Pakistan Launches Five- and 10-Year Eurobond Plan as Global Market Access Improves
Pakistan prepares a new dollar-denominated Eurobond offering.
Pakistan has launched the process for a new Pakistan Eurobond offering with five-year and 10-year maturities. The government aims to strengthen its return to international capital markets after recent sovereign rating upgrades.
Finance Minister’s adviser Khurram Schehzad said the proposed transaction would depend on market conditions. He described the move as another step towards expanding Pakistan’s access to global investors.
The government has not yet announced the size, pricing or final yields of the bonds. These details will depend on investor demand and conditions in international debt markets.
Pakistan Tests Longer-Term Investor Demand
Schehzad said the planned issuance follows improvements in Pakistan’s sovereign credit ratings and key macroeconomic indicators. He added that the move reflects stronger engagement between Pakistan and international investors.
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The announcement comes less than five months after Pakistan returned to the international bond market following a four-year absence.
In April, the government raised $500 million through a three-year Eurobond under its Global Medium-Term Note programme. The bond carried a coupon of 6.975 per cent.
Strong investor demand later allowed Pakistan to increase the issue to $750 million. The government used a $250 million green-shoe option to expand the transaction. The bond is scheduled to mature in April 2029.
The latest Pakistan Eurobond plan would extend the maturity profile beyond the three-year bond issued in April.
Ratings Support New Bond Programme
Pakistan also repaid a $1.4 billion Eurobond that matured in April. The repayment helped the country restore a pricing benchmark in international debt markets.
For several years, Pakistan had relied heavily on multilateral, bilateral and commercial financing.
On Tuesday, S&P assigned a ‘B’ rating to Pakistan’s Global Medium-Term Note programme and the proposed US dollar-denominated notes. The rating matches Pakistan’s sovereign rating.
Fitch Ratings has also assigned a ‘B-’ rating to the GMTN programme. It gave the programme a Recovery Rating of ‘RR4’, in line with Pakistan’s long-term sovereign rating.
Five- and 10-Year Bonds Offer Fresh Test
The proposed five-year and 10-year tranches will provide a fresh test of international investor confidence in Pakistan.
The longer maturities could also help the government build a broader yield curve for future international borrowing.
However, the final structure will depend on market conditions and investor demand. Pakistan will need to balance its financing needs with borrowing costs as it seeks to maintain access to global capital markets.
