Pakistan to Launch Panda Bonds in Chinese Capital Market
Published on: July 1, 2024.
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Pakistan Plans to Issue ‘Panda Bonds’ in Chinese Market
In an effort to strengthen economic ties with China, the Pakistani government is making preparations to issue Panda Bonds in the Chinese capital market, according to a report by 24NewsHD TV Channel.
Panda Bonds are renminbi-denominated bonds issued by non-Chinese entities in China’s domestic market. This move allows Pakistan to tap into the vast pool of Chinese investors and diversify its investor base.
To facilitate the issuance of Panda Bonds, the Ministry of Finance has decided to engage a Chinese rating agency, as well as a Chinese law firm and legal counsel. The government has called for technical and financial proposals from Chinese rating agencies, with a deadline of July 29. Similarly, proposals from domestic legal counsel are sought by July 15.
The selection of the Chinese rating agency will be done through a competitive process, and the chosen agency will provide its services for the duration of the project. Once selected, an agreement letter will be signed between the Government of Pakistan and the successful Chinese companies.
This move is expected to attract Chinese investors to invest in Pakistan’s bonds, further strengthening the economic relationship between the two countries. It will also provide Pakistan with an opportunity to raise funds in Chinese yuan, diversifying its borrowing options.
By issuing Panda Bonds, Pakistan can access a new pool of investors and potentially benefit from lower borrowing costs due to the high demand for renminbi-denominated assets. This can also enhance Pakistan’s presence in the global bond market and boost its international standing.
This initiative is part of Pakistan’s broader efforts to attract foreign investment and boost its economy. The government aims to leverage its strong ties with China and explore new avenues for collaboration. The issuance of Panda Bonds is seen as a significant step towards achieving these goals.
In conclusion, Pakistan’s decision to issue Panda Bonds in the Chinese capital market is a strategic move that aims to strengthen economic ties with China and attract more foreign investment. This initiative has the potential to boost Pakistan’s economy and enhance its presence in the global bond market.
Source: [24NewsHD TV Channel](https://www.24newshd.tv)
