Bangkok--29 Jan--Standard & Poor's
Standard & Poor's Ratings Services predicts that sovereign debt markets will continue to deepen in the Asia-Pacific region during 2007, albeit at a slower pace than in recent years, according to a report published today titled "Asia-Pacific Sovereign Debt Will Exceed US$10 Trillion In 2007".
"The Asia-Pacific region accounts for almost 40% of global sovereign debt outstanding and Japan will maintain its position as the dominant borrower in Asia-Pacific with over 80% of expected debt stock in 2007," said Standard & Poor's credit analyst Brendan Flynn. "Similarly, sovereign commercial borrowing globally is projected to be just over US$4 trillion in 2007, of which Asia-Pacific will account for 37%. Domestic borrowing will remain the preferred funding source in the region, with an ever decreasing reliance on external debt."
Commercial debt outstanding of sovereigns in Asia-Pacific is likely to increase and breach the US$10 trillion mark for the first time. Of the 21 sovereigns rated by Standard & Poor's, 13 are projected to record increases in debt in US$ terms, while five are projected to reduce sovereign commercial debt and three are forecast to remain at zero commercial debt outstanding.
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