China expects that issuing Portuguese public debt in yuan to be carried out in a “satisfactory” way and that it will be “mutually beneficial,” according to the Chinese ambassador to Portugal.
Cai Run told Portuguese news agency Lusa that for Portugal the debt issue will be “another source of financing” and for China it will mean “popularity” and one way for the country “to be welcomed by the international community.”
Speaking about the 40th anniversary of the establishment of diplomatic relations between Portugal and the People’s Republic of China and the visit of the Portuguese President to Beijing in April 2019, Cai Run stressed that if the Portuguese debt issue in the Chinese market is carried out soon Portugal “will be the first country in the euro zone to issue government debt in yuan.”
Portugal and China, through Caixa Geral de Depósitos (CGD) and the Bank of China, in October 2018 signed an agreement to issue Portuguese public debt in yuan, one of 17 bilateral agreements signed during the visit of Chinese President Xi Jinping, to Portugal.
Portugal has had authorization from the People’s Bank of China to issue debt in the Chinese market since 2017.
Cai Run said that “financial cooperation is important” as part of bilateral Sino-Portuguese cooperation, highlighting Chinese investments made in the last few years in banking sector.
The ambassador recalled that Chinese investment in Portugal has exceeded 9 billion euros since 2012 and there has been “a stable increase in Portuguese investment in China at the same time.”
Portugal is now the fifth largest Chinese investment destination abroad and is, for China, a partner for investments in other European countries and in the other Portuguese-speaking countries, he said.