The global index provider has decided to maintain Indonesia's status as an emerging market in view of ongoing reforms, but says a downgrade is still possible if "sufficient progress" is not made by the November review.
Brokers and investors conduct stock transactions on Jan. 2, 2025, in the Main Hall of the Indonesia Stock Exchange (IDX) in Kebayoran Baru, South Jakarta. (Antara Foto/Hafidz Mubarak A)
Global index compiler MSCI has decided to maintain Indonesia in the emerging market category but says a downgrade remains possible as it continues to assess the effectiveness of domestic stock market reforms.In its June review, MSCI acknowledged the transparency reforms introduced by the Financial Services Authority (OJK), the Indonesia Stock Exchange (IDX) and the Indonesian Central Securities Depository (KSEI).
The measures include enhanced disclosure of shareholders that own more than 1 percent of a listed company rather than 5 percent previously, a more granular investor classification, a high shareholding concentration (HSC) framework and a road map to raise the minimum free float to 15 percent for IDX stocks.
“While these announcements represent a step in the right direction, what matters for international institutional investors is the consistent implementation and sustained effect of these measures across the market,” MSCI stated in the review, published on Tuesday in the United States.
