Pakistan to float $250m Panda Bonds in Chinese market: Aurangzeb

ISLAMABAD: Finance Minister Muhammad Aurangzeb said Wednesday that Pakistan was moving ahead with its first-ever Panda Bonds in China to diversify funding sources, after drawing interest from Chinese investors.

He said $250 million worth of bonds would be issued in the first phase.

Briefing the Senate Standing Committee on Finance, chaired by Senator Saleem Mandviwalla, the finance minister said that negotiations with the International Monetary Fund (IMF) were progressing in the right direction, stressing that the government was not introducing any additional taxes.

Aurangzeb told the committee that Pakistan repaid $500 million worth of Eurobonds a day earlier, while another $1.3 billion payment would be made in April.

He said that the government was determined to raise the tax-to-GDP ratio to 11 per cent by the end of the current fiscal year.

Responding to concerns over first-quarter tax shortfalls, Aurangzeb said that several tax-related cases were pending in courts, and their resolution could boost revenue collection.

The finance minister maintained that signs of economic stability were becoming visible and emphasised that Pakistan should tap its potential in the field of cryptocurrency.

Pakistan set to launch inaugural Panda bonds to attract Chinese investors

He said that progress was being made on the Pakistan Virtual Assets Regulatory Authority Bill, noting that cryptocurrency — once an unregulated sector — was now being brought under regulation.

It may be recalled that Pakistan and the IMF formally began talks on September 29 for the second review of the $7 billion loan programme and the first review of the $1.3 billion climate financing programme.

Pakistan assured the IMF of full compliance with the loan programme. The IMF delegation, led by the mission chief for Pakistan, met Finance Minister Aurangzeb at the Ministry of Finance, where the Pakistani side briefed the Fund on overall economic performance and targets under the bailout plan.

Technical-level discussions had commenced on September 25, but formal talks began on September 29 after the finance minister’s return.

The IMF delegation will also assess Pakistan’s economic situation and the impact of recent floods on fiscal targets.

Successful negotiations would pave the way for the Fund’s board approval and release of the next tranche of the loan.