Oil, Materials
The first group is perhaps the biggest. Oil and materials producers alone -- two export-oriented sectors -- have sold about 30 percent of the dollar debt, according to data compiled by Bloomberg. While hurt by slumping energy prices, they’re largely unaffected by, or even benefit from, exchange-rate declines because they receive revenue in dollars and have most of their costs in local currencies, said Aziz Sunderji, a strategist at Barclays.
Bonds of the Russian steelmaker Evraz Plc, for example, have returned 12 percent over the past year as the currency plunged 38 percent against the dollar.
The most exposed companies to foreign-exchange swings are those that sell their services and products in the local market, Sunderji said. These industries, which include telecommunications, airlines, retailers, property developers and utility companies, account for 19 percent of the debt outstanding, Bloomberg data show.
Yet some of them have currency hedges in place to mitigate the effects. A BIS survey showed that currency derivative trading soared to $536 billion in 2013 from $380 billion three years earlier, a sign that companies may have increased their hedging.
Brazil’s Gol
What’s left are banks and financial firms, which make up 38 percent of the overseas debt. Most of them have dollar assets to offset the liabilities, according to Sunderji.
When all the pieces are put together, the risk of a 1980s- like emerging-market crisis seems remote, according to Peter Varga, who manages $1.1 billion in emerging-market corporate bonds at Erste Sparinvest in Vienna.
“I’m not really concerned,” Varga said in an interview last month. “The companies facing problems are minorities.”
Among those in the minority, Gol Linhas Aereas Inteligentes SA, Brazil’s biggest airline, stands out as one of the biggest losers.