Pakistan Panda Bond for Eurobond Debt
Pakistan Plans Panda Bond and Bank Financing to Meet Eurobond Obligations
ISLAMABAD – Pakistan is moving to secure funds to cover upcoming Eurobond repayments, with financing expected to be arranged through a consortium of banks, according to government sources.
The authorities are exploring a combination of Panda Bonds and commercial loans to meet external debt obligations. Pakistan faces a $500 million Eurobond repayment on September 30, followed by a $1 billion maturity in April next year.
“These steps are part of a broader strategy to ensure timely debt servicing while safeguarding external financial stability,” sources said.
Finance Minister Muhammad Aurangzeb earlier confirmed that the proposed Panda Bond will be denominated in Chinese yuan, with a target issuance of $200 million to $300 million. The initiative is being structured with support from development institutions, including the Asian Infrastructure Investment Bank (AIIB), which may provide credit guarantees.
The move forms part of Pakistan’s larger effort to diversify funding sources, reduce reliance on U.S. dollar borrowing, and strengthen integration with China’s capital markets. It also aligns with the country’s aim to elevate its credit rating to a single ‘B’ level.
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