Henry Fernandez, CEO of MSCI, stated that South Korea's equity markets exhibit characteristics typical of emerging markets, which prevents the country from achieving developed-market status. He emphasized that the inability to trade the Korean won outside of local office hours complicates portfolio management for international investors.
Although South Korea's Kospi index has performed exceptionally well, surging 112% in 2025, MSCI pointed out several issues, including rigid investor identification systems and restrictions on investment products, as barriers to an upgrade. While reforms are underway, concerns remain about the liquidity of the won in a potential 24-hour trading environment.
MSCI's decision not to place South Korea on the Developed Markets watchlist reflects ongoing investor apprehensions regarding these unresolved issues