Kazakhstan to Issue USD 2 Billion in Yuan Bonds

On September 22, the Kazakhstan Stock Exchange (KASE) began allowing secondary market transactions in securities settled in Chinese yuan, Orda.kz reports.

Against this backdrop, reports emerged that Kazakhstan plans to issue yuan-denominated bonds totaling two billion dollars.

Bloomberg notes that Kazakhstan’s authorities aim to attract Chinese currency to finance growing trade with Beijing and strengthen investment cooperation.

While state-owned companies have previously issued panda bonds (yuan-denominated bonds traded in China’s domestic market by foreign issuers) and dim sum bonds (yuan-denominated bonds issued in Hong Kong), this will mark the country’s first issuance of sovereign yuan debt.

Economy Minister Serik Zhumangarin explained that the main reasons are to secure financing for export-oriented projects and to demonstrate Kazakhstan’s reliability as an investment partner. He added that projects agreed upon by President Toqayev during his recent trip to the SCO summit will also be financed in Chinese currency.

Organizations that have already issued or are planning to issue yuan-denominated bonds include KazMunayGas, the Development Bank of Kazakhstan, and the Samruq-Qazyna Fund.

Trading of yuan-settled securities on KASE first began in March.

Original Author: Nikita Drobny