1. Discussion by Salim Dehmej
Comments on
“What Slice of the Pie? The Corporate Bond Market Boom in Emerging Economies”
Discussion by Salim Dehmej
17-18 NOVEMBER 2016, Madrid

2. Topical issue Source: FT 05/10/2016 Source: FT 01/11/2016
Source: FT - Saudi Arabia’s $17.5bn bond sale has lessons for debt market

3. Summary
Aim: Evolution of NFC’ debt composition in emerging countries, in Local & Foreign currency markets.
Results: determinants of bond market access in EMs vary with global cyclical conditions (FC) and macro fundamentals (LC).
Are all EM concerned? market size/liquidity and entry/exist facilities are important.
The paper also highlights some financial stability risks and come out with policy recommendations.

4. Data & Methodology Data: 47 EMs, for the 2000–13 period.
Decomposed both into bank loans and bonds, and into local and foreign currencies
Uses 2 econometric technics:
- Censored panel regression: Identify global and local drivers of bond market shares
- Panel quantile regression: take into account the bond market development (market size)

5. Comments (1/5)
Is it possible to extend data to 2016 instead of 2014 (capturing recent trends: during tightening)
Financing structure: who buy bonds? If banks : not disintermediation but market intermediation?
Is the exchange rate regime matters? Is private bond crowding out sovereign debt?

6. Comments (2/5)
Financial stability : more details on debt: short vs long term; senior/secured? ; by rating (junk bonds?)
Source: Molteni and Umana Dajud (forthcoming)

7. Comments (3/5) Corporate debt by sector/region
Source: FSB 2015 (IMF data)

8. Comments (4/5)
Is there any threshold?
Source: FSB 2015

9. Comments (5/5)
Policy perspective: internal/equity financing instead of debt (debt overhang/deleveraging)
What about ex ante Macroprudential policy (FX related tools) and ex post capital control (CMF) measures?
Form
Separate the literature from the introduction (very long)?
Difficult to follow all regressions -> separate robustness/sensitivity from main regressions