The FTSE Group is exploring the possibility of upgrading Israel's status from an advanced emerging market to a developed country, the index provider said Tuesday. "Israel had until last year passed all but one of the criteria that the market has told us is appropriate for a developed market, and this year it passed that requirement," Gareth Parker, head of business development at the FTSE Group said. "As a result, Israel meets all the criteria and we have placed it on the watch list for possible promotion because it is now ready." That means that Israel, currently classified as an advanced emerging market, is now under review for a year. Having achieved the first step in changing its status, Israel will be assessed again next September for an upgrade to developed status, after which the FTSE would give at least a six-month notification to investors should the change be approved. Four other countries were added to the watch list - Poland and Hungary for a possible move to advanced emerging status, Greece for a downgrade to emerging market from developed and Pakistan for a possible removal from the FTSE Global Equity Index Series. FTSE bases its classifications on 20 investment criteria which it developed with feedback from investors who were looking for more transparency about how different markets were classified. The criteria are divided into four categories: market and regulatory environment, custody and settlement, dealing landscape and the derivatives market. Each sub-category is graded with either a "pass" color coded green, "restricted" yellow or "not met" red. Parker explained that geopolitical issues do not come into considerations for the grading. "We are trying to give people more information in their armory as to decide what investment they should make and where they should put their money," he said. "Through this process they know that if they decide they want to be in Israel, it is a very well developed market that meets all these criteria." As a developed country, Israel would join the ranks of Germany, Switzerland, the UK, France among other European economies, and Parker added that being on the watch list will increase investor awareness about the market here. Those managers who run developed markets funds will be looking at Israel and working out what they will do if the actual change is implemented, he explained, while others will take note that Israel is a market they need to investigate. "Moving to being a developed market has got to be perceived as a step up," Parker said. "The fact that Israel meets literally all the criteria stands out for us. There isn't anything the international investor needs to be concerned about in the physical reality of the market."