Pakistan is set to re-enter international sovereign debt markets in 2026 after a four-year hiatus, with Finance Minister Muhammad Aurangzeb revealing plans for the nation's first-ever panda bond alongside traditional Eurobonds and sukuks. The announcement, made during the World Economic Forum Annual Meeting 2026 in Davos, signals strong macroeconomic recovery and renewed investor confidence.
Aurangzeb told Bloomberg that a request for advisers will soon be issued to structure the debt offerings, with formats dollar, euro, or sukuk still under consideration. "We've consolidated our gains in macroeconomic stability," he stated, citing sharp improvements in inflation, interest rates, fiscal deficit, and current account balance. The minister emphasized that the "direction of travel has clearly improved," crediting IMF-supported reforms that reopened global market access after Pakistan's 2022 exclusion.
No immediate rupee pressure exists, Aurangzeb noted, alongside structural breakthroughs like successful Pakistan International Airlines (PIA) privatization and plans to sell a stake in New York’s Roosevelt Hotel. The government aims to pivot toward export-led growth, avoiding past import-driven imbalances.
Reform momentum remains critical: "We have to stay the course on reforms… That's the only way to move toward sustainable growth," Aurangzeb stressed. This return would mark Pakistan's first sovereign issuance since 2022, bolstering access to diverse global financing amid expanding tax bases and state asset sales.
