Comparing this with the same analysis in developed markets shows that relative levels of foreign participation are higher in developed markets than emerging markets.
Within the eurozone countries a higher level of foreign participation should perhaps be expected. Even so, given emerging markets’ relatively strong economic fundamentals and low levels of total debt, it is perhaps not surprising that they too have high levels of foreign participation.
Analysing the percentage of total government debt issued on international markets, while individual country experiences do vary, it is very clear that the overall trend is one of convergence towards developed market levels. This is even apparent when China is excluded because its large total debt size combined with low levels of international debt positively distorts the emerging markets totals.
Thanos Papasavvas is a strategist on the fixed income and currencies team at Investec Asset Management
