JAKARTA, Indonesia: Indonesia plans to issue yuan-denominated sovereign bonds, known as Panda Bonds, by June 2026 as part of its effort to diversify state financing sources and reduce reliance on Western capital markets.
Finance Minister, Purbaya Yudhi Sadewa, said preparations for the issuance are underway, and he, together with senior Finance Ministry officials, is expected to travel to China soon to advance the process.
He said the planned issuance forms part of the government’s broader strategy to strengthen the resilience of the National Budget (APBN) by expanding financing sources beyond traditional markets.
“We continue to diversify so that we do not depend on financing from the United States or Western countries,” he said, according to Antara News Agency on Wednesday.
Purbaya said China has ample liquidity and a large financial market capable of absorbing Indonesian government debt instruments.
Additionally, he said China’s financial market offers competitive yields of between 2.3 per cent and 2.5 per cent.
The strong confidence among Chinese investors in Indonesia’s economic fundamentals also makes them less sensitive to credit rating considerations.
Purbaya said the government also engaged with Industrial and Commercial Bank of China, which expressed readiness to support the Panda Bond issuance.
He said Indonesia is also considering allowing Chinese institutions to issue bonds in the domestic market as part of reciprocal financial cooperation between the two countries.
The proposal was discussed during a bilateral meeting between Purbaya and Chinese Finance Minister, Lan Fo’an, on the sidelines of the IMF-World Bank Spring Meetings 2026 in Washington, DC, last month.
According to Purbaya, the arrangement could widen investment options for Indonesian investors while deepening bilateral financing cooperation with China. – BERNAMA
