Indonesia’s stock market is at risk of being reclassified from an Emerging Market to a Frontier Market by MSCI, a leading global index provider. The potential downgrade stems from concerns regarding transparency and market quality. MSCI has issued a warning, giving Indonesia until November 2026 to demonstrate significant improvements in these areas. A demotion to Frontier Market status could discourage foreign investment and negatively impact market liquidity. Indonesian authorities are now under pressure to address the identified shortcomings and maintain the country’s current market classification. Failure to do so would signal reduced investor confidence and potentially hinder economic growth. The government has not yet released a detailed response to the MSCI ultimatum.