Brazil formally kicked off plans to issue its first sovereign panda bonds on Thursday, a landmark move that officials said would create new opportunities for bilateral cooperation in financial markets.
The move, which makes Brazil the first Latin American country to issue sovereign panda bonds, shows the growing interest of international issuers in such bonds for diversified and lower-cost funding channels, and this could pave the way for broader participation by international issuers in China's bond market, analysts said.
A panda bond is a renminbi-denominated debt instrument issued by overseas governments or institutions in China's onshore capital market.
On Thursday, Brazil's Ministry of Finance delivered its letter of intent for issuing panda bonds to the National Association of Financial Market Institutional Investors, with officials from China and Brazil attending a ceremony in Beijing marking the occasion.
Brazil plans to raise up to 5 billion yuan ($735 million) with its inaugural issuance of panda bonds.
