IDX to Seek Clarification from MSCI Over Potential Market Downgrade

The Indonesia Stock Exchange plans to request further clarification from MSCI regarding a proposal to downgrade the domestic capital market from an emerging market to a standalone market.

The Indonesia Stock Exchange plans to request further clarification from Morgan Stanley Capital International regarding its proposal to downgrade Indonesia’s capital market classification from an emerging market to a standalone market. The index provider previously stated that maintaining Indonesia in its current category is no longer appropriate following feedback and complaints from global market participants.

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In response to the potential downgrade, IDX President Director Jeffrey Hendrik asserted that the exchange, together with the Financial Services Authority, has implemented various measures to enhance transparency, market integrity, and overall standards across the domestic capital market. According to Jeffrey, these ongoing structural reforms have been positively received by both global investors and international index providers. Jeffrey emphasized that the IDX respects the independence of the index provider in conducting evaluations, yet it seeks further dialogue to understand the assessment.

The exchange noted that the proposal is not yet final, as the formal consultation phase with market participants remains open for feedback until April 30, 2027. The definitive outcome of the consultation will be announced no later than the end of June 2027. During this consultation period, the index provider is committed to providing interim updates on feedback from market participants.

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