Pakistan raises RMB 1.75 billion in debut Panda Bond, draws more than five times demand

Pakistan has successfully completed its first-ever Panda Bond issuance in China, raising RMB 1.75 billion ($250 million) through a three-year fixed-rate sovereign bond that was more than five times oversubscribed, according to official details shared on Thursday.

The yuan-denominated bond, Pakistan’s inaugural issuance in China’s onshore capital market, attracted investor orders worth more than RMB 8.8 billion ($1.26 billion), far exceeding the amount offered.

The strong demand enabled the government to secure a coupon rate of 2.5%, reflecting investor confidence in Pakistan’s improving macroeconomic indicators, fiscal discipline, external account stability and debt repayment capacity.

Demand for the debut transaction alone surpassed the government’s total planned Panda Bond programme size of RMB 7.2 billion, equivalent to about $1 billion.

The issuance marks Pakistan’s first sovereign borrowing in renminbi and opens access to China’s domestic bond market, the world’s second largest.

Officials said the transaction will help diversify Pakistan’s investor base, deepen financial cooperation with China and support the country’s return to international capital markets.

The successful offering is being viewed by policymakers as a sign of improving international confidence in Pakistan’s economic reform programme and broader efforts to restore long-term market access.