UAE gets market upgrade - 28th Sep 2011

The UAE has been upgraded from frontier to emerging market status by Russell Investments, a global emerging fund manager.
The UAE is the only country to obtain emerging market status within the Russell Global Index series.
Russell’s announcement came in the wake of a decision by MSCI in June to postpone a decision on upgrading the UAE and Qatar to emerging market status for six months.
S&P is also close to a decision on upgrading several countries in the region. In July it said consultations were taking place in a bid to make a decision on upgrading the UAE, Jordan and Qatar by the first quarter of 2012.
An upgrade to emerging market status would force global emerging market fund managers, who benchmark to the emerging market index, to allocate funds to the region. That would raise liquidity levels and put the MENA region more firmly on the radar of global investors. It would also almost certainly spur the inflow of foreign direct investments into the UAE.
While the UAE is the only GCC country to have received Russell emerging market status, the firm has said Qatar also meets most of the criteria for an upgrade. The main reason this has not been done yet is that Qatari regulations stipulate a 25 percent foreign ownership limit.

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