Prabowo accused MSCI of trying to intimidate Indonesia — Channel NewsAsia
Indonesian President Prabowo Subianto said on October 21 that global index provider MSCI had tried to “intimidate” the country by warning that Indonesian stocks could be reclassified as a standalone market. He made the remarks during a cabinet meeting, Channel NewsAsia reports.
“MSCI intended to intimidate us,” Prabowo said. According to him, Indonesia is not afraid of anyone and will not allow itself to be intimidated. The president also mentioned foreign interference but gave no details.
MSCI warning
Last week, MSCI said it was considering reclassifying Indonesian stocks as a standalone market. The provider said Indonesia was not doing enough to counter coordinated trading practices on its stock market.
The unexpected announcement triggered a record two-day stock sell-off. According to the source’s assessment, a possible downgrade threatens significant capital outflows and could cut Indonesia’s economy, valued in the report at $1.5 trillion, off from major investment flows tied to emerging-market indices.
Response to the accusations
In response to an inquiry, MSCI said it makes decisions using transparent, rules-based methodologies. The provider also said it would continue monitoring the situation on the Indonesian market and engaging with its participants and authorities.
Former Indonesian trade minister Muhammad Lutfi wrote on Instagram that Singapore state investors Temasek and GIC had allegedly pressured MSCI to issue the warning. GIC and Temasek rejected the claims. GIC called the accusations false, while Fock Wai Hoong, head of Temasek Global Investments for Asia-Pacific, said that neither the institution nor its employees had approached MSCI to influence its decisions regarding exchanges in the region.
