Branko Drcelic, Director of the Public Debt Administration at the Ministry of Finance, Serbia sat down with Bonds & Loans to discuss how the country moved from chronic deficits to a healthy surplus, catalysing a local currency debt capital market in the process.
Corporate borrowing in India is set to get a lot more challenging as investors search for higher coupons and banks tighten up their lending practices following a build-up of non-performing loans, according to analysts. It is unclear whether even the country’s largest corporates are immune to the sandwiching of rising interest rates and a banking sector in flux.
Just a few years ago, barely any debt capital markets investors would have paid much attention to regions like Central Asia and the CIS. Yet with overwhelming demand for sovereign notes issued by the likes of Belarus and Tajikistan, regular issues from Kazakhstan and a highly anticipated debut Eurobond from Uzbekistan, the region is putting itself on the EM fixed income map.
After a traumatic few years catalysed by the annexation of Crimea and the ensuing civil conflict with its easternmost regions, Ukraine has developed a certain degree of flexibility in managing a series of shocks encountered since. But a lack of progress on crucial reforms, political mismanagement, and consistent lack of access to credit for key sectors like agriculture threaten the progress achieved so far.
Despite a conspicuous rise in tensions between Turkey and some of its closest neighbours and allies, the country finished 2017 as one of the fastest growing economies in the world – thanks in part to an unprecedented fiscal stimulus that helped among other things stoke the continued deepening of the capital markets. Against that backdrop, a number of leading issuers and borrowers once again set new benchmarks in the credit markets for 2018, securing a number of ‘firsts’ while making the market more robust.
Sukuk – sharia-compliant bonds – may have risen to prominence in majority-Muslim countries over the past two decades, but their appeal has clearly gained momentum among a diverse group of stakeholders – and for good reason. These instruments offer borrowers ethical, price-competitive ways of diversifying their investments and raising new capital - just some of the reasons why global sukuk issuance has spiked in recent years.
The first two stages of the Egyptian government’s solar and wind programme have been somewhat hit-and-miss, but increased development bank involvement sets the next stage on a path to encourage wider private sector participation. Third time’s a charm – but only if local and commercial lenders play their part, analysts suggest.
With over USD33bn of issuances year to date in 2017 – from just under USD2.5bn in 2008 – the sovereign Sukuk market has grown rapidly over the past decade. Despite such progress, there remains room for further unprecedented growth. The market remains restricted by liquidity constraints, higher costs, and a lack of deep understanding of the Sukuk instrument. If proactive, however, borrowers can overcome these challenges in the pursuit of high-quality borrowing instruments.
The saying ‘water is the new oil’ has never been more accurate than it is today. The Middle East, Turkey and Africa (META) contains some of the world’s most water-scarce regions. Population growth and urbanisation have led to a rising demand for water and growing levels of wastewater. Increasing water production and ensuring efficient, effective wastewater treatment are essential to the continued development of the META region.
Bonds & Loans speaks with Irakli Gilauri, CEO of BGEO Group about the company’s funding strategy, its first – and the country’s first – local currency Eurobond, and how other emerging market corporates can help deepen demand for local currency assets.
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- Turkey’s 2018 Funding & Liquidity Agenda
18 Oct 2018