Pakistan is preparing to issue its first Panda bonds before December 2025, aiming to raise $250 million through yuan-denominated debt. The bonds will be placed privately on China’s national interbank market and made available to qualified institutional investors. This marks Pakistan’s entry into the Chinese bond market for the first time.
The Panda bond will carry a tentative coupon rate between 3% and 4% per annum and will have a three-year term. The transaction is being handled by a consortium of financial advisers and underwriters, including China International Capital Corporation Ltd. and Habib Bank Ltd. This move is part of Pakistan’s broader effort to diversify its financing sources.
In July, representatives from Pakistan’s Ministry of Finance held pre-marketing meetings with investors in Beijing. These meetings were part of a non-deal roadshow aimed at generating interest in the upcoming bond issuance. Officials believe this bond will open new avenues for raising capital from China.
According to Finance Minister Muhammad Aurangzeb, the bond launch is pending some final approvals and documentation. He said the issuance could go up to $300 million once finalized. The government also seeks credit guarantees from multilateral partners to support the offering.
Until now, Pakistan has mostly issued bonds in US dollars and euros. However, officials say the Chinese capital market presents a promising new opportunity. If successful, this Panda bond could pave the way for more future issuances.