Finance Minister Muhammad Aurangzeb has said that Pakistan plans to launch Panda Bond by June this year with an aim to enhance country’s presence in China’s capital markets.
In an interview with Hong Kong’s TVB News Channel, the Finance Minister said through the issuance of the Panda Bond, Pakistan intends to raise approximately two hundred million US dollars from Chinese investors.
The move is expected to be worth around $200 million to $250 million, but “it’s not a question of amount,” the minister said. “What is important is that we do go for an inaugural issue and then, once it’s successful, we can always keep it on tap,” he said. Aurangzeb said that not using the world’s second-largest capital market until now had “been a miss on our part.” “We are quite keen that during this calendar year, we do,” he added.
Although Pakistan’s sovereign credit ratings have been upgraded since it secured a $7 billion bailout package from the International Monetary Fund, it has yet to break out of the “CCC” or “Caa” level as assessed by the three major global agencies. This severely constrains its options for financing in the global market.
The Finance Minister has expressed hope for reaching the “B” rating zone in due course by carrying out reforms in accordance with the IMF’s terms, he stressed the importance of “diversifying” the country’s funding sources.
