Publication:
Shadow Sovereign Ratings for Unrated Developing Countries

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dc.contributor.authorDe, Prabal
dc.contributor.authorRatha, Dilip
dc.contributor.authorMohapatra, Sanket
dc.date.accessioned2012-06-07T19:43:18Z
dc.date.available2012-06-07T19:43:18Z
dc.date.issued2007-06
dc.description.abstractThe authors attempt to predict sovereign ratings for developing countries that do not have risk ratings from agencies such as Fitch, Moody's, and Standard and Poor's. Ratings affect capital flows to developing countries through international bond, loan, and equity markets. Sovereign rating also acts as a ceiling for the foreign currency rating of sub-sovereign borrowers. As of the end of 2006, however, only 86 developing countries have been rated by the rating agencies. Of these, 15 countries have not been rated since 2004. Nearly 70 developing countries have never been rated. The results indicate that the unrated countries are not always at the bottom of the rating spectrum. Several unrated poor countries appear to have a "B" or higher rating, in a similar range as the emerging market economies with capital market access. Drawing on the literature, the analysis presents a stylized relationship between borrowing costs and the credit rating of sovereign bonds. The launch spread rises as the credit rating deteriorates, registering a sharp rise at the investment grade threshold. Based on these findings, a case can be made in favor of helping poor countries obtain credit ratings not only for sovereign borrowing, but for sub-sovereign entities' access to international debt and equity capital. The rating model, along with the stylized relationship between spreads and ratings can be useful for securitization and other financial structures, and for leveraging official aid for improving borrowing terms in poor countries.en
dc.identifierhttp://documents.worldbank.org/curated/en/2007/06/7746920/shadow-sovereign-ratings-unrated-developing-countries
dc.identifier.doi10.1596/1813-9450-4269
dc.identifier.urihttps://hdl.handle.net/10986/7448
dc.languageEnglish
dc.publisherWorld Bank, Washington, DC
dc.relation.ispartofseriesPolicy Research Working Paper; No. 4269
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo/
dc.subjectACCOUNTING
dc.subjectACTUAL DEBT
dc.subjectBANK LENDING
dc.subjectBENCHMARK
dc.subjectBONDS
dc.subjectBORROWING
dc.subjectBORROWING COSTS
dc.subjectBUDGET BALANCE
dc.subjectCAPITAL FLOWS
dc.subjectCAPITAL MARKET
dc.subjectCAPITAL MARKETS
dc.subjectCOMMERCIAL BANKS
dc.subjectCOUNTRY RISK
dc.subjectCOUNTRY RISK RATINGS
dc.subjectCREDIT MARKET
dc.subjectCREDITORS
dc.subjectCREDITWORTHINESS
dc.subjectCROSS-SECTION DATA
dc.subjectCURRENT ACCOUNT
dc.subjectCURRENT ACCOUNT BALANCE
dc.subjectDEBT
dc.subjectDEBT BURDEN
dc.subjectDEBT BURDENS
dc.subjectDEBT CRISIS
dc.subjectDEBT DEFAULTS
dc.subjectDEBT INTOLERANCE
dc.subjectDEBT OBLIGATIONS
dc.subjectDEBT RATIO
dc.subjectDEBT RESTRUCTURING
dc.subjectDEBT SERVICE
dc.subjectDEFAULT
dc.subjectDEPENDENT VARIABLE
dc.subjectDEVELOPED COUNTRIES
dc.subjectDEVELOPING COUNTRIES
dc.subjectECONOMETRIC MODEL
dc.subjectECONOMIC DEVELOPMENT
dc.subjectECONOMIC GROWTH
dc.subjectECONOMIC GROWTH PROSPECTS
dc.subjectECONOMIC OUTLOOK
dc.subjectECONOMIC STRUCTURE
dc.subjectEMPIRICAL ANALYSIS
dc.subjectEQUITY CAPITAL
dc.subjectEQUITY MARKETS
dc.subjectEXCHANGE RATES
dc.subjectEXPLANATORY VARIABLE
dc.subjectEXPLANATORY VARIABLES
dc.subjectEXPORTS
dc.subjectEXTERNAL DEBT
dc.subjectEXTERNAL DEBT BURDEN
dc.subjectEXTERNAL DEBT SERVICE
dc.subjectEXTERNAL LIQUIDITY
dc.subjectEXTERNAL OBLIGATIONS
dc.subjectFINANCIAL CRISIS
dc.subjectFINANCIAL STRUCTURES
dc.subjectFORECASTS
dc.subjectFOREIGN CURRENCY DEBT
dc.subjectFOREIGN EXCHANGE
dc.subjectGDP
dc.subjectGDP PER CAPITA
dc.subjectGOVERNMENT DEBT
dc.subjectGROWTH RATE
dc.subjectHIGH CORRELATION
dc.subjectHIGHLY INDEBTED COUNTRY
dc.subjectINCOME
dc.subjectINDIVIDUAL COUNTRIES
dc.subjectINFLATION
dc.subjectINFLATION RATE
dc.subjectINSURANCE
dc.subjectINTEREST RATES
dc.subjectINTERNATIONAL DEBT
dc.subjectLINEAR REGRESSION
dc.subjectLIQUIDITY
dc.subjectLIQUIDITY CRISIS
dc.subjectLOAN MARKETS
dc.subjectLOCAL AUTHORITIES
dc.subjectMACROECONOMIC VARIABLES
dc.subjectNATIONAL INCOME
dc.subjectNATURAL RESOURCES
dc.subjectNEGATIVE RELATIONSHIP
dc.subjectPER CAPITA INCOME
dc.subjectPOLICY RESEARCH
dc.subjectPOOR COUNTRIES
dc.subjectPOOR COUNTRY
dc.subjectPRIVATE DEBT
dc.subjectPRIVATE DEBT FLOWS
dc.subjectPRIVATE SECTOR
dc.subjectPROPERTY RIGHTS
dc.subjectPUBLIC SECTOR
dc.subjectREAL GDP
dc.subjectREGRESSION ANALYSIS
dc.subjectREGRESSION MODELS
dc.subjectREGRESSION RESULTS
dc.subjectREGRESSION SAMPLE
dc.subjectRISK EVALUATION
dc.subjectRISK PREMIUM
dc.subjectSAVINGS
dc.subjectSECURITIES
dc.subjectSECURITIZATION
dc.subjectSHORT TERM DEBT
dc.subjectSHORT-TERM DEBT
dc.subjectSOVEREIGN BOND
dc.subjectSOVEREIGN BONDS
dc.subjectSOVEREIGN BORROWERS
dc.subjectSOVEREIGN DEFAULT
dc.titleShadow Sovereign Ratings for Unrated Developing Countriesen
dspace.entity.typePublication
okr.crossref.titleShadow Sovereign Ratings For Unrated Developing Countries
okr.date.doiregistration2025-04-10T09:25:03.653563Z
okr.doctypePublications & Research::Policy Research Working Paper
okr.doctypePublications & Research
okr.docurlhttp://documents.worldbank.org/curated/en/2007/06/7746920/shadow-sovereign-ratings-unrated-developing-countries
okr.globalpracticeMacroeconomics and Fiscal Management
okr.globalpracticePoverty
okr.globalpracticeFinance and Markets
okr.globalpracticeTrade and Competitiveness
okr.guid759061468323725184
okr.identifier.doi10.1596/1813-9450-4269
okr.identifier.externaldocumentum000016406_20070621154413
okr.identifier.internaldocumentum7746920
okr.identifier.reportWPS4269
okr.language.supporteden
okr.pdfurlhttp://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2007/06/21/000016406_20070621154413/Rendered/PDF/wps4269.pdfen
okr.topicEconomic Theory and Research
okr.topicFinance and Financial Sector Development::Financial Intermediation
okr.topicInternational Economics and Trade::External Debt
okr.topicCountry Strategy and Performance
okr.topicPoverty Reduction::Inequality
okr.topicInternational Economics and Trade
okr.topicMacroeconomics and Economic Growth
okr.unitDevelopment Research Group (DECRG)
okr.volume1 of 1
relation.isAuthorOfPublication979327ad-ac79-5a52-98ad-ee91fca9734d
relation.isAuthorOfPublication.latestForDiscovery979327ad-ac79-5a52-98ad-ee91fca9734d
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
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