Thursday, November 6

JSE to Lobby FTSE to Join Club of Elite Nations
THE JSE Securities Exchange SA is set to lobby the London-based FTSE group to have SA upgraded to an elite list of 24 nations classed as "developed" countries, which would give the country significant prestige as an investment destination.

The question is if this is reasonable. The last time I looked, the JSE was the 9th largest stock exchange in the world. However;

...what could prove a stumbling block was SA's relatively low gross domestic product per capita, which falls below the FTSE standard of $10000. SA is likely to argue for flexibility, pointing to recent upgrades in SA's sovereign status from rating agencies Fitch and Standard & Poor's.

Allan Greenblo, South African adviser to the FTSE, said SA was keen to avoid losing ground to China, which is to be upgraded to "advanced emerging" level.

"SA could be crowded out as China would eventually grab a larger share of the index tracking money available for advanced emerging countries," he said.

Another article by AllAfrica points out some of the rewards of being upgraded by the FTSE.

Annan: Global Funds Flow Wrong Direction

For the sixth straight year, net transfers of funds in 2002 flowed from poor countries to developed ones, not the other way around. UN Secretary General Kofi Annan told the General Assembly that increased investment and development aid are needed to reverse the trend, which bleeds low-income countries of hundreds of billions of dollars annually.


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