The Kabul Tribune (KT) — Pakistan’s dollar bonds have emerged as the best performers in Asia this year, with a powerful rally that shows no sign of slowing as global investors grow increasingly confident in the country’s economic outlook.
Analysts say the surge has been driven by recent
credit-rating upgrades and Islamabad’s plans to re-enter international capital
markets — signals that have bolstered sentiment among major asset managers,
including Goldman Sachs Asset Management and UBS Asset Management.
Danske Bank Asset Management, which bought Pakistan’s bonds
at the height of its financial crisis two years ago, said it has increased its
holdings several times throughout 2024. “We are optimistic that Pakistan will
stay on the reform course,” the firm said.
UBS Asset Management’s Shamaila Khan echoed that view,
pointing to Islamabad’s continued adherence to the International Monetary
Fund’s program. “They’re sticking to the IMF policies, which we believe they
have a strong commitment to do so,” she said.
Economists note that improved market access is easing
concerns about Pakistan’s near-term liabilities. With the government preparing
to return to global debt markets, refinancing risks appear lower. Market access
means “you really are not concerned about refinancing over the next 2–3 years,”
one global investor said.
The renewed optimism marks a dramatic turnaround for
Pakistan, which had been battling a severe balance-of-payments crisis.
Investors now say the momentum may continue as long as reforms hold and the
IMF-backed stabilization program remains on track.
