Korea from April next year will join the World Government Bond Index. Shown is the nightscape of the Yeouido financial district of Seoul's Yeongdeungpo-gu District featuring the flying balloon Seoul Moon. (Seoul Metropolitan Government)

By Charles Audouin

The nation from April next year will join the World Government Bond Index (WGBI).

The Ministry of Economy and Finance on Oct. 8 said the U.K.'s Financial Times Stock Exchange (FTSE) Russell confirmed Korea's inclusion in the WGBI as scheduled in April. As one of the world's three major bond indexes, the WGBI includes government bonds from 26 major economies.

The entry of Korean government bonds in the index will come in stages of eight installments in equal monthly amounts through November 2026.

"We will work closely with the Korean government, investors, and market infrastructure organizations to ensure the smooth inclusion of Korean government bonds in our indexes,” FTSE Russell said. "We will continue to receive feedback from market participants on whether this change is well-prepared."

As of this October, FTSE Russell estimated Korea's WGBI inclusion weight at 2.08%, ninth highest among all WGBI member countries. The U.S. has the largest of 40.9%, followed by China (10.1%), Japan (9.2%), France (6.5%), Italy (6%), Germany (5.2%), the U.K. (5.1%) and Spain (4%).

"This announcement is expected to greatly raise market predictability and help enhance the credibility and stability of the domestic government bond market," the ministry said. "The government will continue efforts to advance the domestic foreign exchange and capital markets so that foreign investors can invest in Korea's capital market without difficulty."

caudouin@korea.kr