Although it’s difficult to get exact figures, one banker reckons that corporates and financial institutions in developing countries issued about $125 billion of local-currency debt in 2005. That’s more than the amount that was issued by these same borrowers in the international capital markets.
In Asia (excluding Japan), the outstanding amount of local-currency bonds has increased by 167% since 1996. Eastern Europe, Africa and Latin America are also making progress. Borrowers in several countries, such as Russia, South Africa, Brazil, Colombia and Mexico, are more readily using their domestic markets to fund themselves, reducing their vulnerability to exchange rate risk.
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