Islamabad: The federal cabinet has approved a plan to issue Yuan denominated ‘Panda bonds’ in the Chinese market to raise foreign exchange from global markets, reported a news source. At the moment, the size of the issue has not been released.
This strategy was approved in a cabinet meeting headed by Prime Minister Imran Khan. Dr Khaqan Najeeb, the Official Spokesperson to the Finance Ministry, revealed that this decision was made after rounds of deliberations with Chinese banks, regulatory authorities, investment groups, stock exchanges, and traditional financial advisers. About these bonds, he said, ‘They will help government diversify investor base of capital market issuance and provide a source of raising renminbi (RMB).’
He added that the size, tenor, and pricing of these Panda bonds would depend on the market response at the time of the issuance, which will be done in several rounds. This will give the Pakistani government space to shift from USD to RMB when trading with China as well.
