South Korea to unveil MSCI Developed Market inclusion roadmap early next year

South Korea's Ministry of Economy and Finance plans to unveil a roadmap for MSCI Developed Market inclusion early next year. This development aims to tackle long-standing accessibility issues keeping the country classified as an emerging market. Despite being Asia's fourth-largest economy, South Korea has faced challenges such as regulatory barriers that have prevented MSCI from classifying it as a developed market. The roadmap is expected to focus on enhancing market accessibility, addressing structural constraints highlighted by MSCI, such as restrictions in the foreign exchange market. Recent reforms aim to increase foreign participation, making Korea's markets more investable. The government sees this initiative as a way to eliminate the 'Korea discount' and improve investor confidence. Achieving MSCI status can attract substantial foreign capital as index-linked funds adjust allocations. However, such upgrades typically involve a watchlist phase, which allows global investors time to adapt before full inclusion. Ultimately, a successful inclusion could significantly enhance Korea's global investment appeal.