ISLAMABAD (MNN); The government on Monday announced an increase in its Eurobond issuance from $500 million to $750 million by exercising the green-shoe option, as rising oil import costs driven by tensions in the Middle East have increased the country’s foreign exchange requirements.
The green-shoe option allows a borrower to raise additional funds at the same rate when investor demand exceeds initial expectations. According to the Ministry of Finance, Pakistan expanded its issuance after receiving strong interest from global institutional investors, marking a significant return to international capital markets after four years.
Adviser to the Finance Minister Khurram Schehzad stated that the move reflected stronger-than-expected investor demand and reinforced confidence in Pakistan’s economic outlook. He noted that the three-year Eurobond, initially set at $500 million, attracted substantial global participation, allowing the government to broaden its investor base.
He further highlighted that the upsizing demonstrated sustained investor appetite, improved liquidity in Pakistan’s sovereign yield curve, and strengthened the country’s re-engagement with global financial markets. The bond carries an interest rate of 6.975 percent and is set to mature in April 2029.
Earlier, Finance Minister Muhammad Aurangzeb described the initial $500 million issuance as a major milestone, calling it a strong vote of confidence in Pakistan’s economic direction.
The development follows recent financial support measures, including Saudi Arabia increasing its support facility for Pakistan from $5 billion to $8 billion, and the repayment of $2 billion to the United Arab Emirates. Earlier this month, Pakistan also repaid $1.43 billion in external debt, including a $1.3 billion Eurobond that matured on April 8.
