Public Debt Markets in Central America, Panama, and the Dominican Republic

152 Pages Posted: 23 Aug 2007

See all articles by Hemant C. Shah

Hemant C. Shah

International Monetary Fund (IMF)

Andreas (Andy) Jobst

International Monetary Fund (IMF) - European Department

Laura Valderrama

International Monetary Fund - Monetary and Capital Markets Department

Ivan Guerra

International Monetary Fund (IMF)

Date Written: July 2007

Abstract

This paper-consisting of a regional study and seven country studies-reviews the state of domestic public debt markets in Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Nicaragua, and Panama as at end-2005. Although they account for the lion's share of capital markets, regional public debt markets remain underdeveloped for a variety of reasons. The problems of small scale, dollarization, and weak public finances in many countries are compounded by poor structure and composition of debt (with sizeable nonstandard and non-tradable components), fragmentation of public debt between central banks and the sovereigns and across instruments, poor debt management practices, weaknesses in securities market, and small investor bases all of which result in high transaction costs and a lack of liquid benchmarks. The paper also briefly discusses efforts towards and impediments to regional integration of public debt markets. The authorities recognize these problems and the paper takes note of the regional efforts to harmonize debt standards and improve issuance practices. It offers several recommendations to improve strategic debt management, issuance mechanics, and secondary trading.

Keywords: Public debt, Central America, Costa Rica, El Salvador, Honduras, Guatemala, Dominican Republic, Nicaragua, Panama, Capital markets, Debt management, Financial integration, Working Paper

Suggested Citation

Shah, Hemant C. and Jobst, Andreas A. and Valderrama, Laura and Guerra, Ivan, Public Debt Markets in Central America, Panama, and the Dominican Republic (July 2007). IMF Working Papers, Vol. , pp. 1-150, 2007. Available at SSRN: https://ssrn.com/abstract=1007896

Hemant C. Shah

International Monetary Fund (IMF) ( email )

700 19th Street NW
Washington, DC 20431
United States
202-623-9831 (Phone)

Andreas A. Jobst

International Monetary Fund (IMF) - European Department ( email )

700 19th Street NW
Washington, DC 20431
United States
+1-202-538-2898 (Phone)

Laura Valderrama (Contact Author)

International Monetary Fund - Monetary and Capital Markets Department ( email )

700 19th Street NW
Washington, DC 20431
United States

Ivan Guerra

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Register to save articles to
your library

Register

Paper statistics

Downloads
156
Abstract Views
1,410
rank
190,466
PlumX Metrics