Israel Struggles With Upgrade From Emerging to Developed Market

Israel struggles with its move from an emerging to developed market
Tel Aviv Photograph by Jeremy Woodhouse/Corbis

In the minds of many investors, Israel left the ranks of emerging markets in 2010. In May of that year, MSCI, the New York-based firm that builds popular investing indexes, added the country to its benchmark of developed nations. The promotion was a sign of Israel’s success: Its economy had recovered from the financial crisis faster than most advanced nations, and foreign money was pouring into its stock market. In 2009, Israel’s benchmark TA-25 stock index gained 75 percent. “We’re playing with the big boys now,” said Ester Levanon, then the chief executive officer of the Tel Aviv Stock Exchange (TASE), after winning MSCI’s approval.

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