ISLAMABAD – PTI Government has decided to launch yet another economicinitiative.
Pakistan has approved the launching of Panda Bond in Chinese-denominatedYuan currency.
The federal cabinet approved a strategy to issue ‘Panda bonds’ in Chinesemarkets so that it can raise foreign exchange from global markets.
The cabinet approved the decision during its recent meeting, which waspresided over by Prime Minister Imran Khan.
The Finance Ministry did not seek the cabinet’s nod for the size of thebond at this stage. However, it is expected that the possible transactionsize will be equivalent to $500 million in two different tranches. This isbeing done so that Pakistan can finance its yawning trade deficit withBeijing.
At least one tranche is expected during the current fiscal year.
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Ministry of Finance Adviser and official spokesman, Dr Khaqan Najeeb, saidthe government is successfully continuing its multi-pronged approach forbridging foreign financing needs and building foreign exchange reserves.
He further said that Panda Bond’s approval by the cabinet is a part of thisstrategy, adding this is a well-thought-out decision after several roundsof discussions with Chinese banks, investment groups, regulatoryauthorities in China and stock exchange and traditional financial advisers.
These bonds will help the government diversify investor base of capitalmarket issuance and provide a source of raising Renminbi.
