Brazil is preparing to launch its first sovereign bonds denominated in Chinese currency, known as panda bonds, in 2025. The move was analyzed by the Chinese newspaper Global Times as a clear sign of the growing internationalization of the yuan and an important milestone in the financial rapprochement between the two countries.

“For Brazil, one of South America's largest economies, the plan has significant implications,” the editorial notes. Given the urgent need for investment in infrastructure and industrial modernization, the country may find panda bonds to be a cheaper alternative that is less exposed to exchange rate volatility.

The publication also highlights that the issuance of panda bonds takes the partnership to a higher level by incorporating state financing into the joint strategy. The growing internationalization of the Chinese currency also reflects, according to the Chinese newspaper, the demand from developing countries for a more pluralistic global monetary system. As more countries integrate into the yuan-centered international financial system, a more diversified global financial order begins to take shape.

(Source: Brasil247, on June 10)