MSCI points out obstacles in front of the South Korean market before a crucial review.

In its latest Market Accessibility Review report, MSCI stated that South Korea has not yet addressed several key obstacles faced by foreign investors, which is seen as a setback for both global funds and the government hoping for the country to upgrade to developed market status in the future. In the annual assessment released on Friday, MSCI acknowledged that South Korea has made progress in reforms, including plans to launch a 24-hour foreign exchange market and take wider measures to improve investor access. However, the New York-based index provider pointed out that the accessibility of the South Korean market is still hindered due to a lack of fully deliverable offshore Korean won market and ongoing inefficiencies in the short selling settlement process. Despite South Korea lifting the short selling ban in early 2025, "frictions have arisen in practice, and the relevant operational processes and infrastructure are still being continuously improved." The report also mentioned, "The calculation method for financing amount is not clear, leading to inefficiencies in the settlement process."