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Title
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Localising sovereign debt : the rise of local currency bond markets in sub-Saharan Africa
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Author
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Abstract
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| This paper analyses the development of local currency sovereign bond markets (LCBMs) in sub-Saharan Africa (SSA), a potentially important source of longer-term public finance. We make two contributions to the literature. First, we build a novel data set comprising 28 SSA countries for the period 200014 to uncover the main correlates of LCBM capitalisation, of local currency bond (LCB) tenors and of LCB issue yields. We find that LCBM capitalisation in SSA relates to politico-institutional factors, overall financial development and financial system structure. For LCB tenors and issue yields, inflation levels matter too. Second, we complement our econometric analysis with qualitative case studies of Kenya and Nigeria, where we further investigate the drivers of LCBM development and place LCBMs in a broader public debt context. While we document the increasing importance of LCBMs in SSA, we also highlight new vulnerabilities, including those related to investor base composition. |
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Language
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English
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Source (journal)
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The world economy : the leading journal on international economic relations. - Oxford
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Publication
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Oxford
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2018
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ISSN
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0378-5920
[print]
1467-9701
[online]
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DOI
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10.1111/TWEC.12624
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Volume/pages
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41
:12
(2018)
, p. 3317-3344
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ISI
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000453601800004
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Full text (Publisher's DOI)
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Full text (open access)
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Full text (publisher's version - intranet only)
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