Pakistan moves closer to issuing first panda bond

Pakistan is set to issue its first panda bond, targeting about $250 million in an inaugural sale in January as part of a broader $1 billion program, the Finance Division said Friday.

Finance Minister Muhammad Aurangzeb chaired a meeting to review progress on the yuan-denominated bond, which will be sold in China’s onshore market. Officials said approvals from multilateral partners have been secured, and engagement with Chinese institutional investors has been positive.

Final regulatory clearance from Chinese authorities is expected in early January, with issuance planned for later that month subject to approvals.

The government is pursuing the panda bond as part of a structured financing strategy aligned with debt management objectives. The overall program is planned at about $1 billion, with additional tranches under a phased approach called “Panda Series II.”

Officials said market conditions remain supportive, documentation and guarantees are in place, and discussions with financial institutions are ongoing. Initial outreach for subsequent issuances has begun, with pricing to be determined closer to market engagement once regulatory requirements are met.

Aurangzeb noted the bond will help diversify Pakistan’s funding sources and support medium-term debt sustainability, complementing the country’s recent macroeconomic stabilization efforts.