Pakistan’s plans to issue Panda Bonds in 2025 have been postponed. Initially, the country aimed to issue $250 million worth of Panda Bonds in December. However, due to delays in approval from the Asian Infrastructure Investment Bank (AIIB), the plan has been shelved for now. The government now targets launching the bonds in early 2026, likely in January or February.
The Panda Bonds are part of Pakistan’s strategy to raise funds in the Chinese capital market. The bonds would have a three-year tenure with a fixed interest rate. Pakistan hopes to secure financing at a rate below 10%. The bonds will be settled in Chinese yuan and are expected to raise between $200 million and $300 million.
The Asian Development Bank (ADB) had already approved a guarantee for up to 95% of the Panda Bonds. However, approval from the AIIB is still pending. The AIIB’s board meeting is expected by the end of this month or next month, which will finalize the issuance date.
This is the third time that the Panda Bond issuance plan has been delayed. The government has faced multiple setbacks due to various approval processes and internal delays. Once the final approvals are granted, Pakistan plans to move forward with the bond issuance, which is seen as vital for its foreign currency reserves.
The delay has sparked concerns among some observers, but officials remain optimistic. Finance Minister Muhammad Aurangzeb reaffirmed that the bonds will provide much-needed funding and diversify Pakistan’s international financing options. With the backing of institutions like the ADB and AIIB, Pakistan aims to boost its economic recovery efforts.
