DistantNews
Support us
🇮🇩 Indonesia /Economy & Trade

Indonesia to Issue $1 Billion Panda Bond in China

From Tempo · () Indonesian

Translated from Indonesian, summarized and contextualized by DistantNews.

At a glance

News Official statement New plan
  • Indonesia's government will issue a Panda Bond worth $1 billion on July 23, 2026, targeting the Chinese market.
  • The bond has received a top AAA rating from Chinese agency Lianhe Credit Rating, reflecting Indonesia's strong economic fundamentals.
  • The issuance is a cautious first step into the Chinese bond market, despite potential for higher demand, with Bank of China acting as lead underwriter.

Indonesia's government is set to issue a Panda Bond worth $1 billion on July 23, 2026, marking its entry into China's substantial bond market. The issuance has secured a top AAA rating from Lianhe Credit Rating, a respected Chinese agency, signifying the highest possible creditworthiness for a debt issuer in China. This rating underscores Indonesia's robust economic standing and its ability to attract investment.

So in China, our debt rating is at the top, right side.

— Purbaya Yudhi SadewaDescribing Indonesia's top AAA credit rating in the Chinese market.

Finance Minister Purbaya Yudhi Sadewa highlighted the significance of the AAA rating, emphasizing that China represents a large and promising market for debt instruments. He expressed confidence that this high rating will facilitate the bond issuance. The assessment by Lianhe Credit Rating was based on key Indonesian factors, including consistent economic growth, solid economic fundamentals, its status as Southeast Asia's largest economy with resilience to external shocks, and a government debt-to-GDP ratio below 40 percent.

With this AAA rating, it should not be too difficult for us to issue debt instruments there.

— Purbaya Yudhi SadewaExplaining the importance of the AAA rating for issuing bonds in China.

While the potential demand for the bond is estimated to be significantly higher, the government has deliberately capped the issuance at $1 billion. This cautious approach is intended to test the waters in a new market. "This is a new market, so we are testing the waters first," Purbaya stated, noting the substantial bid interest despite the self-imposed limit. Bank of China will serve as the lead underwriter for this issuance, supported by joint lead underwriters and bookrunners including Industrial and Commercial Bank of China (ICBC), China International Trust and Investment Corporation (CITIC), China International Capital Corp (CICC), and the Development Bank of Singapore (DBS). Several other major Chinese banks will act as co-managers.

This is a new market, so we are testing the waters first. Although the offering, the bid is very large. But we are limiting it to US$ 1 billion first.

— Purbaya Yudhi SadewaExplaining the decision to limit the Panda Bond issuance to $1 billion initially.
DistantNews Editorial

Originally published by Tempo in Indonesian. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

More Stories

From Our Blog