GIC and Temasek deny pressuring MSCI to downgrade Indonesia

Singaporean sovereign wealth funds GIC and Temasek have rejected allegations that they pressured index provider MSCI to downgrade Indonesia’s stock market classification. The denials follow claims made by former Indonesian Trade Minister Muhammad Lutfi, who suggested that such a downgrade could trigger market panic and allow investors to acquire Indonesian equities at lower prices.

A spokesperson for GIC stated that investment decisions are driven by company and asset-level fundamentals rather than index classifications, noting that the firm has invested in Indonesia for over 30 years. Fock Wai Hoong, Temasek Global Investment’s head for Asia-Pacific excluding China and India, described the allegations as having ‘no basis and are patently untrue,’ asserting that no Temasek personnel have contacted MSCI to influence regional exchange decisions.

MSCI is currently consulting with market participants regarding a plan to change Indonesia’s classification from an Emerging Market to a Standalone Market. A final decision is expected to be announced by June 30, 2027.