Prime Highlights
- The Arab Energy Fund has become the first MENA-based multilateral institution approved to issue Panda bonds in China.
- The move strengthens financial cooperation between China and the Gulf region, especially Saudi Arabia.
Key Facts
- The fund is authorized to issue up to 10 billion yuan (about $1.4 billion) in Renminbi-denominated bonds over two years.
- Approval was granted by China’s National Association of Financial Market Institutional Investors, allowing direct access to the onshore bond market.
Background
The Arab Energy Fund has received regulatory approval to issue Panda bonds in China, becoming the first multilateral financial institution from the Middle East and North Africa to access the country’s domestic bond market.
The approval was granted by China’s National Association of Financial Market Institutional Investors, which oversees the interbank bond market. The decision allows the Riyadh-based fund to raise capital directly from Chinese investors through Renminbi-denominated bonds.
The Arab Energy Fund can raise up to 10 billion yuan through Panda bonds over the next two years.
This move highlights stronger financial ties between China and the GCC, especially Saudi Arabia. Recent high-level engagements between the two sides have focused on investment cooperation and technology exchange across key Vision 2030 sectors, resulting in several bilateral agreements.
Vicky Bhatia, chief financial officer of the Arab Energy Fund, said the approval would help diversify the institution’s funding base while deepening cooperation with Chinese capital markets. She noted that access to onshore Renminbi financing provides long-term stability and supports the fund’s capital planning efforts.
With over 50 years of experience, the Arab Energy Fund invests in traditional and clean energy projects. It has a strong track record and a high international credit rating.
Entering China’s Panda bond market gives the fund new funding options and highlights China’s growing role in financing global energy projects, as well as closer financial links between the MENA region and Asia.
