Global media lauds Pakistan’s inclusion in emerging markets index

A number of international media outlets including the Wall Street Journal, Bloomberg and CNBC have covered the news of Pakistan’s reclassification to MSCI’s emerging market index and have analysed its impact on Pakistan’s capital markets.

“That’s an interesting lesson from Pakistan. The investors are comfortable now that they won’t close the market again,” CNBC in its analysis quoted managing director J.P. Morgan, Adrian Mowat.

The Wall Street Journal noted that the government of Prime Minister Nawaz Sharif made boosting foreign investment in Pakistan a key part of its plan to revive the country’s economy when it came into power in 2013. Reuters mentioned in its report that over the past few years officials had been enacting a host of market reforms to regain the trust of investors, including demutualising Pakistan’s bourses to weaken the influence of stockbrokers and deepen the investor base.

Bloomberg states that Asia’s best-performing share market of 2016 could attract about $220 million of inflows. The media outlet says that Prime Minister Nawaz Sharif has boosted economic growth in recent years and achieved relative stability through an International Monetary Fund loan program that averted an external payments crisis in 2013.

Yahoo News reports that Pakistan became the first frontier market since Qatar and the United Arab Emirates several years ago to earn the prestigious frontier-to-emerging promotion.

Credit Suisse thinks that the Pakistani economy is much like the Indian economy which remains domestically focused. This is reflected in the $28 billion equity market which is mostly domestic, including banks. Pakistan’s economy has delivered successful growth in recent years, although the political environment remains unfavourable.