* GRAPHIC-EM debt issuance and maturity profile:
LONDON Dec 13 From tiny frontier markets to the
world's No. 2 economy, a range of developing countries could
experience serious stress next year if a strengthening dollar
and sluggish domestic economies make it harder to meet debt
Emerging governments and companies must repay more than $300
billion next year in hard currency debt, roughly a third more
than 2016 - the result of a borrowing spree after 2008 when
Western interest rates collapsed.
"One consequence of the very loose global monetary policy
we've had for the past decade is that financing was easily
available and went in some cases to corners of the market that
didn't really deserve it," said Graham Stock, head of EM
sovereign research at asset manager BlueBay.
Meanwhile, the dollar's five-year rally, renewed by Donald
Trump's U.S. election victory, will extend into 2017, Reuters
Following is a list of potential pressure points in emerging
markets for 2017, in order of the size of their economy:
CHINA - Chinese companies owe some $18 trillion (about 170
percent of gross domestic product), with close to $800 billion
billion) maturing in 2017. Since 2014 Beijing has allowed 85
defaults and domestic ratings firm Chengxin predicts more in
Beijing may allow the yuan, already near 8-1/2-year lows, to
fall further to stop burning through central bank reserves,
which are at the lowest since 2010. That may prove a problem for
companies with hard currency borrowings. Non-financial firms
face $530 billion in external debt repayments in the next 12
months, the Institute for International Finance (IIF) estimates.
"If I had to make a bet for 2017 I would be much more
concerned about China. (Financial sector deterioration) is
speeding up," said Francois Savary, chief investment officer of
Prime Partners in Geneva. "China could be a major risk for
TURKEY - The lira's slump to record lows raises fears that
companies may struggle to repay external debt, with
non-financial firms owing $79 billion in the next 12 months,
according to the IIF. The economy's first quarterly contraction
since 2009 also possibly heralds a rise in bad bank loans; other
weaknesses are low reserves compared with short-term debt and a
current account gap around 5 percent: tmsnrt.rs/2fM78iH
JPMorgan noted that while Turkish companies had always
successfully rolled over debts, the "dangerously high" current
account deficit meant "investors will remain alert to the risk
of a sudden stop in capital flows".
VENEZUELA - The government and state oil firm PDVSA
have resolutely serviced debt, though PDVSA
recently swapped $2.8 billion in bonds and resorted to a grace
period for a coupon on 2035 bonds. Brokerage Exotix
calculates that about $10 billion is due next year in bonds,
loans and interest but expects the country to muddle through
2017. However, with food shortages and triple-digit inflation it
is unclear how long the government can cling to power. BlueBay's
Stock said he had cut his overweight position: "We think we are
getting closer to the end of the road for these payments."
MOZAMBIQUE - Is set to miss a $60 million coupon due in
January on its $727 million "tuna bond" which it wants to
restructure so it can get a loan deal with the IMF. Creditors
refuse to negotiate until an audit reveals how much Mozambique
owes and to whom. Around $1 billion in state-guaranteed loans is
also owed by two state firms, borrowings that had not been
previously disclosed to bondholders.
REPUBLIC OF CONGO - Delayed paying coupons on its 2029
dollar bond in June and last December and Fitch noted "repeated
arrears on other bilateral commitments". Republic of Congo
blamed technical problems but investors want to see if an
end-December coupon is on time.
Moody's has highlighted "liquidity risk" and said raising
financing in future would be "challenging". Exotix said the
fiscal deficit was approaching 20 percent of GDP and advised
selling the bond.
MONGOLIA - The resource-rich country's economic boom is
over, but $1 billion in bonds mature between March 2017 and
January 2018. Hong Kong-listed Mongolian Mining Corp
is already in default. Investors hope the cash-strapped country
can win a Chinese bailout; if an IMF deal is reached,
bondholders may face writedowns.
SURINAME - The economy will contract 9 percent in 2016, says
the IMF, which in a recent statement criticised the South
American country for backtracking on reforms required for a $500
million loan. The IMF noted Suriname had limited
finances to cover essential spending, including wages and
pensions. That may become a concern for holders of a $550
million bond, with first coupons due April 2017.
BELIZE - The central American country said last month it
wanted to "amend" $530 million in 2038 bonds for its third
restructuring in a decade. The bonds carry a step-up coupon that
climbs from 5 percent to 6.767 percent in 2017. Talks started
last week with creditors.
($1 = 6.9004 Chinese yuan renminbi)
(Reporting by Sujata Rao, Claire Milhench, Karin Strohecker and