Investors, regulators and entrepreneurs of the UAE were given a deadline by MSCI in the early hours yesterday.
Regulators were given six months to comply with a set of rules for the UAE to be promoted up the ladder of global stock markets. All these players, however, should consider something more important.
By December these crucial players in the economy should decide upon the true purpose of a public stock market and whether they need one.
The euphoria surrounding the run-up to MSCI's decision on allowing the UAE to leave the frontiers of investment to join emerging markets such as Brazil, China and Thailand is understandable. But to focus so much energy on joining this club for its own sake is an unhelpful diversion.
Complying with the organisation's rules on the speed and efficiency of trading or on foreign share ownership is a helpful guide on the road to a level playing field for global stock trading. That much is obvious from the progress the UAE has made on both these fronts, which was recognised by MSCI in its decision this week. But there are more fundamental issues to address before beginning to tackle these technicalities.
A well functioning stock market is a collective force for prosperity born out of necessity.
In 18th-century America, traders and shippers would gather under a buttonwood tree in what is now downtown Manhattan to exchange ideas and propositions with investors. If the investors liked the sound of whatever caper the traders proposed, they would fund it in return for a share of the profits.
The New York Stock Exchange, which stands close to where that buttonwood tree grew, performs precisely the same function. It is a magnet for investors to fuel the profits of tomorrow.
But the UAE's economy is in a different phase. Its key engines of growth - oil, property development, telecommunications and even tourism and hospitality - are led by companies with a significant reliance on the state for capital.
These economic powerhouses do not need to gather at the buttonwood tree to fund growth and prosperity, so they do not truly need a stock market.
To create a real need for a stock market, more companies that play a central role in the UAE's economic development should consider floating larger stakes on the ADX and DFM.
Unless our markets can play their role - that of finding and distributing capital among successful economic players and weeding out those bound to fail - it does not matter what MSCI calls them.
