FTSE Country Classification

FTSE recognises the importance of the application of a transparent, objective and consistent approach when assigning the market status of countries as developed or emerging.

In 2003, FTSE conducted a widespread market consultation which resulted in the development of a framework and criteria for assigning countries based on:

• Economic size
• Wealth
• Quality of markets
• Depth and breadth of markets

FTSE applies this framework to conduct an annual review of the market status of all countries into Developed, Advanced Emerging or Secondary Emerging. Any changes to a country’s status will be subject to at least six months notice.

In order to ensure that the potential reclassification of countries is transparent to investors we have created a Watch List of counties that may be subject to a change in their classification if a number of set conditions are met. The Watch List is reviewed annually by the FTSE Equity Indices Committee.

A full list of countries and their current classification can be viewed in the September 2007 Country Classification Update.

September 2007 Country Classification Review

Following the September 2007 Country Classification Review, the FTSE Policy Group has approved four changes to the designation of countries in the FTSE Global Equity Index Series:

• Israel will be promoted to Developed status in June 2008;
• Hungary and Poland will be promoted to Advanced Emerging status from June 2008.

The Policy Group also confirmed that the FTSE Watch List now comprises the following countries:

• China 'A' Shares;
• Greece;
• South Korea;
• Taiwan;
• Pakistan (update January 2008).

For further information, including the full list of Watch List countries, please download the September 2007 Country Classification Update.