Kuwait Achieves ‘Emerging Market’ Status in Latest MSCI Reclassification

Monday, 23 December 2019

Kuwait, 19 December, 2019: Marking a momentous milestone in its transformation into a
world-class financial and commercial center, Kuwait has been officially upgraded to
Emerging Market status by leading index compiler MSCI Inc. Effective May 2020, the
country’s MSCI indexes will be reclassified to Emerging Markets status.
Paving the way for increased participation from foreign investors in Kuwait’s capital
market and driving significant capital inflows to the country, the inclusion will take place
in one phase with the addition of nine blue chips to the benchmark. Kuwait’s addition adds
further diversification to the MSCI Emerging Markets Index with an estimated weight of
The reclassification of Kuwait from its previous ‘Frontier Market’ status comes as an
emphatic endorsement for the sweeping market development reforms undertaken by the
tri-lateral task force of Boursa Kuwait, the Capital Markets Authority (CMA) and Kuwait
Clearing Company’s (KCC).
MSCI had granted conditional approval for the inclusion of Kuwait in the coveted index
as part of the benchmark provider’s 2019 Annual Market Classification Review held on
June 25, 2019. The country successfully completed the implementation of MSCI’s
recommendations, including the introduction of omnibus account structures and same
National Investor Number (NIN) cross trades by the end of October, a month ahead of
the stated deadline.

The official status upgrade follows the country’s inclusion in S&P Dow Jones Indices’
Global Equity Indices, with an Emerging Market classification in December 2018 and in
the FTSE Russell Emerging Markets Index in September 2017.
Commenting on the achievement, Mr. Hamad Al-Humaidhi, Chairman, Boursa Kuwait,
said: “Kuwait’s MSCI status upgrade represents a tremendous achievement that places
the country firmly on the global investment map, and will contribute to sustainable
prosperity for the nation and its people. I would like to take this opportunity to thank His
Highness Sheikh Sabah al-Ahmad Al-Sabah, Emir of Kuwait, and His Highness Sheikh
Nawaf Al-Ahmad Al-Jaber Al-Sabah, Crown Prince of Kuwait, for their wise leadership
and tireless support for the Kuwaiti economy, which, under their visionary stewardship,
continues to go from strength to strength.”
Mr. Mohammad Al-Osaimi, Chief Executive Officer, Boursa Kuwait, commented: “As
we celebrate this milestone accomplishment, I would like to extend my deepest gratitude
to the Board of Directors, the senior management and my colleagues at Boursa Kuwait
as well as the Capital Markets Authority and the Commissioner’s Council for their
unremitting commitment and tireless efforts. The seamless support we received from the
Kuwait Clearing Company and its employees have also been instrumental to the success
of our endeavors in developing the Kuwaiti capital market in accordance with global
standards. Our regulatory and operational reforms as well as infrastructure improvements
to enhance market access for foreign investors enabled us to secure the coveted MSCI
Emerging Market status, representing a major step towards realizing the country’s
overarching objectives outlined in the New Kuwait 2035 vision.”
Boursa Kuwait’s recent milestones include the completion of its privatization, becoming
the only stock exchange in the Middle East that is 94 percent owned by the private sector.
The achievement follows the conclusion of the public offering to Kuwaiti citizens for the
Capital Markets Authority’s 50 percent stake in the company in December. The company
has also rolled out numerous initiatives to improve market access and efficiency, enhance
transparency and governance, increase liquidity, and strengthen investor confidence. It
also hosted a series of roadshows and corporate day events across leading markets
around the world to promote the Kuwaiti capital market.