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Asean Bond Market Development; Where Does it Stand? Where is it Going?

Author

Listed:
  • Mahmood Pradhan
  • Shanaka J Peiris
  • Mangal Goswami
  • Dulani Seneviratne
  • Joshua Felman
  • Andreas Jobst
  • Simon T Gray

Abstract

Since the Asian crisis, ASEAN5 countries have expended considerable effort in trying to develop their domestic bond markets. Yet today these markets are not much larger, relative to GDP, than they were a decade before. How can we explain this? And does this mean that domestic markets have not, in fact, developed? The paper argues that bond market growth has been held back by a sharp fall in investment rates, which has left firms with little need for bond borrowing. Even so, markets have developed in other ways, to such an extent that substantial amounts of foreign portfolio investment have begun to flow into ASEAN5 bonds. These developments have important ramifications. With the investor base growing and infrastructure investment likely to rise, ASEAN5 bond markets could expand rapidly over the next decade, holding out the prospect that the region could finally achieve "twin engine" financial systems.

Suggested Citation

  • Mahmood Pradhan & Shanaka J Peiris & Mangal Goswami & Dulani Seneviratne & Joshua Felman & Andreas Jobst & Simon T Gray, 2011. "Asean Bond Market Development; Where Does it Stand? Where is it Going?," IMF Working Papers 11/137, International Monetary Fund.
  • Handle: RePEc:imf:imfwpa:11/137
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    References listed on IDEAS

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    9. Shanaka J Peiris, 2010. "Foreign Participation in Emerging Markets’ Local Currency Bond Markets," IMF Working Papers 10/88, International Monetary Fund.
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    Cited by:

    1. repec:eee:reveco:v:51:y:2017:i:c:p:193-213 is not listed on IDEAS
    2. repec:eee:quaeco:v:66:y:2017:i:c:p:136-148 is not listed on IDEAS
    3. Yibin Mu & Peter Phelps & Janet Gale Stotsky, 2013. "Bond Markets in Africa," IMF Working Papers 13/12, International Monetary Fund.
    4. Sonali Jain-Chandra & D. Filiz Unsal, 2014. "The effectiveness of monetary policy transmission under capital inflows: Evidence from Asia," Borsa Istanbul Review, Research and Business Development Department, Borsa Istanbul, vol. 14(2), pages 96-103, June.
    5. Mukherjee, Dr. Kedar nath, 2012. "Corporate Bond Market in India: Current Scope and Future Challenges," MPRA Paper 42478, University Library of Munich, Germany.
    6. Olaf Unteroberdoerster & Runchana Pongsaparn, 2011. "Financial Integration and Rebalancing in Asia," IMF Working Papers 11/243, International Monetary Fund.

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