Brazil is preparing its first issuance of Panda Bonds in China, a public debt operation denominated in yuan aimed at diversifying the country's sources of financing, reducing its dependence on the US dollar and strengthening Brazil's presence in the Chinese financial market.

The information was confirmed in Beijing by Mathias Alencastro, Secretary of International Affairs of the Ministry of Finance, who was in the Chinese capital to take part in bilateral agenda meetings and to prepare for the visit of the Minister, Dario Durigan, scheduled for the coming weeks.

Panda Bonds are debt securities issued by foreign entities in the Chinese financial market and denominated in the local currency. With this initiative, the Brazilian Government seeks to broaden its base of international investors and open a new avenue of external financing, in line with its strategy of diversifying public debt management.

The possibility of tapping the Chinese market had already been signalled about a year ago by Dario Durigan. The expectation is that the project will be formally announced during his trip to China, consolidating the strengthening of financial co-operation between Brasília and Beijing.

(Source: Brasil 247, on 9 June)