Pakistan will issue Yuan-denominated Panda Bonds\u201d as early as June to further integrate its capital markets with that of China, Federal Minister for Finance and Revenue, Muhammad Aurangzeb said.
\nIn an interview with South China Morning Post (SCMP), the minister also assured more cooperation with Beijing on the next phase of the China\u2013Pakistan Economic Corridor (CPEC)\u2013a key initiative for boosting bilateral trade and investment.<\/p>\n
He also called for more participation from China\u2019s private sector and export-led industries to transform Pakistan\u2019s debt-laden economy. Aurangzeb said Pakistan aimed to raise US$200 million to US$250 million from Chinese investors.<\/p>\n
The minister is in Hong Kong for the two-day Asian Financial Forum, which began on Monday.<\/p>\n
\u201cSince I took over [in March 2024], I have been very vocal about this \u2013 that we want to go for panda bonds, an inaugural sovereign panda bond \u2026 I\u2019m pushing everyone, including our own teams, to see if we can get this done before June,\u201d the paper quoted as having said.<\/p>\n
The minister added that Pakistan had followed Egypt\u2019s lead to issue the yuan bonds on the back of credit improvement from the Beijing-led Asian Infrastructure Investment Bank (AIIB).<\/p>\n
He said, Pakistan had endured years-long inflation and was pushed to the brink of default in 2023 as its economy withered amid political chaos and economic mismanagement. But the country\u2019s economy rebounded last year as the inflation rate dropped from nearly 38 per cent in May 2023 to 4.1 per cent last month.<\/p>\n
The International Monetary Fund (IMF) and Pakistan also reached an agreement on a 37-month extended bailout loan of about US$7 billion, with some of the country\u2019s main debt holders, including China, agreeing to a one-year debt rollover last year.<\/p>\n
Amid what he called the \u201cbalance of payment problem\u201d, Aurangzeb said that enhancing CPEC cooperation would be crucial, adding that the newest version of a flagship Belt and Road Initiative project would help the country digest its debt through an export-led model.<\/p>\n
The second phase of the project, according to Pakistan, aims to set up special economic zones in partnership with China to reform the country\u2019s agricultural and information technology sectors while attracting Chinese companies to relocate their low-end industries to the country.<\/p>\n
Aurangzeb said Pakistan was in trouble because the economy had been \u201cprimarily import-led\u201d, which caused the country to \u201crun out of foreign currency and get into a balance of payment problem\u201d.<\/p>\n
\u201cWhich means we have to fundamentally change the DNA of the economy towards export-led growth,\u201d he added.
\n\u201cCPEC phase two is all about primarily business-to-business, especially the economic zones. We want to make it work for some companies from the mainland to come in and use it as a real export hub.\u201d He also assured to step up security in his country to protect Chinese companies.<\/p>\n
Meanwhile, the minister said, Pakistan was exploring more joint ventures with Hong Kong and secondary listings for its firms in the city, the country\u2019s finance minister has said ahead of a meeting with Chief Executive John Lee Ka-chiu on Monday.
\nHe said, he would express his interest to Lee about the possibility of having a Hong Kong delegation visit Pakistan to identify areas for closer collaboration.<\/p>\n
\u201cIf there is an opportunity for companies out of Pakistan, as joint ventures with local companies, to come in and do primary and secondary listings in the Hong Kong stock exchange, for instance, I think it can be a real win-win, not only in terms of the investment that we expect back in Pakistan, but also outward investment,\u201d he said.<\/p>\n","protected":false},"excerpt":{"rendered":"
Pakistan will issue Yuan-denominated Panda Bonds\u201d as early as June to further integrate its capital markets with that of China, Federal Minister for Finance and Revenue, Muhammad Aurangzeb said. In an interview with South China Morning Post (SCMP), the minister also assured more cooperation with Beijing on the next phase of the China\u2013Pakistan Economic Corridor […]<\/p>\n","protected":false},"author":2,"featured_media":445555,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[],"class_list":{"0":"post-455281","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business"},"yoast_head":"\n