Panda Bonds Prepared, Government Seeks to Reduce US Dollar Dependence
The government is preparing the issuance of global bonds in renminbi (RMB), or Panda Bonds, in the mainland Chinese market. Finance Minister Purbaya Yudhi Sadewa stated that this step is being taken to expand funding sources while reducing dependence on the US dollar amid global turbulence that continues to pressure the rupiah.
“The purpose of issuing Panda Bonds is so that Indonesia does not rely too heavily on funding in US dollars,” said Purbaya during a media discussion at Kebon Sirih, Jakarta, on Wednesday (6/5/2026).
According to him, issuing bonds in Chinese currency is also expected to help maintain rupiah stability when pressures in the global market increase. With more diverse funding sources, risks from US dollar fluctuations can be mitigated.
Additionally, the funding costs through Panda Bonds are considered cheaper. Purbaya noted that the yield offered is in the range of 2.3 to 2.5 percent, lower than government bonds in US dollars or other currencies.
The government has begun exploring this issuance with several financial institutions in China. One of them is the Industrial and Commercial Bank of China (ICBC), which is said to be ready to support the issuance process.
“We have already discussed with ICBC and they are ready. With a yield of around 2.3 percent alone, demand is already very high,” he revealed.
Purbaya assessed that investors in China have sufficient confidence in Indonesia’s economic fundamentals. According to him, the Chinese financial market also has a different approach because it is not too focused on credit ratings.
“They do not rely too much on ratings because they trust Indonesia’s good economic fundamentals,” he said.
Furthermore, he stated that the Panda Bond issuance is likely to take place next month. The government also plans to visit China to finalise preparations for the bond issuance.
“Next month, we may go to China to prepare for this issuance,” said Purbaya.
Previously, the government had first issued Dimsum Bonds in Hong Kong. The presence of Panda Bonds in China’s domestic market is expected to expand the investor base while strengthening the country’s financing resilience amid global economic uncertainty.