KARACHI: Federal Minister for Finance and Revenue Muhammad Aurangzeb said on Friday his country’s inaugural Panda Bond issuance would support inclusive growth and deepen long-term financial cooperation with China, as Pakistan became the first South Asian nation to tap the Chinese onshore bond market.
Speaking at the launch ceremony at Pakistan’s embassy in Beijing, Aurangzeb said the debut issuance of 1.75 billion yuan ($250 million) marked a milestone in Pakistan’s economic engagement with China and international capital markets, while expressing hope for a sustained partnership with Chinese investors and institutions.
Panda Bonds are yuan-denominated bonds issued by foreign governments or institutions in China’s domestic capital market. Pakistan on Thursday launched its first-ever Panda Bond after establishing a 7.2 billion yuan ($1 billion) program following two years of preparation and coordination with Chinese regulators, financial institutions and development partners.
The issuance ceremony in Beijing was attended by representatives from the Chinese government, multilateral development banks, investors, financial institutions and rating agencies.
“This was Pakistan’s first Sustainable Panda Bond, with proceeds earmarked for projects in the water, energy, and health sector underscoring the Government’s commitment to inclusive and sustainable growth,” Aurangzeb said at the ceremony, according to a finance ministry statement.
Pakistan has described the Panda Bond issuance as part of its efforts to diversify financing channels, strengthen investor confidence and expand its presence in international financial markets as it seeks to stabilize an economy long reliant on external financing support.
The finance minister said Pakistan was “proud to become the first Panda Bond issuer from South Asia,” adding that the successful issuance reflected confidence among Chinese investors in Pakistan’s economic direction and reform agenda.
Aurangzeb said the debut issuance received an “overwhelmingly positive response” and was oversubscribed, reflecting strong investor confidence in Pakistan’s economic outlook.
He said the “successful issuance marked not the end, but the beginning of a long-term partnership between Pakistan and the Chinese capital market,” and expressed confidence that the establishment of the 7.2 billion yuan program would provide Pakistan with a strong platform for future issuances and deepen financial connectivity and sustainable economic cooperation between Pakistan and China.
Aurangzeb also reaffirmed Pakistan’s commitment to reforms under its International Monetary Fund program, saying adherence to the reform agenda had strengthened macroeconomic stability and reinforced market confidence in the economy.
