Pakistan initiates the process for emitting its first Panda bond
Pakistan's Ministry of Finance recently concluded a successful non-deal investor roadshow (NDR) in Beijing, China, marking a significant step towards the country's inaugural Panda Bond issuance. The roadshow, held from July 7 to 11, 2025, aimed to engage potential Chinese investors and financial institutions, discussing Pakistan's macroeconomic outlook and the proposed bond structure[1][2][4].
The Panda Bond, denominated in Chinese yuan, is expected to be worth between $200 million and $300 million[1][4]. This issuance is a strategic move to tap China's onshore bond market, as part of Pakistan's broader strategy to diversify funding sources, reduce reliance on dollar-denominated borrowing, and integrate more deeply with China's capital markets[1][2].
Khurram Schehzad, advisor to the finance minister, led the discussions, covering the macroeconomic review and outlook, ongoing debt management reforms, the structure and progress of the proposed Panda Bond transaction, regulatory processes, credit enhancement arrangements, and investor interest in the forthcoming issuance[2].
The transaction is being structured with support from multilateral development institutions, such as the Asian Infrastructure Investment Bank (AIIB) and potentially the Asian Development Bank (ADB), for credit guarantees[1][3]. The inaugural Panda Bond is expected to be launched later this year, following the completion of necessary regulatory approvals[2][4].
The roadshow has drawn strong initial interest, indicating investor confidence in Pakistan's reform trajectory and its growing credibility in international capital markets[2][4]. The successful NDR reflects the government's commitment to innovative financial diplomacy, emphasising its proactive investor engagement and diversification of funding sources through access to China's onshore capital market[3].
The Panda Bond aims to expand Pakistan's investor base and diversify funding sources, sending a clear message of Pakistan's readiness to enter new capital frontiers with confidence and credibility[4]. The delegation from the Ministry of Finance held technical discussions with potential investors, underwriters, prospective guarantors, Chinese Rating Agency, and Chinese legal counsel during the roadshow[1].
In conclusion, Pakistan's debut Panda Bond issuance is gaining momentum, with strong investor interest and positive discussions during the recent NDR in Beijing. The successful roadshow is a testament to the government's commitment to financial diplomacy and its efforts to diversify funding sources, paving the way for a more robust and resilient Pakistani economy.
- The Panda Bond, expected to be valued between $200 million and $300 million, marks a strategic shift in Pakistan's financial strategy, aiming to diversify funding sources and reduce reliance on dollar-denominated borrowing.
- Khurram Schehzad, advisor to the finance minister, led discussions during the NDR, covering the country's macroeconomic outlook, debt management reforms, and the proposed Panda Bond structure, all of which sparked strong initial interest among potential investors.
- The transaction is being supported by multilateral development institutions, such as the Asian Infrastructure Investment Bank (AIIB) and the Asian Development Bank (ADB), for credit guarantees, further emphasizing the country's commitment to secure funding while integrating more deeply with China's capital markets.
- The inaugural Panda Bond issuance is anticipated to launch later this year, following regulatory approvals, sending a clear message that Pakistan is ready to enter new capital frontiers with confidence and credibility, expanding its investor base in the process.
- The successful NDR in Beijing is a testament to Pakistan's commitment to financial diplomacy, as it strives to engage proactively with investors and leverages real-estate and business opportunities in China's onshore capital market, with the long-term goal of fostering a more robust and resilient economy.
