Purbaya opens opportunities for China to issue bonds in Indonesia

Jakarta (ANTARA) - Finance Minister Purbaya Yudhi Sadewa has opened opportunities for China to issue debt securities or bonds in the Indonesian market. This option emerged during bilateral discussions with Chinese Finance Minister Lan Fo’an on the sidelines of the International Monetary Fund and World Bank Group Spring Meeting (IMF-World Bank Spring Meeting) held from 13 to 17 April in Washington, DC, United States. “China is our largest trading partner, so the outcome of those talks was very positive,” Purbaya told reporters during a media briefing at the Ministry of Finance office in Jakarta on Tuesday. During the meeting, Purbaya conveyed the Indonesian Government’s plan to issue Yuan-denominated bonds or Panda Bonds in the Chinese market. Purbaya stated that this intention received a positive response because interest rates in the Chinese financial market are considered more competitive, at around 2.3 per cent. This condition is seen as an alternative to reduce Indonesia’s cost of capital. As part of the reciprocal scheme, Purbaya said Indonesia is also opening opportunities for China to issue bonds domestically. According to him, this step could provide space for Indonesian investors to access Chinese debt instruments while expanding bilateral financing cooperation. Purbaya said information regarding financing options from China has also been conveyed to bond investors in the United States. This communication is part of the government’s negotiation strategy to show that Indonesia has alternative funding sources with more efficient costs. He revealed that this approach has led to a significant increase in incoming bids.