Korea and Taiwan remain 'emerging'
The MSCI Korea Index and the MSCI Taiwan Index will be maintained in ‘emerging market’ status – at least until the MSCI’s next Annual Market Classification Review in 2012.
Qatar and the United Arab emirates will also have an extension until December for a potential reclassification from ‘frontier’ to ‘emerging’ status to enable participants to assess the impacts of recent changes in those markets, MSCI announced.
Listed reasons for maintaining the ‘emerging’ status of both Korea and Taiwan included accessibility issues, in particular the lack of full currency convertibility.
This included the absence of active offshore currency markets, and issues linked to the rigidity of the ID systems, MSCI stated.
Korea has put some measures in place to alleviate the resulting frictions and inefficiencies including revisions to its Banking Act, but investor feedback suggests limited improvement, MSCI stated.
Anti-competitive practices have also not been eliminated, with the provision of stock market data still subject to contractual anti-competitive clauses, according to MSCI.
AUTHOR
Chris Kennedy
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