The purpose of this toolkit report is to describe the linkages between local government credit financing needs and capital markets in the emerging coutries. The report is presented in the form of a framework for decisionmaking about identifying, analyzing, and strengthening these linkages. No two countries are alike. Therefore, it considers a host of connections between the operation of the credit markets at various stages of development and the structure, powers, and practices of local governments. Given the existing environment, of which numerous examples are presented, the report considers a number of policy options. It is important to note that local governments, whatever may be the desired goals of greater autonomy and capacity at that level, are found in a variety of existing contexts in terms of political power and authority. These structures will shape the desirability and applicability of many of the market-oriented and local empowerment suggestions found in this tool kit.
