MSCI Rejects South Korea for Developed Markets Index Despite Record Stock Market Gains

According to MSCI, South Korea failed to be added to the MSCI Developed Markets Watch List in 2026, citing insufficient market accessibility as the primary barrier. The agency specifically identified restrictions on offshore won transactions and limited foreign exchange market liquidity as key obstacles preventing global institutional investors from freely accessing Korean capital markets.

Despite the rejection, South Korea's financial authorities are accelerating reform efforts. As of June 6, 2026, the Korea Exchange operates 24-hour won-dollar foreign exchange trading. The government plans to launch an offshore won settlement system on a trial basis in September, with full implementation beginning next year. Analysts view these structural improvements as critical for potential inclusion in 2027 or later, noting that MSCI now requires demonstrated market stability before reassessing South Korea's status.