The Industrial and Commercial Bank of China (ICBC) is talking to governments and state-linked entities in the Gulf region that are interested in issuing yuan-denominated bonds in China, said an executive at ICBC, China's largest bank.
One government entity is in the process of applying to issue such instruments, known as panda bonds, which would make it the first issuer from the Middle East in China's interbank bond market, said Zhou Xiaodong, general manager of ICBC Dubai Branch.
Xiaodong did not name the entity, but said potential issuers had to have investment-grade credit ratings.
Gulf governments and companies have become more eager to issue bonds abroad in the past couple of years as low oil prices cause governments to run budget deficits and tighten liquidity in local banking systems.
According to Reuters, Beijing is encouraging foreign bond issuers as it seeks to internationalize its currency and open up sources of finance for its 'Belt and Road' trade route.
