Corporate bonds as financing vehicle in central and Eastern Europe

The aim of the paper is to discuss corporate bond financing in Central and Eastern Europe (CEE) and repercussions to transition. We provide empirical data on the growing use of corporate bonds in CEE and discuss the level of development of bond markets and the implications for company finance and the transition process. We argue that the comparatively low level of development of the domestic corporate bond markets may create impediments to economic growth during the continuing transition in the CEE countries. We also discuss the relationship to foreign direct investment and bank loans, and changes in financial strategies.