Pakistan raises $500m through Eurobond after 4-year hiatus

ISLAMABAD: A day after receiving $2 billion in assistance from Saudi Arabia, the government on Friday announced it had raised $500 million from the international capital market through a Eurobond after four years.

In a post on the social media platform X, Adviser to the Finance Minister Khurram Schehzad said, “Pakistan has successfully returned to the international capital markets after a four-year hiatus, with the issuance of a $500m Eurobond today, at attractive terms under its Global Medium-Term Note (GMTN) Programme.”

“The three-year Eurobond witnessed strong investor demand despite ongoing global market and geopolitical uncertainties — signalling renewed confidence in Pakistan’s economic outlook,” he said.

Informed sources said the bond attracted 6.95 per cent interest rates with maturity in April 2029.

The announcement came a day after Saudi Arabia announced it was extending its support of $5bn to $8bn, with the first additional disbursement of $2bn.

In his X post, Schehzad said that this “well-timed issuance adds fresh liquidity to Pakistan’s sovereign yield curve, strengthening its presence in global bond markets and supporting the development of a more efficient pricing benchmark for future transactions”.

He said that the development marked Pakistan’s successful market re-entry after four years, demonstrated strong investor demand in a challenging global environment and strengthened positioning in international capital markets.

“The transaction reflects improving investor sentiment and marks an important step in Pakistan’s strategy to diversify funding sources and rebuild a sustainable market presence,” he said.

“This milestone underscores the continued efforts of the Finance Division, particularly the debt management team, in executing a disciplined and forward-looking debt strategy,” he said.

“Looking ahead, Pakistan will continue to deepen its engagement with global markets, with a request for proposals for financial advisers for the GMTN and International Sukuk programmes to be launched soon, while the Panda Bond programme is also progressing toward issuance,” he said.

“With macroeconomic stability taking hold, structural reforms advancing, and growth momentum gradually strengthening, with the opening of the Straight of Hormuz and energy prices correcting, Pakistan’s timely return to global markets reflects improving fundamentals and renewed investor confidence with a stable to positive economic outlook,” he said.

Speaking to the media in Washington, Finance Minister Muhammad Aurangzeb maintained that the development was the “culmination of a four-year journey”.

He said that it signalled that Pakistan’s economy was “going in the right direction”. Aurangzeb further stressed that it was a “huge vote of confidence” in Pakistan’s leadership and the country’s economic direction.

“It is a moment of happiness for us,” he remarked.

Last week, Pakistan had repaid $1.4 billion against the maturity of a Eurobond on April 8.