Pakistan to issue panda bonds to strengthen capital market ties with China

Finance Minister Muhammad Aurangzeb announced Pakistan’s plan to debut yuan-denominated Panda bonds, aiming to raise $200-$250 million from Chinese investors within six to nine months. Speaking at the Asian Financial Forum in Hong Kong, he emphasized the need to tap into Chinese capital markets to boost the economy’s export-led transformation. Amid improving economic indicators, including a three-year high in foreign reserves ($18.7 billion), record remittances ($3.1 billion in December), and a revised 3% GDP growth forecast for 2024-25, Aurangzeb highlighted the government’s efforts to stabilize the economy. These include broadening the tax base to achieve a 13.5% tax-to-GDP ratio, as targeted under the IMF’s Extended Fund Facility, and reducing the policy rate to spur sustainable growth.