Analyst Says Indonesia's MSCI Report Card Superior to India, Korea and Taiwan
The Indonesian capital market is considered to have a higher level of accessibility compared to India, Korea, the Philippines, Taiwan, and Thailand, according to the MSCI Accessibility Review 2026.
Capital market observer and Co-Founder of Pasar Dana, Hans Kwee, stated that Indonesia’s position remains strong based on the 18 criteria used by MSCI. In the latest assessment, Indonesia achieved 10 criteria rated ‘++’, six rated ‘+’, and only two rated ‘-’.
He noted that while this achievement places Indonesia below Hong Kong and Malaysia, it remains superior to several other emerging nations. “Indonesia is ahead of India, Korea, the Philippines, Taiwan, and Thailand. When compared to Vietnam, which has the potential to rise to Emerging Markets, Indonesia is far superior, as Vietnam only has 6 criteria rated ‘++’, 4 rated ‘+’, and 8 rated ‘-’”, Hans Kwee wrote on Monday (22/06/2026).
Hans noted that almost all of Indonesia’s indicators in the MSCI Accessibility Review 2026 remained stable compared to the previous year. The only change occurred in the Information Flow aspect, which dropped from a ‘+’ rating to ‘-’.
Nevertheless, he believes the decline in Information Flow has been addressed by regulators and market infrastructure players through capital market reform agendas led by the Financial Services Authority (OJK) and Self-Regulatory Organisations (SRO). Consequently, he expects this indicator to have the potential to improve in the next assessment.
Furthermore, Hans highlighted Indonesia’s achievement in the Foreign Ownership Limits and Foreign Room indicators, which received ‘++’ ratings. This assessment is even higher than Hong Kong and India, which only received ‘-’ ratings.
He explained that MSCI determines market classification based on three main factors: the level of economic development, market size and liquidity, and market accessibility. Currently, Indonesia has 11 stocks that meet MSCI’s size and liquidity requirements, far above the minimum threshold of one stock required to maintain Emerging Market status.
“Given this, it is impossible for Indonesia to drop to Frontier Market in the MSCI Market Classification Review on 23 June,” he said.
He also assessed that the chance of Indonesia being downgraded to Frontier Market status is very small. The most likely scenario is that Indonesia remains in the Emerging Market group, accompanied by the removal of the current interim freeze status.
He added that the main impact of the current interim freeze is the delayed opportunity for several Indonesian stocks to enter the MSCI index. If the status is not lifted, the potential addition of Indonesian stocks to the MSCI index will likely only be realised after the next review process.
In line with this, Associate Director of Pilarmas Investindo Sekuritas, Maximilianus Nicodemus, stated that this aligns with market expectations. He noted there is no reason for Indonesia’s classification to be downgraded from its emerging market status.
“With good economic growth prospects, despite the risks of increases, we are confident that Indonesia is still worthy of being there,” he told CNBC Indonesia on Friday (19/06/2026).
Previously, Acting President Director of the Indonesia Stock Exchange (BEI), Jeffrey Hendrik, assessed that the report maintains many positive aspects of the Indonesian capital market, although there are several notes requiring improvement.
“We certainly appreciate what has been presented, and it has been part of our discussions all this time. Therefore, improvements will continue to be made. One thing is certain: we believe it will be better in the future,” Jeffrey said at the BEI Building, Jakarta.
Regarding concerns that Indonesia could potentially drop from the emerging market category to frontier market in the next MSCI announcement on 23 June 2026, Jeffrey stated his optimism that Indonesia will remain in the emerging market group.
“Looking at what has been presented today, we have great hope that Indonesia will remain in the emerging market,” Jeffrey asserted.
Furthermore, the IDX will continue to conduct communications and regular meetings with MSCI to clarify several points of concern. One of the issues to be discussed relates to the availability of information in English, as mentioned in the MSCI report.