Bond Markets in Asia - Issuance

Issuance

Issuance in Asia is predominantly issued by sovereign issuers but corporate bonds are becoming an important source of growth in Asian fixed-income markets. Currently issuance is predominantly in US dollars, although local currency issuance is also growing. Asian governments, central banks and the Asian Development Bank are keen to see the expansion of Asian bond markets over the next few years in order to help provide finance for the large infrastructural development that the region needs over the next decade. Alongside the expansion of the bond markets, Asian governments and central banks are currently discussing the creation of an Asian Currency Unit. The ADB has suggested that bonds may also be issued in ACU over the next few years. This would help lower the financing costs for Asian issuers who have substantial trade links with other countries in the region.

Asian issuers tends to have a much higher credit rating than other sovereign debt, particularly those in Latin America because of the strong economic underpinnings and low political risks. Most Asian countries have ratings which are investment grade.