The economic performance of East Asia has been a remarkable story spanning several decades. The region has enjoyed macroeconomic stability, consistent growth, low inflation, increasing openness to international flows of trade and private capital, and a steady reduction in poverty and improvement in living standards. Along with rapid expansion of productive capacity and extensive structural changes in their economies, the financial sectors of these countries have also developed vigorously. The region now has a well developed banking system, and boasts four of the top twenty stock markets in the world. The combined size of its bond markets at US $338 billion, or 22 percent of Gross Domestic Product (GDP) at the end of 1994, was only one-third of the size of the region's equity markets. The main objectives of the report are to provide a comprehensive survey of the East Asian bond markets, identify the best practices that have fostered development of these bond markets, and present a broad agenda for reforms that will further contribute to their development in the region. This study finds great diversity among these markets in their size, sophistication, regulatory framework and infrastructure. Each of these countries has taken significant steps in recent years to improve the functioning of their bond markets. It is clear that most of these markets are poised for growth and, in most cases, the institutional prerequisites are either already in place or are being put in place.