The Pakistan Credit Rating Agency Limited (PACRA) has entered into a Memorandum of Understanding (MoU) with Lianhe Ratings Global Limited, the international arm of one of China’s largest credit rating groups, to explore potential cooperation across a range of credit-rating and sustainable-finance activities.
According to material information submitted to the Pakistan Stock Exchange on September 1, 2026, the proposed collaboration will focus on sustainable-finance ratings and assessments, green and sustainability-linked financial instruments, research and knowledge-sharing, and rating-related services for potential Panda Bond issuances by Pakistani sovereign and corporate issuers.
The partnership could create an avenue for greater cooperation between Pakistan’s credit-rating industry and China’s financial markets. In particular, the potential involvement in Panda Bonds could support Pakistani issuers seeking access to China’s renminbi-denominated bond market.
Under the MoU, PACRA and Lianhe Global intend to explore opportunities for developing expertise and services related to sustainable finance. This includes areas such as green financing and sustainability-linked instruments, which have become increasingly important as investors and financial institutions place greater emphasis on environmental and sustainability considerations.
The two parties will also look at research and knowledge-sharing opportunities. Such cooperation could help facilitate the exchange of expertise and market knowledge between Pakistan and China’s financial sectors.
Another key area identified in the agreement is rating-related services for potential Panda Bond issuances by Pakistani sovereign and corporate borrowers. Panda Bonds are renminbi-denominated debt securities issued in China by foreign entities, providing an alternative avenue for international borrowers to access Chinese capital markets.
However, PACRA clarified that the initiatives contemplated under the MoU remain subject to the execution of definitive agreements, where applicable. The company also stated that any material development arising from the cooperation will be disclosed in accordance with applicable requirements.
The MoU therefore represents an initial framework for exploring collaboration rather than a confirmation of specific transactions or bond issuances.
For PACRA, the proposed partnership provides an opportunity to broaden its international cooperation and potentially strengthen its capabilities in emerging areas of sustainable finance. For Pakistani issuers, greater cooperation with Chinese rating expertise could potentially support future efforts to access China’s capital markets, subject to the successful development of specific initiatives.
The agreement highlights the growing importance of cross-border financial cooperation between Pakistan and China, particularly in areas involving sustainable finance, capital-market access and credit-rating services.
