## Market Access and High Spread Issuances

_IMF Working Papers, January 16, 2026_

## Source details

**Canonical URL:** [Market Access and High Spread Issuances](https://www.imf.org/en/publications/wp/issues/2026/01/16/market-access-and-high-spread-issuances-573294)

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## Bibliographic details
- Authors: Raphael A Espinoza, Metodij Hadzi-Vaskov, Luis Carlos Ibanez-Thomae, Flora Lutz
- Published: January 16, 2026
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9798229037259.001

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### Summary
- Study investigates factors determining emerging markets’ likelihood to access international capital markets.
- Approach:
  - Develop a simple theoretical model outlining market access foundations: role of risk, spreads, net worth, and cost of repaying debt.
  - Estimate a random forest model to assess key predictors of market access.
  - Collect a novel dataset and examine characteristics of high spread issuances.
- Key conceptual finding: trade-off between risk insurance and moral hazard; relevance of unconventional instruments such as guarantees and macro-contingent debt.

### Theoretical model: mechanisms and implications
- Highlights the role of:
  - risk,
  - spreads,
  - net worth,
  - cost of repaying debt.
- Demonstrates a trade-off between:
  - risk insurance, and
  - moral hazard.
- Underscores the relevance of unconventional instruments:
  - guarantees,
  - macro-contingent debt.

### Empirical approach and key predictors
- Methodology:
  - Random forest model used to assess predictors of market access.
- Key predictors identified:
  - outstanding obligations,
  - reserves,
  - short-term external debt,
  - EMBIG spreads,
  - size of the economy.

### Non-linear effects and interactions
- Important non-linear effects documented:
  - An inverted U-curve for the effect of spreads on likelihood of issuance.
  - A positive relationship between likelihood of issuance and external debt at low spreads that turns negative at high spreads.
  - High sensitivity to governance only for high spreads.

### Characteristics of high-spread issuances
- High spread issuances are often unconventional and include:
  - guarantees,
  - contingencies,
  - collateral.
- These empirical characteristics align with theoretical predictions.

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_Source: https://www.imf.org/en/publications/wp/issues/2026/01/16/market-access-and-high-spread-issuances-573294_