巴西财政部副部长：加强对华关系，计划最早今年发行熊猫债

Core Insights - The financial sector is emerging as a new growth point in China-Brazil cooperation, with Brazil's Lula government seeking to strengthen trade and investment ties with China, including plans to issue sovereign bonds in the Chinese market as early as this year [1][3] - Brazil's Deputy Finance Minister Dario Durigan indicated that Brazil plans to issue sustainable development bonds in the US and Europe, as well as Panda bonds in China, reflecting a diversification of financial partnerships and a reduction of reliance on traditional Western financial systems [1][3] - The issuance of Panda bonds, which are RMB-denominated bonds issued by foreign entities in China, is seen as a win-win strategy for both Brazil and China, potentially lowering Brazil's financing costs and promoting the internationalization of the RMB [3][5] Financial Context - Brazil's public debt is heavily financed through domestic investors, with less than 5% denominated in foreign currencies, primarily USD. Recently, Brazil issued international bonds worth $2.75 billion, with yields of 5.68% for five-year USD bonds and 6.73% for bonds maturing in 2035 [3] - The Brazilian central bank raised the benchmark interest rate to 14.75% to combat inflation, marking the highest level since August 2006, which has increased borrowing costs for the government, whose debt-to-GDP ratio stands at 76% [4][5] - The issuance of RMB-denominated bonds is expected to alleviate Brazil's debt pressure, with analysts suggesting that the cost of issuing 10-year bonds could be as low as 2%, compared to higher rates for bonds denominated in Brazilian real [5] Panda Bond Market Growth - The Panda bond market has been rapidly developing and is becoming a significant driver of RMB internationalization, with various international entities, including foreign governments and financial institutions, participating in the market [5][6] - In 2024, the annual issuance of Panda bonds in the interbank market is projected to reach approximately 185.8 billion RMB, with a market size nearing 300 billion RMB. The cumulative issuance in the first four months of this year was 62.2 billion RMB, indicating a strong growth trend [6]