THE Philippine government and the Bank of China (BOC) on Thursday signed the underwriting agreement of the country’s maiden issuance of $200 million worth of yuan-denominated securities or panda bonds.

Finance Secretary Carlos G. Dominguez and BOC Chairman Chen Siqing signed the agreement during the official visit of Chinese Premier Li Keqiang at the Malacañang on Thursday. Mr. Keqiang and President Rodrigo R. Duterte stood as witnesses.

“The Panda bond issue will diversify our funding sources and provide benchmarks for other Philippine issuers in the onshore market, particularly at this time that the renminbi is a reserve currency,” National Treasurer Rosalia V. de Leon said in a statement, noting that the securities to be offered will bolster China’s financial support for critical infrastructure projects in the Philippines.

Mr. Dominguez added that the issuance of panda bonds “will depend on market conditions, the possible business risks and the trend in dollar interest rates.”

Moreover, Ms. de Leon told reporters on Thursday that the government is still working on issuing the panda bonds at the end of the year, as they are still waiting for the approval of the People’s Bank of China (PBoC), Bejing’s central bank.

“We’re working [to hopefully offer it] within the year. We’re waiting the approval of PBoC,” Ms. de Leon said after Thursday’s Treasury bill auction.

On September, the country’s economic delegation led by Mr. Dominguez headed to China for a non-deal roadshow to lure potential investors to buy Panda bonds.

Aside from the underwriting agreement, Mr. Dominguez also signed deals with Export-Import Bank of China President Liu Liange for the latter to partially finance three infrastructure projects, which include Kaliwa Dam-New Centennial water source and the Chico River pump irrigation facility. — K.A.N. Vidal