• News & Article
• Indonesia Issues First Dim Sum Bond

Indonesia Issues First Dim Sum Bond

The Ministry of Finance has officially issued Indonesia's first yuan-denominated bond in the country's history, known as a Dim Sum Bond, with a total value of CNH 6 billion (approximately Rp13.2 trillion).
This issuance marks a new step in the government's funding strategy to diversify financing sources whilst strengthening financial relations with China.

Issuance Details: Two Series, Competitive Coupons
The instrument consists of two tenors:
- 5 years valued at CNH 3.5 billion, with fixed coupon of 2.5%, maturing October 2030.
- 10 years valued at CNH 2.5 billion, with fixed coupon of 2.9%, maturing October 2035.

Both coupons are lower than initial market guidance (2.9% and 3.3%), indicating strong demand from global investors.
The bonds will be listed on Singapore Exchange (SGX) and follow SEC-registered issuance format, in line with US market regulations.

Bank of China (HK), HSBC, and Standard Chartered acted as joint bookrunners, with credit ratings of Baa2 / BBB / BBB from Moody's, S&P, and Fitch respectively.

Economic and Financial Significance
This step carries strategic importance in several respects:
1. Diversification of financing sources — Indonesia now has direct access to the offshore yuan bond market, expanding its investor base beyond USD and EUR markets.
2. Deepening Indonesia-China financial relations, particularly in the context of cross-border trade and investment cooperation.
3. Natural hedging against trade exposure, as China is a major trading partner with substantial transaction volumes in yuan.

For the global market, the success of this issuance represents a sign of investor confidence in Indonesia's fundamentals, particularly amid global volatility and elevated interest rates in dollar markets.

Market Implications and Fiscal Position
In terms of funding costs, coupons of 2.5–2.9% are competitive compared to yields on Indonesia's dollar-denominated global bonds, which remain in the 4–5% range.
This delivers financing efficiency whilst demonstrating the deepening maturity of the offshore CNH market for Asian sovereign issuers.

For the government, issuance proceeds will be used for general financing needs of the 2025 state budget, focusing on public projects and productive investments.
The combination of currency diversification, stable ratings, and timely execution demonstrates that Indonesia's fiscal strategy is becoming increasingly adaptive to global dynamics.

With this step, Indonesia joins the ranks of other Asian countries such as the Philippines and South Korea that have earlier capitalised on the offshore yuan market.
Moving forward, the success of this issuance could pave the way for regular issuances in non-dollar currencies, adding fiscal flexibility amid the evolving global landscape.