This can be attributed to the enhancement of the market infrastructure of these economies, not just because of improvements in the risk/return profile of these bonds in terms of the creditworthiness of the issuers and the relatively higher yields of the papers. Moreover, there has also been a significant improvement in the problem of currency mismatch.
The share of foreign lenders’ loans denominated in local currencies has increased remarkably, as shown in Figure 3, although the maturities of such loans are still one year or shorter. It is worth mentioning here that some countries have implemented measures explicitly to reduce the mismatch.