Islamabad: Pakistan on Thursday issued its first-ever Panda Bond in China’s onshore capital market, attracting strong investor demand in a move officials described as a sign of growing confidence in the country’s economic outlook.
Advisor to the Finance Minister Khurram Schehzad said the inaugural Panda Bond was a three-year fixed-rate instrument and Pakistan’s first RMB-denominated sovereign issuance in China’s domestic capital market.
“The landmark Panda Bond issuance of RMB 1.75 billion, equivalent to USD 250 million, attracted overwhelming investor demand of over RMB 8.8 billion, approximately USD 1.26 billion, resulting in an oversubscription of more than five times,” Schehzad said in a post on X.
Panda Bonds are yuan-denominated bonds issued by foreign governments or institutions in China.
According to Schehzad, demand for the first tranche alone exceeded Pakistan’s entire planned Panda Bond programme size of RMB 7.2 billion, or around USD 1 billion equivalent.
He said the strong response reflected increasing international investor confidence in Pakistan’s reform agenda and improving macroeconomic indicators.
“The strong order book enabled highly competitive pricing with a 2.5% coupon, demonstrating the market’s positive assessment of Pakistan’s improving macroeconomic fundamentals, external stability, disciplined fiscal management, and sovereign repayment capacity,” he said.
Officials described the issuance as a major step in expanding Pakistan’s access to international capital markets and deepening financial cooperation with China.
Schehzad said the successful issuance signalled international recognition of Pakistan’s economic recovery and reflected confidence in the country’s fiscal reforms, debt management efforts, and commitment to sustainable growth.
Meanwhile, Finance Minister Muhammad Aurangzeb travelled to Beijing on Wednesday to attend the issuance ceremony for Pakistan’s inaugural Panda Bond.
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