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<SEC-DOCUMENT>0001144204-04-013732.txt : 20040902
<SEC-HEADER>0001144204-04-013732.hdr.sgml : 20040902
<ACCEPTANCE-DATETIME>20040902113641
ACCESSION NUMBER:		0001144204-04-013732
CONFORMED SUBMISSION TYPE:	N-CSR
PUBLIC DOCUMENT COUNT:		4
CONFORMED PERIOD OF REPORT:	20040630
FILED AS OF DATE:		20040902
DATE AS OF CHANGE:		20040902
EFFECTIVENESS DATE:		20040902

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			HERZFELD CARIBBEAN BASIN FUND INC
		CENTRAL INDEX KEY:			0000880406
		IRS NUMBER:				650396889
		STATE OF INCORPORATION:			MD
		FISCAL YEAR END:			0630

	FILING VALUES:
		FORM TYPE:		N-CSR
		SEC ACT:		1940 Act
		SEC FILE NUMBER:	811-06445
		FILM NUMBER:		041012835

	BUSINESS ADDRESS:	
		STREET 1:		P O BOX 161465
		CITY:			MIAMI
		STATE:			FL
		ZIP:			33116
		BUSINESS PHONE:		3052711900

	MAIL ADDRESS:	
		STREET 2:		PO BOX 161465
		CITY:			MIAMI
		STATE:			FL
		ZIP:			33116

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	FIRST CUBA FUND INC
		DATE OF NAME CHANGE:	19920929
</SEC-HEADER>
<DOCUMENT>
<TYPE>N-CSR
<SEQUENCE>1
<FILENAME>v06211_ncsr.txt
<DESCRIPTION>FORM N-CSR
<TEXT>
                                  UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                   FORM N-CSR

   CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number 811-06445
                                   ----------------

                     The Herzfeld Caribbean Basin Fund, Inc.
          ------------------------------------------------------------
               (Exact name of registrant as specified in charter)

                      P.O. BOX 161465, MIAMI, FLORIDA 33116
          ------------------------------------------------------------
          (Address of principal executive offices)          (Zip code)

                               THOMAS J. HERZFELD
                        P.O. BOX 161465, MIAMI, FL 33116
          ------------------------------------------------------------
                     (Name and address of agent for service)

Registrant's telephone number, including area code: 305-271-1900
                                                    ------------------

Date of fiscal year end: 06/30/04
                         ----------------------

Date of reporting period: 06/30/04
                         ----------------------

Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the  transmission to stockholders of
any report that is required to be transmitted to  stockholders  under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1).  The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.

A registrant  is required to disclose the  information  specified by Form N-CSR,
and the  Commission  will make this  information  public.  A  registrant  is not
required to respond to the  collection  of  information  contained in Form N-CSR
unless the Form  displays a  currently  valid  Office of  Management  and Budget
("OMB")  control number.  Please direct comments  concerning the accuracy of the
information  collection  burden  estimate and any  suggestions  for reducing the
burden to Secretary,  Securities and Exchange Commission,  450 Fifth Street, NW,
Washington,  DC 20549-0609.  The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.

<PAGE>

ITEM 1.   SHAREHOLDER REPORT

<PAGE>


                               [GRAPHIC OMITTED]


                           THE HERZFELD
                           CARIBBEAN BASIN
                           FUND, INC.


                                 ANNUAL REPORT
                                 JUNE 30, 2004


<PAGE>

================================================================================

THE HERZFELD CARIBBEAN BASIN FUND, INC.
The Herzfeld Building
PO Box 161465
Miami, FL  33116
(305) 271-1900

INVESTMENT ADVISOR
HERZFELD/CUBA
a division of Thomas J. Herzfeld Advisors, Inc.
PO Box 161465
Miami, FL  33116
(305) 271-1900

TRANSFER AGENT & REGISTRAR
Investors Bank & Trust Company
200 Clarendon Street, 16th Floor
Boston, MA  02116
(617) 443-6870

CUSTODIAN
Investors Bank & Trust Company
200 Clarendon Street, 5th Floor
Boston, MA  02116

COUNSEL
Pepper Hamilton LLP
3000 Two Logan Square
18th and Arch Streets
Philadelphia, PA  19103

INDEPENDENT AUDITORS
Kaufman, Rossin & Co., P.A.
2699 South Bayshore Drive
Miami, FL  33133
www.kaufmanrossin.com

- --------------------------------------------------------------------------------
The Herzfeld Caribbean Basin Fund's investment objective is long-term capital
appreciation. To achieve its objective, the Fund invests in issuers that are
likely, in the Advisor's view, to benefit from economic, political, structural
and technological developments in the countries in the Caribbean Basin, which
consist of Cuba, Jamaica, Trinidad and Tobago, the Bahamas, the Dominican
Republic, Barbados, Aruba, Haiti, the Netherlands Antilles, the Commonwealth of
Puerto Rico, Mexico, Honduras, Guatemala, Belize, Costa Rica, Panama, Colombia
and Venezuela. The fund invests at least 80% of its total assets in a broad
range of securities of issuers including U.S.-based companies, which engage in
substantial trade with and derive substantial revenue from operations in the
Caribbean Basin Countries.
- --------------------------------------------------------------------------------

                          Listed NASDAQ SmallCap Market
                                  Symbol: CUBA

                                      -2-
<PAGE>


LETTER TO STOCKHOLDERS
================================================================================

August 9, 2004

Dear Fellow Stockholders:

We are pleased to present our annual report for the period ended June 30, 2004.
On that date The Herzfeld Caribbean Basin Fund's net assets were $9,109,162 and
its net asset value per share was $5.43, compared with $6,626,004, or $3.95 per
share, at the beginning of the period. This represents a gain of 37.5% in net
asset value and an increase of 39.5% in share price from $3.49 to $4.87 per
share.

                               [GRAPHIC OMITTED]
                               Thomas J. Herzfeld
                             Chairman and President

PORTFOLIO COMMENTARY

Our largest position continues to be FLORIDA EAST COAST INDUSTRIES (FLA). For
the benefit of stockholders who are not familiar with the company, FLA is
headquartered in St. Augustine, Florida, and has two main businesses: the
Flagler Development Company (real estate) and the Florida East Coast Railroad.
Just today, Florida East Coast Industries released its second quarter results,
and they were quite favorable. For example, the railroad revenues increased by
11% and the operating profit was ahead 13%. During the same six month period,
the real estate company's revenues increased 6%. I continue to believe that FLA
would be favorably impacted by a lifting of the embargo with Cuba. The company's
main rail business is a freight line operating between Jacksonville and Miami.

Following the end of our fiscal year, we added one speculative investment to the
portfolio, CANCERVAX (CNVX), a U.S. company which just announced a business
venture with Cuba. The deal was done with U.S. government approval and is
related to the development of three cancer drugs developed in the Center for
Molecular Immunology in Havana. To comply with U.S. regulations, CancerVax will
pay for its investment with food and medical supplies rather than U.S. dollars.
Since the U.S. government has now permitted this type of business arrangement
with Cuba, we are reviewing the possibility of similar transactions.


                                      -3-
<PAGE>

LETTER TO STOCKHOLDERS (CONTINUED)
================================================================================

LARGEST ALLOCATIONS

The following tables present our largest investment and geographic allocations
as of June 30, 2004.

- --------------------------------  ----------------------------------------------
GEOGRAPHIC       % OF NET ASSETS  LARGEST PORTFOLIO POSITIONS    % OF NET ASSETS
ALLOCATION

USA                       55.96%  Florida East Coast Industries, Inc.     22.91%
Mexico                    13.09%  Consolidated Water Co.                   7.71%
Cayman Islands             9.27%  Royal Caribbean Cruises Ltd.             7.15%
Latin American Regional    7.38%  Florida Rock Industries, Inc.            6.94%
Netherlands Antilles       4.30%  The Latin American Equity Fund, Inc.     5.10%
Belize                     2.85%  Watsco Incorporated                      4.62%
Panama                     2.77%  Orthofix International N.V.              4.30%
Puerto Rico                2.12%  Seaboard Corporation                     3.83%
Virgin Islands             1.06%  Carnival Corp.                           3.61%
Colombia                   0.51%  Carlisle Holdings, Inc.                  2.85%
Costa Rica                 0.39%  ----------------------------------------------
Venezuela                  0.09%
Dominican Republic         0.05%
Cuba                       0.00%
- --------------------------------

PREMIUM/DISCOUNT

As the graph below depicts, the Fund has traded at both premiums and discounts
every year except the year of inception in which it traded only at a premium. As
I have stated before, we believe that closed-end funds trading at discounts to
net asset value represent good value.

      PREMIUM/DISCOUNT OF THE HERZFELD CARIBBEAN BASIN FUND FROM INCEPTION


                               [GRAPHIC OMITTED]


                                      -4-
<PAGE>

LETTER TO STOCKHOLDERS (CONTINUED)
================================================================================

Daily net asset values and press releases on the Fund are available on the
Internet at WWW.HERZFELD.COM.

I would like to thank the members of the Board of Directors for their hard work
and guidance and also to thank my fellow stockholders for their continued
support and suggestions.

                                    Sincerely,

                                    /s/ Thomas J. Herzfeld

                                    Thomas J. Herzfeld
                                    Chairman of the Board and President




                                      -5-
<PAGE>

SCHEDULE OF INVESTMENTS AS OF JUNE 30, 2004
================================================================================

Shares or Principal Amount          Description                     Market Value
- --------------------------------------------------------------------------------

Common stocks - 99.84% of net assets

Banking and finance - 3.56%
    7,000  Bancolombia, S.A.                                        $    46,760
   16,120  Banco Latinoamericano de Exportaciones, S.A.                 252,762
    3,600  Grupo Financiero Banorte, S.A. de C.V. Series O               12,729
    8,400  Grupo Financiero Inbursa, S.A. de C.V. Series O               11,788

Communications - 10.12%
   11,000  America Movil, S.A. de C.V. Series A                          19,929
   43,800  America Movil, S.A. de C.V. Series L                          79,541
    1,000  America Movil ADR Series L                                    36,370
   11,100  America Telecom, S.A. de C.V. Series A1*                      21,361
    3,000  Atlantic Tele-Network, Inc.                                   96,300
   11,100  Carso Global Telecom, S.A. de C.V. Series A1                  16,261
    7,000  Garmin Ltd.                                                  259,280
      725  Grupo Iusacell, S.A. de C.V. Series V*                           880
   16,800  Grupo Radio Centro, S.A. ADR                                  99,792
    3,000  Grupo Televisa, S.A. GDR                                     135,810
   12,100  Grupo Televisa, S.A. Series CPO                               27,176
    1,000  Telefonos de Mexico ADR Series L                              33,270
   11,000  Telefonos de Mexico, S.A. de C.V. Series A                    18,174
   39,300  Telefonos de Mexico, S.A. de C.V. Series L                    65,306
   18,000  Tricom, S.A. ADR*                                              4,500
   13,900  TV Azteca, S.A. de C.V. Series CPO                             7,470

Conglomerates - 3.51%
    4,900  Alfa, S.A. de C.V. Series A                                   16,440
   39,400  Carlisle Holdings, Inc.*                                     259,646
    3,100  Corporacion Interamericana de Entretenimiento, S.A. de C.V.
              Series B*                                                   6,584
    7,000  Desc, S.A. de C.V. Series B*                                   1,984
    3,300  Grupo Carso, S.A. de C.V. Series A1                           13,447
    3,300  U.S. Commercial Corp., S.A. de C.V.*                           1,716
    2,600  Vitro, S.A. Series A                                           2,531
    6,000  Vitro Sociedad Anonima ADR                                    17,640

- -------------
*Non-income producing

                            See accompanying notes.

                                      -6-
<PAGE>

SCHEDULE OF INVESTMENTS AS OF JUNE 30, 2004 (CONTINUED)
================================================================================

Shares or Principal Amount          Description                     Market Value
- --------------------------------------------------------------------------------

Construction and related - 9.15%
   12,000  Bufete Industrial S.A. ADR*                              $       600
   10,442  Cemex, S.A. de C.V. Series CPO                                60,464
    1,936  Ceramica Carabobo Class A ADR*                                 2,382
    4,000  Consorcio ARA, S.A. de C.V. Series A1*                        11,512
   15,600  Empresas ICA, Sociedad Controladora, S.A. de C.V.*             4,773
   15,000  Florida Rock Industries, Inc.                                632,550
    1,665  Hylsamex S.A. CPO*                                             2,425
   21,950  Mastec, Inc.*                                                119,188

Consumer products and related manufacturing - 5.77%
  800,000  Atlas Electricas, S.A.                                        35,840
    5,400  Grupo Casa Saba, S.A. ADR                                     68,828
   15,000  Watsco Incorporated                                          421,050

Food, beverages and tobacco - 3.17%
   10,300  Coca Cola Femsa, S.A. de C.V. ADR                            228,557
    5,800  Fomento Economico Mexicano, S.A. de C.V. Series UBD           26,515
    7,300  Grupo Bimbo, S.A. de C.V. Series A                            15,377
    7,300  Grupo Modelo, S.A. de C.V. Series C                           18,275

Investment companies - 7.38%
   16,404  The Latin American Discovery Fund, Inc.                      208,167
   32,345  The Latin America Equity Fund, Inc.                          464,474

Leisure - 10.76%
    7,000  Carnival Corp.                                               329,000
   15,000  Royal Caribbean Cruises Ltd.                                 651,150

Medical - 4.30%
    9,160  Orthofix International N.V.*                                 391,407

Pulp and paper - 0.17%
    5,700  Kimberly-Clark de Mexico, S.A. de C.V. Series A               15,515

- -------------
*Non-income producing

                            See accompanying notes.

                                      -7-
<PAGE>

SCHEDULE OF INVESTMENTS AS OF JUNE 30, 2004 (CONTINUED)
================================================================================

Shares or Principal Amount          Description                     Market Value
- --------------------------------------------------------------------------------

Railroad and landholdings - 22.91%
   54,000  Florida East Coast Industries, Inc.                      $ 2,087,100

Retail - 0.81%
    3,700  Controladora Comercial Mexicana, S.A. de C.V. Series UBC       4,073
    1,380  Grupo Elektra, S.A. de C.V. Series CPO                         8,136
   20,669  Wal-Mart de Mexico, S.A. de C.V. Series V                     61,274

Trucking and marine freight - 6.22%
    8,000  Grupo TMM, S.A. ADR*                                          19,600
      700  Seaboard Corporation                                         348,565
   39,600  Trailer Bridge, Inc.*                                        198,396

Utilities - 9.27%
   12,000  Caribbean Utilities Ltd. Class A                             142,200
   27,000  Consolidated Water, Inc.                                     702,540

Other - 2.74%
    2,414  Mantex S.A.I.C.A*                                              4,872
   39,620  Margo Caribe, Inc.*                                          193,147
      843  Siderurgica Venezolana Sivensa ADR                               762
       75  Siderurgica Venezolana Sivensa Series B                           68
   35,000  Xcelera, Inc.*                                                50,750

TOTAL COMMON STOCKS (COST $6,778,698)                               $ 9,094,979

Bonds - 0% of net assets
  165,000  Republic of Cuba - 4.5%, 1977 - in default
  (cost $63,038) (Note 2)*                                                   --

OTHER ASSETS LESS LIABILITIES - 0.16% OF NET ASSETS                 $    14,183
                                                                    -----------

NET ASSETS - 100%                                                   $ 9,109,162
                                                                    ===========



- -------------
*Non-income producing

                            See accompanying notes.


                                      -8-
<PAGE>

STATEMENT OF ASSETS AND LIABILITIES AS OF JUNE 30, 2004
================================================================================

ASSETS

   Investments in securities, at market value (cost $6,841,736)
        (Notes 2 and 5)                                            $ 9,094,979
   Cash                                                                 13,146
   Dividends receivable                                                 12,266
   Other assets                                                         55,749
                                                                   -----------

      TOTAL ASSETS                                                 $ 9,176,140
                                                                   -----------

LIABILITIES

   Accrued investment advisor fee (Note 3)              $  31,974
   Other payables                                          35,004
                                                        ---------

      TOTAL LIABILITIES                                                 66,978
                                                                   -----------

NET ASSETS (Equivalent to $5.43 per share
   based on 1,677,636 shares outstanding)                          $ 9,109,162
                                                                   ===========


NET ASSETS CONSIST OF THE FOLLOWING:
   Common stock, $.001 par value; 100,000,000
      shares authorized; 1,677,636 shares issued
      and outstanding                                              $     1,678
   Additional paid-in capital                                        8,362,502
   Accumulated net investment loss (Note 5)                         (1,244,987)
   Accumulated net realized loss on investments (Note 5)              (263,274)
   Net unrealized gain on investments (Notes 4 and 5)                2,253,243
                                                                   -----------

      TOTAL                                                        $ 9,109,162
                                                                   ===========


                            See accompanying notes.


                                      -9-
<PAGE>

STATEMENT OF OPERATIONS
YEAR ENDED JUNE 30, 2004
================================================================================

INVESTMENT INCOME
   Dividends                                                       $   188,886
   Interest                                                                134
                                                                   -----------
       Total investment income                                         189,020

EXPENSES
   Investment advisor fees (Note 3)                    $  120,864
   Custodian fees                                          54,000
   Professional fees                                       44,333
   Insurance                                               27,618
   Transfer agent fees                                     17,500
   Listing fees                                            15,000
   Director fees                                            7,800
   Printing                                                 7,087
   Postage                                                  4,943
   Miscellaneous                                            4,960
                                                       ----------
      Total investment expenses                                        304,105
                                                                   -----------

      INVESTMENT LOSS - NET                                        ($  115,085)

REALIZED AND UNREALIZED GAIN
   ON INVESTMENTS AND FOREIGN CURRENCY
   Net realized gain on investments and foreign
     currency                                             358,431
   Change in unrealized gain on investments and
     foreign currency                                   2,239,812
                                                       ----------

      NET GAIN ON INVESTMENTS                                        2,598,243
                                                                   -----------

NET INCREASE IN NET ASSETS RESULTING
   FROM OPERATIONS                                                 $ 2,483,158
                                                                   ===========


                            See accompanying notes.


                                      -10-
<PAGE>

STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED JUNE 30, 2004 AND 2003
================================================================================

                                                          2004           2003

INCREASE IN NET ASSETS RESULTING FROM
   OPERATIONS:
   Net investment loss                               ($   115,085)  ($  186,014)
   Net realized gain (loss) on investments and
      foreign currency                                    358,431      (964,095)
   Change in unrealized gain on investments
      and foreign currency                              2,239,812     1,337,987
                                                     ------------   -----------
      Net increase in net assets resulting from
         operations                                     2,483,158       187,878

DISTRIBUTIONS TO STOCKHOLDERS FROM:
   Long-term realized gains                                    --      (129,950)
                                                     ------------   -----------

NET INCREASE IN NET ASSETS                           $  2,483,158   $    57,928

NET ASSETS:

   Beginning of year                                 $  6,626,004   $ 6,568,076
                                                     ------------   -----------

   End of year                                       $  9,109,162   $ 6,626,004
                                                     ============   ===========



                            See accompanying notes.


                                      -11-
<PAGE>

FINANCIAL HIGHLIGHTS
YEARS ENDED JUNE 30, 2000 THROUGH 2004
================================================================================

<TABLE>
<CAPTION>
                                                           2004         2003         2002         2001          2000
                                                           ----         ----         ----         ----          ----
<S>                                                        <C>          <C>          <C>          <C>           <C>
PER SHARE OPERATING PERFORMANCE
(FOR A SHARE OF CAPITAL STOCK OUTSTANDING FOR THE YEAR)
Net asset value, beginning of year                         $3.95        $3.92        $5.15        $5.02         $6.12
                                                           -----        -----        -----        -----         -----
Operations:
   Net investment loss(1)                                 (0.07)       (0.11)       (0.10)       (0.07)        (0.10)
   Net realized and unrealized gain (loss) on investment
     transactions(1)                                        1.55         0.22       (0.98)         0.20        (1.00)
                                                            ----         ----       ------         ----        ------
      Total from operations                                 1.48         0.11       (1.08)         0.13        (1.10)
                                                            ----         ----       ------         ----        ------

Distributions:
   From net investment income                                 --           --       (0.10)           --            --
   From net realized gains                                    --       (0.08)       (0.05)           --            --
                                                                       ------       ------
      Total distributions                                     --       (0.08)       (0.15)           --            --
                                                                       ------       ------

Net asset value, end of year                               $5.43        $3.95        $3.92        $5.15         $5.02
                                                           -----        -----        -----        -----         -----

Per share market value, end of year                        $4.87        $3.49        $3.48        $4.20         $5.06
                                                           -----        -----        -----        -----         -----

Total investment return (loss) based on
   market value per share                                 39.54%        2.70%     (13.45%)     (17.04%)      (15.63%)
                                                          ------        -----     --------     --------      --------

RATIOS AND SUPPLEMENTAL DATA
Net assets, end of year (in 000's)                        $9,109       $6,626       $6,568       $8,643        $8,424
                                                          ------       ------       ------       ------        ------

Ratio of expenses to average net assets                    3.67%        4.46%        3.77%        3.11%         3.11%
                                                           -----        -----        -----        -----         -----

Ratio of net investment loss
  to average net assets                                  (1.39%)      (3.15%)      (2.45%)      (1.33%)       (1.76%)
                                                         -------      -------      -------      -------       -------

Portfolio turnover rate                                      23%           3%          18%          27%           10%
                                                             ---           --          ---          ---           ---
</TABLE>

(1)   Computed by dividing the  respective  year's amounts from the Statement of
      Operations by the average outstanding shares for each year presented.

                             See accompanying notes.


                                      -12-
<PAGE>

NOTES TO FINANCIAL STATEMENTS
================================================================================

NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

ORGANIZATION AND RELATED MATTERS

The  Herzfeld  Caribbean  Basin  Fund,  Inc.  (the  Fund) is a  non-diversified,
closed-end  management  investment  company  incorporated  under the laws of the
State of Maryland on March 10, 1992, and registered under the Investment Company
Act of 1940. The Fund commenced  investing  activities in January 1994. The Fund
is listed on the NASDAQ SmallCap Market and trades under the symbol "CUBA".

The  Fund's  investment  policy  is to  invest  at least  80% of its  assets  in
investments that are economically tied to Caribbean Basin Countries.  The Fund's
investment  objective  is to obtain  long-term  capital  appreciation.  The Fund
pursues  its  objective  by  investing  primarily  in equity  and  equity-linked
securities of public and private companies,  including U.S.-based companies, (i)
whose securities are traded principally on a stock exchange in a Caribbean Basin
Country  or (ii)  that  have at least  50% of the  value of  their  assets  in a
Caribbean Basin Country or (iii) that derive at least 50% of their total revenue
from operations in a Caribbean Basin Country. The Fund's investment objective is
fundamental  and may not be changed  without  the  approval of a majority of the
Fund's outstanding voting securities.

At June 30,  2004,  the Fund had  foreign  investments  in  companies  operating
principally in Mexico and the Cayman Islands representing  approximately 13% and
9% of the Fund's net assets, respectively.

The Fund's custodian and transfer agent is Investors Bank & Trust Company, based
in Boston, Massachusetts.

SECURITY VALUATION

Investments in securities traded on a national  securities exchange (or reported
on the  NASDAQ  national  market  or  SmallCap  market)  are  stated at the last
reported sales price on the day of valuation (or at the NASDAQ official  closing
price);  other  securities  traded in the  over-the-counter  market  and  listed
securities  for which no sale was  reported  on that date are stated at the last
quoted  bid  price.   Restricted  securities  and  other  securities  for  which
quotations  are not readily  available are valued at fair value as determined by
the Board of Directors.


                                      -13-
<PAGE>

NOTES TO FINANCIAL STATEMENTS
================================================================================

INCOME RECOGNITION

Security transactions are recorded on the trade date. Gains and losses on
securities sold are determined on the basis of identified cost. Dividend income
is recognized on the ex-dividend date, and interest income is recognized on an
accrual basis. Discounts and premiums on debt securities purchased are amortized
over the life of the respective securities. It is the Fund's practice to include
the portion of realized and unrealized gains and losses on investments
denominated in foreign currencies as components of realized and unrealized gains
and losses on investments and foreign currency.

DEPOSITS WITH FINANCIAL INSTITUTIONS

The Fund may, during the course of its operations, maintain account balances
with financial institutions in excess of federally insured limits.

USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS

The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.

INCOME TAXES

The Fund's policy is to continue to comply with the provisions of the Internal
Revenue Code that are applicable to regulated investment companies and to
distribute all its taxable income to its stockholders. Under these provisions,
the Fund is not subject to federal income tax on its taxable income and no
federal tax provision is required.

The Fund has adopted a June 30 year-end for federal income tax purposes.

DISTRIBUTIONS TO STOCKHOLDERS

Distributions to stockholders are recorded on the ex-dividend date. Income and
capital gain distributions are determined in accordance with income tax
regulations which may differ from accounting principles generally accepted in
the United States of America. For the year ended June 30, 2004, no distributions
were declared or paid to stockholders.


                                      -14-
<PAGE>

NOTES TO FINANCIAL STATEMENTS
================================================================================

NOTE 2. NON-MARKETABLE SECURITY OWNED

Investments in securities  include  $165,000  principal,  4.5%, 1977 Republic of
Cuba bonds  purchased  for  $63,038.  The bonds are listed on the New York Stock
Exchange and had been  trading in default  since 1960.  A  "regulatory  halt" on
trading was imposed by the New York Stock Exchange in July, 1995. As of June 30,
2004,  the  position  was  valued  at  $0  by  the  Board  of  Directors,  which
approximates the bonds' fair value.

NOTE 3. TRANSACTIONS WITH AFFILIATES

HERZFELD / CUBA (the  "Advisor"),  a division  of Thomas J.  Herzfeld  Advisors,
Inc., is the Fund's  investment  advisor and charges a monthly fee at the annual
rate of 1.45% of the Fund's  average  daily net assets.  Total fees for the year
ended June 30, 2004  amounted  to  $120,864 of which  $31,974 is payable at year
end.

During  the year  ended  June  30,  2004,  the Fund  paid  $6,012  of  brokerage
commissions to Thomas J. Herzfeld & Co., Inc., an affiliate of the Advisor.

NOTE 4. INVESTMENT TRANSACTIONS

During  the year  ended  June  30,  2004,  purchases  and  sales  of  investment
securities were $2,032,151 and $1,826,148, respectively.

At June 30, 2004, the Fund's investment  portfolio had gross unrealized gains of
$3,423,176  and  gross  unrealized  losses  of  $1,169,933,  resulting  in a net
unrealized  gain of  $2,253,243  for both  financial  statement  and  income tax
purposes.

NOTE 5. INCOME TAX INFORMATION

The cost of securities  owned for financial  statement  purposes equals the cost
basis for income tax purposes.

The  income  tax basis of  distributive  earnings  as of June 30,  2004  include
$1,244,987 of accumulated  net  investment  loss,  $263,274 of  accumulated  net
realized  loss  on  investments   and  $2,253,243  of  net  unrealized  gain  on
investments.

For the year ended June 30, 2004,  the Fund utilized a capital loss carryover of
$358,431,  of a total cost loss carryover  available of $964,095.  The remaining
capital loss carryover of $605,664 expires in the tax year ended June 30, 2008.


                                      -15-
<PAGE>

DIRECTORS AND OFFICERS OF THE FUND
================================================================================
NAME                                 POSITION(S)           TERM OF OFFICE AND
ADDRESS                                 HELD              LENTH OF TIME SERVED
AGE                                   WITH FUND
- --------------------------------------------------------------------------------
Officers

THOMAS J. HERZFELD                   President,               three years;
PO Box 161465                        Chairman,                1993 to present
Miami, FL  33116                     Director
Age: 59

CECILIA L. GONDOR                    Secretary,               three years;
PO Box 161465                        Treasurer,               1993 to present
Maimi, FL  33116                     Director
Age: 42

Independent Directors

ANN S. LIEFF                         Director                 three years;
c/o The Herzfeld Caribbean                                    1998 to present
Basin Fund, Inc.
PO Box 161465
Miami, FL 33116
Age: 52



MICHAEL A. RUBIN                     Director                 three years;
c/o The Herzfeld Caribbean                                    2002 to present
Basin Fund, Inc.
PO Box 161465
Miami, FL 33116
Age: 62

ALBERT L. WEINTRAUB                  Director                 three years;
c/o The Herzfeld Caribbean                                    1999 to present
Basin Fund, Inc.
PO Box 161465
Miami, FL 33116
Age: 74


                                      -16-
<PAGE>

================================================================================
  PRINCIPAL OCCUPATION(S)        NUMBER OF PORTFOLIOS           PUBLIC
    DURING PAST 5 YEARS           IN COMPLEX OVERSEEN        DIRECTORSHIPS
                                      BY DIRECTOR
- --------------------------------------------------------------------------------


Chairman and President of                  2              The Cuba Fund, Inc.
Thomas J. Herzfeld & Co., Inc.,                           (in registration)
a broker dealer, and Thomas J.
Herzfeld Advisors, Inc.

Executive Vice President of                2              The Cuba Fund, Inc.
Thomas J. Herzfeld & Co., Inc.,                           (in registration)
a broker dealer, and Thomas J.
Herzfeld Advisors, Inc.



President of the Lieff Company, a          1              Hastings
management consulting firm that                           Entertainment, Inc.;
offers business solutions,                                Claire's Stores, Inc.;
strategies and CEO mentoring to                           Mayors Jewelers, Inc.
corporations and women/family-
owned businesses, 1998-present;
former CEO Spec's Music 1980-1998,
a retailer of recorded music.

Partner of Michael A. Rubin P.A.,          1              Margo Caribe, Inc.
attorney at law; Broker, Oaks
Management & Real Estate Corp.,
a real estate corporation



Senior Partner of Weintraub,               1              None
Weintraub; of counsel Orshan
et al, attornies; Chairman of
E-Lysium Transaction Systems, Inc.,
an application service provider of
transaction processing, billing
and payment systems




                                      -17-
<PAGE>


INDEPENDENT AUDITORS' REPORT
================================================================================

KAUFMAN ROSSIN & CO.
PROFESSTIONAL ASSOCIATION
CERTIFIED PUBLIC ACCOUNTANTS


To the Board of Directors and Stockholders
The Herzfeld Caribbean Basin Fund, Inc.

We have audited the accompanying statement of assets and liabilities,  including
the schedule of  investments,  of The Herzfeld  Caribbean Basin Fund, Inc. as of
June 30, 2004, 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,  and the  financial  highlights  for each of the five  years in the
period then ended. These financial  statements and financial  highlights are the
responsibility  of the Fund's  management.  Our  responsibility is to express an
opinion on these  financial  statements  and financial  highlights  based on our
audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting  Oversight Board (United States of America).  Those standards require
that we plan and perform the audit to obtain reasonable  assurance about whether
the  financial   statements  and  financial  highlights  are  free  of  material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the  amounts  and   disclosures  in  the  financial   statements  and  financial
highlights.  Our procedures include  confirmation of securities owned as of June
30, 2004,  by  correspondence  with the  custodian  and  brokers.  An audit also
includes assessing the accounting principles used and significant estimates made
by  management,   as  well  as  evaluating  the  overall   financial   statement
presentation.  We believe  that our audits  provide a  reasonable  basis for our
opinion.

In our opinion,  the financial  statements and financial  highlights referred to
above present fairly, in all material  respects,  the financial  position of The
Herzfeld  Caribbean Basin Fund, Inc. as of June 30, 2004, and the results of its
operations  for the year then  ended,  the changes in net assets for each of the
two years in the period then ended, and the financial highlights for each of the
five years in the period then ended, in conformity  with  accounting  principles
generally accepted in the United States of America.

/s/ Kaufman, Rossin & Co.

Miami, Florida
July 15, 2004


                                      -18-
<PAGE>

PRIVACY POLICY
================================================================================

INFORMATION WE COLLECT

We collect  nonpublic  information  about you from applications or other account
forms you complete,  from your  transactions  with us, our  affiliates or others
through transactions and conversations over the telephone.

INFORMATION WE DISCLOSE

We do not  disclose  information  about  you,  or our former  customers,  to our
affiliates or to service  providers or other third parties except on the limited
basis permitted by law. For example, we may disclose nonpublic information about
you to third parties to assist us in servicing  your account with us and to send
transaction confirmations, annual reports, prospectuses and tax forms to you. We
may also disclose  nonpublic  information  about you to  government  entities in
response to subpoenas.

OUR SECURITY PROCEDURES

To ensure  the  highest  level of  confidentiality  and  security,  we  maintain
physical,   electronic  and  procedural  safeguards  that  comply  with  federal
standards to guard your personal  information.  We also restrict  access to your
personal  and  account  information  to those  employees  who need to know  that
information to provide services to you.

PROXY VOTING POLICIES AND PROCEDURES
================================================================================

A  description  of the policies  and  procedures  used to determine  how to vote
proxies  relating to portfolio  securities  is available  without  charge,  upon
request, by calling the Fund at 800-TJH-FUND,  or by accessing the SEC's website
at www.sec.gov.


                                      -19-
<PAGE>


THE HERZFELD CARIBBEAN BASIN FUND, INC.
The Herzfeld Building
P.O. Box 161465
Miami, FL  33116
<PAGE>

ITEM 2.  CODE OF ETHICS

(a)   The registrant, as of the end of the period covered by this report, has
      adopted a code of ethics that applies to the registrant's 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.

(c)   There have been no amendments, during the period covered by this report,
      to a provision of the code of ethics that applies to the registrant's
      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, and that relates to any element of the code of ethics
      description.

(d)   The registrant has not granted any waivers, including an implicit waiver,
      from a provision of the code of ethics that applies to the registrant's
      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, that relates to one or more of the items set forth in
      paragraph (b) of this item's instructions.

ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.

As of the end of the period covered by the report, the registrant's board of
directors has determined that Albert L. Weintraub is as an audit committee
financial expert qualified to serve on its audit committee and that he is
"independent," as defined by Item 3 of Form N-CSR.

ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

(a) - (d)

Set forth in the table below are audit fees and non-audit related fees billed to
the registrant by its principal accountant (the "Auditor") for the audit of the
registrant's annual financial statements and services provided by the Auditor in
connection with statutory and regulatory filings during and for the Registrant's
fiscal years ended June 30, 2003 and 2004.

Fiscal Year                      Audit-Related
Ended June 30,    Audit Fees        Fees (1)      Tax Fees (2)  All Other Fees
- ------------------------------------------------------------------------------
2003                $15,500           $0            $3,500          $4,512
2004                $20,500           $0            $3,500          $4,682

(1) These fees related to services consisting of accounting consultations,
agreed upon procedure reports, attestation reports, comfort letters and review
of statutory and regulatory filings not included in Audit Fees.
<PAGE>

(2) These fees related to services consisting of the review or preparation of
U.S. federal, state, local and excise tax returns.

(e)   The registrant's Audit Committee charter requires that the Audit Committee
      pre-approve all auditing services and non-audit services (including the
      fees for such services and terms thereof) to be performed for the
      registrant by its Auditor, and the committee has not adopted pre-approval
      policies and procedures, although it may determine to do so in the future.
      The engagement to render auditing and non-auditing services would be
      presented to and pre-approved by the Audit Committee. All of the audit,
      audit-related and tax services described above for which the Auditor
      billed the registrant fees for the fiscal years ended June 30, 2003 and
      2004 were pre-approved by the Audit Committee.

(f)   Not applicable.

(g)   The aggregate non-audit fees billed by the registrant's Auditor for
      services rendered to the registrant, and rendered to the registrant's
      investment adviser, and any entity controlling, controlled by, or under
      common control with the adviser that provides ongoing services to the
      registrant for each of the last two fiscal years of the registrant were
      $4,512 for 2003 and $4,682 for 2004.

(h)   Not applicable.

ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.

(a)   The registrant has a separately-designated standing audit committee
      established in accordance with Section 3(a)(58)(A) of the Exchange Act.
      The registrant's audit committee is comprised of Albert L. Weintraub, Ann
      S. Lieff, and Michael A. Rubin.

(b)   Not applicable.

ITEM 6. SCHEDULE OF INVESTMENTS.

Not yet applicable.

ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
        MANAGEMENT INVESTMENT COMPANIES.

A copy of the registrant's proxy voting policies and procedures as well as its
adviser's policies and procedures are attached hereto as Appendix A.

ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
        COMPANY AND AFFILIATED PURCHASERS.

(a) Not applicable.
<PAGE>

ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

There have been no material changes to the procedures by which the stockholders
may recommend nominees to the registrant's board of directors, where those
changes were implemented after the registrant last provided disclosure in
response to the requirements of Item 7(d)(2)(ii)(G) of Schedule 14A (17 CFR
240.14a-101), or this Item.

ITEM 10. CONTROLS AND PROCEDURES.

(a)   The registrant's principal executive and principal financial officers, or
      persons performing similar functions, have concluded that the registrant's
      disclosure controls and procedures (as defined in Rule 30a-3(c) under the
      Investment Company Act of 1940, as amended (the "1940 Act") (17 CFR
      270.30a-3(c))) are effective, as of a date within 90 days of the filing
      date of the report that includes the disclosure required by this
      paragraph, based on their evaluation of these controls and procedures
      required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and
      Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as
      amended (17 CFR 240.13a-15(b) or 240.15d-15(b)).

(b)   There were no changes in the registrant's internal control over financial
      reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR
      270.30a-3(d)) that occurred during the registrant's last fiscal half-year
      (the registrant's second fiscal half-year in the case of an annual report)
      that has materially affected, or is reasonably likely to materially
      affect, the registrant's internal control over financial reporting.

ITEM 11. EXHIBITS.

(a)(1) Code of ethics is filed herewith as Exhibit 99.Code Eth.

(a)(2) Certifications pursuant to Rule 30a-2(a) under the 1940 Act and Section
      302 of the Sarbanes-Oxley Act of 2002 are filed herewith as Exhibits
      99.302 Cert.

(a)(3) Not applicable.

(b)   Certifications pursuant to Rule 30a-2(a) under the 1940 Act and Section
      906 of the Sarbanes-Oxley Act of 2002 are filed herewith as Exhibits
      99.906 Cert.
<PAGE>

                                   Signatures

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.

The Herzfeld Caribbean Basin Fund, Inc.

By:  /s/ Thomas J. Herzfeld
     -------------------------
     Thomas J. Herzfeld
     President and Chairman

Date: August 31, 2004

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

By:  /s/ Thomas J. Herzfeld
     -------------------------
     Thomas J. Herzfeld
     President and Chairman

Date: August 31, 2004

By:  /s/ Cecilia L. Gondor
     -------------------------
     Cecilia L. Gondor
     Secretary and Treasurer
     (Principal Financial Officer)

Date: August 31, 2004
<PAGE>

                                   APPENDIX A

                     THE HERZFELD CARIBBEAN BASIN FUND, INC.

                       PROXY VOTING POLICY AND PROCEDURES

      The Board of Directors of The Herzfeld Caribbean Basin Fund, Inc. (the
"Fund") hereby adopts the following policy and procedures with respect to voting
proxies relating to portfolio securities held by the Fund:

POLICY

      It is the policy of the Board of Directors of the Fund (the "Board") to
delegate the responsibility for voting proxies relating to portfolio securities
held by the Fund to the Fund's investment adviser (the "Adviser") as a part of
the Adviser's general management of the Fund, subject to the Board's continuing
oversight.(1) The voting of proxies is an integral part of the investment
management services that the Adviser provides pursuant to the advisory contract.

      The Adviser may, but is not required to, delegate the responsibility for
voting proxies relating to portfolio securities held by the Fund to a
sub-adviser ("Sub-Adviser") retained to provide investment advisory services, if
applicable. If such responsibility is delegated to a Sub-Adviser, then the
Sub-Adviser shall assume the fiduciary duty and reporting responsibilities of
the Adviser under these policy guidelines.

FIDUCIARY DUTY

      The right to vote a proxy with respect to portfolio securities held by the
Fund is an asset of the Fund. The Adviser, to which authority to vote on behalf
of the Fund is delegated, acts as a fiduciary of the Fund and must vote proxies
in a manner consistent with the best interest of the Fund and its shareholders.

PROCEDURES

      The following are the procedures adopted by the Board for the
administration of this policy:

            A. Review of Adviser Proxy Voting Procedures. The Adviser with
authority to vote proxies on behalf of the Fund shall present to the Board its
policies, procedures and other guidelines for voting proxies at least annually,
and must notify the Board promptly of material changes to any of these
documents.

            B. Voting Record Reporting. No less than annually, the Adviser shall
report to the Board a record of each proxy voted with respect to portfolio
securities of the Fund

- ----------
      (1) This policy is adopted for the purpose of the disclosure requirements
adopted by the Securities and Exchange Commission, Release Nos. 33-8188,
34-47304, IC-25922.
<PAGE>

during the year. With respect to those proxies that the Adviser has identified
as involving a conflict of interest(2), the Adviser shall submit a separate
report indicating the nature of the conflict of interest and how that conflict
was resolved with respect to the voting of the proxy.

REVOCATION

      The delegation by the Board of the authority to vote proxies relating to
portfolio securities of the Fund is entirely voluntary and may be revoked by the
Board, in whole or in part, at any time.

ANNUAL FILING

      The Fund shall file an annual report of each proxy voted with respect to
its portfolio securities during the twelve-month period ended June 30 on Form
N-PX not later than August 31 of each year.

DISCLOSURES

      The Fund shall include in its annual report to stockholders:

      A description of this policy and of the policies and procedures used by
the Adviser to determine how to vote proxies relating to portfolio
securities(3); and

      A statement disclosing that information regarding how the Fund voted
proxies relating to portfolio securities during the most recent 12-month period
ended June 30 is available without charge, upon request, by calling the Fund's
toll-free telephone number and on the SEC website(4).

      The Fund shall also include in its annual and semi-annual reports to
stockholders:

      A statement disclosing that a description of the policies and procedures
used by or on behalf of the Fund to determine how to vote proxies relating to
portfolio securities of

- ----------
      (2) As it is used in this document, the term "conflict of interest" refers
to a situation in which the Adviser or Sub-Adviser or affiliated persons of the
Adviser or Sub-Adviser have a financial interest in a matter presented by a
proxy other than the obligation it incurs as investment adviser to the Fund
which compromises the Adviser's or Sub-Adviser's independence of judgment and
action with respect to the voting of the proxy.

      (3) This disclosure shall be included in the annual report next filed by
the Fund, on Form N-CSR on or after July 1, 2003.

      (4) Id.
<PAGE>

the Funds is available without charge, upon request, by calling the Fund's
toll-free telephone number and on the SEC website.(5)

      A statement disclosing that information regarding how the Fund voted
proxies relating to portfolio securities during the most recent 12-month period
ended June 30 is available without charge, upon request, by calling the Fund's
toll-free telephone number and on the SEC website.(6)

Review of Policy.

      At least annually, the Board shall review this Policy to determine its
sufficiency and shall make and approve any changes that it deems necessary from
time to time.

- ----------
      (5) http://www.sec.gov.

      (6) Id.

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.CODE ETH
<SEQUENCE>2
<FILENAME>v06211_ex99-codeeth.txt
<TEXT>

                  HERZFELD CARIBBEAN BASIN FUND, INC.

     CODE OF ETHICS FOR PRINCIPAL EXECUTIVE AND FINANCIAL OFFICERS

I.    COVERED OFFICERS/PURPOSE OF THE CODE

      This code of ethics (the "Code") for the Herzfeld Caribbean Basin Fund,
Inc. (the "Fund"), a closed-end investment company registered under the
Investment Company Act of 1940 ("Investment Company Act"), applies to the Fund's
Chief Executive Officer and Chief Financial Officer (the "Covered Officers" each
of whom are set forth in Exhibit A) for the purpose of promoting:

      o     honest and ethical conduct, including the ethical handling of actual
            or apparent conflicts of interest between personal and professional
            relationships;

      o     full, fair, accurate, timely and understandable disclosure in
            reports and documents that a registrant files with, or submits to,
            the Securities and Exchange Commission ("SEC") and in other public
            communications made by the Fund;

      o     compliance with applicable laws and governmental rules and
            regulations;

      o     the prompt internal reporting of violations of the Code to an
            appropriate person or persons identified in the Code; and

      o     accountability for adherence to the Code.

      Each Covered Officer should adhere to a high standard of business ethics
and should be sensitive to situations that may give rise to actual as well as
apparent conflicts of interest.

II.   COVERED OFFICERS HONEST AND ETHICAL CONDUCT AND ETHICALLY HANDLING ACTUAL
      AND APPARENT CONFLICTS OF INTEREST

      OVERVIEW. The Covered Officers shall conduct their activities on behalf of
the Fund in an honest and ethical manner. A "conflict of interest" occurs when a
Covered Officer's private interest interferes with the interests of, or his
service to, the Fund. For example, a conflict of interest would arise if a
Covered Officer, or a member of his family, receives improper personal benefits
as a result of his position with the Fund.

      Certain conflicts of interest arise out of the relationships between
Covered Officers and the Fund and already are subject to conflict of interest
provisions in the Investment Company Act of 1940 and the Investment Advisers Act
of 1940 ("Investment Advisers Act"). For example, Covered Officers may not
individually engage in certain transactions (such as the purchase or sale of
securities or other property) with the Fund because of their status as
"affiliated persons" of the Fund. The Fund's and the investment adviser's
compliance programs and procedures are designed to prevent, or identify and
correct, violations of these provisions. This Code does not, and is not intended
to, repeat or replace these programs and procedures, and such conflicts fall
outside of the parameters of this Code.
<PAGE>

      Although typically not presenting an opportunity for improper personal
benefit, conflicts arise from, or as a result of, the contractual relationship
between the Fund and the investment adviser, of which the Covered Officers are
also officers or employees. As a result, this Code recognizes that the Covered
Officers will, in the normal course of their duties (whether formally for the
Fund or for the adviser, or for both), be involved in establishing policies and
implementing decisions that will have different effects on the adviser and the
Fund. The participation of the Covered Officers in such activities is inherent
in the contractual relationship between the Fund and the adviser and is
consistent with the performance by the Covered Officers of their duties as
officers of the Fund. Thus, if performed in conformity with the provisions of
the Investment Company Act and the Investment Advisers Act, such activities will
be deemed to have been handled ethically. In addition, it is recognized by the
Fund's Board of Directors ("Board") that the Covered Officers may also be
officers or employees of one or more other investment companies covered by this
or other codes.

      Other conflicts of interest are covered by the Code, even if such
conflicts of interest are not subject to provisions in the Investment Company
Act and the Investment Advisers Act. The following list provides examples of
conflicts of interest under the Code, but Covered Officers should keep in mind
that these examples are not exhaustive. The overarching principle is that the
personal interest of a Covered Officer should not be placed improperly before
the interest of the Fund.

                                     * * * *

      Each Covered Officer must not:

      o     use his personal influence or personal relationships improperly to
            influence investment decisions or financial reporting by the Fund
            whereby the Covered Officer would benefit personally to the
            detriment of the Fund;

      o     cause the Fund to take action, or fail to take action, for the
            individual personal benefit of the Covered Officer rather than the
            benefit of the Fund; and

      o     use material non-public knowledge of portfolio transactions made or
            contemplated for the Fund to trade personally or cause others to
            trade personally in contemplation of the market effect of such
            transactions.

      There are some conflict of interest situations that should be reviewed by
the Fund's legal counsel, if material. Examples of these include:

      o     service as a director on the board of any public or private company;

      o     receipt of gifts, in excess of reasonable or business-appropriate;


                                      -2-
<PAGE>

      o     the receipt of any entertainment from any company with which the
            Fund has current or prospective business dealings unless such
            entertainment is business-related, reasonable in cost, appropriate
            as to time and place, and not so frequent as to raise any question
            of impropriety;

      o     any ownership interest in, or any consulting or employment
            relationship with, any of the Fund's service providers, other than
            its investment adviser, principal underwriter, administrator or any
            affiliated person thereof; and

      o     a direct or indirect financial interest in commissions, transaction
            charges or spreads paid by the Fund for effecting portfolio
            transactions or for selling or redeeming shares other than an
            interest arising from the Covered Officer's employment, such as
            compensation or equity ownership.

III.  DISCLOSURE AND COMPLIANCE

      o     Each Covered Officer should familiarize himself with the disclosure
            requirements generally applicable to the Fund.

      o     Each Covered Officer should not knowingly misrepresent, or cause
            others to misrepresent, facts about the Fund to others, whether
            within or outside the Fund, including to the Fund's Board and
            independent auditor, and to government regulators and
            self-regulatory organizations.

      o     Each Covered Officer should, to the extent appropriate within his
            area of responsibility, consult with other officers and employees of
            the Fund and the adviser with the goal of promoting full, fair,
            accurate, timely and understandable disclosure in the reports and
            documents the Fund files with, or submits to, the SEC and in other
            public communications made by the Fund.

      o     It is the responsibility of each Covered Officer to promote
            compliance with the standards and restrictions imposed by applicable
            laws, rules and regulations.

IV.   REPORTING AND ACCOUNTABILITY

      Each Covered Officer must:

      o     upon adoption of the Code (or thereafter as applicable, upon
            becoming a Covered Officer), affirm in writing to the Board that he
            has received, read, and understands the Code;

      o     annually affirm to the Board that he has complied with the
            requirements of the Code and report on the Covered Officer's
            affiliations and relationships;


                                      -3-
<PAGE>

      o     not retaliate against any other Covered Officer or any employee of
            the Fund or its affiliated persons for reports of potential
            violations that are made in good faith; and

      o     notify the Fund's legal counsel promptly if he knows of any
            violation of the Code. Failure to do so is itself a violation of the
            Code.

      The Fund's legal counsel is responsible for applying the Code to specific
situations in which questions are presented under it and has the authority to
interpret the Code in any particular situation. However, any approvals or
waivers sought by a Covered Officer will be considered by the Independent
Directors on the Board.

      The Fund will follow these procedures in investigating and enforcing the
Code:

      o     the Fund legal counsel will take all appropriate action to
            investigate any potential violations reported to such counsel;

      o     if, after such investigation, the Fund legal counsel believes that
            no violation has occurred, such counsel is not required to take any
            further action;

      o     any matter that the Fund legal counsel believes is a violation will
            be reported to the Board;

      o     the Board will consider appropriate action, which may include review
            of, and appropriate modifications to, applicable policies and
            procedures; notification to appropriate personnel of the investment
            adviser or its board; or a recommendation to dismiss the Covered
            Officer;

      o     the Board will be responsible for granting waivers, as appropriate;
            and

      o     any changes to or waivers of the Code will, to the extent required,
            be disclosed as provided by SEC rules.

V.    OTHER POLICIES AND PROCEDURES

      The Code shall be the sole code of ethics adopted by the Fund for purposes
of Section 406 of the Sarbanes-Oxley Act and the rules and forms applicable to
registered investment companies thereunder. Insofar as other policies or
procedures of the Fund, the Fund's adviser, principal underwriter, or other
service providers govern or purport to govern the behavior or activities of the
Covered Officers who are subject to the Code, they are superseded by the Code to
the extent that they overlap or conflict with the provisions of the Code. The
Fund's and its investment adviser's codes of ethics under Rule 17j-1 under the
Investment Company Act and the adviser's more detailed policies and procedures
are separate requirements applying to the Covered Officers and others, and are
not part of the Code.


                                      -4-
<PAGE>

VI.   AMENDMENTS

      Any amendments to the Code, other than amendments to Exhibit A, must be
approved or ratified by a majority vote of the Board, including a majority of
independent trustees.

VII.  CONFIDENTIALITY

      All reports and records prepared or maintained pursuant to the Code will
be considered confidential and shall be maintained and protected accordingly.
Except as otherwise required by law or the Code, such matters shall not be
disclosed to anyone other than the appropriate Board, its legal counsel and the
adviser.

VIII. INTERNAL USE

      The Code is intended solely for the internal use by the Fund and does not
constitute an admission, by or on behalf of any Fund, as to any fact,
circumstance, or legal conclusion.

Date: November 12, 2003


                                      -5-
<PAGE>

                               EXHIBIT A

                  Chief Executive Officer - Thomas J. Herzfeld

                  Chief Financial Officer - Cecilia L. Gondor


                                      -6-

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.CERT
<SEQUENCE>3
<FILENAME>v06211_ex99-cert.txt
<TEXT>
EX-99.302CERT

                                 CERTIFICATIONS

I, Thomas J. Herzfeld, certify that:

      1. I have reviewed this report on Form N-CSR of The Herzfeld Caribbean
Basin Fund, Inc.;

      2. Based on my knowledge, this report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this report;

      3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material respects the
financial condition, results of operations, changes in net assets, and cash
flows (if the financial statements are required to include a statement of cash
flows) of the registrant as of, and for, the periods presented in this report;

      4. The registrant's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Rule 30a-3(c) under the Investment Company Act of 1940) and internal control
over financial reporting (as defined in Rule 30a-3(d) under the Investment
Company Act of 1940) for the registrant and have:

            (a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this report is being prepared;

            (b) Designed such internal control over financial reporting, or
caused such internal control over financial reporting to be designed under our
supervision to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles;

            (c) Evaluated the effectiveness of the registrant's disclosure
controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of a date within 90
days prior to the filing date of this report based on such evaluation; and

            (d) Disclosed in this report any change in the registrant's internal
control over financial reporting that occurred during the registrant's most
recent fiscal half-year (the registrant's second fiscal half-year in the case of
an annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial reporting;
and
<PAGE>

      5. The registrant's other certifying officer(s) and I have disclosed to
the registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):

            (a) All significant deficiencies and material weaknesses in the
design or operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to record,
process, summarize, and report financial information; and

            (b) Any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's internal control
over financial reporting.

Date: August 31, 2004

/s/ Thomas J. Herzfeld
- ---------------------------
Thomas J. Herzfeld
President and Chairman

                                    * * * * *

I, Cecilia L. Gondor, certify that:

      1. I have reviewed this report on Form N-CSR of The Herzfeld Caribbean
Basin Fund, Inc.;

      2. Based on my knowledge, this report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this report;

      3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material respects the
financial condition, results of operations, changes in net assets, and cash
flows (if the financial statements are required to include a statement of cash
flows) of the registrant as of, and for, the periods presented in this report;

      4. The registrant's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Rule 30a-3(c) under the Investment Company Act of 1940) and internal control
over financial reporting (as defined in Rule 30a-3(d) under the Investment
Company Act of 1940) for the registrant and have:

            (a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this report is being prepared;
<PAGE>

            (b) Designed such internal control over financial reporting, or
caused such internal control over financial reporting to be designed under our
supervision to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles;

            (c) Evaluated the effectiveness of the registrant's disclosure
controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of a date within 90
days prior to the filing date of this report based on such evaluation; and

            (d) Disclosed in this report any change in the registrant's internal
control over financial reporting that occurred during the registrant's most
recent fiscal half-year (the registrant's second fiscal half-year in the case of
an annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial reporting;
and

      5. The registrant's other certifying officer(s) and I have disclosed to
the registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):

            (a) All significant deficiencies and material weaknesses in the
design or operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to record,
process, summarize, and report financial information; and

            (b) Any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's internal control
over financial reporting.

Date: August 31, 2004

/s/ Cecilia Gondor
- ---------------------------------------
Cecilia Gondor
Secretary and Treasurer
(Principal Financial Officer)

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.906CERT
<SEQUENCE>4
<FILENAME>v06211_ex99-906cert.txt
<TEXT>
Exhibit 10(b)
EX 99.906CERT

Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
(subsection (a) and (b) of 18 U.S.C. 1350
Code)

In connection with the attached Report of The Herzfeld Caribbean Basin Fund,
Inc. (the "Fund") on Form N-CSR to be filed with the Securities and Exchange
Commission for the fiscal half-year ended December 31, 2003 (the "Report"), each
of the undersigned officers of the Fund does hereby certify that, to the best of
such officer's knowledge:

      1. The Report fully complies with the requirements of Section 13(a) or
15(d) of the Securities Exchange Act of 1934; and

      2. The information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations of the Fund
as of, and for, the periods presented in the Report.

Dated: August 31, 2004

/s/ Thomas J. Herzfeld
- -----------------------
Thomas J. Herzfeld
President and Chairman
(Principal Executive Officer)

Dated: August 31, 2004

/s/ Cecilia L. Gondor
- ------------------------
Cecilia L. Gondor
Secretary and Treasurer
(Principal Financial Officer)

</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
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