Pakistan raises $500 million Eurobond at 6.95% as investor demand signals market re-entry

Pakistan on Friday successfully tapped the international capital market for the first time in four years, raising $500 million through a three-year Eurobond issued under its Global Medium-Term Note (GMTN) programme, reflecting renewed investor appetite for the country’s sovereign debt.

Sources familiar with the transaction said the bond was priced at an interest rate of 6.95 percent and will mature in April 2029, drawing strong participation from global investors despite persistent geopolitical and financial market uncertainties.

The issuance came just days after Pakistan repaid $1.4 billion against the maturity of an earlier Eurobond on April 8, a move that helped restore confidence in the country’s external repayment capacity.

Finance Minister Muhammad Aurangzeb, speaking to media in Washington, described the successful return to international markets as the culmination of a four-year stabilization effort and evidence that the economy was moving in the right direction. He termed the development a significant vote of confidence in Pakistan’s economic leadership and reform trajectory.

The government’s re-entry into global debt markets also coincided with renewed financial backing from Saudi Arabia, which recently expanded its financial support framework for Pakistan from $5 billion to $8 billion, including an additional $2 billion disbursement announced a day earlier.

In a statement shared on social media platform X, Adviser to the Finance Minister Khurram Schehzad said the issuance strengthens Pakistan’s sovereign yield curve, enhances its visibility in global bond markets, and supports the creation of a more efficient pricing benchmark for future transactions.

He added that the successful transaction demonstrates improving investor sentiment toward Pakistan’s macroeconomic outlook and forms part of a broader strategy to diversify funding sources and rebuild a sustained presence in international capital markets.

Officials indicated that further external financing initiatives are in the pipeline, including the planned launch of requests for proposals for financial advisers for upcoming GMTN and International Sukuk programmes, while progress is also underway on the country’s proposed Panda Bond issuance.

Authorities maintained that recent macroeconomic stabilization, ongoing structural reforms, and easing global energy risks have collectively supported Pakistan’s return to international markets, though sustaining investor confidence will depend on continued fiscal discipline and consistent policy execution.