Indonesia targets US$1 billion Panda Bond issuance: minister

Beijing (ANTARA) - Indonesia is targeting an initial issuance of US$1 billion in Panda Bonds in China to diversify development financing sources and support rupiah stability, Finance Minister Purbaya Yudhi Sadewa said.

"Our initial target is around US$1 billion, but we will see what the market looks like. If demand is larger, we will increase it," he said in Beijing on Thursday.

Purbaya made the remarks after meetings with Chinese Finance Minister Lan Fo'an, officials from the People’s Bank of China (PBOC), representatives of the Asian Infrastructure Investment Bank (AIIB), and investors during his June 16–19 visit to China.

He said support from China's central bank has strengthened prospects for the issuance, with book-building expected to begin once regulatory approval is granted.

Indonesia is also exploring the use of bilateral local currency arrangements with China to facilitate direct yuan-rupiah transactions and help reduce pressure on the rupiah.

He added that China's Finance Ministry has expressed strong support for the plan, which is expected to provide Indonesia with access to one of the world's largest bond markets.

Panda Bonds provide foreign governments and companies access to China's large and liquid financial market. The proceeds can be used to finance budgetary needs, infrastructure projects, investments, and other development programs.

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Translator: Desca Lidya, Raka Adji

Editor: Anton Santoso

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