Ukrainian Debt Market

¶ … Ukrainian bond market, specifically seeking to determine the factors that are restraining its development. The Ukrainian bond market is underdeveloped, with relatively poor liquidity. Several different factors contributing to this are examined. What we know already is that there is a low level of liquidity in the Ukrainian debt market. This serves to suppress demand for the nation's debt, and it increases the cost of borrowing because low liquidity means higher risk for buyers.

We also know that the country's banking sector has also been a contributor to the slow growth of the debt markets. The main issue with the banking sector is that it is a barrier to investors to buying these bonds -- the banks should act as intermediary but does note. What we need to find out is what other factors are contributing to the overall sluggishness of the Ukrainian debt markets.

Some of the specific issues that might come into play are taxation, fees and charges, risk, regulatory complexity in the underwriting process, and the overall lack of size of the market for primary underwriting and secondary trading of sovereign debt products. 4. There are a number of sources for the information that we will need to gather.

The Ministry of the Economy of Ukraine compiles some of the needed data, as does the Stock Market Commission of Ukraine, the National Bank of Ukraine, the State Statistics Committee of Ukraine and possibly some international bodies such as the World Bank as well. The different rates that will be studied as the data should be available from these difference sources. 5. The data being gathered is from 2000-2010. Some of this might be available online from the above-mentioned sources. If not, these ministries will be contacted to provide the data.

Obviously, things might not be running as normal in Ukraine right now. Under normal circumstances it would take weeks to get this data back from government officials there but significant government disruption is occurring and it might take longer under these circumstances. The cost should not be high -- it is not anticipated that anybody will need to fly to Kiev to get this information -- it can all be transmitted via email or registered mail. 6. The research is socially acceptable.

There are no human subjects so no worries about informed consent. The study is based on past data, all of it macroeconomic in nature, so current study of this data does not seem to have any ethical implications. Socially, it is valuable to know what the influences on the markets for different financial products are. In this case, with debt.