Executives planning to expand internationally in the new year will find that they have more varied funding sources than ever. Global financial markets now boast unprecedented depth, integration, and liquidity. Deeper markets provide better access to capital and improve the allocation of risk.
Much of the growth in global financial assets over the past 25 years has come from a rapid expansion of corporate and government debt. Corporate-debt securities are the largest—and fastest-growing—component of the global financial stock. Together with government debt securities, they account for nearly half of the overall growth in global financial assets from 1993 to 2003. Debt has increased across all major countries and regions. International issues of corporate debt, though still small, are growing more than three times as fast as domestic issues (22 and 7 percent a year, respectively), reflecting the increasing globalization of capital as companies seek funds outside their domestic borders.
For more on what drives debt and on the convergence of national capital markets into a single, global one, read "Mapping the global capital markets."
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