<DOCUMENT>
<TYPE>EX-99.H.2
<SEQUENCE>12
<FILENAME>y93068a1exv99whw2.txt
<DESCRIPTION>FORM OF LETTER AGREEMENT
<TEXT>
<PAGE>

                                                               EXHIBIT (2)(h)(2)

                                LETTER AGREEMENT

                                                              New York, New York
                                                                 [       ], 2004

UBS Securities LLC
299 Park Avenue
New York, New York 10171-0026

Ladies and Gentlemen:

                  We understand that The Central Europe and Russia Fund, Inc., a
Maryland corporation (the "Fund"), has appointed UBS Securities LLC to act as
dealer manager (the "Dealer Manager") in connection with the issuance by the
Fund to the holders of record (the "Holders") at the close of business on the
record date set forth in the Prospectus (as defined herein) (the "Record Date")
of transferable rights entitling such Holders to subscribe for up to
[__________] shares (each a "Share" and, collectively, the "Shares") of the
Fund's common stock, par value $0.01 per share (the "Common Shares"), of the
Fund (the "Offer"). Pursuant to the terms of the Offer, the Fund is issuing each
Holder one transferable right (each a "Right" and, collectively, the "Rights")
for each Common Share held by such Holder on the Record Date. Such Rights
entitle holders to acquire during the subscription period set forth in the
Prospectus (the "Subscription Period"), at the price set forth in such
Prospectus (the "Subscription Price"), one Share for each three Rights exercised
(except that any Holder who is issued fewer than three Rights will be able to
subscribe for one full Share pursuant to the primary subscription), on the terms
and conditions set forth in such Prospectus. No fractional shares will be
issued. Any Holder who fully exercises all Rights initially issued to such
Holder (other than those Rights that cannot be exercised because they represent
the right to acquire less than one Share) will be entitled to subscribe for,
subject to allocation, additional Shares (the "Over-Subscription Privilege") on
the terms and conditions set forth in the Prospectus. The Rights are
transferable and are expected to be listed on the New York Stock Exchange, Inc.

                  The Fund has filed with the Securities and Exchange Commission
(the "Commission") a registration statement on Form N-2 (Nos. 333-111828 and
811-06041) and a related preliminary prospectus and preliminary statement of
additional information under the Investment Company Act of 1940, as amended (the
"Investment Company Act"), the Securities Act of 1933, as amended (the
"Securities Act"), and the rules and regulations of the Commission under the
Investment Company Act and the Securities Act (the "Rules and Regulations"). The
term "Registration Statement" means the registration statement, as amended, at
the time it becomes or became effective, including financial statements and all
exhibits and all documents, if any, incorporated therein by reference, and any
information deemed to be included by Rule 430A. The term "Prospectus" means the
final prospectus and final statement of additional

<PAGE>

information in the forms filed with the Commission pursuant to Rule 497(c), (e),
(h) or (j) of the Rules and Regulations, as the case may be, as from time to
time amended or supplemented pursuant to the Securities Act.

                  Deutsche Asset Management International GmbH, a German limited
liability company (the "Investment Adviser") acts as investment adviser to the
Fund pursuant to an Investment Advisory Agreement dated as of January 31, 1990
between the Fund and the Investment Adviser. The Investment Adviser is not a
party to the Dealer Manager Agreement (the "Dealer Manager Agreement") pursuant
to which the Fund is appointing or will appoint the Dealer Manager to act in
such capacity in connection with the Offer. As a further inducement to the
Dealer Manager to enter into the Dealer Manager Agreement and to act as Dealer
Manager in connection with the Offer, the Investment Adviser has executed and
delivered to the Dealer Manager this Letter Agreement (""Agreement""). This
Agreement will become effective upon execution of the Dealer Manager Agreement,
as notified to the Investment Adviser by the Dealer Manager.

1.       Representations and Warranties; Agreements.

         a.       The Investment Adviser represents and warrants to, and agrees
                  with, the Dealer Manager as of the date hereof and as of the
                  date of the commencement of the Offer that:

                  i.       The Investment Adviser has been duly organized and is
                           validly existing as a limited liability company under
                           the laws of the Federal Republic of Germany, has full
                           power and authority (corporate and other) to own its
                           properties and conduct its business as described in
                           the Registration Statement and the Prospectus, and is
                           duly qualified to do business as a foreign
                           corporation in each jurisdiction wherein it owns or
                           leases real property or in which the conduct of its
                           business requires such qualification, except where
                           the failure to be so qualified does not involve a
                           material adverse effect upon the Investment Adviser's
                           business, properties, financial position or
                           operations.

                  ii.      The Investment Adviser is duly registered as an
                           investment adviser under the Investment Advisers Act
                           of 1940, as amended (the "Advisers Act'), and is not
                           prohibited by the Advisers Act or the Investment
                           Company Act, or the rules and regulations under such
                           Acts, from acting as investment adviser for the Fund
                           as contemplated in the Prospectus and the Investment
                           Advisory Agreement.

                  iii.     This Agreement has been duly authorized, executed and
                           delivered by the Investment Adviser. The Investment
                           Advisory Agreement has been duly authorized, executed
                           and delivered by the Investment Adviser, and complies
                           with all applicable provisions of

                                       2

<PAGE>

                           the Investment Company Act, the Advisers Act and the
                           rules and regulations under such Acts, and is,
                           assuming due authorization, execution and delivery by
                           the other party thereto, a legal, valid, binding and
                           enforceable obligation of the Investment Adviser,
                           subject to the qualification that the enforceability
                           of the Investment Adviser's obligations thereunder
                           may be limited by bankruptcy, insolvency,
                           reorganization, moratorium and similar laws of
                           general applicability relating to or affecting
                           creditors' rights, to general principles of equity
                           (regardless of whether enforceability is considered
                           in a proceeding in equity or at law) and to
                           termination under the Investment Company Act.

                  iv.      Neither the execution, delivery, performance and
                           consummation by the Investment Adviser of its
                           obligations under this Agreement or the Investment
                           Advisory Agreement nor the consummation of the
                           transactions contemplated herein or therein or in
                           connection with the Offer will conflict with or
                           violate the charter, by-laws or similar
                           organizational documents of the Investment Adviser,
                           or conflict with, result in a breach of, or
                           constitute a default or an event of default under, or
                           result in the creation or imposition of any lien,
                           charge or encumbrance upon any properties or assets
                           of the Investment Adviser under the charter, bylaws
                           or similar organizational document, the terms and
                           provisions of any material agreement, indenture,
                           mortgage, loan agreement, note, insurance or surety
                           agreement, lease or other instrument to which the
                           Investment Adviser is a party or by which it may be
                           bound or to which any of the property or assets of
                           the Investment Adviser is subject, nor will such
                           action result in any violation of any order, law,
                           rule or regulation of any court or governmental
                           agency or body having jurisdiction over the
                           Investment Adviser or any of its properties.

                  v.       There is no pending or, to the best of the Investment
                           Adviser's knowledge, threatened action, suit or
                           proceeding affecting the Investment Adviser or to
                           which the Investment Adviser is a party before or by
                           any court or governmental agency, authority or body
                           or any arbitrator which would disqualify the
                           Investment Adviser pursuant to Section 9(a) of the
                           Investment Company Act from acting as investment
                           adviser to the Fund or is otherwise reasonably likely
                           to result in any material adverse change in the
                           Investment Adviser's ability to perform its services
                           under the Investment Advisory Agreement.

                  vi.      No consent, approval, authorization, notification or
                           order of, or filing with, or the issuance of any
                           license or permit by, any court or governmental
                           agency or body is required for the consummation by
                           the Investment Adviser of the transactions
                           contemplated by

                                       3

<PAGE>

                           Investment Advisory Agreement or in connection with
                           the offer to be consummated by the Investment
                           Adviseor except such as have been obtained, or if the
                           registration statement filed with respect to the
                           Shares is not effective under the Securities Act as
                           of the time of execution hereof, such as may be
                           required (and shall be obtained as provided in this
                           Agreement) under the Investment Company Act, the
                           Securities Act and the Securities Exchange Act of
                           1934, as amended (the "Exchange Act"), or by the
                           National Association of Securities Dealers, Inc., the
                           New York Stock Exchange or the Frankfurt Stock
                           Exchange.

                  vii.     The Investment Adviser (A) has not taken, directly or
                           indirectly, any action designed to cause or to result
                           in, or that has constituted or which might reasonably
                           be expected to constitute, the stabilization or
                           manipulation of the price of any security of the Fund
                           to facilitate the issuance of the Rights or the sale
                           or resale of the Rights and the Shares, (B) has not
                           since the filing of the Registration Statement sold,
                           bid for or purchased, or paid anyone any compensation
                           for soliciting purchases of, Common Shares of the
                           Fund (except for the solicitation of exercises of the
                           Rights pursuant to this Agreement) and (C) will not,
                           until the later of the expiration of the Rights or
                           the completion of the distribution (within the
                           meaning of the anti-manipulation rules under the
                           Exchange Act) of the Shares, sell, bid for or
                           purchase, pay or agree to pay any person any
                           compensation for soliciting another to purchase any
                           other securities of the Fund (except for the
                           solicitation of exercises of the Rights pursuant to
                           this Agreement); provided that any action in
                           connection with the Fund's dividend reinvestment and
                           cash purchase plan will not be deemed to be within
                           the terms of this Section 1.a.vii.

         b.       The Investment Adviser agrees to notify promptly in writing,
                  from the date of this Agreement through the expiration date of
                  the Offer set forth in the Prospectus, as it may be extended
                  as provided for in the Prospectus (the "Expiration Date"), if
                  any representation, warranty or agreement of the Investment
                  Adviser set forth in Section 1.a. of this Agreement shall be
                  untrue or incorrect in any material respect.

2.       Representations, Warranties and Agreements to Survive Delivery. The
         agreements, representations and warranties of the Investment Adviser
         set forth in or made pursuant to this Agreement shall survive the
         Expiration Date and will remain in full force and effect, regardless of
         any investigation made by or on behalf of Dealer Manager or any of the
         officers, directors or controlling persons referred to in Section 7 of
         the Dealer Manager Agreement, and will survive delivery of and payment
         for the Shares pursuant to the Offer.

                                       4

<PAGE>

3.       Notices. All communications hereunder will be in writing and effective
         only on receipt, and, if sent to the Dealer Manager, will be mailed,
         delivered or telegraphed and confirmed to UBS Securities LLC, 299 Park
         Avenue, New York, New York 10171-0026, Attn: Syndicate Department.

4.       Applicable Law. This Agreement will be governed by and construed in
         accordance with the laws of the State of New York.

5.       Submission to Jurisdiction. Except as set forth below, no claim (a
         "Claim") may be commenced, prosecuted or continued in any court other
         than the courts of the State of New York located in the City and County
         of New York or in the United States District Court for the Southern
         District of New York, which courts shall have jurisdiction over the
         adjudication of such matters, and the Investment Adviser consents to
         the jurisdiction of such courts and personal service with respect
         thereto. The Investment Adviser hereby consents to personal
         jurisdiction, service and venue in any court in which any Claim arising
         out of or in any way relating to this Agreement is brought by any third
         party against UBS Securities. Each of UBS Securities and the Investment
         Adviser (on its behalf and, to the extent permitted by applicable law,
         on behalf of its stockholders and affiliates) waives all right to trial
         by jury in any action, proceeding or counterclaim (whether based upon
         contract, tort or otherwise) in any way arising out of or relating to
         this Agreement. The Investment Adviser agrees that a final judgment in
         any such action, proceeding or counterclaim brought in any such court
         shall be conclusive and binding upon the Investment Adviser and may be
         enforced in any other courts in the jurisdiction of which the
         Investment Adviser is or may be subject, by suit upon such judgment.

6.       Counterparts. This Agreement may be executed in one or more
         counterparts, each of which shall be deemed to be an original, but all
         of which together shall constitute one and the same instrument.

                  If the foregoing is in accordance with your understanding of
our agreement, please so indicate in the space provided below for that purpose,
whereupon this letter shall constitute a binding agreement between the
Investment Adviser and the Dealer Manager.

                                                     Very truly yours,

                                    Deutsche Asset Management International GmbH

                                    By:_________________________________________
                                       Name:____________________________________
                                       Title:___________________________________

                                       5

<PAGE>

The foregoing Agreement is hereby confirmed
and accepted as of the date first above written.

UBS Securities LLC

By:_________________________________
   Name:____________________________
   Title:___________________________

By:_________________________________
   Name:____________________________
   Title:___________________________

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