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Beyond Aid: How Much Should African Countries Pay to Borrow?

Jun 01, 2010 | C.A. Gueye, A.N.R. Sy | IMF
This paper proposes a two-step approach to estimate the sovereign credit rating and interest rate cost of a country considering borrowing externally. Estimates can be used to assess the costs and benefits of different financing options. The method can also be used to construct foreign currency as well as domestic local currency yield curves.