SEOUL: South Korea has failed to be added to the World Government Bond Index run by FTSE Russell, the London-based organisation says.

South Korea will remain on its watch list for a potential upgrade to a market accessibility level of two from one and consideration for inclusion in the WGBI, according to the FTSE Russell.

The country was added to the WGBI watch list in September 2022 and must wait until September this year to see if it will be included in the index when the financial entity announces its decision.

“Local market authorities continue to progress on initiatives intended to improve the accessibility of South Korean government bonds for international investors, which would facilitate the fulfillment of the criteria for a market accessibility level of two,” the British entity said in a statement.

The WGBI is a broad index designed to measure the performance of government bond markets, including local currencies and sovereign bonds of major advanced nations.

South Korea has been pushing for its inclusion in the global bond index, which it hopes will help attract foreign investment and raise investor confidence in its government bonds.

South Korea and India are the only countries among the world’s top 10 economies in terms of nominal gross domestic product that have yet to be included in the bond index.

“The government will push for reform measures regarding foreign investment with a goal to be included in the FTSE WGBI within this year,” Seoul’s finance ministry said. “We will also expand communications with international investors.”

FTSE Russell said it acknowledged “the meaningful progress” over the last six months by the South Korean government, as well as Seoul’s commitment to address feedback from investors regarding the implementation of reform measures.

 - ANN