMOUNT (000)			COUPON RATE			MATURITY DATE	VALUE
$	5,980	Los Angeles Unified School District		5.75	%	07/01/34	$	8,428,505
	1,450	Metropolitan Transportation Authority		6.668		11/15/39		1,866,048
	6,245	Missouri Highway & Transportation Commission		5.445		05/01/33		8,227,900
	3,625	New York City, NY, Transitional Finance Authority Future Tax Secured Revenue Series A		5.267		05/01/27		4,512,219
	3,000	New York State Dormitory Authority		5.628		03/15/39		4,130,754
	1,725	North Carolina State University at Raleigh, Series B		2.62		10/01/39		1,859,343
	1,400	Onondaga Civic Development Corp., NY		3.068		12/01/55		1,442,456
	700	Pennsylvania State University/The, PA, Series D		2.84		09/01/50		733,376
	2,575	State of Oregon Department of Transportation		5.834		11/15/34		3,742,711
	1,580	State of Washington		5.481		08/01/39		2,283,301
	725	University of Virginia, VA		2.256		09/01/50		714,328
	280	University of Chicago (The), Series C		2.547		04/01/50		282,078
		Total Municipal Bonds (Cost $40,486,103)						54,492,264
		U.S. Agency Securities (8.2%)
	2,175	Federal Home Loan Bank		3.25		11/16/28		2,602,867
	6,960	Private Export Funding Corp.		4.30		12/15/21		7,231,637
		Tennessee Valley Authority
	6,935			5.25		09/15/39		10,432,774
	8,085			7.125		05/01/30		12,344,845
		Total U.S. Agency Securities (Cost $26,474,836)						32,612,123
		U.S. Treasury Securities (12.2%)
		U.S. Treasury Bonds
	3,150			2.25		08/15/46		3,596,660
	4,100			2.875		08/15/45		5,217,731
	5,850			3.00		11/15/45		7,614,826
		U.S. Treasury Notes
	27,275			1.25		08/31/24		28,298,878
	4,000			0.25		06/30/25		3,990,156
		Total U.S. Treasury Securities (Cost $46,857,705)						48,718,251

PRINCIPAL AMOUNT (000)			COUPON RATE		MATURITY DATE			VALUE
		Short-Term Investments (12.5%)
		U.S. Treasury Securities (10.7%)
		U.S. Treasury Bills
$	2,370	(e)(f)		0.088	06/03/21			$	2,369,282
	2,000	(e)		0.086	04/22/21				1,999,580
	16,250	(e)		0.101	02/25/21 - 03/04/21				16,248,033
	6,000	(e)		0.147	02/25/21				5,998,743
	16,000	(e)		0.168	02/25/21				15,996,175
		Total U.S. Treasury Securities (Cost $42,610,587)							42,611,813
NUMBER OF SHARES (000)
		Investment Company (1.8%)
	7,231	Morgan Stanley Institutional Liquidity Funds - Government Portfolio - Institutional Class (See Note 9) (Cost $7,230,667)							7,230,667
		Total Short-Term Investments (Cost $49,841,254)							49,842,480
		Total Investments (Cost $414,050,455) (g)(h)				112.2	%		447,197,717
		Liabilities in Excess of Other Assets				(12.2	)		(48,607,148	)
		Net Assets				100.0	%	$	398,590,569

AID Agency for International Development.

IO Interest Only.

LIBOR London Interbank Offered Rate.

REMIC Real Estate Mortgage Investment Conduit.

TBA To Be Announced.

(a) Security is subject to delayed delivery.

(b) 144A security - Certain conditions for public sale may exist. Unless otherwise noted, these securities are deemed to be liquid.

(c) Floating or variable rate securities: The rates disclosed are as of December 31, 2020. For securities based on a published reference rate and spread, the reference rate and spread are indicated in the description in the Portfolio of Investments. Certain variable rate securities may not be based on a published reference rate and spread but are determined by the issuer or agent and are based on current market conditions. These securities do not indicate a reference rate and spread in their description in the Portfolio of Investments.

(d) Inverse Floating Rate Security - Interest rate fluctuates with an inverse relationship to an associated interest rate. Indicated rate is the effective rate at December 31, 2020.

(e) Rate shown is the yield to maturity at December 31, 2020.

(f) All or a portion of the security was pledged to cover margin requirements for futures contracts.

(g) Securities are available for collateral in connection with purchase of securities on a forward commitment basis and open futures contracts.

(h) At December 31, 2020, the aggregate cost for federal income tax purposes is $416,494,984. The aggregate gross unrealized appreciation is $31,604,636 and the aggregate gross unrealized depreciation is $812,988, resulting in net unrealized appreciation of $30,791,648.

Futures Contracts:

The Fund had the following futures contracts open at December 31, 2020:

	NUMBER OF CONTRACTS		EXPIRATION DATE	NOTIONAL AMOUNT (000)			VALUE			UNREALIZED APPRECIATION (DEPRECIATION)
Long:
U.S. Treasury 5 yr. Note		197	Mar-21	$	19,700		$	24,854,320		$	56,463
U.S. Treasury 30 yr. Bond		1	Mar-21		100			173,188			(1,588	)
Short:
U.S. Treasury 2 yr. Note		42	Mar-21		(8,400	)		(9,281,016	)		(7,952	)
U.S. Treasury Ultra Bond		8	Mar-21		(800	)		(1,708,500	)		(9,625	)
U.S. Treasury Ultra Long Bond		107	Mar-21		(10,700	)		(16,730,453	)		51,617
										$	88,915

Currency Abbreviation:

USD - United States Dollar

Statement of Assets and Liabilities December 31, 2020

Assets:
Investments in securities, at value (cost $406,819,788)	$	439,967,050
Investment in affiliate, at value (cost $7,230,667)		7,230,667
Total investments in securities, at value (cost $414,050,455)		447,197,717
Receivable for:
Investments sold		26,270,717
Interest		1,909,597
Shares of beneficial interest sold		331,245
Dividends from affiliate		66
Prepaid expenses and other assets		42,261
Total Assets		475,751,603
Liabilities:
Payable for:
Investments purchased		75,282,200
Shares of beneficial interest redeemed		1,340,538
Advisory fee		98,322
Transfer and sub transfer agent fees		94,102
Distribution fee		80,134
Trustees' fees		54,007
Dividends to shareholders		42,444
Administration fee		29,653
Variation margin on open futures contracts		20,889
Accrued expenses and other payables		118,745
Total Liabilities		77,161,034
Net Assets	$	398,590,569
Composition of Net Assets:
Paid-in-Capital	$	370,999,167
Total Distributable Earnings	$	27,591,402
Net Assets	$	398,590,569
Class A Shares:
Net Assets	$	289,964,016
Shares Outstanding (unlimited shares authorized, $0.01 par value)		32,449,242
Net Asset Value Per Share	$	8.94
Maximum Offering Price Per Share, (net asset value plus 3.36% of net asset value)	$	9.24
Class L Shares:
Net Assets	$	6,258,553
Shares Outstanding (unlimited shares authorized, $0.01 par value)		694,882
Net Asset Value Per Share	$	9.01
Class I Shares:
Net Assets	$	91,971,442
Shares Outstanding (unlimited shares authorized, $0.01 par value)		10,287,293
Net Asset Value Per Share	$	8.94
Class C Shares:
Net Assets	$	10,396,558
Shares Outstanding (unlimited shares authorized, $0.01 par value)		1,154,190
Net Asset Value Per Share	$	9.01

Statement of Operations For the year ended December 31, 2020

Net Investment Income: Income
Interest	$	12,455,649
Dividends from affiliate (Note 9)		21,138
Total Income		12,476,787
Expenses
Advisory fee (Note 4)		1,669,684
Distribution fee (Class A shares) (Note 5)		744,753
Distribution fee (Class L shares) (Note 5)		33,145
Distribution fee (Class C shares) (Note 5)		86,404
Administration fee (Note 4)		318,035
Sub transfer agent fees and expenses (Class A shares)		158,480
Sub transfer agent fees and expenses (Class L shares)		4,516
Sub transfer agent fees and expenses (Class I shares)		75,495
Sub transfer agent fees and expenses (Class C shares)		6,375
Transfer agent fees and expenses (Class A shares) (Note 8)		152,122
Transfer agent fees and expenses (Class L shares) (Note 8)		4,522
Transfer agent fees and expenses (Class I shares) (Note 8)		21,923
Transfer agent fees and expenses (Class C shares) (Note 8)		3,570
Professional fees		175,442
Registration fees		77,968
Shareholder reports and notices		64,925
Custodian fees (Note 7)		37,676
Trustees' fees and expenses		12,072
Other		75,219
Total Expenses		3,722,326
Less: waiver of Advisory fees (Note 4)		(363,792	)
Less: reimbursement of class specific expenses (Class A shares) (Note 4)		(72,958	)
Less: reimbursement of class specific expenses (Class L shares) (Note 4)		(2,160	)
Less: reimbursement of class specific expenses (Class I shares) (Note 4)		(97,366	)
Less: reimbursement of class specific expenses (Class C shares) (Note 4)		(921	)
Less: rebate from Morgan Stanley affiliated cash sweep (Note 9)		(13,333	)
Net Expenses		3,171,796
Net Investment Income		9,304,991
Realized and Unrealized Gain (Loss): Realized Gain (Loss) on:
Investments		1,711,408
Futures contracts		(533,491	)
Net Realized Gain		1,177,917
Change in Unrealized Appreciation (Depreciation) on:
Investments		10,143,855
Futures contracts		39,128
Net Change in Unrealized Appreciation (Depreciation)		10,182,983
Net Gain		11,360,900
Net Increase	$	20,665,891

Statements of Changes in Net Assets

	FOR THE YEAR ENDED DECEMBER 31, 2020			FOR THE YEAR ENDED DECEMBER 31, 2019
Increase (Decrease) in Net Assets:
Operations:
Net investment income	$	9,304,991		$	11,788,626
Net realized gain		1,177,917			455,785
Net change in unrealized appreciation (depreciation)		10,182,983			12,155,836
Net Increase		20,665,891			24,400,247
Dividends to Shareholders from Net Investment Income:
Class A shares		(7,297,311	)		(7,356,479	)
Class B shares*		—			(2,167,467	)
Class L shares		(142,980	)		(199,583	)
Class I shares		(2,315,642	)		(2,296,938	)
Class C shares		(134,112	)		(41,155	)
Total Dividends and Distributions to Shareholders		(9,890,045	)		(12,061,622	)
Net increase (decrease) from transactions in shares of beneficial interest		17,867,945			(35,405,265	)
Net Increase (Decrease)		28,643,791			(23,066,640	)
Net Assets:
Beginning of period		369,946,778			393,013,418
End of Period	$	398,590,569		$	369,946,778

* All Class B shares were redeemed/converted to class A shares as of July 29, 2019.

1. Organization and Accounting Policies

Morgan Stanley U.S. Government Securities Trust (the "Fund") is registered under the Investment Company Act of 1940, as amended (the "Act"), as a diversified, open-end management investment company. The Fund applies investment company accounting and reporting guidance. The Fund's investment objective is to seek a high level of current income consistent with safety of principal. The Fund was organized as a Massachusetts business trust on September 29, 1983 and commenced operations on June 29, 1984. On July 28, 1997, the Fund converted to a multiple class share structure.

The Fund offers Class A shares, Class B shares, Class L shares, Class I shares and Class C shares. The five classes are substantially the same except that most Class A shares are subject to a sales charge imposed at the time of purchase and some Class A shares, most Class B shares and most Class C shares are subject to a contingent deferred sales charge imposed on shares redeemed within eighteen months, six years and one year, respectively. Class L shares and Class I shares are not subject to a sales charge. Additionally, Class A shares, Class L shares and Class C shares incur distribution expenses. As of this reporting period, all Class B shares were redeemed/converted to Class A shares and there were no shares outstanding. Accordingly, no financial highlights have been presented for Class B.

The Fund suspended offering Class L shares to all investors (April 30, 2015). Class L shareholders of the Fund do not have the option of purchasing additional Class L shares. However, the existing Class L shareholders may invest through reinvestment of dividends and distributions. In addition, Class L shares of the Fund may be exchanged for Class L shares of any Morgan Stanley Multi-Class Fund, even though Class L shares are closed to investors.

The following is a summary of significant accounting policies:

In March 2020, the Financial Accounting Standards Board ("FASB") issued an Accounting Standard Update, ASU 2020-04, Reference Rate Reform (Topic 848) — Facilitation of the Effects of Reference Rate Reform on Financial Reporting ("ASU 2020-04"), which provides optional, temporary relief with respect to the financial reporting of contracts subject to certain types of modifications due to the planned discontinuation of the London Interbank Offered Rate ("LIBOR") and other IBOR-based reference rates at the end of 2021. The temporary relief provided by ASU 2020-04 is effective for certain reference rate-related contract modifications that occur during the period from March 12, 2020 through December 31, 2022. Management is evaluating the impact of ASU 2020-04 on the Fund's investments, derivatives, debt and other contracts that will undergo reference rate-related modifications as a result of the reference rate reform.

A. Valuation of Investments — (1) Certain portfolio securities may be valued by an outside pricing service/vendor approved by the Fund's Board of Trustees (the "Trustees"). The pricing service/vendor may employ a pricing model that takes into account, among other things, bids, yield spreads and/or other market data and specific security characteristics. Alternatively, if a valuation is not available from an outside pricing service/vendor, and the security trades on an exchange, the security may be valued at its latest reported sale price (or at the exchange official closing price if such exchange reports an official closing price), prior to the time when assets are valued. If there are no sales on a given day and if there is no official exchange closing price for that day, the security is valued at the mean between the last reported bid and asked prices if such bid and asked prices are available in the relevant exchanges. If only bid prices are available then the latest bid price may be used. If Morgan Stanley Investment Management Inc. (the "Adviser"), a wholly-owned subsidiary of Morgan Stanley, determines that the price provided by the outside pricing service/vendor or exchange does not reflect the security's fair value or is unable to provide a price, prices from brokers or dealers may also be utilized. In these circumstances, the value of the security will be the mean of bid and asked prices obtained from brokers or dealers; (2) portfolio securities for which over-the-counter ("OTC") market quotations are readily available are valued at its latest reported sales price (or at the market official closing price if such market reports an official closing price), and if there was no trading in the security on a given day and if there is no official closing price from relevant markets for that day, the security is valued at the mean between the last reported bid and asked prices if such bid and asked prices are available on the relevant markets; (3) when market quotations are not readily available, including circumstances under which the Adviser determines that the market quotations are not reflective of a security's market value, portfolio securities are valued at their fair value as determined in good faith under procedures established by and under the general supervision of the Trustees; (4) futures are valued at the settlement price on the exchange on which they trade or, if a settlement price is unavailable, at the last sale price on the exchange; and (5) investments in mutual funds, including the Morgan Stanley Institutional Liquidity Funds, are valued at the net asset value ("NAV") as of the close of each business day.

The Trustees have responsibility for determining in good faith the fair value of the investments, and the Trustees may appoint others, such as the Fund's Adviser or a valuation committee, to assist the Trustees in determining fair value and to make the actual calculations pursuant to the fair valuation methodologies previously approved by the Trustees. Under procedures approved by the Trustees, the Fund's Adviser has formed a Valuation Committee whose members are approved by the Trustees. The Valuation Committee provides administration and oversight of the Fund's valuation policies and procedures, which are reviewed at least annually by the Trustees. These procedures allow the Fund to utilize independent pricing services, quotations from securities and financial instrument dealers and other market sources to determine fair value.

B. Accounting for Investments — Security transactions are accounted for on the trade date (date the order to buy or sell is executed). Realized gains and losses on security transactions are determined by the identified cost method. Dividend income and other distributions are recorded on the ex-dividend date. Discounts are accreted and premiums are amortized over the life of the respective securities and are included in interest income. Interest income is accrued daily as earned.

C. Multiple Class Allocations — Investment income, realized and unrealized gain (loss) and non-class specific expenses are allocated daily based upon the proportion of net assets of each class. Class specific expenses are borne by the respective share classes and include Distribution, Transfer Agent and Sub Transfer Agent fees.

D. Dividends and Distributions to Shareholders — Dividends and distributions to shareholders are recorded on the ex-dividend date. Dividends from net investment income, if any, are declared daily and paid monthly. Net realized capital gains, if any, are distributed at least annually.

E. When-Issued/Delayed Delivery Securities — The Fund may purchase or sell when-issued and delayed delivery securities. Securities purchased on a when-issued or delayed delivery basis are purchased for delivery beyond the normal settlement date at a stated price, and no income accrues to the Fund on such securities prior to delivery date. Payment and delivery for when-issued and delayed delivery securities can take place a month or more after the date of the transaction. When the Fund enters into a purchase transaction on a when-issued or delayed delivery basis, securities are available for collateral in an amount at least equal in value to the Fund's commitments to purchase such securities. Purchasing securities on a when-issued or delayed delivery basis may involve a risk that the market price at the time of delivery may be lower than the agreed upon purchase price, in which case there could be an unrealized loss at the time of delivery. Purchasing investments on a when-issued or delayed delivery basis may be considered a form of leverage which may increase the impact that gains (losses) may have on the Fund.

F. Use of Estimates — The preparation of financial statements in accordance with generally accepted accounting principles in the United States ("GAAP") requires management to make estimates and assumptions that affect the reported amounts and disclosures. Actual results could differ from those estimates.

G. Indemnifications — The Fund enters into contracts that contain a variety of indemnifications. The Fund's maximum exposure under these arrangements is unknown. However, the Fund has not had prior claims or losses pursuant to these contracts and expects the risk of loss to be remote.

2. Fair Valuation Measurements

FASB Accounting Standards Codification^TM ("ASC") 820, "Fair Value Measurement" ("ASC 820"), defines fair value as the value that the Fund would receive to sell an investment or pay to transfer a liability in a timely transaction with an independent buyer in the principal market, or in the absence of a principal market, the most advantageous market for the investment or liability. ASC 820 establishes a three-tier hierarchy to distinguish between (1) inputs that reflect the assumptions market participants would use in valuing an asset or liability developed based on market data obtained from sources independent of the reporting entity (observable inputs); and (2) inputs that reflect the reporting entity's own assumptions about the assumptions market participants would use in valuing an asset or liability developed based on the best information available in the circumstances (unobservable inputs) and to establish classification of fair value measurements for disclosure purposes. Various inputs are used in determining the value of the Fund's investments. The inputs are summarized in the three broad levels listed below:

• Level 1 — unadjusted 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. Factors considered in making this determination may include, but are not limited to, information obtained by contacting the issuer, analysts, or the appropriate stock exchange (for exchange-traded securities), analysis of the issuer's financial statements or other available documents and, if necessary, available information concerning other securities in similar circumstances.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities and the determination of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to each security.

The following is a summary of the inputs used to value the Fund's investments as of December 31, 2020:

INVESTMENT TYPE	LEVEL 1 UNADJUSTED QUOTED PRICES		LEVEL 2 OTHER SIGNIFICANT OBSERVABLE INPUTS		LEVEL 3 SIGNIFICANT UNOBSERVABLE INPUTS		TOTAL
Assets:
Fixed Income Securities
Agency Adjustable Rate Mortgages	$	—	$	2,287,195	$	—	$	2,287,195
Agency Bond — Finance (U.S. Government Guaranteed)		—		1,195,613		—		1,195,613

INVESTMENT TYPE	LEVEL 1 UNADJUSTED QUOTED PRICES			LEVEL 2 OTHER SIGNIFICANT OBSERVABLE INPUTS		LEVEL 3 SIGNIFICANT UNOBSERVABLE INPUTS		TOTAL
Assets (cont'd):
Fixed Income Securities (cont'd)
Agency Bonds — Sovereign (U.S. Government Guaranteed)	$	—		$	18,545,092	$	—	$	18,545,092
Agency Fixed Rate Mortgages		—			143,570,190		—		143,570,190
Asset-Backed Securities		—			9,436,750		—		9,436,750
Collateralized Mortgage Obligations — Agency Collateral Series		—			32,688,982		—		32,688,982
Commercial Mortgage-Backed Securities		—			15,269,919		—		15,269,919
Mortgages — Other		—			38,538,858		—		38,538,858
Municipal Bonds		—			54,492,264		—		54,492,264
U.S. Agency Securities		—			32,612,123		—		32,612,123
U.S. Treasury Securities		—			48,718,251		—		48,718,251
Total Fixed Income Securities		—			397,355,237		—		397,355,237
Short-Term Investments
U.S. Treasury Securities		—			42,611,813		—		42,611,813
Investment Company		7,230,667			—		—		7,230,667
Total Short-Term Investments		7,230,667			42,611,813		—		49,842,480
Futures Contracts		108,080			—		—		108,080
Total Assets		7,338,747			439,967,050		—		447,305,797
Liabilities:
Futures Contracts		(19,165	)		—		—		(19,165	)
Total	$	7,319,582		$	439,967,050	$	—	$	447,286,632

Transfers between investment levels may occur as the markets fluctuate and/or the availability of data used in an investment's valuation changes.

3. Derivatives

The Fund may, but it is not required to, use derivative instruments for a variety of purposes, including hedging, risk management, portfolio management or to earn income. Derivatives are financial instruments whose value is based, in part, on the value of an underlying asset, interest rate, index or financial instrument. Prevailing interest rates and volatility levels, among other things, also affect the value of derivative instruments. A derivative instrument often has risks similar to its underlying asset and may have additional risks, including imperfect correlation between the value of the derivative and the underlying asset, risks of default by the counterparty to certain transactions, magnification of

losses incurred due to changes in the market value of the securities, instruments, indices or interest rates to which the derivative instrument relates, risks that the transactions may not be liquid and risks arising from margin requirements. The use of derivatives involves risks that are different from, and possibly greater than, the risks associated with other portfolio investments. Derivatives may involve the use of highly specialized instruments that require investment techniques and risk analyses different from those associated with other portfolio investments. All of the Fund's holdings, including derivative instruments, are marked-to-market each day with the change in value reflected in unrealized appreciation (depreciation). Upon disposition, a realized gain or loss is recognized.

Certain derivative transactions may give rise to a form of leverage. Leverage magnifies the potential for gain and risk of loss. Leverage associated with derivative transactions may cause the Fund to liquidate portfolio positions when it may not be advantageous to do so to satisfy its obligations or to meet earmarking or segregation requirements, pursuant to applicable Securities and Exchange Commission rules and regulations, or may cause the Fund to be more volatile than if the Fund had not been leveraged. Although the Adviser seeks to use derivatives to further the Fund's investment objectives, there is no assurance that the use of derivatives will achieve this result.

Following is a description of the derivative instruments and techniques that the Fund used during the period and their associated risks:

Futures — A futures contract is a standardized, exchange-traded agreement to buy or sell a specific quantity of an underlying asset, reference rate or index at a specific price at a specific future time. The value of a futures contract tends to increase and decrease in tandem with the value of the underlying instrument. Depending on the terms of the particular contract, futures contracts are settled through either physical delivery of the underlying instrument on the settlement date or by payment of a cash settlement amount on the settlement date. During the period the futures contract is open, payments are received from or made to the broker based upon changes in the value of the contract (the variation margin). A decision as to whether, when and how to use futures contracts involves the exercise of skill and judgment and even a well-conceived futures transaction may be unsuccessful because of market behavior or unexpected events. In addition to the derivatives risks discussed above, the prices of futures contracts can be highly volatile, using futures contracts can lower total return and the potential loss from futures contracts can exceed the Fund's initial investment in such contracts. No assurance can be given that a liquid market will exist for any particular futures contract at any particular time. There is also the risk of loss by the Fund of margin deposits in the event of bankruptcy of a broker with which the Fund has open positions in the futures contract.

FASB ASC 815, "Derivatives and Hedging" ("ASC 815"), is intended to improve financial reporting about derivative instruments by requiring enhanced disclosures to enable investors to better understand how

and why the Fund uses derivative instruments, how these derivative instruments are accounted for and their effects on the Fund's financial position and results of operations.

The following table sets forth the fair value of the Fund's derivative contracts by primary risk exposure as of December 31, 2020:

PRIMARY RISK EXPOSURE

ASSET DERIVATIVES
STATEMENT OF ASSETS
AND LIABILITIES LOCATION

FAIR VALUE

LIABILITY DERIVATIVES
STATEMENT OF ASSETS
AND LIABILITIES LOCATION

FAIR VALUE

Interest Rate Risk

Variation margin on open
futures contracts

108,080

(a)

Variation margin on open
futures contracts

(19,165

)(a)

(a) Includes cumulative appreciation (depreciation) as reported in the Portfolio of Investments. Only current day's net variation margin is reported within the Statement of Assets and Liabilities.

The following tables set forth by primary risk exposure the Fund's realized gains (losses) and change in unrealized appreciation (depreciation) by type of derivative contract for the year ended December 31, 2020 in accordance with ASC 815:

AMOUNT OF REALIZED GAIN (LOSS) ON DERIVATIVES

PRIMARY RISK EXPOSURE				FUTURES CONTRACTS
Interest Rate Risk				$	(533,491	)

CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON DERIVATIVES

PRIMARY RISK EXPOSURE				FUTURES CONTRACTS
Interest Rate Risk				$	39,128

For the year ended December 31, 2020, the average monthly amount outstanding for each derivative type is as follows:

Futures Contracts:
Average monthly notional value				$	89,824,239

4. Advisory/Administration Agreements

Pursuant to an Investment Advisory Agreement with the Adviser, the Fund pays an advisory fee, accrued daily and paid monthly, by applying the following annual rates to the net assets of the Fund determined as of the close of each business day: 0.42% to the portion of the daily net assets not exceeding $1 billion; 0.395% to the portion of the daily net assets exceeding $1 billion but not exceeding $1.5 billion; 0.37% to the portion of the daily net assets exceeding $1.5 billion but not exceeding $2 billion; 0.345% to the portion of the daily net assets exceeding $2 billion but not exceeding $2.5 billion; 0.32% to the portion of the daily net assets exceeding $2.5 billion but not exceeding

$5 billion; 0.295% to the portion of the daily net assets exceeding $5 billion but not exceeding $7.5 billion; 0.27% to the portion of the daily net assets exceeding $7.5 billion but not exceeding $10 billion; 0.245% to the portion of the daily net assets exceeding $10 billion but not exceeding $12.5 billion; and 0.22% to the portion of the daily net assets exceeding $12.5 billion. For the year ended December 31, 2020, the advisory fee rate (net of waiver/rebate) was equivalent to an annual effective rate of 0.33% of the Fund's average daily net assets.

The Adviser also serves as the Administrator to the Fund and provides administrative services pursuant to an Administration Agreement for an annual fee, accrued daily and paid monthly, of 0.08% of the Fund's average daily net assets.

Under a Sub-Administration Agreement between the Administrator and State Street Bank and Trust Company ("State Street"), State Street provides certain administrative services to the Fund. For such services, the Administrator pays State Street a portion of the fee the Administrator receives from the Fund.

The Adviser/Administrator has agreed to reduce its advisory fee, its administration fee and/or reimburse the Fund so that total annual operating expenses, excluding certain investment related expenses, taxes, interest and other extraordinary expenses (including litigation), will not exceed 0.85% for Class A, 1.12% for Class L, 0.52% for Class I and 1.62% for Class C shares. The fee waivers and/or expense reimbursements will continue for at least one year from the date of the Fund's prospectus or until such time that the Trustees act to discontinue all or a portion of such waivers and/or expense reimbursements when they deem such action is appropriate. For the year ended December 31, 2020, $363,792 of advisory fees were waived and $173,405 of other expenses were reimbursed by the Adviser pursuant to this arrangement.

5. Plan of Distribution

Shares of the Fund are distributed by Morgan Stanley Distribution, Inc. (the "Distributor"), an affiliate of the Adviser/Administrator. The Fund has adopted a Plan of Distribution (the "Plan") pursuant to Rule 12b-1 under the Act. The Plan provides that the Fund will pay the Distributor a fee which is accrued daily and paid monthly at the following annual rates: (i) Class A — up to 0.25% of the average daily net assets of Class A shares; (ii) Class L — up to 0.50% of the average daily net assets of Class L shares; and (iii) Class C — up to 1.00% of the average daily net assets of Class C shares.

In the case of Class A shares, Class L shares and Class C shares, expenses incurred pursuant to the Plan in any calendar year in excess of 0.25%, 0.50% and 1.00% of the average daily net assets of Class A shares, Class L shares and Class C shares, respectively, will not be reimbursed by the Fund through payments in any subsequent year, except that expenses representing a gross sales commission credited to Financial Intermediaries at the time of sale may be reimbursed in the subsequent calendar year. For the year ended December 31, 2020, the distribution fee was accrued for Class A shares, Class L shares and Class C shares at the annual rate of 0.25%, 0.50% and 1.00%, respectively.

The Distributor has informed the Fund that for the year ended December 31, 2020, it received contingent deferred sales charges from certain redemptions of the Fund's Class A shares and Class C shares of $4,748 and $4,338, respectively, and received $59,168 in front-end sales charges from sales of the Fund's Class A shares. The respective shareholders pay such charges, which are not an expense of the Fund.

6. Shares of Beneficial Interest

Transactions in shares of beneficial interest were as follows:

	FOR THE YEAR ENDED DECEMBER 31, 2020						FOR THE YEAR ENDED DECEMBER 31, 2019
	SHARES			AMOUNT			SHARES			AMOUNT
CLASS A SHARES
Sold		2,304,438		$	20,558,014			1,790,801		$	15,389,135
Conversion from Class B		—			—			31,765,057			270,926,924
Reinvestment of dividends		785,009			7,005,086			811,274			7,035,306
Redeemed		(4,680,335	)		(41,749,303	)		(4,429,474	)		(38,341,753	)
Net increase (decrease) — Class A		(1,590,888	)		(14,186,203	)		29,937,658			255,009,612
CLASS B SHARES*
Exchanged		—			—			10,979			92,520
Conversion to Class A		—			—			(31,766,804	)		(270,926,924	)
Reinvestment of dividends		—			—			233,941			1,977,399
Redeemed		—			—			(1,963,964	)		(16,629,265	)
Net decrease — Class B		—			—			(33,485,848	)		(285,486,270	)
CLASS L SHARES
Exchanged		13,234			119,527			281			2,510
Reinvestment of dividends		15,717			141,334			22,690			197,181
Redeemed		(96,095	)		(863,002	)		(135,335	)		(1,173,793	)
Net decrease — Class L		(67,144	)		(602,141	)		(112,364	)		(974,102	)
CLASS I SHARES
Sold		4,760,448			42,618,222			613,936			5,309,687
Reinvestment of dividends		244,059			2,180,115			257,417			2,221,212
Redeemed		(2,269,227	)		(20,266,239	)		(1,340,630	)		(11,583,457	)
Net increase (decrease) — Class I		2,735,280			24,532,098			(469,277	)		(4,052,558	)
CLASS C SHARES
Sold		1,692,978			15,191,754			238,169			2,075,757
Reinvestment of dividends		14,839			133,890			4,708			40,917
Redeemed		(800,794	)		(7,201,453	)		(233,099	)		(2,018,621	)
Net increase — Class C		907,023			8,124,191			9,778			98,053
Net increase (decrease) in Fund		1,984,271		$	17,867,945			(4,120,053	)	$	(35,405,265	)

* All Class B shares were redeemed/converted to class A shares as of July 29, 2019.

7. Custodian Fees

State Street (the "Custodian") also serves as Custodian for the Fund in accordance with a Custodian Agreement. The Custodian holds cash, securities and other assets of the Fund as required by the Act. Custody fees are payable monthly based on assets held in custody, investment purchases and sales activity and account maintenance fees, plus reimbursement for certain out-of-pocket expenses.

8. Dividend Disbursing and Transfer Agent

The Fund's dividend disbursing and transfer agent is DST Asset Manager Solutions, Inc. ("DST"). Pursuant to a Transfer Agency Agreement, the Fund pays DST a fee based on the number of classes, accounts and transactions relating to the Fund.

9. Security Transactions and Transactions with Affiliates

The cost of purchases and proceeds from sales of investment securities, excluding short-term investments, for the year ended December 31, 2020, aggregated $751,947,154 and $731,539,926, respectively. Included in the aforementioned are purchases and sales of U.S. Government securities of $715,028,347 and $698,138,344, respectively.

The Fund invests in the Institutional Class of the Morgan Stanley Institutional Liquidity Funds — Government Portfolio (the "Liquidity Funds"), an open-end management investment company managed by the Adviser. Advisory fees paid by the Fund are reduced by an amount equal to its pro-rata share of the advisory and administration fees paid by the Fund due to its investment in the Liquidity Funds. For the year ended December 31, 2020, advisory fees paid were reduced by $13,333 relating to the Fund's investment in the Liquidity Funds.

A summary of the Fund's transactions in shares of affiliated investments during the year ended December 31, 2020 is as follows:

AFFILIATED INVESTMENT COMPANY				VALUE DECEMBER 31, 2019				PURCHASES AT COST				PROCEEDS FROM SALES				DIVIDEND INCOME				REALIZED GAIN (LOSS)				CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION)				VALUE DECEMBER 31, 2020
Liquidity Funds				$	7,529,619			$	150,075,560			$	150,374,512			$	21,138			$	—			$	—			$	7,230,667

The Fund has an unfunded noncontributory defined benefit pension plan covering certain independent Trustees of the Fund who will have served as independent Trustees for at least five years at the time of retirement. Benefits under this plan are based on factors which include years of service and compensation. The Trustees voted to close the plan to new participants and eliminate the future benefits growth due to increases to compensation after July 31, 2003. Aggregate pension costs for

the year ended December 31, 2020, included in "Trustees' fees and expenses" in the Statement of Operations amounted to $1,354. At December 31, 2020, the Fund had an accrued pension liability of $54,007, which is reflected as "Trustees' fees" in the Statement of Assets and Liabilities.

The Fund is permitted to purchase and sell securities ("cross-trade") from and to other Morgan Stanley funds as well as other funds and client accounts for which the Adviser or an affiliate of the Adviser serves as investment adviser, pursuant to procedures approved by the Trustees in compliance with Rule 17a-7 under the Act (the "Rule"). Each cross-trade is executed at the current market price in compliance with provisions of the Rule. For the year ended December 31, 2020, the Fund did not engage in any cross-trade transactions.

The Fund has an unfunded Deferred Compensation Plan (the "Compensation Plan"), which allows each independent Trustee to defer payment of all, or a portion, of the fees he or she receives for serving on the Board of Trustees. Each eligible Trustee generally may elect to have the deferred amounts credited with a return equal to the total return on one or more of the Morgan Stanley funds that are offered as investment options under the Compensation Plan. Appreciation/depreciation and distributions received from these investments are recorded with an offsetting increase/decrease in the deferred compensation obligation and do not affect the NAV of the Fund.

10. Federal Income Tax Status

It is the Fund's intention to continue to qualify as a regulated investment company and distribute all of its taxable and tax-exempt income. Accordingly, no provision for federal income taxes is required in the financial statements.

The Fund may be subject to taxes imposed by countries in which it invests. Such taxes are generally based on income and/or capital gains earned or repatriated. Taxes are accrued based on net investment income, net realized gains and net unrealized appreciation as such income and/or gains are earned. Taxes may also be based on transactions in foreign currency and are accrued based on the value of investments denominated in such currency.

FASB ASC 740-10, "Income Taxes — Overall", sets forth a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. Management has concluded there are no significant uncertain tax positions that would require recognition in the financial statements. If applicable, the Fund recognizes interest accrued related to unrecognized tax benefits in "Interest Expense" and penalties in "Other Expenses" in the Statement of Operations. The Fund files tax returns with the U.S. Internal Revenue Service, New York and various states. Generally, each of the tax years in the four-year period ended December 31, 2020 remains subject to examination by taxing authorities.

The tax character of distributions paid may differ from the character of distributions shown for GAAP purposes due to short-term capital gains being treated as ordinary income for tax purposes. The tax character of distributions paid during fiscal years 2020 and 2019 was as follows:

2020 DISTRIBUTIONS PAID FROM:		2019 DISTRIBUTIONS PAID FROM:
ORDINARY INCOME		ORDINARY INCOME
$	9,890,045	$	12,061,622

The amount and character of income and gains to be distributed are determined in accordance with income tax regulations which may differ from GAAP. These book/tax differences are either considered temporary or permanent in nature.

Temporary differences are attributable to differing book and tax treatments for the timing of the recognition of gains (losses) on certain investment transactions and the timing of the deductibility of certain expenses.

The Fund had no permanent differences causing reclassifications among the components of net assets for the year ended December 31, 2020.

At December 31, 2020, the components of distributable earnings for the Fund on a tax basis were as follows:

UNDISTRIBUTED ORDINARY INCOME				UNDISTRIBUTED LONG-TERM CAPITAL GAIN
$	1,718,528			$	—

At December 31, 2020, the Fund had available for federal income tax purposes unused long term capital losses of $4,632,581 that do not have an expiration date.

To the extent that capital loss carryforwards are used to offset any future capital gains realized, no capital gains tax liability will be incurred by the Fund for gains realized and not distributed. To the extent that capital gains are offset, such gains will not be distributed to the shareholders. During the year ended December 31, 2020, the Fund utilized capital loss carryforwards for U.S. federal income tax purposes of $1,139,364.

11. Market Risk and Risks Relating to Certain Financial Instruments

The Fund may invest in mortgage securities, including securities issued by the Federal National Mortgage Association ("FNMA") and Federal Home Loan Mortgage Corporation ("FHLMC"). These are

fixed income securities that derive their value from or represent interests in a pool of mortgages or mortgage securities. An unexpectedly high rate of defaults on the mortgages held by a mortgage pool may adversely affect the value of a mortgage-backed security and could result in losses to the Fund. The risk of such defaults is generally higher in the case of mortgage pools that include sub-prime mortgages. Sub-prime mortgages refer to loans made to borrowers with weakened credit histories or with a lower capacity to make timely payments on their mortgages. The securities held by the Fund are not backed by sub-prime mortgages.

Additionally, securities issued by FNMA and FHLMC are not backed by or entitled to the full faith and credit of the United States; rather, they are supported by the right of the issuer to borrow from the U.S. Department of the Treasury.

The Federal Housing Finance Agency ("FHFA") serves as conservator of FNMA and FHLMC and the U.S. Department of the Treasury has agreed to provide capital as needed to ensure FNMA and FHLMC continue to provide liquidity to the housing and mortgage markets.

Certain impacts to public health conditions particular to the coronavirus (COVID-19) outbreak could impact the operations and financial performance of certain of the Fund's investments. The extent of the impact to the financial performance of the Fund's investments will depend on future developments, including (i) the duration and spread of the outbreak, (ii) the restrictions and advisories, (iii) the effects on the financial markets, and (iv) the effects on the economy overall, all of which are highly uncertain and cannot be predicted. If the financial performance of the Fund's investments is impacted because of these factors for an extended period, the Fund's investment results may be adversely affected.

12. Credit Facility

The Fund and other Morgan Stanley funds participated in a $300,000,000 committed, unsecured revolving line of credit facility (the "Facility") with State Street. This Facility is to be used for temporary emergency purposes or funding of shareholder redemption requests. The interest rate on borrowings is based on the federal funds rate or 1 month LIBOR rate plus a spread. The Facility also has a commitment fee of 0.25% per annum based on the unused portion of the Facility. During the year ended December 31, 2020, the Fund did not have any borrowings under the Facility.

13. Other

At December 31, 2020, the Fund had record owners of 10% or greater. Investment activities of these shareholders could have a material impact on the Fund. The aggregate percentage of such owners was 47.0%.

14. LIBOR Risk

The Fund's investments, payment obligations and financing terms may be based on floating rates, such as London Interbank Offer Rate ("LIBOR"), Euro Interbank Offered Rate and other similar types of reference rates (each, a "Reference Rate"). These Reference Rates are generally intended to represent the rate at which contributing banks may obtain short-term borrowings from each other within certain financial markets. On July 27, 2017, the Chief Executive of the UK Financial Conduct Authority ("FCA"), which regulates LIBOR, announced that the FCA will no longer persuade nor require banks to submit rates for the calculation of LIBOR and certain other Reference Rates after 2021. Such announcement indicates that the continuation of LIBOR and other Reference Rates on the current basis cannot and will not be guaranteed after the end of 2021. This announcement and any additional regulatory or market changes may have an adverse impact on the Fund or its investments.

In advance of 2022, regulators and market participants are currently engaged in identifying successor Reference Rates ("Alternative Reference Rates"). Additionally, prior to the end of 2021, it is expected that market participants will focus on the transition mechanisms by which the Reference Rates in existing contracts or instruments may be amended, whether through marketwide protocols, fallback contractual provisions, bespoke negotiations or amendments or otherwise. Nonetheless, the termination of certain Reference Rates presents risks to the Fund. At this time, it is not possible to completely identify or predict the effect of any such changes, any establishment of Alternative Reference Rates or any other reforms to Reference Rates that may be enacted in the UK or elsewhere. The elimination of a Reference Rate or any other changes or reforms to the determination or supervision of Reference Rates could have an adverse impact on the market for or value of any securities or payments linked to those Reference Rates and other financial obligations held by the Fund or on its overall financial condition or results of operations.

	FOR THE YEAR ENDED DECEMBER 31,
	2020			2019			2018			2017			2016⁽¹⁾
Class A Shares
Selected Per Share Data:
Net asset value, beginning of period	$	8.68		$	8.41		$	8.67		$	8.68		$	8.71
Income (loss) from investment operations:
Net investment income		0.20			0.27			0.25			0.24			0.25
Net realized and unrealized gain (loss)		0.28			0.27			(0.26	)		(0.01	)		(0.04	)
Total income (loss) from investment operations		0.48			0.54			(0.01	)		0.23			0.21
Less dividends from net investment income		(0.22	)		(0.27	)		(0.25	)		(0.24	)		(0.24	)
Net asset value, end of period	$	8.94		$	8.68		$	8.41		$	8.67		$	8.68
Total Return⁽²⁾		5.55	%		6.43	%		(0.01	)%		2.66	%		2.40	%⁽³⁾
Ratios to Average Net Assets:
Net expenses		0.85	%⁽⁴⁾⁽⁶⁾		0.85	%^(4)(5)(6)		0.87	%⁽⁴⁾⁽⁶⁾		0.86	%⁽⁴⁾⁽⁶⁾		0.87	%⁽⁴⁾⁽⁷⁾
Net investment income		2.32	%⁽⁴⁾⁽⁶⁾		2.97	%⁽⁴⁾⁽⁶⁾		3.01	%⁽⁴⁾⁽⁶⁾		2.79	%⁽⁴⁾⁽⁶⁾		2.66	%⁽⁴⁾⁽⁷⁾
Rebate from Morgan Stanley affiliate		0.00	%⁽⁸⁾		0.00	%⁽⁸⁾		0.00	%⁽⁸⁾		0.01	%		0.00	%⁽⁸⁾
Supplemental Data:
Net assets, end of period, in thousands	$	289,964		$	295,522		$	34,504		$	38,438		$	42,375
Portfolio turnover rate		189	%		167	%		159	%		179	%		279	%

(1) Reflects prior period custodian out-of-pocket expenses that were reimbursed in September 2016. The amount of the reimbursement was immaterial on a per share basis and did not impact the total return of Class A shares.

(2) Does not reflect the deduction of sales charge. Calculated based on the net asset value as of the last business day of the period.

(3) Performance was positively impacted by approximately 0.68% for Class A shares due to the receipt of proceeds from the settlements of class action suits involving the Fund's past holdings. There were one-time settlements, and as a result, the impact on the NAV and consequently the performance will not likely be repeated in the future. Had these settlements not occurred, the total return for Class A shares would have been approximately 1.72%.

(4) The ratios reflect the rebate of certain Fund expenses in connection with investments in a Morgan Stanley affiliate during the period. The effect of the rebate on the ratios is disclosed in the above table as "Rebate from Morgan Stanley affiliate."

(5) Effective February 28, 2019, the Adviser has agreed to limit the ratio of expenses to average net assets to the maximum ratio of 0.85% for Class A shares. Prior to February 28, 2019, the maximum ratio was 0.87% for Class A shares.

(6) If the Fund had borne all of its expenses that were waived by the Adviser/Administrator, the annualized expense and net investment income ratios would have been as follows:

PERIOD ENDED	EXPENSE RATIO			NET INVESTMENT INCOME RATIO
December 31, 2020		0.97	%		2.20	%
December 31, 2019		0.99			2.83
December 31, 2018		1.02			2.86
December 31, 2017		1.08			2.57

(7) If the Fund had not received the reimbursement from the custodian and had borne all of its expenses that were waived by the Adviser/Administrator, the annualized expense and net investment income ratios would have been as follows:

PERIOD ENDED				EXPENSE RATIO				NET INVESTMENT INCOME RATIO
December 31, 2016					1.19	%			2.34	%

(8) Amount is less than 0.005%.

	FOR THE YEAR ENDED DECEMBER 31,
	2020			2019			2018			2017			2016⁽¹⁾
Class L Shares
Selected Per Share Data:
Net asset value, beginning of period	$	8.75		$	8.48		$	8.73		$	8.75		$	8.77
Income (loss) from investment operations:
Net investment income		0.18			0.24			0.23			0.22			0.23
Net realized and unrealized gain (loss)		0.27			0.27			(0.25	)		(0.02	)		(0.03	)
Total income (loss) from investment operations		0.45			0.51			(0.02	)		0.20			0.20
Less dividends from net investment income		(0.19	)		(0.24	)		(0.23	)		(0.22	)		(0.22	)
Net asset value, end of period	$	9.01		$	8.75		$	8.48		$	8.73		$	8.75
Total Return⁽²⁾		5.21	%		6.09	%		(0.25	)%		2.38	%		2.24	%⁽³⁾
Ratios to Average Net Assets:
Net expenses		1.12	%⁽⁴⁾⁽⁵⁾		1.12	%⁽⁴⁾⁽⁵⁾		1.10	%⁽⁴⁾⁽⁵⁾		1.11	%⁽⁴⁾⁽⁵⁾		1.12	%⁽⁴⁾⁽⁶⁾
Net investment income		2.02	%⁽⁴⁾⁽⁵⁾		2.73	%⁽⁴⁾⁽⁵⁾		2.74	%⁽⁴⁾⁽⁵⁾		2.51	%⁽⁴⁾⁽⁵⁾		2.41	%⁽⁴⁾⁽⁶⁾
Rebate from Morgan Stanley affiliate		0.00	%⁽⁷⁾		0.00	%⁽⁷⁾		0.00	%⁽⁷⁾		0.01	%		0.00	%⁽⁷⁾
Supplemental Data:
Net assets, end of period, in thousands	$	6,259		$	6,668		$	7,411		$	9,729		$	12,004
Portfolio turnover rate		189	%		167	%		159	%		179	%		279	%

(2) Calculated based on the net asset value as of the last business day of the period.

(3) Performance was positively impacted by approximately 0.67% for Class L shares due to the receipt of proceeds from the settlements of class action suits involving the Fund's past holdings. These were one-time settlements, and as a result, the impact on the NAV and consequently the performance will not likely be repeated in the future. Had these settlements not occurred, the total return for Class L shares would have been approximately 1.57%.

(5) If the Fund had borne all of its expenses that were waived by the Adviser/Administrator, the annualized expense and net investment income ratios would have been as follows:

PERIOD ENDED	EXPENSE RATIO			NET INVESTMENT INCOME RATIO
December 31, 2020		1.24	%		1.90	%
December 31, 2019		1.25			2.60
December 31, 2018		1.20			2.64
December 31, 2017		1.24			2.38

(6) If the Fund had not received the reimbursement from the custodian and had borne all of its expenses that were waived by the Adviser/Administrator, the annualized expense and net investment income ratios would have been as follows:

PERIOD ENDED				EXPENSE RATIO				NET INVESTMENT INCOME RATIO
December 31, 2016					1.21	%			2.32	%

(7) Amount is less than 0.005%.

	FOR THE YEAR ENDED DECEMBER 31,
	2020			2019			2018			2017			2016⁽¹⁾
Class I Shares
Selected Per Share Data:
Net asset value, beginning of period	$	8.69		$	8.41		$	8.67		$	8.68		$	8.71
Income (loss) from investment operations:
Net investment income		0.23			0.29			0.28			0.27			0.28
Net realized and unrealized gain (loss)		0.27			0.28			(0.26	)		(0.01	)		(0.04	)
Total income from investment operations		0.50			0.57			0.02			0.26			0.24
Less dividends from net investment income		(0.25	)		(0.29	)		(0.28	)		(0.27	)		(0.27	)
Net asset value, end of period	$	8.94		$	8.69		$	8.41		$	8.67		$	8.68
Total Return⁽²⁾		5.77	%		6.90	%		0.34	%		2.90	%		2.88	%⁽³⁾
Ratios to Average Net Assets:
Net expenses		0.52	%⁽⁴⁾⁽⁵⁾		0.52	%⁽⁴⁾⁽⁵⁾		0.52	%⁽⁴⁾⁽⁵⁾		0.51	%⁽⁴⁾⁽⁵⁾		0.52	%⁽⁴⁾⁽⁶⁾
Net investment income		2.61	%⁽⁴⁾⁽⁵⁾		3.35	%⁽⁴⁾⁽⁵⁾		3.36	%⁽⁴⁾⁽⁵⁾		3.14	%⁽⁴⁾⁽⁵⁾		3.00	%⁽⁴⁾⁽⁶⁾
Rebate from Morgan Stanley affiliate		0.00	%⁽⁷⁾		0.00	%⁽⁷⁾		0.00	%⁽⁷⁾		0.01	%		0.00	%⁽⁷⁾
Supplemental Data:
Net assets, end of period, in thousands	$	91,971		$	65,594		$	67,487		$	73,314		$	80,861
Portfolio turnover rate		189	%		167	%		159	%		179	%		279	%

(2) Calculated based on the net asset value as of the last business day of the period.

(3) Performance was positively impacted by approximately 0.69% for Class I shares due to the receipt of proceeds from the settlements of class action suits involving the Fund's past holdings. These were one-time settlements, and as a result, the impact on the NAV and consequently the performance will not likely be repeated in the future. Had these settlements not occurred, the total return for Class I shares would have been approximately 2.19%.

(5) If the Fund had borne all of its expenses that were waived by the Adviser/Administrator, the annualized expense and net investment income ratios would have been as follows:

PERIOD ENDED	EXPENSE RATIO			NET INVESTMENT INCOME RATIO
December 31, 2020		0.73	%		2.40	%
December 31, 2019		0.74			3.13
December 31, 2018		0.72			3.16
December 31, 2017		0.74			2.91

PERIOD ENDED				EXPENSE RATIO				NET INVESTMENT INCOME RATIO
December 31, 2016					0.69	%			2.83	%

(7) Amount is less than 0.005%.

	FOR THE YEAR ENDED DECEMBER 31,
	2020			2019			2018			2017			2016⁽¹⁾
Class C Shares
Selected Per Share Data:
Net asset value, beginning of period	$	8.75		$	8.48		$	8.74		$	8.75		$	8.77
Income (loss) from investment operations:
Net investment income		0.13			0.20			0.19			0.18			0.17
Net realized and unrealized gain (loss)		0.28			0.27			(0.26	)		(0.02	)		(0.02	)
Total income (loss) from investment operations		0.41			0.47			(0.07	)		0.16			0.15
Less dividends from net investment income		(0.15	)		(0.20	)		(0.19	)		(0.17	)		(0.17	)
Net asset value, end of period	$	9.01		$	8.75		$	8.48		$	8.74		$	8.75
Total Return⁽²⁾		4.69	%		5.56	%		(0.76	)%		1.87	%		1.60	%⁽³⁾
Ratios to Average Net Assets:
Net expenses		1.62	%⁽⁴⁾⁽⁵⁾		1.62	%⁽⁴⁾⁽⁵⁾		1.62	%⁽⁴⁾⁽⁵⁾		1.61	%⁽⁴⁾⁽⁵⁾		1.62	%⁽⁴⁾⁽⁶⁾
Net investment income		1.40	%⁽⁴⁾⁽⁵⁾		2.23	%⁽⁴⁾⁽⁵⁾		2.24	%⁽⁴⁾⁽⁵⁾		2.00	%⁽⁴⁾⁽⁵⁾		1.90	%⁽⁴⁾⁽⁶⁾
Rebate from Morgan Stanley affiliate		0.00	%⁽⁷⁾		0.00	%⁽⁷⁾		0.00	%⁽⁷⁾		0.01	%		0.00	%⁽⁷⁾
Supplemental Data:
Net assets, end of period, in thousands	$	10,397		$	2,163		$	2,012		$	902		$	691
Portfolio turnover rate		189	%		167	%		159	%		179	%		279	%

(2) Does not reflect the deduction of sales charge. Calculated based on the net asset value as of the last business day of the period.

(3) Performance was positively impacted by approximately 0.56% for Class C shares due to the receipt of proceeds from the settlements of class action suits involving the Fund's past holdings. These were one-time settlements, and as a result, the impact on the NAV and consequently the performance will not likely be repeated in the future. Had these settlements not occurred, the total return for Class C shares would have been approximately 1.04%.

(5) If the Fund had borne all of its expenses that were waived by the Adviser/Administrator, the annualized expense and net investment income ratios would have been as follows:

PERIOD ENDED	EXPENSE RATIO			NET INVESTMENT INCOME RATIO
December 31, 2020		1.72	%		1.30	%
December 31, 2019		1.85			2.00
December 31, 2018		1.96			1.90
December 31, 2017		1.96			1.65

PERIOD ENDED				EXPENSE RATIO				NET INVESTMENT INCOME RATIO
December 31, 2016					2.15	%			1.37	%

(7) Amount is less than 0.005%.

To the Shareholders and Board of Trustees of
Morgan Stanley U.S. Government Securities Trust

Opinion on the Financial Statements

We have audited the accompanying statement of assets and liabilities of Morgan Stanley U.S. Government Securities Trust (the "Fund"), including the portfolio of investments, as of December 31, 2020, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the five years in the period then ended and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of Morgan Stanley U.S. Government Securities Trust at December 31, 2020, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended and its financial highlights for each of the five years in the period then ended, in conformity with U.S. generally accepted accounting principles.

Basis for Opinion

These financial statements are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Fund in accordance with the U.S. federal securities law and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of the Fund's internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Fund's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 31, 2020 by correspondence with the custodian and others or by other appropriate auditing procedures where replies from others were not received. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

We have served as the auditor of one or more Morgan Stanley investment companies since 2000.

Boston, Massachusetts
February 26, 2021

In compliance with Rule 22e-4 under the Investment Company Act of 1940, as amended (the "Liquidity Rule"), the Fund has adopted and implemented a liquidity risk management program (the "Program"), which is reasonably designed to assess and manage the risk that the Fund could not meet requests to redeem shares issued by the Fund without significant dilution of remaining investors' interests in the Fund (i.e., liquidity risk). The Fund's Board of Trustees (the "Board") previously approved the designation of the Liquidity Risk Subcommittee (the "LRS") as Program administrator. The LRS is comprised of representatives from various divisions within Morgan Stanley Investment Management.

At a meeting held on April 22-23, 2020, the Board reviewed a written report prepared by the LRS that addressed the Program's operation and assessed its adequacy, and effectiveness of implementation for the period from December 1, 2018, through December 31, 2019, as required under the Liquidity Rule. The report concluded that the Program operated effectively and was adequately and effectively implemented in all material aspects, and that the relevant controls and safeguards were appropriately designed to enable the LRS to administer the Program in compliance with the Liquidity Rule.

In accordance with the Program, the LRS assessed each Fund's liquidity risk no less frequently than annually taking into consideration certain factors, as applicable, such as (i) investment strategy and liquidity of portfolio investments, (ii) short-term and long-term cash flow projections and (iii) holdings of cash and cash equivalents and borrowing arrangements and other funding sources. Certain factors are considered under both normal and reasonably foreseeable stressed conditions.

Each Fund portfolio investment is classified into one of four liquidity categories, which classification is assessed at least monthly by the LRS. The classification is based on a determination of the number of days it is reasonably expected to take to convert the investment into cash, or sell or dispose of the investment, in current market conditions without significantly changing the market value of the investment. Liquidity classification determinations take into account various market, trading and investment-specific considerations, as well as market depth, and in some cases utilize third-party vendor data.

The Liquidity Rule limits a fund's investments in illiquid investments to 15% of its net assets and requires funds that do not primarily hold assets that are highly liquid investments to determine and maintain a minimum percentage of the fund's net assets to be invested in highly liquid investments (highly liquid investment minimum or "HLIM"). The LRS believes that the Program includes provisions reasonably designed to review, monitor and comply with the 15% limit on illiquid investments and for determining, periodically reviewing and complying with the HLIM requirement, as applicable.

There can be no assurance that the Program will achieve its objectives under all circumstances in the future. Please refer to the Fund's prospectus for more information regarding the Fund's exposure to liquidity risk and other risks to which it may be subject.

FACTS				WHAT DOES MSIM DO WITH YOUR PERSONAL INFORMATION?
Why?				Financial companies choose how they share your personal information. Federal law gives consumers the right to limit some but not all sharing. Federal law also requires us to tell you how we collect, share, and protect your personal information. Please read this notice carefully to understand what we do.
What?				The types of personal information we collect and share depend on the product or service you have with us. This information can include: n Social Security number and income n investment experience and risk tolerance n checking account number and wire transfer instructions
How?				All financial companies need to share customers' personal information to run their everyday business. In the section below, we list the reasons financial companies can share their customers' personal information; the reasons MSIM chooses to share; and whether you can limit this sharing.

Reasons we can share your personal information	Does MSIM share?	Can you limit this sharing?
For our everyday business purposes — such as to process your transactions, maintain your account(s), respond to court orders and legal investigations, or report to credit bureaus	Yes	No
For our marketing purposes — to offer our products and services to you	Yes	No
For joint marketing with other financial companies	No	We don't share
For our affiliates' everyday business purposes — information about your transactions and experiences	Yes	No
For our affiliates' everyday business purposes — information about your creditworthiness	No	We don't share
For our affiliates to market to you	No	We don't share
For non-affiliates to market to you	No	We don't share

Questions? Call toll-free (844) 312-6327 or email: imprivacyinquiries@morganstanley.com

Name, Address and Birth Year of
Independent Trustee

Position(s)
Held with
Registrant

Length of
Time Served*

Principal Occupation(s)
During Past 5 Years
and Other Relevant
Professional Experience

Number of
Funds
in Fund
Complex
Overseen by
Independent
Trustee**

Other Directorships
Held by Independent Trustee***

Frank L. Bowman
c/o Perkins Coie LLP
Counsel to the Independent Trustees
1155 Avenue of the Americas,
22nd Floor
New York, NY 10036
Birth Year: 1944

Trustee

Since
August 2006

President, Strategic Decisions, LLC (consulting) (since February 2009); Director or Trustee of various Morgan Stanley Funds (since August 2006); Chairperson of the Compliance and Insurance Committee (since October 2015); formerly, Chairperson of the Insurance Sub- Committee of the Compliance and Insurance Committee (2007-2015); served as President and Chief Executive Officer of the Nuclear Energy Institute (policy organization) (February 2005-November 2008); retired as Admiral, U.S. Navy after serving over 38 years on active duty including 8 years as Director of the Naval Nuclear Propulsion Program in the Department of the Navy and the U.S. Department of Energy (1996- 2004); served as Chief of Naval Personnel (July 1994-September 1996) and on the Joint Staff as Director of Political Military Affairs (June 1992- July 1994); knighted as Honorary Knight Commander of the Most Excellent Order of the British Empire; awarded the Officier de l'Orde National du Mérite by the French Government; elected to the National Academy of Engineering (2009).

Director of Naval and Nuclear Technologies LLP; Director Emeritus of the Armed Services YMCA; Member of the National Security Advisory Council of the Center for U.S. Global Engagement and a member of the CNA Military Advisory Board; Trustee of Fairhaven United Methodist Church; Member of the Board of Advisors of the Dolphin Scholarship Foundation; Director of other various non-profit organizations; formerly, Director of BP plc (November 2010-May 2019)

Name, Address and Birth Year of
Independent Trustee

Position(s)
Held with
Registrant

Length of
Time Served*

Principal Occupation(s)
During Past 5 Years
and Other Relevant
Professional Experience

Number of
Funds
in Fund
Complex
Overseen by
Independent
Trustee**

Other Directorships
Held by Independent Trustee***

Kathleen A. Dennis
c/o Perkins Coie LLP
Counsel to the Independent Trustees
1155 Avenue of the Americas,
22nd Floor
New York, NY 10036
Birth Year: 1953

Trustee

Since
August 2006

Chairperson of the Governance Committee (January 2021), Chairperson of the Liquidity and Alternatives Sub-Committee of the Investment Committee (2006-2020); and Director or Trustee of various Morgan Stanley Funds (since August 2006); President, Cedarwood Associates (mutual fund and investment management consulting) (since July 2006); formerly, Senior Managing Director of Victory Capital Management (1993-2006).

Board Member, University of Albany Foundation (2012-present); Board Member, Mutual Funds Directors Forum (2014-present); Director of various non-profit organizations.

Nancy C. Everett
c/o Perkins Coie LLP
Counsel to the Independent Trustees
1155 Avenue of the Americas,
22nd Floor
New York, NY 10036
Birth Year: 1955

Trustee

Since
January 2015

Chairperson of the Equity Investment Committee (since January 2021); Director or Trustee of various Morgan Stanley Funds (since January 2015); Chief Executive Officer, Virginia Commonwealth University Investment Company (since November 2015); Owner, OBIR, LLC (institutional investment management consulting) (since June 2014); formerly, Managing Director, BlackRock, Inc. (February 2011-December 2013); and Chief Executive Officer, General Motors Asset Management (a/k/a Promark Global Advisors, Inc.) (June 2005- May 2010).

Formerly, Member of Virginia Commonwealth University School of Business Foundation (2005-2016); Member of Virginia Commonwealth University Board of Visitors (2013- 2015); Member of Committee on Directors for Emerging Markets Growth Fund, Inc. (2007-2010); Chairperson of Performance Equity Management, LLC (2006-2010); and Chairperson, GMAM Absolute Return Strategies Fund, LLC (2006-2010).

Name, Address and Birth Year of
Independent Trustee

Position(s)
Held with
Registrant

Length of
Time Served*

Principal Occupation(s)
During Past 5 Years
and Other Relevant
Professional Experience

Number of
Funds
in Fund
Complex
Overseen by
Independent
Trustee**

Other Directorships
Held by Independent Trustee***

Jakki L. Haussler
c/o Perkins Coie LLP
Counsel to the Independent Trustees
1155 Avenue of the Americas,
22nd Floor
New York, NY 10036
Birth Year: 1957

Trustee

Since
January 2015

Director or Trustee of various Morgan Stanley Funds (since January 2015) Chairman, Opus Capital Group (1996); formerly, Chief Executive Officer, Opus Capital Group (1996-2019); Director, Capvest Venture Fund, LP (May 2000- December 2011); Partner, Adena Ventures, LP (July 1999-December 2010); Director, The Victory Funds (February 2005- July 2008).

Director of Cincinnati Bell Inc. and Member, Audit Committee and Chairman, Governance and Nominating Committee; Director of Service Corporation International and Member, Audit Committee and Investment Committee; Director of Northern Kentucky University Foundation and Member, Investment Committee; Member of Chase College of Law Transactional Law Practice Center Board of Advisors; Director of Best Transport; Director of Chase College of Law Board of Visitors; formerly, Member, University of Cincinnati Foundation Investment Committee; Member, Miami University Board of Visitors (2008-2011); Trustee of Victory Funds (2005-2008) and Chairman, Investment Committee (2007-2008); and Member, Service Provider Committee (2005-2008).

Dr. Manuel H. Johnson
c/o Johnson Smick International, Inc.
220 I Street, NE — Suite 200
Washington, D.C. 20002
Birth Year: 1949

Trustee

Since July 1991

Senior Partner, Johnson Smick International, Inc. (consulting firm); Chairperson of the Fixed Income, Liquidity and Alternatives Investment Committee (January 2021), Chairperson of the Investment Committee (2006-2020) and Director or Trustee of various Morgan Stanley Funds (since July 1991); Co-Chairman and a founder of the Group of Seven Council (G7C) (international economic commission); formerly, Chairperson of the Audit Committee (July 1991-September 2006) Vice Chairman of the Board of Governors of the Federal Reserve System and Assistant Secretary of the U.S. Treasury.

Director of NVR, Inc. (home construction).

Name, Address and Birth Year of
Independent Trustee

Position(s)
Held with
Registrant

Length of
Time Served*

Principal Occupation(s)
During Past 5 Years
and Other Relevant
Professional Experience

Number of
Funds
in Fund
Complex
Overseen by
Independent
Trustee**

Other Directorships
Held by Independent Trustee***

Joseph J. Kearns
c/o Perkins Coie LLP
Counsel to the Independent Trustees
1155 Avenue of the Americas,
22nd Floor
New York, NY 10036
Birth Year: 1942

Trustee

Since
August 1994

Senior Adviser, Kearns & Associates LLC (investment consulting); Chairperson of the Audit Committee (since October 2006) and Director or Trustee of various Morgan Stanley Funds (since August 1994); formerly, Deputy Chairperson of the Audit Committee (July 2003-September 2006) and Chairperson of the Audit Committee of various Morgan Stanley Funds (since August 1994); CFO of the J. Paul Getty Trust (1982-1999).

Director, Rubicon Investment (since February 2019); Prior to August 2016, Director of Electro Rent Corporation (equipment leasing); Prior to December 31, 2013, Director of The Ford Family Foundation.

Michael F. Klein
c/o Perkins Coie LLP
Counsel to the Independent Trustees
1155 Avenue of the Americas,
22nd Floor
New York, NY 10036
Birth Year: 1958

Trustee

Since
August 2006

Chairperson of the Risk Committee (since January 2021); Managing Director, Aetos Alternatives Management, LP (since March 2000); Co-President, Aetos Alternatives Management, LP (since January 2004) and Co-Chief Executive Officer of Aetos Alternatives Management, LP (since August 2013); Chairperson of the fixed Income Sub-Committee of the Investment committee (2006-2020) and Director or Trustee of various Morgan Stanley Funds (since August 2006); formerly, Managing Director, Morgan Stanley & Co. Inc. and Morgan Stanley Dean Witter Investment Management and President, various Morgan Stanley Funds (June 1998-March 2000); Principal, Morgan Stanley & Co. Inc. and Morgan Stanley Dean Witter Investment Management (August 1997- December 1999).

Director of certain investment funds managed or sponsored by Aetos Alternatives Management, LP; Director of Sanitized AG and Sanitized Marketing AG (specialty chemicals).

Name, Address and Birth Year of
Independent Trustee

Position(s)
Held with
Registrant

Length of
Time Served*

Principal Occupation(s)
During Past 5 Years
and Other Relevant
Professional Experience

Number of
Funds
in Fund
Complex
Overseen by
Independent
Trustee**

Other Directorships
Held by Independent Trustee***

Patricia Maleski
c/o Perkins Coie LLP
Counsel to the Independent Trustees
1155 Avenue of the Americas,
22nd Floor
New York, NY 10036
Birth Year: 1960

Trustee

Since
January 2017

Director or Trustee of various Morgan Stanley Funds (since January 2017); Managing Director, JPMorgan Asset Management (2004-2016); Oversight and Control Head of Fiduciary and Conflicts of Interest Program (2015- 2016); Chief Control Officer-Global Asset Management (2013-2015); President, JPMorgan Funds (2010- 2013); Chief Administrative Officer (2004-2013); various other positions including Treasurer and Board Liaison (since 2001).

None.

W. Allen Reed
c/o Perkins Coie LLP
Counsel to the Independent Trustees
1155 Avenue of the Americas,
22nd Floor
New York, NY 10036
Birth Year: 1947

Chair of the Board and Trustee

Chair of the Boards since August 2020 and Trustee since August 2006

Chair of the Boards of various Morgan Stanley Funds (since August 2020); Director or Trustee of various Morgan Stanley Funds (since August 2006); formerly, Vice Chair of the Boards of various Morgan Stanley Funds (January 2020-August 2020); President and Chief Executive Officer of General Motors Asset Management; Chairman and Chief Executive Officer of the GM Trust Bank and Corporate Vice President of General Motors Corporation (August 1994- December 2005).

Formerly, Director of Legg Mason, Inc. (2006-2019); and Director of the Auburn University Foundation (2010-2015).

* This is the earliest date the Trustee began serving the Morgan Stanley Funds. Each Trustee serves an indefinite term, until his or her successor is elected.

** The Fund Complex includes (as of December 31, 2020) all open-end and closed-end funds (including all of their portfolios) advised by Morgan Stanley Investment Management Inc. (the "Adviser") and any funds that have an adviser that is an affiliated person of the Adviser (including, but not limited to, Morgan Stanley AIP GP LP).

*** This includes any directorships at public companies and registered investment companies held by the Trustee at any time during the past five years.

Name, Address
and Birth Year of
Executive Officer

Position(s)
Held with
Registrant

Length of
Time Served*

Principal Occupation(s) During Past 5 Years

John H. Gernon
522 Fifth Avenue
New York, NY 10036
Birth Year: 1963

President and Principal Executive Officer

Since September 2013

President and Principal Executive Officer of the Equity and Fixed Income Funds and the Morgan Stanley AIP Funds (since September 2013) and the Liquidity Funds and various money market funds (since May 2014) in the Fund Complex; Managing Director of the Adviser; Head of Public Markets Product Development (since 2006).

Timothy J. Knierim
1633 Broadway
New York, NY 10019
Birth Year: 1959

Chief Compliance Officer

Since December 2016

Managing Director of the Adviser and various entities affiliated with the Adviser; Chief Compliance Officer of various Morgan Stanley Funds and the Adviser (since December 2016) and Chief Compliance Officer of Morgan Stanley AIP GP LP (since 2014). Formerly, Managing Director and Deputy Chief Compliance Officer of the Adviser (2014-2016).

Francis J. Smith
522 Fifth Avenue
New York, NY 10036
Birth Year: 1965

Treasurer and Principal Financial Officer

Treasurer since July 2003 and Principal Financial Officer since September 2002

Managing Director of the Adviser and various entities affiliated with the Adviser; Treasurer (since July 2003) and Principal Financial Officer of various Morgan Stanley Funds (since September 2002).

Mary E. Mullin
1633 Broadway
New York, NY 10019
Birth Year: 1967

Secretary

Since June 1999

Managing Director of the Adviser; Secretary of various Morgan Stanley Funds (since June 1999).

Michael J. Key
522 Fifth Avenue
New York, NY 10036
Birth Year: 1979

Vice President

Since June 2017

Vice President of the Equity and Fixed Income Funds, Liquidity Funds, various money market funds and the Morgan Stanley AIP Funds in the Fund Complex (since June 2017); Executive Director of the Adviser; Head of Product Development for Equity and Fixed Income Funds (since August 2013).

* This is the earliest date the officer began serving the Morgan Stanley Funds. Each officer serves a one-year term, until his or her successor is elected and qualifies.

(a) The registrant has adopted a code of ethics (the "Code of Ethics") that applies to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party.

The registrant's Board of Trustees has determined that Joseph J. Kearns, an “independent” Trustee, is an “audit committee financial expert" serving on its audit committee. Under applicable securities laws, a person who is determined to be an audit committee financial expert will not be deemed an "expert" for any purpose, including without limitation for the purposes of Section 11 of the Securities Act of 1933, as a result of being designated or identified as an audit committee financial expert. The designation or identification of a person as an audit committee financial expert does not impose on such person any duties, obligations, or liabilities that are greater than the duties, obligations, and liabilities imposed on such person as a member of the audit committee and Board of Trustees in the absence of such designation or identification.

(e)(1) The audit committee’s pre-approval policies and procedures are as follows:

The Audit Committee of the Board is required to review and, in its sole discretion, pre-approve all Covered Services to be provided by the Independent Auditors to the Fund and Covered Entities in order to assure that services performed by the Independent Auditors do not impair the auditor’s independence from the Fund.

The SEC has issued rules specifying the types of services that an independent auditor may not provide to its audit client, as well as the audit committee’s administration of the engagement of the independent auditor. The SEC’s rules establish two different approaches to pre-approving services, which the SEC considers to be equally valid. Proposed services either: may be pre-approved without consideration of specific case-by-case services by the Audit Committee (“general pre-approval”); or require the specific pre-approval of the Audit Committee or its delegate (“specific pre-approval”). The Audit Committee believes that the combination of these two approaches in this Policy will result in an effective and efficient procedure to pre-approve services performed by the Independent Auditors. As set forth in this Policy, unless a type of service has received general pre-approval, it will require specific pre-approval by the Audit Committee (or by any member of the Audit Committee to which pre-approval authority has been delegated) if it is to be provided by the Independent Auditors. Any proposed services exceeding pre-approved cost levels or budgeted amounts will also require specific pre-approval by the Audit Committee.

The appendices to this Policy describe the Audit, Audit-related, Tax and All Other services that have the general pre-approval of the Audit Committee. The term of any general pre-approval is 12 months from the date of pre-approval, unless the Audit Committee considers and provides a different period and states otherwise. The Audit Committee will annually review and pre-approve the services that may be provided by the Independent Auditors without obtaining specific pre-approval from the Audit Committee. The Audit Committee will add to or subtract from the list of general pre-approved services from time to time, based on subsequent determinations.

The purpose of this Policy is to set forth the policy and procedures by which the Audit Committee intends to fulfill its responsibilities. It does not delegate the Audit Committee’s responsibilities to pre-approve services performed by the Independent Auditors to management.

The Fund’s Independent Auditors have reviewed this Policy and believes that implementation of the Policy will not adversely affect the Independent Auditors’ independence.

³ This Audit Committee Audit and Non-Audit Services Pre-Approval Policy and Procedures (the “Policy”), adopted as of the date above, supersedes and replaces all prior versions that may have been adopted from time to time.

As provided in the Act and the SEC’s rules, the Audit Committee may delegate either type of pre-approval authority to one or more of its members. The member to whom such authority is delegated must report, for informational purposes only, any pre-approval decisions to the Audit Committee at its next scheduled meeting.

The annual Audit services engagement terms and fees are subject to the specific pre-approval of the Audit Committee. Audit services include the annual financial statement audit and other procedures required to be performed by the Independent Auditors to be able to form an opinion on the Fund’s financial statements. These other procedures include information systems and procedural reviews and testing performed in order to understand and place reliance on the systems of internal control, and consultations relating to the audit. The Audit Committee will approve, if necessary, any changes in terms, conditions and fees resulting from changes in audit scope, Fund structure or other items.

In addition to the annual Audit services engagement approved by the Audit Committee, the Audit Committee may grant general pre-approval to other Audit services, which are those services that only the Independent Auditors reasonably can provide. Other Audit services may include statutory audits and services associated with SEC registration statements (on Forms N-1A, N-2, N-3, N-4, etc.), periodic reports and other documents filed with the SEC or other documents issued in connection with securities offerings.

The Audit Committee has pre-approved the Audit services in Appendix A. All other Audit services not listed in Appendix A must be specifically pre-approved by the Audit Committee (or by any member of the Audit Committee to which pre-approval has been delegated).

Audit-related services are assurance and related services that are reasonably related to the performance of the audit or review of the Fund’s financial statements and, to the extent they are Covered Services, the Covered Entities or that are traditionally performed by the Independent Auditors. Because the Audit Committee believes that the provision of Audit-related services does not impair the independence of the auditor and is consistent with the SEC’s rules on auditor independence, the Audit Committee may grant general pre-approval to Audit-related services. Audit-related services include, among others, accounting consultations related to accounting, financial reporting or disclosure matters not classified as “Audit services”; assistance with understanding and implementing new accounting and financial reporting guidance from rulemaking authorities; agreed-upon or expanded audit procedures related to accounting and/or billing records required to respond to or comply with financial, accounting or regulatory reporting matters; and assistance with internal control reporting requirements under Forms N-CEN and/or N-CSR.

The Audit Committee has pre-approved the Audit-related services in Appendix A. All other Audit-related services not listed in Appendix A must be specifically pre-approved by the Audit Committee (or by any member of the Audit Committee to which pre-approval has been delegated).

The Audit Committee believes that the Independent Auditors can provide Tax services to the Fund and, to the extent they are Covered Services, the Covered Entities, such as tax compliance, tax planning and tax advice without impairing the auditor’s independence, and the SEC has stated that the Independent Auditors may provide such services.

Pursuant to the preceding paragraph, the Audit Committee has pre-approved the Tax Services in Appendix A. All Tax services in Appendix A must be specifically pre-approved by the Audit Committee (or by any member of the Audit Committee to which pre-approval has been delegated).

The Audit Committee believes, based on the SEC’s rules prohibiting the Independent Auditors from providing specific non-audit services, that other types of non-audit services are permitted. Accordingly, the Audit Committee believes it may grant general pre-approval to those permissible non-audit services classified as All Other services that it believes are routine and recurring services, would not impair the independence of the auditor and are consistent with the SEC’s rules on auditor independence.

The Audit Committee has pre-approved the All Other services in Appendix A. Permissible All Other services not listed in Appendix A must be specifically pre-approved by the Audit Committee (or by any member of the Audit Committee to which pre-approval has been delegated).

Pre-approval fee levels or budgeted amounts for all services to be provided by the Independent Auditors will be established annually by the Audit Committee. Any proposed services exceeding these levels or amounts will require specific pre-approval by the Audit Committee. The Audit Committee is mindful of the overall relationship of fees for audit and non-audit services in determining whether to pre-approve any such services.

All requests or applications for services to be provided by the Independent Auditors that do not require specific approval by the Audit Committee will be submitted to the Fund’s Principal Financial and Accounting Officer and must include a detailed description of the services to be rendered. The Fund’s Principal Financial and Accounting Officer will determine whether such services are included within the list of services that have received the general pre-approval of the Audit Committee. The Audit Committee will be informed on a timely basis of any such services rendered by the Independent Auditors. Requests or applications to provide services that require specific approval by the Audit Committee or Chairperson of the Audit Committee will be submitted to the Audit Committee by the Fund's Principal Financial and Accounting Officer, who, after consultation with the Independent Auditors, will discuss whether, the request or application is consistent with the SEC’s rules on auditor independence.

The Audit Committee has designated the Fund’s Principal Financial and Accounting Officer to monitor the performance of all services provided by the Independent Auditors and to determine whether such services are in compliance with this Policy. The Fund’s Principal Financial and Accounting Officer will report to the Audit Committee on a periodic basis on the results of its monitoring. Both the Fund’s Principal Financial and Accounting Officer and management will immediately report to the Chairperson of the Audit Committee any breach of this Policy that comes to the attention of the Fund’s Principal Financial and Accounting Officer or any member of management.

The Audit Committee has determined to take additional measures on an annual basis to meet its responsibility to oversee the work of the Independent Auditors and to assure the auditor’s independence from the Fund, such as reviewing a formal written statement from the Independent Auditors delineating all relationships between the Independent Auditors and the Fund, consistent with the PCAOB’s Ethics and Independence Rule 3526, and discussing with the Independent Auditors its methods and procedures for ensuring independence.

Covered Entities include the Fund’s investment adviser(s) and any entity controlling, controlled by or under common control with the Fund’s investment adviser(s) that provides ongoing services to the Fund(s). Beginning with non-audit service contracts entered into on or after May 6, 2003, the Fund’s audit committee must pre-approve non-audit services provided not only to the Fund but also to the Covered Entities if the engagements relate directly to the operations and financial reporting of the Fund. This list of Covered Entities would include:

(e)(2) Beginning with non-audit service contracts entered into on or after May 6, 2003, the audit committee also is required to pre-approve services to Covered Entities to the extent that the services are determined to have a direct impact on the operations or financial reporting of the Registrant. 100% of such services were pre-approved by the audit committee pursuant to the Audit Committee’s pre-approval policies and procedures (attached hereto).

(h) The audit committee of the Board of Trustees has considered whether the provision of services other than audit services performed by the auditors to the Registrant and Covered Entities is compatible with maintaining the auditors' independence in performing audit services.

*Aggregate fees related to the pre-approved services will be limited to 10% of the 2020/2021 annual fees for audit and tax services (see fee schedule distributed by the Auditors).

** Audit and tax services for new funds/portfolios will be subject to the maximum audit and tax fee for a fund/portfolio on fee schedule distributed by the Auditors.

(a) The registrant has a separately-designated standing audit committee established in accordance with Section 3(a)(58)(A) of the Exchange Act whose members are:

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

There have been no material changes to the procedures by which shareholders may recommend nominee to the Fund’s Board of Trustees since the Fund last provided disclosure in response to this item.

(a) The registrant’s principal executive officer and principal financial officer have concluded that the registrant’s disclosure controls and procedures are sufficient to ensure that information required to be disclosed by the registrant in this Form N-CSR was recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, based upon such officers' evaluation of these controls and procedures as of a date within 90 days of the filing date of the report.

(b) There were no changes in the registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.

Item 12. Disclosure of Securities Lending Activities for Closed End Management Investment Companies.

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.

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

How does MSIM protect my personal information?				To protect your personal information from unauthorized access and use, we use security measures that comply with federal law. These measures include computer safeguards and secured files and buildings. We have policies governing the proper handling of customer information by personnel and requiring third parties that provide support to adhere to appropriate security standards with respect to such information.
How does MSIM collect my personal information?				We collect your personal information, for example, when you n open an account or make deposits or withdrawals from your account n buy securities from us or make a wire transfer n give us your contact information We also collect your personal information from others, such as credit bureaus, affiliates, or other companies.
Why can't I limit all sharing?				Federal law gives you the right to limit only n sharing for affiliates' everyday business purposes — information about your creditworthiness n affiliates from using your information to market to you n sharing for non-affiliates to market to you State laws and individual companies may give you additional rights to limit sharing. See below for more on your rights under state law.

Affiliates				Companies related by common ownership or control. They can be financial and non-financial companies. n Our affiliates include companies with a Morgan Stanley name and financial companies such as Morgan Stanley Smith Barney LLC and Morgan Stanley & Co.
Non-affiliates				Companies not related by common ownership or control. They can be financial and non-financial companies. n MSIM does not share with non-affiliates so they can market to you.
Joint marketing				A formal agreement between non-affiliated financial companies that together market financial products or services to you. n MSIM doesn't jointly market

	Registrant			Covered Entities⁽¹⁾
Audit Fees	$	62,078			N/A

Non-Audit Fees
Audit-Related Fees	$	—	⁽²⁾	$	—	⁽²⁾
Tax Fees	$	4,613	⁽³⁾	$	535,939	⁽⁴⁾
All Other Fees	$	—		$	30,000	⁽⁵⁾
Total Non-Audit Fees	$	4,613		$	565,939

Total	$	66,691		$	565,939

Service Range of Fees
	The Fund(s)	Covered Entities
Statutory audits or financial audits for the Funds	For a complete list of fees, please contact the legal department **	N/A
Services associated with SEC registration statements (including new fund filings/seed audits), periodic reports and other documents filed with the SEC or other documents issued in connection with securities offerings (e.g., comfort letters for closed-end fund offerings, consents), and assistance in responding to SEC comment letters	*	*
Consultations by the Fund’s management as to the accounting or disclosure treatment of transactions or events and/or the actual or potential impact of final or proposed rules, standards or interpretations by the SEC, FASB, or other regulatory or standard setting bodies (Note: Under SEC rules, some consultations may be “audit related” services rather than “audit” services)	*	*

Service Range of Fees
	The Fund(s)	Covered Entities
Attest procedures not required by statute or regulation	*	*
Due diligence services pertaining to potential fund mergers	*	*
Consultations by the Fund’s management as to the accounting or disclosure treatment of transactions or events and/or the actual or potential impact of final or proposed rules, standards or interpretations by the SEC, FASB, or other regulatory or standard-setting bodies (Note: Under SEC rules, some consultations may be “audit” services rather than “audit-related” services)	*	*
General assistance with implementation of the requirements of SEC rules or listing standards promulgated pursuant to the Sarbanes-Oxley Act	*	*

Welcome Shareholder					3
Fund Report					4
Performance Summary					8
Expense Example					10
Portfolio of Investments					12
Statement of Assets and Liabilities					20
Statement of Operations					21
Statements of Changes in Net Assets					22
Notes to Financial Statements					23
Financial Highlights					37
Report of Independent Registered Public Accounting Firm					41
Liquidity Risk Management Program					42
Privacy Notice					43
Trustee and Officer Information					46

	⁽¹⁾	Covered Entities include the Adviser (excluding sub-advisors) and any entity controlling, controlled by or under common control with the Adviser that provides ongoing services to the Registrant.
	⁽²⁾	Audit-Related Fees represent assurance and related services provided that are reasonably related to the performance of the audit of the financial statements of the Covered Entities' and funds advised by the Adviser or its affiliates, specifically data verification and agreed-upon procedures related to asset securitizations and agreed-upon procedures engagements.
	⁽³⁾	Tax Fees represent tax compliance, tax planning and tax advice services provided in connection with the preparation and review of the Registrant’s tax returns.
	⁽⁴⁾	Tax Fees represent tax compliance, tax planning and tax advice services provided in connection with the review of Covered Entities' tax returns.
	⁽⁵⁾	All other fees represent project management for future business applications and improving business and operational processes.

Service Range of Fees
	The Fund(s)	Covered Entities
U.S. federal, state and local tax planning and advice	*	*
U.S. federal, state and local tax compliance	*	*
International tax planning and advice	*	*
International tax compliance	*	*
Review/preparation of federal, state, local and international income, franchise, and other tax returns	$400,000 PwC	N/A
Identification of Passive Foreign Investment Companies	$150,000 PwC	*
PwC ITV Tool – assist in determining which Fund holdings have foreign capital gains tax exposure	$125,000 PwC	*
Foreign Tax Services - Preparation of local foreign tax returns and assistance with local tax compliance issues (including maintenance of transaction schedules, assistance in periodic tax remittances, tax registration, representing funds before foreign revenue authorities and assistance with assessment orders)	$500,000 PwC/EY	*
Assistance with tax audits and appeals before the IRS and similar state, local and foreign agencies	*	*
Tax advice and assistance regarding statutory, regulatory or administrative developments (e.g., excise tax reviews, evaluation of Fund’s tax compliance function)	*	*

	·	Bookkeeping or other services related to the accounting records or financial statements of the audit client
	·	Financial information systems design and implementation
	·	Appraisal or valuation services, fairness opinions or contribution-in-kind reports
	·	Actuarial services
	·	Internal audit outsourcing services

	·	Management functions
	·	Human resources
	·	Broker-dealer, investment adviser or investment banking services
	·	Legal services
	·	Expert services unrelated to the audit

/s/ John H. Gernon
John H. Gernon
Principal Executive Officer
February 16, 2021