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Offshore EME bond issuance and the transmission channels of global liquidity

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  • Kim, Soyoung
  • Shin, Hyun Song

Abstract

Using offshore affiliates as financing vehicles by emerging market corporates (“offshore issuance”) has become widespread post-crisis. In this study, we investigate the extent to which offshore bond issuance has become a transmission channel of global financial conditions to emerging market economies. Using panel vector auto-regression methods, we find that offshore bond issuance has become more important than onshore bond issuance as a transmission channel of global liquidity after 2010. We also find that offshore bond issuance plays a significant role in countries with strengthened capital account restrictions, but not in countries with weakened capital account restrictions.

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  • Kim, Soyoung & Shin, Hyun Song, 2021. "Offshore EME bond issuance and the transmission channels of global liquidity," Journal of International Money and Finance, Elsevier, vol. 112(C).
    • Handle: RePEc:eee:jimfin:v:112:y:2021:i:c:s0261560620302928
    DOI: 10.1016/j.jimonfin.2020.102336
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    References listed on IDEAS

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    Cited by:

    1. Samuel Federico Kaplan & Arin Kerim Peren & Polyzos Efstathios & Spagnolo Nicola, 2022. "Stock Market Responses to Monetary Policy Shocks: Universal Firm-Level Evidence," Asociación Argentina de Economía Política: Working Papers 4571, Asociación Argentina de Economía Política.
    2. Mizen, Paul & Packer, Frank & Remolona, Eli & Tsoukas, Serafeim, 2021. "Original sin in corporate finance: New evidence from Asian bond issuers in onshore and offshore markets," Journal of International Money and Finance, Elsevier, vol. 119(C).
    3. Ge, Futing & Zhang, Weiguo, 2022. "The determinants of cross-border bond risk premia," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 81(C).
    4. Annina Kaltenbrunner & Elif Karaçimen & Joel Rabinovich, 2023. "The changing financial practises of Brazilian and Turkish firms under financial subordination, a mixed-methods analysis," Working Papers PKWP2306, Post Keynesian Economics Society (PKES).

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