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UAE and Qatar upgrades to shake up region
09 August 2013
Index provider MSCI has brought two new Gulf entrants into the emerging markets club, heralding a potentially seismic shift in the region’s fortunes, finds James Gavin
The upgrade of Qatar and the United Arab Emirates (UAE) from frontier market to emerging market (EM) status has long been anticipated. After almost five years of rumours, the elevation was finally announced on June 11 and is a reflection of the widespread recognition of how far these two markets have developed in recent years.
Both have made a concerted effort to engineer their elevation into the EM band over the past couple of years, topped off in May 2013 with the introduction of mechanisms to deal with false trades.
The Abu Dhabi Exchange cleared the final hurdle on May 7 by instituting a buyer compensation scheme whereby an investor purchasing stocks will be paid cash compensation in the event of securities being unavailable for delivery to the investor on the settlement date.
Market participants also recognised Qatar’s progress in improving the operational efficiency of the delivery versus payment (DVP)...
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