Investors hunting for better yields amidst rock bottom rates in established markets have caused the amount of emerging market corporate debt in the global market to explode. Jay Tambe, partner at Jones Day, said the repercussions could be massive and painful. EM corporate debt skyrocketed from $4 trillion in 2004 to more than $15 trillion, according to the International Monetary Fund. As for where the majority of the issuance is coming from, Chinese corporate debt alone makes up more than 60% of the amount. 'These were attractive places to invest and it was relatively easy for companies in that part of the world to raise debt without paying a lot in interest rates,' said Tambe. 'It was an attractive proposition for both issuers and investors.' Nevertheless, Tambe said he expects the number of corporate credit defaults to start snowballing as emerging market growth in China and Brazil stumbles while corporate profits and commodity prices slide.

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