How sovereign is the EU?

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• Are EU bonds govvies yet?
• Fast moving credit market develops a strange rattling noise
• Debt-for-nature: from the Galapagos to the developing world

The EU’s huge funding programme and how it issues debt make it appear very much like a sovereign borrower. But while it might like to view itself as such, its audience of investors and bankers don’t entirely agree that it is… yet.

We discuss why the EU wants to be part of the govvie market, what it needs to do to get there and discover that there could be all sorts of consequences if it achieves its goal in the eyes of the bond market.

Meanwhile, the go-faster stripes seem to be wearing off of the speeding credit market as investors worry about spreads and interest rates and some new bank and corporate bond issues start to look a little stodgy — and it could not be happening at a worse time for issuers.

Finally, we look into debt-for-nature swaps and how this innovative bit of financing could help vulnerable countries deal with two of their most pressing problems: global warming and debt sustainability.