Investors turn more cautious on
Investors are turning more cautious about dollar bonds from "frontier" markets - a fast growing but less developed and higher risk sub-set of emerging economies - due to sliding oil prices, low trading volumes and expectations of smaller returns.
Within the diverse group of economies, which ranges from Belarus and Belize to Egypt and Pakistan, interest is likely to shift in 2015 towards energy importing nations that will benefit from cheaper crude, and away from oil exporters. Debt issuance by frontier countries is a small proportion of the total for emerging markets, which are dominated by bigger names such as Brazil or Russia. But their governments have made the most of investors' hunt for better returns while interest rates in developed economies remain ultra low.
According to Thomson Reuters data, frontier countries sold $19.7 billion in hard currency debt last year - an almost 50 percent rise from 2013 and nearly three times the 2012 level.
Yet many, especially oil exporters such as Nigeria and Ecuador, are likely to be hit hard this year by the dramatic drop in crude prices, said Kevin Daly, portfolio manager at Aberdeen Asset Management's emerging debt team.