MSCI upgrades Kuwait to Emerging Markets

Executive Summary

• The Morgan Stanley Capital International (MSCI), a leading provider of global capital market indices, announced on June 25, 2019 that it would reclassify Kuwait as an emerging market, subject to availability of omnibus account structures and same National Investor Number (NIN) cross trades for international investors before the end of November 2019. MSCI is expected to convey its final decision on December 31, 2019. Kuwait now becomes the fourth GCC nation following the UAE, Qatar and Saudi Arabia to become part of the MSCI EM indices.
• Currently, only local licensed entities are allowed to trade using omnibus accounts and same NIN trading is available for only certain exempt ‘non-discretionary’ local accounts. An omnibus account allows for managed trades of more than one person, and allows for anonymity of the persons in the account. A broker who manages the Omnibus account would have the ability to execute trades on behalf of the holders of the account. The National Investor Number is a pre-requisite to trade in equity markets. Kuwait’s Capital Market Authority has announced that they will both be made available to international institutional investors before November 2019.