The borrowing frenzy to finance artificial intelligence infrastructure is causing governments to start a capital battle with tech giants. Bank of America strategists say this is driving up borrowing costs in developing countries, while geopolitical concerns, high oil prices, and rising policy interest rates are already putting upward pressure on bond yields. In the second half of this year, the average yield on emerging market dollar bonds soared by nearly 1 percentage point, reaching the highest level since April last year. Bank of America's Merveille Paja, who is responsible for sovereign credit strategies in Eastern Europe, the Middle East and Africa, said this could challenge governments seeking to refinance maturing debts.

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