The Effects of Derivatives Regulation on Infrastructure Finance : Some Evidence from Emerging Markets
This study seeks to assess the effects of post-crisis regulatory reforms on derivatives used to hedge infrastructure finance transactions in Emerging Market and Developing Economies (EMDEs). The motivation for this analysis stems from the importanc...
| Main Authors: | , , |
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| Format: | Working Paper |
| Language: | English |
| Published: |
World Bank, Washington, DC
2020
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/916131586157513109/The-Effects-of-Derivatives-Regulation-on-Infrastructure-Finance-Some-Evidence-from-Emerging-Markets http://hdl.handle.net/10986/33590 |
| Summary: | This study seeks to assess the effects
of post-crisis regulatory reforms on derivatives used to
hedge infrastructure finance transactions in Emerging Market
and Developing Economies (EMDEs). The motivation for this
analysis stems from the importance of infrastructure in
EMDEs, the mandate of the WBG to mobilize financing for
infrastructure, and the role that derivatives play in the
structuring of infrastructure financing transactions.
Although this study suggests that there has been an impact
resulting from regulatory reforms, the effect on
infrastructure finance transactions in EMDEs has been
mitigated by several factors. Infrastructure projects have
specific characteristics of structure, quality and recovery
rate that suggest there is scope for further analysis to
explore enhancements to the regulatory framework affecting
the instruments used to hedge the risks of investing in
infrastructure assets – without undermining the achievement
of the overall regulatory objectives. In order to move
toward new patterns of infrastructure financing, risk
management in infrastructure projects will become more
important than previously. |
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