## _wp14127 - 1. Summary of First-Time Issuances

## Source details

**Canonical URL:** [_wp14127 - 1. Summary of First-Time Issuances](https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/wp/2014/_wp14127.pdf)

## Other formats

- [Markdown version](/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/wp/2014/_wp14127.pdf.md)
- [Structured JSON version](/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/wp/2014/_wp14127.pdf.json)

---

### Introduction: objectives and context
- International bond issuance by debut issuers has risen in recent years driven by both demand and supply factors.
- Objectives of the paper:
  - Explore rationale behind the movement into international bond markets by debut issuers.
  - Analyze implications of such issuances for sovereign risks (exchange rate, interest rate, refinancing).
  - Suggest policy actions to mitigate those risks.
- Contextual points:
  - Bonds issued in international markets are typically denominated in hard currencies, have large volumes and a bullet structure, increasing exposure to exchange rate and refinancing risk.
  - The sum of issuance over the last decade is US$14 billion, which represents less than 3 percent of the market capitalization of emerging market bonds (JP Morgan’s EMBIG was US$579 billion at end-April 2013).

### Country coverage: sample and selection criteria
- Sample:
  - 23 countries that issued in the international market for the first time since 2004 (or re-entered after a long hiatus).
  - Total amount issued since then totals about US$14 billion (until December 2013).
- Selection criteria for inclusion:
  - (1) Placed a financial instrument in the international market for the first time since 2004;
  - (2) The issued amount is at least 200 million U.S. dollars;
  - (3) The proceeds were devoted to either covering financing needs or as a debt management operation;
  - (4) The instrument was issued by the central government.
- Notes:
  - Tanzania’s issuance was a private placement and is included.
  - Montenegro and Albania issued in Euros; all other new issuances were in U.S. dollars.
  - Mongolia issued two bonds: a 10Y bond for $1,000mn and a 5Y bond for $500mn.

### Stylized facts on issuances
- Aggregate and regional patterns:
  - 23 EMs and LICs issued internationally for the first time or re-entered after a long hiatus since 2004.
  - Africa accounted for 36 percent of issuances by number (9 issuances) and US$4.9 billion of the gross amount.
- Timing and clustering:
  - Debut sovereign issuances slumped in 2008–09 (only Georgia and Senegal tapped markets).
  - Since 2010, fourteen sovereigns have tapped international capital markets, issuing a total of US$8.5 billion (or US$564 million on average per issuance).
  - Evidence of regional bunching: e.g., Belarus, Montenegro and Albania in 2010; Bolivia, Paraguay and Honduras within a four-month span.
- Instrument characteristics:
  - Majority are U.S. dollar-denominated, fixed-coupon bullet securities.
  - Maturity typically ranges from 5 to 10 years; only half of the country sample issued at 10 years.
  - Issue sizes ranged from US$200 million to US$1,000 million; larger bonds issued by large economies or resource-rich countries (e.g., Mongolia, Zambia, Gabon).
- Investor market dynamics:
  - International market practices largely define instrument characteristics (medium to long-term, fixed rate, hard currency).
  - International bonds enable diversification of investor base and access to a more liquid global bond market.

### Rationale for issuance — demand and supply factors
- Demand-side drivers:
  - Search-for-yield, ample international financial liquidity, and demand for portfolio diversification produced demand-driven easy financing conditions.
  - Favorable country prospects and prudent fiscal policies in many developing countries attracted investor capital.
- Supply-side drivers and country motives:
  - Need to raise resources for large infrastructure projects not fundable domestically (notably in several African issuers such as Zambia and Senegal; Latin American issuers such as Paraguay and Bolivia).
  - Decline in concessional financing as countries graduate to middle income status increased attractiveness of nonconcessional international bonds.
  - Uses of proceeds included budget support, repaying arrears (e.g., Honduras), debt restructuring (e.g., Seychelles 2010, Gabon 2007), and creating benchmarks for the corporate sector (e.g., Nigeria).
- Cost considerations:
  - Issuing in currencies with the lowest cost of capital can reduce borrowing costs assuming no significant currency depreciation over bond life.
- Debt capacity:
  - Almost half of first-time issuers have debt to GDP ratios below 60 percent, low debt services and relatively smooth debt redemption profiles, providing some room to borrow at non-concessional terms.
  - Exceptions include Seychelles (debt to GDP of 132 percent in the year of issuance, down from almost 176 percent three years before), and Sri Lanka, Mongolia, Pakistan and Jordan (debt ratios between 60-100 percent of GDP).

### Market signals and credit ratings
- Credit rating dynamics:
  - In some cases, improvements in credit ratings preceded first issuances, especially in Latin America.
  - Almost half of the countries reached a BB- or higher rating at the time of issuance (upper level of HY ratings), particularly in Latin America and Asia; less common in Africa and Eastern Europe and Middle East.
  - Rating upgrades serve as a positive signal to investors and can help secure minimum comfort for debut issuances.

### Macroeconomic conditions at time of issuance
- Growth and inflation:
  - At the time of issuance, growth and inflation dynamics were positive across all regions.
  - Growth and inflation performances improved in the run-up to issuance; inflation and inflation volatility declined since early 2000.
  - More than 50 percent of countries were projected to grow at least by 5 percent in the next 5-year period.
- Fiscal and current account conditions:
  - Greater heterogeneity observed across countries in fiscal balance and current account indicators (no single regional pattern).
- Historical parallel:
  - Some parallels exist between the recent spike in international bond issuance by frontier markets and the build-up of external debt in emerging markets in the 1990s (for example, following debt relief operations like the Brady Plan).

### Risks identified and implications
- Key risk channels associated with debut international bonds:
  - Exchange rate risk due to predominance of hard-currency denomination.
  - Refinancing risk because of large-volume, bullet-structured maturities.
  - Interest rate risk from fixed-rate exposures.
- Current assessment:
  - The resulting risks have not yet risen to systemic levels, but policy actions are needed to mitigate vulnerabilities and prepare for redemption, strengthen debt management capacity, and support debt sustainability.

### Key statistics and exact figures from the sample and analysis
- Sample size and totals:
  - 23 countries; total issuance since 2004 of about US$14 billion (until December 2013).
  - Since 2010, fourteen sovereigns issued a total of US$8.5 billion (average US$564 million per issuance).
- Regional and issuer-specific figures:
  - Africa: 36 percent of issuances by number (9 issuances) and US$4.9 billion of gross amount.
  - Issue sizes: ranged from US$200 million to US$1,000 million.
  - Mongolia issued two bonds: a 10Y bond for $1,000mn and a 5Y bond for $500mn.
- Market capitalization context:
  - JP Morgan’s EMBIG market capitalization was US$579 billion at end-April 2013; cumulative first-time issuance (US$14 billion) represents less than 3 percent of that market capitalization.
- Debt ratios and outliers:
  - Almost half of first-time issuers have debt to GDP ratios below 60 percent.
  - Seychelles: debt to GDP of 132 percent in the year of issuance (declining from almost 176 percent three years before).
- Instrument characteristics:
  - Maturities mostly 5 to 10 years; only half of sample issued at 10 years.
  - Most issuance denominated in U.S. dollars; Montenegro and Albania issued in Euros.

### Box 1 — Original Sin: A Case of Déjà Vu?
- Debt-relief precedents and post-relief bond issuance:
  - Recent spike in international bond issuance by debut sovereigns has in many instances been preceded by debt relief operations that improved sustainability indicators, reduced the debt overhang, and improved growth prospects, enabling access to international markets for the first time this decade.
  - Historical parallel: the Brady Plan in the 1990s had a similar effect and led to a rapid accumulation of external debt following the temporary relief.
- Reasons debut issuers borrow in foreign currencies:
  - Revenues in foreign currency; thin or absent domestic currency markets; opportunistic cost considerations.
- “Original sin” and investor portfolio constraints:
  - First-time issuers may be willing but unable to borrow in local currency in international markets due to investors’ lack of trust and portfolio constraints in major currencies.
- Differences with 1980s–1990s debut issuers:
  - Today’s debut issuers have ample and rising international reserves accumulated since early 2000, which should shelter them from “sudden stop-type” events that characterized the 1990’s.
- Exchange rate volatility and heterogeneity:
  - QE tapering announcements in the US at the end of May caused exchange rate volatility in some regions to bounce back.
- Evaluation of pricing:
  - New-issue premia for the sample averaged about 50 basis points over the secondary market yield of similarly rated countries.
  - Honduras and Mongolia appear mispriced (yields much higher than similarly rated peers even after controlling for the new-issue premium); Namibia also had a spread much larger than the peer-group average.
  - Credit ratings alone cannot explain all observed variation in pricing.

### Box 2 — Study Case of Bond Issuances—Tanzania
- Issuance specifics:
  - Issuer: Government of Tanzania (GoT).
  - Issue date: February 27, 2013.
  - Instrument: U.S. dollar-denominated floating rate note (FRN).
  - Issue amount: US$ 600 million.
  - Coupon/indexing: Indexed to 6-month Libor plus 600 basis points.
  - 6-month LIBOR at issuance: 0.46 percent.
  - Maturity / structure:
    - Note matures in March 2020.
    - Amortizing structure with first repayment commencing on the third anniversary of the issuance date.
    - Average life of the note: 5 years.
    - Final maturity is 7 years but average life is 5 years (amortizing).
  - Legal form: Private placement under English law.
  - Rating: Unrated (NR).
  - Preliminary fixed-rate equivalent pricing: US Treasury 5 year note (0.78 percent on issue date) plus a 632 basis point spread (i.e., swap spread = 632 basis points).
- Comparator issuer parameters (selected exact figures preserved):
  - Tanzania: Coupon / Maturity = 6.46% 2020; Issue date = Feb-13; Issue size = 600; Yield at issue = 6.45; Spread at issue (in bps) = 600; Rating = NR; Remaining average life (yrs) = 5.0; Current yield = 6.46; Reference US Treasury = 0.78; Spread (in bps) = 632; Lead Manager = Standard Bank.
  - Ghana: Coupon / Maturity = 8.5% 2017; Issue date = Oct-07; Issue size = 750; Yield at issue = 8.5; Spread at issue (in bps) = 394; Remaining average life (yrs) = 4; Reference US Treasury = 0.78; Spread (in bps) = 406; Lead Manager = Citi/UBS.
  - Zambia: Coupon / Maturity = 5.375% 2022; Issue date = Sep-12; Issue size = 750; Yield at issue = 5.625; Spread at issue (in bps) = 384; Remaining average life (yrs) = 10; Reference US Treasury = 1.88; Spread (in bps) = 356; Lead Manager = Deutsche/Barclays.
  - Nigeria: Coupon / Maturity = 6.75% 2021; Issue date = Jan-11; Issue size = 500; Yield at issue = 7.126; Spread at issue (in bps) = 372; Remaining average life (yrs) = 8; Reference US Treasury = 1.565; Spread (in bps) = 286; Lead Manager = Deutsche/Barclays.
  - Senegal (2011): Coupon / Maturity = 8.75% 2021; Issue date = May-11; Issue size = 500; Yield at issue = 9.339; Spread at issue (in bps) = 596; Remaining average life (yrs) = 8; Reference US Treasury = 1.565; Spread (in bps) = 512; Lead Manager = Citi.
- Assessment of pricing and structure:
  - The deal “compares poorly relative to the trading levels of its peers,” taking into account longer remaining maturities of comparators and a more benign international environment at issuance.
  - Deal features that contributed to poor pricing: Private placement rather than a Euro or Global bond; FRN structure; Amortization structure.
- Interest rate risk and swap considerations:
  - Floating interest rate structure is “especially risky” when short-term interest rates are at a historical low and likely to rise.
  - Potential swap to fixed-rate would incur transaction fees, may require posting collateral and mark-to-market; Tanzania lacks system or capacity to handle frequent mark-to-market.
  - Legal constraint: Government Loans, Guarantees and Grants Act (as amended in 2003) does not provide explicit authority for the Minister to enter into swap transactions.
- Secondary market pricing — econometric analysis overview:
  - Panel of 23 frontier markets and 21 emerging market comparators over 2000-2013; quarterly frequency.
  - Dependent variable: Secondary market bond spreads over EMBI.
  - Estimation methods: Random effect estimation with heteroskedasticity-robust cluster-adjusted standard errors; robustness checks with OLS and Hausman-Taylor estimators.
- Key econometric findings (selected signs and significance preserved):
  - Quality of institutions (ICRG): Negative coefficient; statistically significant (e.g., -0.745* in column (1)).
  - Growth (industrial production growth): Negative coefficient; statistically significant in some specifications (e.g., -0.080** in column (2); -0.063* in column (6)).
  - M2 to GDP (financial depth): Negative coefficients (e.g., -0.068*** in column (1)).
  - Debt to GDP ratio: Positive and statistically significant (e.g., 0.278** in column (1)).
  - Federal funds rate (global liquidity proxy): Positive and statistically significant (e.g., 0.285** in column (2); 0.513*** in column (4)).
  - Global volatility (VIX): Positive and statistically significant across specifications (e.g., 0.137*** in column (3)).
  - Debut issuer dummy: Positive and statistically significant at the 10 percent level in some specifications (e.g., 5.657* in column (1)).
  - Interaction (Debut issuer dummy * VIX): Positive and statistically significant at 5 percent (e.g., 0.284**).
  - Robustness checks (RE/OLS/HT) produce broadly similar results (selected coefficients preserved as reported).
- Implications from econometric results:
  - Macro fundamentals, financial development, institutional quality, global liquidity, and volatility significantly affect spreads.
  - Even after controlling for these factors, first-time issuers trade at notably wider spreads over the EMBI.
- Performance in recent selloffs (exact figures preserved):
  - May–June 2013: Median increase: 143 and 190 basis points for BB and B-rated respectively, compared to 173 basis points for the EMBI index.
  - January 2014: Median increase: 10 and 31 basis points for BB and B-rated respectively, compared to 33 basis points for the EMBI index.
  - Entire period (May 2013 – March 2014): First issuers showed an increase by 61 and 32 basis points compared to 143 for the EMBI index.
- Investor base and liquidity:
  - Debut issuers’ investor base dominated by exclusively dedicated, real money investors — relatively more stable but contributing to lower liquidity.
  - Regional investor distribution: U.S. investors dominate Asian and Latin American frontier markets; African market split almost evenly between American and European investors (lead-managers’ weighted averages for selected deals).

### Box 3 — Short Story of a Bond Debut—Seychelles, 2006-08
- Issuance and immediate outcomes:
  - On September 27, 2006, the Government of Seychelles issued a 5-year U.S. dollar-denominated bond for US$ 200 million.
  - Original maturity date: October 3, 2011.
  - Issue price: 99.5 dollar per each 100 of face value.
  - Coupon: 9.125 percent.
  - Yield to maturity: 9.47 percent.
  - Spread over US benchmark: 470 basis points.
  - Issued in the Euro market under English law; rated B by S&P.
  - Order book reached $340 millions; investor distribution: 80 percent European investors, remaining 20 percent equally split between US investors and others.
  - The issuance represented approximately 22 percent of GDP.
- Deterioration, missed payments, and restructuring:
  - 2007–08: sharp rise in commodities prices increased imports and depleted international reserves to less than one month of imports; tourism fell.
  - July 2008: missed principal payments for €55 millions (approx. $80 millions) of a privately placed amortizing note due in 2011.
  - October 2008: missed an interest payment on its global bond due in 2011.
  - March 2009: government announced external debt restructuring totaling $320 millions.
  - Debt exchange took place between December 2009 and February 2010 with a face value haircut of 50 percent.
  - October 2008: country requested a Stand-by program from the Fund.
  - December 2009: successor EFF program approved.
- Key risks illustrated:
  - Exchange rate risk: share of foreign currency-denominated debt increased with Eurobond issuance.
  - Refinancing risk: majority issue bullet bonds creating amortization spikes.
  - Interest rate risk: fixed-rate debuts mitigate immediate exposure but medium-term refinancing risk remains.
  - Cost substitution: marginal funding cost of global bonds was above implied interest on existing debt in most cases analyzed.
  - Institutional and capacity risks: limited debt management capacity increases the risk of poorly executed transactions.
- Policy and management implications:
  - Conduct debt sustainability analyses and a medium-term debt strategy.
  - Prepare legal documentation early; secure a credit rating ahead of issuance.
  - Implement investor relations programs; hire independent financial advisors.
  - Manage post-issuance risks: prepare for increased scrutiny, monitor secondary market dynamics, address refinancing risks via sinking funds or liability management, and invest in staff capacity.
- Concluding assessment:
  - Wave of first-time issuance resumed in 2010; sustainability is uncertain given rising borrowing costs and prospects of tighter U.S. monetary policy.
  - Policy priorities: integrate international issuance decisions into broader debt management and DSA context; prepare ahead for redemption; follow operational best principles.

### Annex Table 1 — Selected first sovereign debt issuance records (representative exact entries)
- Middle-East — Pakistan | Date: 12-Feb-04 | Year: 2004 | Yield at issue: 6.8 | Size ($ mn.): 500 | Tenor (years): 5 | Maturity Date: 19-Feb-09 | Spread (in bps.): 370 | Offer Price (%): 100.0 | Size (% GDP) 1/: 0.2 | Moodys (rating at issue): B2 | S&P (rating at issue): B | Currency: USD | Governing Laws: England | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market
- Asia — Vietnam | Date: 27-Oct-05 | Year: 2005 | Yield at issue: 7.2 | Size ($ mn.): 750 | Tenor (years): 10 | Maturity Date: 15-Jan-16 | Spread (in bps.): 256 | Offer Price (%): 98.2 | Size (% GDP) 1/: 0.5 | Moodys: Ba3 | S&P: BB- | Currency: USD | Governing Laws: New York | Issue Type: Fixed rate
- Latin America — Ecuador | Date: 7-Dec-05 | Year: 2005 | Yield at issue: 11.1 | Size ($ mn.): 650 | Tenor (years): 10 | Maturity Date: 15-Dec-15 | Spread (in bps.): 623 | Offer Price (%): 91.7 | Size (% GDP) 1/: 0.8 | Moodys: Caa1 | S&P: CCC+ | Currency: USD
- Africa — Seychelles | Date: 27-Sep-06 | Year: 2006 | Yield at issue: 9.5 | Size ($ mn.): 200 | Tenor (years): 5 | Maturity Date: 3-Oct-11 | Spread (in bps.): 470 | Offer Price (%): 99.5 | Size (% GDP) 1/: 19.4 | S&P: B | Currency: USD
- Africa — Ghana | Date: 27-Sep-07 | Year: 2007 | Yield at issue: 8.5 | Size ($ mn.): 750 | Tenor (years): 10 | Maturity Date: 4-Oct-17 | Spread (in bps.): 387 | Offer Price (%): 100.0 | Size (% GDP) 1/: 1.9 | S&P: B+ | Currency: USD
- Africa — Gabon | Date: 6-Dec-07 | Year: 2007 | Yield at issue: 8.3 | Size ($ mn.): 1,000 | Tenor (years): 10 | Maturity Date: 12-Dec-17 | Spread (in bps.): 426 | Offer Price (%): 100.0 | Size (% GDP) 1/: 5.4 | S&P: BB- | Currency: USD
- Eastern Europe — Montenegro | Date: 7-Sep-10 | Year: 2010 | Yield at issue: 8.0 | Size ($ mn.): 254 | Tenor (years): 5 | Maturity Date: 14-Sep-15 | Spread (in bps.): 666 | Offer Price (%): 99.5 | Size (% GDP) 1/: 5.9 | Moodys: Ba3 | S&P: BB | Currency: EUR
- Africa — Nigeria | Date: 21-Jan-11 | Year: 2011 | Yield at issue: 7.1 | Size ($ mn.): 500 | Tenor (years): 10 | Maturity Date: 28-Jan-21 | Spread (in bps.): 372 | Offer Price (%): 98.2 | Size (% GDP) 1/: 0.2 | S&P: B+ | Currency: USD
- Africa — Zambia | Date: 13-Sep-12 | Year: 2012 | Yield at issue: 5.6 | Size ($ mn.): 750 | Tenor (years): 10 | Maturity Date: 20-Sep-22 | Spread (in bps.): 384 | Offer Price (%): 98.1 | Size (% GDP) 1/: 3.7 | S&P: B+ | Currency: USD
- Asia — Mongolia | Date: 29-Nov-12 | Year: 2012 | Yield at issue: 5.2 | Size ($ mn.): 1,000 | Tenor (years): 10 | Maturity Date: 5-Dec-22 | Spread (in bps.): 358 | Offer Price (%): 100.0 | Size (% GDP) 1/: 9.7 | Moodys: B1 | S&P: BB- | Currency: USD
- Latin America — Paraguay | Date: 17-Jan-13 | Year: 2013 | Yield at issue: 4.6 | Size ($ mn.): 500 | Tenor (years): 10 | Maturity Date: 25-Jan-23 | Spread (in bps.): 275 | Offer Price (%): 100.0 | Size (% GDP) 1/: 1.9 | Moodys: Ba3 | S&P: BB- | Currency: USD
- Africa — Tanzania | Date: 27-Feb-13 | Year: 2013 | Yield at issue: 6.5 | Size ($ mn.): 600 | Tenor (years): 5 | Maturity Date: 27-Feb-20 | Spread (in bps.): 600 | Offer Price (%): 100.0 | Size (% GDP) 1/: 2.1 | Moodys: Not rated | S&P: Not rated | Currency: USD | Issue Type: FRN | Market: Private placement
- Eastern Europe — Armenia | Date: 20-Sep-13 | Year: 2013 | Yield at issue: 6.3 | Size ($ mn.): 700 | Tenor (years): 7 | Maturity Date: 30-Sep-20 | Spread (in bps.): 413 | Offer Price (%): 98.6 | Size (% GDP) 1/: 7.0 | Moodys: Ba2 | Currency: USD

*Source: IMF staff summary as presented in _wp14127 - 1. Summary of First-Time Issuances.*

### 1. Summary of First-Time Issuances .....................................................................................

### _wp14127 - 1. Summary of First-Time Issuances

### Introduction: objectives and context
- International bond issuance by debut issuers has risen in recent years driven by both demand and supply factors.
- Objectives of the paper:
  - Explore rationale behind the movement into international bond markets by debut issuers.
  - Analyze implications of such issuances for sovereign risks (exchange rate, interest rate, refinancing).
  - Suggest policy actions to mitigate those risks.
- Contextual points:
  - Bonds issued in international markets are typically denominated in hard currencies, have large volumes and a bullet structure, increasing exposure to exchange rate and refinancing risk.
  - The sum of issuance over the last decade is US$14 billion, which represents less than 3 percent of the market capitalization of emerging market bonds (JP Morgan’s EMBIG was US$579 billion at end-April 2013).

### Country coverage: sample and selection criteria
- Sample:
  - 23 countries that issued in the international market for the first time since 2004 (or re-entered after a long hiatus).
  - Total amount issued since then totals about US$14 billion (until December 2013).
- Selection criteria for inclusion:
  - (1) Placed a financial instrument in the international market for the first time since 2004;
  - (2) The issued amount is at least 200 million U.S. dollars;
  - (3) The proceeds were devoted to either covering financing needs or as a debt management operation;
  - (4) The instrument was issued by the central government.
- Notes:
  - Tanzania’s issuance was a private placement and is included.
  - Montenegro and Albania issued in Euros; all other new issuances were in U.S. dollars.
  - Mongolia issued two bonds: a 10Y bond for $1,000mn and a 5Y bond for $500mn.

### The issuances — stylized facts
- Aggregate and regional patterns:
  - 23 EMs and LICs issued internationally for the first time or re-entered after a long hiatus since 2004.
  - Africa accounted for 36 percent of issuances by number (9 issuances) and US$4.9 billion of the gross amount.
- Timing and clustering:
  - Debut sovereign issuances slumped in 2008–09 (only Georgia and Senegal tapped markets).
  - Since 2010, fourteen sovereigns have tapped international capital markets, issuing a total of US$8.5 billion (or US$564 million on average per issuance).
  - Evidence of regional bunching: e.g., Belarus, Montenegro and Albania in 2010; Bolivia, Paraguay and Honduras within a four-month span.
- Instrument characteristics:
  - Majority are U.S. dollar-denominated, fixed-coupon bullet securities.
  - Maturity typically ranges from 5 to 10 years; only half of the country sample issued at 10 years.
  - Issue sizes ranged from US$200 million to US$1,000 million; larger bonds issued by large economies or resource-rich countries (e.g., Mongolia, Zambia, Gabon).
- Investor market dynamics:
  - International market practices largely define instrument characteristics (medium to long-term, fixed rate, hard currency).
  - International bonds enable diversification of investor base and access to a more liquid global bond market.

### Rationale for issuance — demand and supply factors
- Demand-side drivers:
  - Search-for-yield, ample international financial liquidity, and demand for portfolio diversification produced demand-driven easy financing conditions.
  - Favorable country prospects and prudent fiscal policies in many developing countries attracted investor capital.
- Supply-side drivers and country motives:
  - Need to raise resources for large infrastructure projects not fundable domestically (notably in several African issuers such as Zambia and Senegal; Latin American issuers such as Paraguay and Bolivia).
  - Decline in concessional financing as countries graduate to middle income status increased attractiveness of nonconcessional international bonds.
  - Uses of proceeds included budget support, repaying arrears (e.g., Honduras), debt restructuring (e.g., Seychelles 2010, Gabon 2007), and creating benchmarks for the corporate sector (e.g., Nigeria).
- Cost considerations:
  - Issuing in currencies with the lowest cost of capital can reduce borrowing costs assuming no significant currency depreciation over bond life.
- Debt capacity:
  - Almost half of first-time issuers have debt to GDP ratios below 60 percent, low debt services and relatively smooth debt redemption profiles, providing some room to borrow at non-concessional terms.
  - Exceptions include Seychelles (debt to GDP of 132 percent in the year of issuance, down from almost 176 percent three years before), and Sri Lanka, Mongolia, Pakistan and Jordan (debt ratios between 60-100 percent of GDP).

### Market signals and credit ratings
- Credit rating dynamics:
  - In some cases, improvements in credit ratings preceded first issuances, especially in Latin America.
  - Almost half of the countries reached a BB- or higher rating at the time of issuance (upper level of HY ratings), particularly in Latin America and Asia; less common in Africa and Eastern Europe and Middle East.
  - Rating upgrades serve as a positive signal to investors and can help secure minimum comfort for debut issuances.

### Macroeconomic conditions at time of issuance
- Growth and inflation:
  - At the time of issuance, growth and inflation dynamics were positive across all regions.
  - Growth and inflation performances improved in the run-up to issuance; inflation and inflation volatility declined since early 2000.
  - More than 50 percent of countries were projected to grow at least by 5 percent in the next 5-year period.
- Fiscal and current account conditions:
  - Greater heterogeneity observed across countries in fiscal balance and current account indicators (no single regional pattern).
- Historical parallel:
  - Some parallels exist between the recent spike in international bond issuance by frontier markets and the build-up of external debt in emerging markets in the 1990s (for example, following debt relief operations like the Brady Plan).

### Risks identified and implications
- Key risk channels associated with debut international bonds:
  - Exchange rate risk due to predominance of hard-currency denomination.
  - Refinancing risk because of large-volume, bullet-structured maturities.
  - Interest rate risk from fixed-rate exposures.
- Current assessment:
  - The resulting risks have not yet risen to systemic levels, but policy actions are needed to mitigate vulnerabilities and prepare for redemption, strengthen debt management capacity, and support debt sustainability.

### Key statistics and exact figures from the sample and analysis
- Sample size and totals:
  - 23 countries; total issuance since 2004 of about US$14 billion (until December 2013).
  - Since 2010, fourteen sovereigns issued a total of US$8.5 billion (average US$564 million per issuance).
- Regional and issuer-specific figures:
  - Africa: 36 percent of issuances by number (9 issuances) and US$4.9 billion of gross amount.
  - Issue sizes: ranged from US$200 million to US$1,000 million.
  - Mongolia issued two bonds: a 10Y bond for $1,000mn and a 5Y bond for $500mn.
- Market capitalization context:
  - JP Morgan’s EMBIG market capitalization was US$579 billion at end-April 2013; cumulative first-time issuance (US$14 billion) represents less than 3 percent of that market capitalization.
- Debt ratios and outliers:
  - Almost half of first-time issuers have debt to GDP ratios below 60 percent.
  - Seychelles: debt to GDP of 132 percent in the year of issuance (declining from almost 176 percent three years before).
- Instrument characteristics:
  - Maturities mostly 5 to 10 years; only half of sample issued at 10 years.
  - Most issuance denominated in U.S. dollars; Montenegro and Albania issued in Euros.

*Source: IMF staff summary as presented in _wp14127 - 1. Summary of First-Time Issuances.*

### Box 1. Original Sin: A Case of Déjà Vu?

### Box 1. Original Sin: A Case of Déjà Vu?

### Debt-relief precedents and post-relief bond issuance
- Recent spike in international bond issuance by debut sovereigns has in many instances been preceded by debt relief operations that improved sustainability indicators, reduced the debt overhang, and improved growth prospects, enabling access to international markets for the first time this decade.
- Historical parallel: debt relief operations in the 1990s (the Brady Plan) had a similar effect and led to a rapid accumulation of external debt following the temporary relief.
- Similarity across episodes: post-restructuring improved market access / improved macro conditions led to renewed external borrowing.

### Reasons debut issuers borrow in foreign currencies
- Primary explanations provided:
  - Revenues in foreign currency: issuers with foreign-currency revenues have incentives to match those revenues with foreign-currency cash outflows to balance foreign-exchange exposure.
  - Thin or absent domestic currency markets: limited appetite for government securities in local currency markets, especially for long-term maturities, leads issuers to tap broader and more liquid international markets in major currencies (mostly U.S. dollars).
  - Opportunistic cost considerations: issuers may attempt to lower the cost of servicing debt by exploiting lower interest rates in a foreign currency.
- Strategic considerations mirrored past behavior: governments wanted to diversify the investor base and exploit more liquid foreign bond markets, seeking lower external borrowing costs.

### “Original sin” and investor portfolio constraints
- Definition and mechanism:
  - “Original sin”: first-time issuers may be willing but unable to borrow in local currency in international markets due to investors’ lack of trust based on past transgressions, leading to external debt accumulation and currency mismatches on balance sheets.
  - If external debt is denominated in foreign currency, real exchange rate depreciation will make it more difficult to service that debt.
- Portfolio diversification limits: established practice in international financial centers to operate in a limited number of major currencies reduces the benefit to investors of adding latecomer developing-country currencies to portfolios, making it harder for those countries to borrow in their own currency internationally.

### Differences with 1980s–1990s debut issuers: reserves and buffers
- Key distinction: Unlike first-time issuers of the 1980-90s, today’s debut issuers have ample and rising international reserves.
- Reserve accumulation:
  - First-time issuers of today have been accumulating international reserves since early 2000, which should shelter them from “sudden stop-type” events that characterized the 1990’s.
  - Although some have had current account deficits, these countries have been able to finance external gaps through FDI and official financing. These “buffer stocks” have naturally hedged them from “sudden stop-type” events.
  - For some regions reserves in foreign currency compared well with more advanced and larger EM countries.
- Historical contrast: reserve accumulation in the 1990s was not sufficient to deal with external shocks.

### Exchange rate volatility and heterogeneity across debut issuers
- Improved fundamentals have generally reduced exchange rate volatility, except for a temporary spike at the time of the financial crisis.
- Recent stresses:
  - QE tapering announcements in the US at the end of May caused exchange rate volatility in some regions to bounce back.
  - In countries with market-determined exchange rates, fluctuations may have helped isolate economies from external shocks while boosting competitiveness if monetary conditions were fine-tuned to avoid deterioration in inflation expectations.
- Cross-country heterogeneity: initial conditions and expected performance vary greatly across and within regions; fiscal balances, current accounts and debt levels are worsening in part of the sample even though growth prospects remain positive.
- Rising exchange rate volatility and exposure to external factors could complicate sovereign debt portfolio management.

### Evaluation of debut issuances — Pricing
- Market context: debut issuers tapped international markets amid historically very low global interest rates; search for yield and demand for portfolio diversification resulted in demand-driven easy financing conditions.
- New-issue premium:
  - It is natural to expect first-time issuers to pay a “New-issue” premium compared to existing bonds of peer countries; international bond issuances by emerging markets usually carry a premium over benchmark rates to reflect new supply.
  - For the sample of first-time issuers, the new issue premia paid at issuance have averaged about 50 basis points over the secondary market yield of similarly rated countries.
  - Note: this “novelty” premium differs from a regular “new issue” premium paid by frequent issuers; both types of premia are time-varying depending on market conditions.
- Mispricing indicators and caution:
  - A yield much higher than expected based on the “new-issue premium” may be interpreted as evidence of mispricing, but dispersion of spreads within a peer group is often large.
  - Based on this indicator, Honduras and Mongolia appear mispriced (yields much higher than similarly rated peers even after controlling for the new-issue premium); Namibia is another example with a spread much larger than the peer-group average. Caution is advised because spread dispersion in the peer group is large.
  - Poor issuance performance can also reflect debt management choices (Tanzania cited as an illustration; further explained elsewhere in the source).
  - Credit ratings alone cannot explain all observed variation in pricing: deviation between minimum and maximum yields is often large for similarly rated countries, and ratings do not capture all changes in fundamentals, institutional characteristics and political risks.

*Source: Box 1, “Original Sin: A Case of Déjà Vu?”*

### Box 2. Study Case of Bond Issuances—Tanzania

### Box 2. Study Case of Bond Issuances—Tanzania

### Issuance specifics
- Issuer: Government of Tanzania (GoT).
- Issue date: February 27, 2013.
- Instrument: U.S. dollar-denominated floating rate note (FRN).
- Issue amount: US$ 600 million.
- Coupon/indexing: Indexed to 6-month Libor plus 600 basis points.
- 6-month LIBOR at issuance: 0.46 percent.
- Maturity / structure:
  - Note matures in March 2020.
  - Amortizing structure with first repayment commencing on the third anniversary of the issuance date.
  - Average life of the note: 5 years.
  - Final maturity is 7 years but average life is 5 years (amortizing).
- Legal form: Private placement under English law.
- Rating: Unrated (NR).
- Preliminary fixed-rate equivalent pricing: US Treasury 5 year note (0.78 percent on issue date) plus a 632 basis point spread (i.e., swap spread = 632 basis points).

### Comparator issuers — key parameters (as presented)
- Tanzania: Coupon / Maturity = 6.46% 2020; Issue date = Feb-13; Issue size = 600 (million US$); Yield at issue = 6.45; Spread at issue (in bps) = 600; Rating = NR; Remaining average life (yrs) = 5.0; Current yield = 6.46; Reference US Treasury = 0.78; Spread (in bps) = 632; Lead Manager = Standard Bank.
- Ghana: Coupon / Maturity = 8.5% 2017; Issue date = Oct-07; Issue size = 750; Yield at issue = 8.5; Spread at issue (in bps) = 394; Rating = -/B/B+; Remaining average life (yrs) = 4; Current yield = 4.841; Reference US Treasury = 0.78; Spread (in bps) = 406; Lead Manager = Citi/UBS.
- Zambia: Coupon / Maturity = 5.375% 2022; Issue date = Sep-12; Issue size = 750; Yield at issue = 5.625; Spread at issue (in bps) = 384; Rating = -/B+/B+; Remaining average life (yrs) = 10; Current yield = 5.438; Reference US Treasury = 1.88; Spread (in bps) = 356; Lead Manager = Deutsche/Barclays.
- Nigeria: Coupon / Maturity = 6.75% 2021; Issue date = Jan-11; Issue size = 500; Yield at issue = 7.126; Spread at issue (in bps) = 372; Rating = B+/BB-; Remaining average life (yrs) = 8; Current yield = 4.426; Reference US Treasury = 1.565; Spread (in bps) = 286; Lead Manager = Deutsche/Barclays.
- Senegal (2011): Coupon / Maturity = 8.75% 2021; Issue date = May-11; Issue size = 500; Yield at issue = 9.339; Spread at issue (in bps) = 596; Rating = B1/B+/-; Remaining average life (yrs) = 8; Current yield = 6.688; Reference US Treasury = 1.565; Spread (in bps) = 512; Lead Manager = Citi.
- Senegal (old): Coupon / Maturity = 8.75% 2014; Issue date = Dec-09; Issue size = 200; Yield at issue = 9.473; Spread at issue (in bps) = 691; Rating = B+; Remaining average life (yrs) = n.a; Current yield = n.a; Reference US Treasury = n.a; Spread (in bps) = n.a; Lead Manager = Standard Chartered.

### Assessment of pricing and structure
- Relative pricing: The deal “compares poorly relative to the trading levels of its peers,” taking into account longer remaining maturities of comparators and a more benign international environment at issuance.
- Swap spread interpretation: The spread for Tanzania is the fixed rate equivalent of the FRN — US Treasury 5 year note (0.78 percent) plus 632 basis points = equivalent to 6 month Libor (0.46 percent) plus 600 basis points.
- Market context note: The 10Y US Treasury rate was trading at 4.5 and 3.4 percent in 2007 and 2011 respectively when Ghana and Nigeria issued their bonds, whereas it was 1.9 percent at the time of the Tanzania deal.
- Deal features that contributed to poor pricing:
  - Private placement rather than a Euro or Global bond (reducing competition among investors).
  - FRN structure (instead of plain-vanilla fixed-rate).
  - Amortization structure (instead of a bullet bond).
- Rationale for FRN choice: Authorities may have chosen FRN because obtaining longer maturities or a fixed-rate instrument for 5 years was not possible given the lack of credit rating.

### Interest rate risk and swap considerations
- Interest rate risk: A floating interest rate structure is “especially risky” when short-term interest rates are at a historical low and likely to rise — the structure has high interest rate risk.
- Potential swap to fixed-rate:
  - Would incur an additional transaction fee.
  - May require posting collateral and mark-to-market.
  - Tanzania lacks a system or capacity to handle frequent mark-to-market.
  - Investment banks have proposed posting upfront cash deposit in a segregated account (with little or no interest), implying negative carry and high expense.
  - Legal constraint: Government Loans, Guarantees and Grants Act (as amended in 2003) does not provide explicit authority for the Minister to enter into swap transactions.

### Contributors
- Gabriel Presciuttini and Eriko Togo.

### Secondary market pricing — econometric analysis overview
- Sample and period: Panel of 23 frontier markets and 21 emerging market comparators over 2000-2013; quarterly frequency.
- Dependent variable: Secondary market bond spreads over EMBI.
- Explanatory variables: Macro variables, fiscal and debt variables, institutional quality measures, global market volatility and liquidity (VIX, Federal funds rate), and a first-time issuers dummy.
- Estimation methods: Random effect estimation with heteroskedasticity-robust cluster-adjusted standard errors; robustness checks with OLS and Hausman-Taylor estimators.

### Key econometric findings (selected coefficient signs and significance reported)
- Quality of institutions (ICRG): Negative coefficient; statistically significant (e.g., -0.745* in column (1); significance levels reported include * p<0.1, ** p<0.05, *** p<0.01).
- Growth (industrial production growth): Negative coefficient; statistically significant in some specifications (e.g., -0.080** in column (2); -0.063* in column (6)).
- Inflation: Coefficients not consistently statistically significant (e.g., 0.049 in column (1)).
- M2 to GDP (financial depth): Negative coefficients (e.g., -0.068*** in column (1)); not always statistically significant across specifications.
- Debt to GDP ratio: Positive and statistically significant (e.g., 0.278** in column (1); significance up to 1 percent in later columns).
- Federal funds rate (global liquidity proxy): Positive and statistically significant (e.g., 0.285** in column (2); 0.513*** in column (4)).
- Global volatility (VIX): Positive and statistically significant across specifications (e.g., 0.137*** in column (3)).
- Debut issuer dummy: Positive and statistically significant at the 10 percent level in some specifications (e.g., 5.657* in column (1) and in robustness checks).
- Interaction term (Debut issuer dummy * VIX): Positive and statistically significant at 5 percent (e.g., 0.284**), indicating that increases in spreads during times of stress are more pronounced for first issuers.
- Robustness checks (Table 4): Alternative estimators (RE, OLS, HT) produce broadly similar results; selected coefficients reported include:
  - Growth (HT): -0.066***.
  - Quality of institutions (RE/OLS/HT): approx. -0.288** / -0.285*** / -0.287***.
  - Debt to GDP (RE/OLS/HT): 0.300*** / 0.152*** / 0.316***.
  - Federal funds rate (RE/OLS/HT): 0.494*** / 0.213** / 0.417***.
  - Global volatility (VIX) (RE/OLS/HT): 0.139*** / 0.119*** / 0.135***.
  - Debut issuer dummy (RE/OLS/HT): 5.657* / 2.165** / 5.087.

### Implications from econometric results
- Macro fundamentals, financial development, institutional quality, global liquidity, and volatility significantly affect spreads.
- Institutional quality, level of indebtedness (debt to GDP), and global liquidity/volatility have especially strong effects on spreads.
- Even after controlling for these factors, first-time issuers trade at notably wider spreads over the EMBI, likely reflecting weaker credit profile, poorer secondary market liquidity, lesser transparency, and lack of capital market financing track record.
- During periods of market stress (higher VIX), first issuers face a disproportionately larger increase in spreads.

### Performance of debut issuers in recent selloffs
- May–June 2013 (first period):
  - Median increase: 143 and 190 basis points for BB and B-rated respectively, compared to 173 basis points for the EMBI index.
- January 2014 (second period):
  - Median increase: 10 and 31 basis points for BB and B-rated respectively, compared to 33 basis points for the EMBI index.
- Entire period (May 2013 – March 2014):
  - First issuers showed an increase by 61 and 32 basis points compared to 143 for the EMBI index.
- Interpretation:
  - On average, debut issuers did not sell off more dramatically than more frequent higher credit quality issuers during the two recent selloffs; in some cases performed better.
  - Debut issuers’ bonds are less liquid and represent a small fraction of investor portfolios, which may have protected them from initial dramatic sell-offs.
  - Concern remains for a more prolonged sell-off or perceived deterioration in relative credit quality.

### Investor base and liquidity considerations
- Investor base differences:
  - Global investment grade cross-over investors and hedge funds tend to buy more liquid emerging market debt and have not heavily purchased lower credit quality debt that includes most debut issuers.
  - Debut issuers’ investor base dominated by exclusively dedicated, real money investors — relatively more stable but contributing to lower liquidity.
- Regional investor distribution noted: U.S. investors dominate Asian and Latin American frontier markets; African market split almost evenly between American and European investors (as per lead-managers’ weighted averages for deals by Mongolia, Zambia, Nigeria, Paraguay, Guatemala, Bolivia, and Honduras).

*Source: Box 2. Study Case of Bond Issuances—Tanzania, IMF staff paper (contributors: Gabriel Presciuttini and Eriko Togo).*

### Box 3. Short Story of a Bond Debut—Seychelles, 2006-08

### Box 3. Short Story of a Bond Debut—Seychelles, 2006-08

### Issuance and immediate outcomes
- On September 27, 2006, the Government of Seychelles issued a 5-year U.S. dollar-denominated bond for US$ 200 million.
- Original maturity date: October 3, 2011.
- Issue price: 99.5 dollar per each 100 of face value.
- Coupon: 9.125 percent.
- Yield to maturity: 9.47 percent.
- Spread over US benchmark: 470 basis points.
- Issued in the Euro market under English law; rated B by S&P.
- Stated uses of proceeds (per prospectus): refinance certain private loans, begin resolution and repayment of certain arrears, and general government purposes.
- Lead manager: Lehman Brothers.
- Order book reached $340 millions; investor distribution: 80 percent European investors, remaining 20 percent equally split between US investors and others.
- The issuance represented approximately 22 percent of GDP — characterized as the largest amount relative to the size of the economy ever issued by a debut country (see table 1 referenced in source).

### Pre-issuance debt context and ratings commentary
- At end-2005: external debt ratio 58.9 percent of GDP; public debt ratio 175 percent of GDP.
- S&P noted that a shortage of foreign currency had contributed to arrears on public sector foreign debt and constrained growth by preventing imports and deterring foreign investment due to difficulty repatriating profits.

### Deterioration, missed payments, and restructuring
- 2007–08: sharp rise in commodities prices increased imports and depleted international reserves to less than one month of imports; tourism fell, weakening growth and government revenues.
- Fund staff (Article IV) noted that the country had carried out “expansionary fiscal and monetary policies that have been incompatible with the maintenance of the pegged exchange rate...”
- July 2008: Seychelles missed principal payments for €55 millions (approx. $80 millions) of a privately placed amortizing note due in 2011.
- October 2008: missed an interest payment on its global bond due in 2011.
- March 2009: government announced external debt restructuring comprising the global bond, 2 external loans and notes, totaling $320 millions.
- Debt exchange took place between December 2009 and February 2010 with a face value haircut of 50 percent.
- Rating on Seychelles was withdrawn while it was still in default.
- October 2008: country requested a Stand-by program from the Fund amid balance of payments and public debt crisis.
- December 2009: successor EFF program approved aimed at consolidating macroeconomic stability and supporting the public debt restructuring process, among other areas.
- Conclusion note: Seychelles defaulted on a $230 million Eurobond in October 2008, following a sharp fall in tourism revenues and years of excess government spending; the default led to debt restructuring and government spending cuts.

### Key risks illustrated by the Seychelles case
- Exchange rate risk
  - Large international bond issuances increase exposure to exchange rate depreciation and currency mismatch between liabilities and revenues.
  - Prior to market entry, many of these countries had foreign currency debt representing around 50 percent of total debt (source: Figure 9 referenced).
  - The share of foreign currency-denominated debt increased with Eurobond issuance, raising vulnerability to depreciation-induced spikes in debt servicing costs and debt-to-GDP ratios.
- Refinancing risk
  - Majority of first-time issuers issue bullet bonds, concentrating amortization at a single future date and producing an amortization spike (see Figure 10 referenced).
  - Amortization spikes create large refinancing and balance-of-payments risks if markets are closed or rates rise at maturity.
  - Amortizing bonds can smooth repayment profiles and reduce these risks.
- Interest rate risk
  - Fixed-rate debut issuances mitigate immediate exposure to a spike in global interest rates, but medium-term refinancing could occur in a higher-rate environment, increasing costs.
- Cost substitution and marginal funding cost
  - International issuance often substitutes concessional and semi-concessional (cheaper) funding with more expensive market funding.
  - For most cases analyzed, the marginal funding cost of global bonds was above the implied interest paid on the existing stock of debt (see Figure 11 referenced).
- Institutional and capacity risks
  - Limited debt management capacity and governance arrangements in many debut issuers increase the risk of poorly executed transactions and misuse of proceeds.
  - Lack of capacity undermines ability to analyze cost-risk trade-offs and to ensure proceeds are used for intended, growth-enhancing purposes.

### Policy and management implications (best practices and operational guidance)
- Strategic considerations
  - Conduct debt sustainability analyses to evaluate future payment capacity under different macro scenarios, budget constraints, and intended use of proceeds.
  - Undertake a comprehensive medium-term debt strategy exercise to assess cost-risk trade-offs, focusing on exchange rate risk and refinancing risk before deciding to issue.
- Operational considerations
  - Prepare legal documentation early with specialized expertise.
  - Secure a credit rating ahead of issuance; delayed or absent ratings can lead to higher borrowing costs (examples cited: Tanzania and Angola).
  - Implement investor relations programs and a proper marketing process to improve demand and pricing.
  - Hire independent financial advisors (distinct from lead managers) to provide impartial advice despite extra cost.
- Managing risks after issuance
  - Prepare for increased market and media scrutiny; strengthen communication and decision transparency.
  - Monitor secondary market dynamics regularly to gauge investor perceptions and market appetite for re-openings.
  - Address refinancing risks proactively: consider sinking funds, active liability management (exchanging near-maturity instruments for longer-term securities), or building hard-currency buffers.
  - Invest in staff qualification and retention to handle new debt-management tasks arising from international issuance.

### Concluding assessment and regional outlook
- Wave of first-time issuance has been gaining momentum and resumed in 2010 after interruption during the global crisis; some issuers have begun second-time issuance (examples listed in source).
- Sustainability of the rush to external markets is uncertain given rising borrowing costs, waning investor interest, and potential faltering growth.
- Stricter liquidity conditions and prospects of tighter U.S. monetary policy are likely to increase international borrowing costs and raise refinancing costs when bonds come due.
- External issuance can meet pressing infrastructure needs but brings risks: large GDP share, concentration in single instruments, exchange rate exposure, and redemption-profile vulnerabilities.
- Policy priorities highlighted:
  - Integrate international issuance decisions into broader debt management and DSA context.
  - Prepare ahead for redemption of debut instruments through buffers or liability management.
  - Follow operational best principles to avoid excessive costs and reputational damage.

*Source: Box 3, “Short Story of a Bond Debut—Seychelles, 2006-08,” IMF Working Paper content provided.*

### Annex Table 1. First Sovereign Debt

### Annex Table 1. First Sovereign Debt

### Issuance records (by region and country)
- Middle-East — Pakistan | Date: 12-Feb-04 | Year: 2004 | Yield at issue: 6.8 | Size ($ mn.): 500 | Tenor (years): 5 | Maturity Date: 19-Feb-09 | Spread (in bps.): 370 | Offer Price (%): 100.0 | Size (% GDP) 1/: 0.2 | Moodys (rating at issue): B2 | S&P (rating at issue): B | Currency: USD | Governing Laws: England | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market
- Asia — Vietnam | Date: 27-Oct-05 | Year: 2005 | Yield at issue: 7.2 | Size ($ mn.): 750 | Tenor (years): 10 | Maturity Date: 15-Jan-16 | Spread (in bps.): 256 | Offer Price (%): 98.2 | Size (% GDP) 1/: 0.5 | Moodys (rating at issue): Ba3 | S&P (rating at issue): BB- | Currency: USD | Governing Laws: New York | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market
- Latin America — Ecuador | Date: 7-Dec-05 | Year: 2005 | Yield at issue: 11.1 | Size ($ mn.): 650 | Tenor (years): 10 | Maturity Date: 15-Dec-15 | Spread (in bps.): 623 | Offer Price (%): 91.7 | Size (% GDP) 1/: 0.8 | Moodys (rating at issue): Caa1 | S&P (rating at issue): CCC+ | Currency: USD | Governing Laws: New York | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market
- Africa — Seychelles | Date: 27-Sep-06 | Year: 2006 | Yield at issue: 9.5 | Size ($ mn.): 200 | Tenor (years): 5 | Maturity Date: 3-Oct-11 | Spread (in bps.): 470 | Offer Price (%): 99.5 | Size (% GDP) 1/: 19.4 | Moodys (rating at issue): n.a. | S&P (rating at issue): B | Currency: USD | Governing Laws: England | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market
- Africa — Ghana | Date: 27-Sep-07 | Year: 2007 | Yield at issue: 8.5 | Size ($ mn.): 750 | Tenor (years): 10 | Maturity Date: 4-Oct-17 | Spread (in bps.): 387 | Offer Price (%): 100.0 | Size (% GDP) 1/: 1.9 | Moodys (rating at issue): n.a. | S&P (rating at issue): B+ | Currency: USD | Governing Laws: England | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market
- Asia — Sri Lanka | Date: 17-Oct-07 | Year: 2007 | Yield at issue: 8.3 | Size ($ mn.): 500 | Tenor (years): 5 | Maturity Date: 24-Oct-12 | Spread (in bps.): 397 | Offer Price (%): 100.0 | Size (% GDP) 1/: 0.8 | Moodys (rating at issue): n.a. | S&P (rating at issue): B+ | Currency: USD | Governing Laws: New York | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market
- Africa — Gabon | Date: 6-Dec-07 | Year: 2007 | Yield at issue: 8.3 | Size ($ mn.): 1,000 | Tenor (years): 10 | Maturity Date: 12-Dec-17 | Spread (in bps.): 426 | Offer Price (%): 100.0 | Size (% GDP) 1/: 5.4 | Moodys (rating at issue): n.a. | S&P (rating at issue): BB- | Currency: USD | Governing Laws: New York | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market
- Middle-East — Georgia | Date: 7-Apr-08 | Year: 2008 | Yield at issue: 7.5 | Size ($ mn.): 500 | Tenor (years): 5 | Maturity Date: 7-Apr-13 | Spread (in bps.): 474 | Offer Price (%): 100.0 | Size (% GDP) 1/: 3.1 | Moodys (rating at issue): n.a. | S&P (rating at issue): B+ | Currency: USD | Governing Laws: England | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market
- Africa — Senegal | Date: 15-Dec-09 | Year: 2009 | Yield at issue: 9.5 | Size ($ mn.): 200 | Tenor (years): 5 | Maturity Date: 22-Dec-14 | Spread (in bps.): 691 | Offer Price (%): 98.0 | Size (% GDP) 1/: 1.4 | Moodys (rating at issue): n.a. | S&P (rating at issue): B+ | Currency: USD | Governing Laws: England | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market
- Eastern Europe — Belarus | Date: 26-Jul-10 | Year: 2010 | Yield at issue: 9.2 | Size ($ mn.): 600 | Tenor (years): 5 | Maturity Date: 3-Aug-15 | Spread (in bps.): 727 | Offer Price (%): 99.0 | Size (% GDP) 1/: 0.9 | Moodys (rating at issue): B1 | S&P (rating at issue): B+ | Currency: USD | Governing Laws: England | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market
- Eastern Europe — Montenegro | Date: 7-Sep-10 | Year: 2010 | Yield at issue: 8.0 | Size ($ mn.): 254 | Tenor (years): 5 | Maturity Date: 14-Sep-15 | Spread (in bps.): 666 | Offer Price (%): 99.5 | Size (% GDP) 1/: 5.9 | Moodys (rating at issue): Ba3 | S&P (rating at issue): BB | Currency: EUR | Governing Laws: England | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market
- Eastern Europe — Albania | Date: 28-Oct-10 | Year: 2010 | Yield at issue: 7.6 | Size ($ mn.): 407 | Tenor (years): 5 | Maturity Date: 4-Nov-15 | Spread (in bps.): 587 | Offer Price (%): 99.5 | Size (% GDP) 1/: 3.2 | Moodys (rating at issue): B1 | S&P (rating at issue): B+ | Currency: EUR | Governing Laws: England | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market
- Middle-East — Jordan | Date: 8-Nov-10 | Year: 2010 | Yield at issue: 4.2 | Size ($ mn.): 750 | Tenor (years): 5 | Maturity Date: 12-Nov-15 | Spread (in bps.): 301 | Offer Price (%): 98.9 | Size (% GDP) 1/: 2.4 | Moodys (rating at issue): Ba2 | S&P (rating at issue): BB | Currency: USD | Governing Laws: England | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market
- Africa — Nigeria | Date: 21-Jan-11 | Year: 2011 | Yield at issue: 7.1 | Size ($ mn.): 500 | Tenor (years): 10 | Maturity Date: 28-Jan-21 | Spread (in bps.): 372 | Offer Price (%): 98.2 | Size (% GDP) 1/: 0.2 | Moodys (rating at issue): Not rated | S&P (rating at issue): B+ | Currency: USD | Governing Laws: England | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market
- Africa — Namibia | Date: 27-Oct-11 | Year: 2011 | Yield at issue: 5.8 | Size ($ mn.): 500 | Tenor (years): 10 | Maturity Date: 3-Nov-21 | Spread (in bps.): 336 | Offer Price (%): 98.1 | Size (% GDP) 1/: 4.1 | Moodys (rating at issue): Baa3 | S&P (rating at issue): Not rated | Currency: USD | Governing Laws: England | Inv. Grade: Y | Issue Type: Fixed rate | Market: Euro market
- Africa — Zambia | Date: 13-Sep-12 | Year: 2012 | Yield at issue: 5.6 | Size ($ mn.): 750 | Tenor (years): 10 | Maturity Date: 20-Sep-22 | Spread (in bps.): 384 | Offer Price (%): 98.1 | Size (% GDP) 1/: 3.7 | Moodys (rating at issue): Not rated | S&P (rating at issue): B+ | Currency: USD | Governing Laws: England | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market
- Latin America — Bolivia | Date: 22-Oct-12 | Year: 2012 | Yield at issue: 4.9 | Size ($ mn.): 500 | Tenor (years): 10 | Maturity Date: 29-Oct-22 | Spread (in bps.): 306 | Offer Price (%): 100.0 | Size (% GDP) 1/: 1.8 | Moodys (rating at issue): B3 | S&P (rating at issue): BB- | Currency: USD | Governing Laws: n.a. | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market
- Asia — Mongolia | Date: 29-Nov-12 | Year: 2012 | Yield at issue: 5.2 | Size ($ mn.): 1,000 | Tenor (years): 10 | Maturity Date: 5-Dec-22 | Spread (in bps.): 358 | Offer Price (%): 100.0 | Size (% GDP) 1/: 9.7 | Moodys (rating at issue): B1 | S&P (rating at issue): BB- | Currency: USD | Governing Laws: New York | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market
- Asia — Mongolia | Date: 29-Nov-12 | Year: 2012 | Yield at issue: 4.2 | Size ($ mn.): 500 | Tenor (years): 6 | Maturity Date: 5-Jan-18 | Spread (in bps.): 354 | Offer Price (%): 100.0 | Size (% GDP) 1/: 4.9 | Moodys (rating at issue): B1 | S&P (rating at issue): BB- | Currency: USD | Governing Laws: New York | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market
- Latin America — Paraguay | Date: 17-Jan-13 | Year: 2013 | Yield at issue: 4.6 | Size ($ mn.): 500 | Tenor (years): 10 | Maturity Date: 25-Jan-23 | Spread (in bps.): 275 | Offer Price (%): 100.0 | Size (% GDP) 1/: 1.9 | Moodys (rating at issue): Ba3 | S&P (rating at issue): BB- | Currency: USD | Governing Laws: n.a. | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market
- Latin America — Honduras | Date: 12-Mar-13 | Year: 2013 | Yield at issue: 7.5 | Size ($ mn.): 500 | Tenor (years): 10 | Maturity Date: 15-Mar-24 | Spread (in bps.): 548 | Offer Price (%): 100.0 | Size (% GDP) 1/: 2.7 | Moodys (rating at issue): B2 | S&P (rating at issue): B+ | Currency: USD | Governing Laws: New York | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market
- Africa — Tanzania | Date: 27-Feb-13 | Year: 2013 | Yield at issue: 6.5 | Size ($ mn.): 600 | Tenor (years): 5 | Maturity Date: 27-Feb-20 | Spread (in bps.): 600 | Offer Price (%): 100.0 | Size (% GDP) 1/: 2.1 | Moodys (rating at issue): Not rated | S&P (rating at issue): Not rated | Currency: USD | Governing Laws: n.a. | Inv. Grade: N | Issue Type: FRN 2/ | Market: Private placement
- Africa — Rwanda | Date: 25-Apr-13 | Year: 2013 | Yield at issue: 7.0 | Size ($ mn.): 400 | Tenor (years): 10 | Maturity Date: 2-May-23 | Spread (in bps.): 516 | Offer Price (%): 98.2 | Size (% GDP) 1/: 5.5 | Moodys (rating at issue): Not rated | S&P (rating at issue): B | Currency: USD | Governing Laws: England | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market
- Eastern Europe — Armenia | Date: 20-Sep-13 | Year: 2013 | Yield at issue: 6.3 | Size ($ mn.): 700 | Tenor (years): 7 | Maturity Date: 30-Sep-20 | Spread (in bps.): 413 | Offer Price (%): 98.6 | Size (% GDP) 1/: 7.0 | Moodys (rating at issue): Ba2 | S&P (rating at issue): Not rated | Currency: USD | Governing Laws: England | Inv. Grade: N | Issue Type: Fixed rate | Market: Euro market

### Notes and annotations
- Source: Dealogic
- Footnote 1/: "The GDP figure correspond to the year prior to the issuance."
- Footnote 2/: "Floating rate note."
- Table columns preserved as in original: Region; Country; Date; Year; Yield at issue; Size ($ mn.); Tenor (years); Maturity Date; Spread (in bps.); Offer Price (%); Size (% GDP) 1/; Moodys (rating at issue); S&P (rating at issue); Currency; Governing Laws; Inv. Grade; Issue Type; Market.

*Source: _wp14127 - Annex Table 1. First Sovereign Debt*

---


_Source: https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/wp/2014/_wp14127.pdf_