Fears of a protracted credit crunch in Asia look overdone as borrowers in the region are rushing to tap the international bond markets. Absolute and relative interest rates have plummeted as investors, flush with cash, have started to see signs of economic recovery and have become more confident about the problems ahead and how they can avoid them.
As yields have fallen, state-owned entities, banks and corporations are more prepared to lock in long-term funding, indicating that 2009 could be a record year for bond issuance in the region.
Asian borrowers had raised more than $45 billion through bonds denominated in G3 currencies by October 19, according to data provider Dealogic. That compares with just...