TEMPO.CO, Jakarta - Indonesia has postponed the issuance of its first Panda Bonds until the end of July 2026, pushing back the launch from its original schedule in early July, Finance Minister Purbaya Yudhi Sadewa announced on Friday, June 26.
Speaking at a press conference at the Finance Ministry in Jakarta, Purbaya said the delay followed requests from Chinese banks and fund managers, who needed more time to complete their internal investment approval processes.
"I think it's good. It means there is strong interest, so I postponed it until the end of July," he said.
According to Purbaya, several prospective investors only recently became aware of Indonesia's bond offering and asked for additional time to submit proposals to their investment committees. The government agreed to the extension to broaden investor participation.
During a recent visit to China, Purbaya met with the governor of the People's Bank of China and the president of the Asian Infrastructure Investment Bank (AIIB). He said the meetings generated strong interest from Chinese financial institutions, some of which are also expected to serve as underwriters for the bond issuance.
"Some of them will also act as underwriters. I will allow them to become underwriters so that our bond sales increase there," he said.
Purbaya described the issuance as an unconventional but strategic step to diversify Indonesia's sources of development financing. In addition to raising funds in U.S. dollars, the government aims to expand financing in China's renminbi.
The Finance Ministry also plans to use a Local Currency Transaction (LCT) mechanism involving the People's Bank of China and Bank Indonesia, allowing renminbi proceeds from the bond sale to be converted directly into rupiah.
"That way, our dependence on the U.S. dollar will decrease, reducing pressure on the rupiah," Purbaya said.
Panda Bonds are renminbi-denominated bonds issued by foreign entities in China's domestic capital market. Indonesia plans to offer the bonds to Chinese investors, with the proceeds earmarked for domestic development projects.
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