OJK Clarifies MSCI Review Period, Denies Market Status Downgrade Is Imminent

The Chief Executive of Capital Market, Financial Derivatives, and Carbon Exchange Supervision at the Financial Services Authority (OJK), Hasan Fawzi, has clarified the results of Morgan Stanley Capital International’s (MSCI) assessment, which will continue to review the progress of Indonesia’s capital market reforms. He dismissed the notion that MSCI is ‘suspending’ the decision on Indonesia’s market classification until November 2026. ‘That is not correct. What exists is a demand for us to be consistent and effective in implementing [the reforms],’ Hasan told reporters at the Indonesia Stock Exchange in Jakarta on Tuesday. According to him, MSCI’s notes should not be interpreted as a risk of a downgrade to frontier market status in the coming November. Hasan explained that if MSCI assesses by November that the reform agenda has not been implemented consistently, Indonesia will be placed on MSCI’s consultation list. He likened this list to the watch list issued by FTSE Russell, noting that the market classification review has its own separate timeline. Hasan stated that the OJK, together with Self-Regulatory Organizations (SROs) in the capital market, routinely holds meetings with global index providers and international investors. ‘God willing, we will convey the progress in due course,’ he said. In its market classification review released on Wednesday, 24 June 2026, MSCI decided to maintain Indonesia’s status as an emerging market. However, MSCI will continue to review the consistency and effectiveness of the implementation of Indonesia’s capital market reforms. Consequently, MSCI will keep assessing the implementation of these reform efforts over the next five months. ‘If sufficient progress is not visible by the time of the November 2026 MSCI Index Review, MSCI will consider various options for the appropriate treatment of Indonesia, including the possibility of a consultation on reclassifying Indonesia from Emerging Market to Frontier Market status,’ MSCI stated.