China A shares remain on MSCI's review list

Consultations are continuing on whether or not to include A shares in the MSCI Emerging Market Index, said Rene Veerman, MSCI's managing director and head of client coverage for Hong Kong and Taiwan.

"The most relevant, latest revision (of the MSCI Emerging Market Index) was just over a month ago. This year we won't include China A shares in MSCI Emerging Markets, but the consultation continues," Veerman told reporters in Hong Kong.

MSCI initiated a review to study the possibility of including A shares in its Emerging Markets Index in June 2013, after Beijing implemented a series of positive market-opening measures to welcome foreign capital.

The latest review took place last month but the world's most popular indexing house again decided against adding mainland shares, citing concerns about "quota allocation process, capital mobility restrictions and beneficial ownership of investments".

MSCI previously said it would implement its inclusion plan in May 2017 but had left open the possibility of an earlier inclusion if all the criteria were met earlier.

"MSCI reviews and identifies countries on the basis of economic development, size, liquidity, market accessibility and extensive discussions with the investment community," Veerman said yesterday in a presentation.

The index company will include China American depositary receipts - Chinese stocks traded on US exchanges - in the MSCI China index in November. They will account for about 13 per cent of the index.