Boao (TDI): Finance Minister Muhammad Aurangzeb hinted that Pakistan may issue Panda Bonds in Yuan this year to tap into China’s extensive capital market.
Speaking in an interview with China’s CGTN during the Boao Forum for Asia, he said Islamabad was ready to engage the Chinese interbank bond market after previously issuing debt only in Western markets.
“I have been supporting and I am very keen that Pakistan go for an inaugural Panda bond,” Aurangzeb said.
“We are very optimistic that during this calendar year, we will do that.”
Panda bonds are yuan-denominated debt instruments issued by foreign entities in China. They provide an opportunity to attract investment from Chinese financial institutions including banks, insurers and asset managers.
The minister noted that while Pakistan had experience with issuing dollar and euro bonds, this would be first entry into the Chinese debt market.
The initiative is part of a broader strategy to diversify funding sources and reduce reliance on Western markets.
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The government is seeking to increase its foreign exchange reserves and stabilize economy after recovering from a prolonged economic crisis that nearly pushed Pakistan into sovereign default two years ago.
In January, the finance minister said the Panda bond issue would target nearly 200 million dollars.
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His announcement comes after major credit agencies upgraded the country’s sovereign ratings, enhancing Pakistan’s prospects of returning to international bond markets.
Aurangzeb said that Islamabad was leveraging its improved macroeconomic indicators and looking to build deeper financial relations with Beijing.
