June 20, 2013
Greece on review for move to emerging markets
MSCI, which has $7 trillion (4.45 trillion pounds) benchmarked against its indices globally, said that Greece was no longer in line with developed markets' size requirements. It also said Greek authorities had failed to address concerns over certain kinds of transactions.
"The Greek equity market has experienced sharp declines, which are of course associated with the situation in Greece, the economic situation. The market has shrunk quite significantly," Dimitris Melas, MSCI's executive director, told reporters.
MSCI criteria for classification include investor access, as well as market size and liquidity, and the country's overall wealth. While the currency is not a criteria, Greek per capita income of $25,000 is significantly above MSCI's cut-off for emerging markets.
Greece made the jump from emerging markets to developed in 2001. But plunging prices mean Greece currently makes up only a tiny 0.0193 percent of the MSCI global markets index.