In my view, there is a clear need to step up research and expand the necessary data base. Useful though it may be to acquire data by conducting surveys at intervals of five, seven or ten years, this process is inadequate and hardly acceptable. Yet we must be just as frank when considering the risks entailed in developing local bond markets.
After all, they are an important playing field for short-term portfolio inflows and outflows. Indeed, this is true of the present capital inflows to the EMEs: short-term portfolio investment represents no less than 50% of capital inflows.