RMB 16.5 billion offshore bond offering by multiple PRC local governments

RMB4bn bond issuance by the Shenzhen Municipal People’s Government

The RMB4bn multi-tranche bond issued by the Shenzhen Municipal People’s Government includes:

• RMB1.5bn 1.61% Bonds due 2027 (the 2027 Bonds)
• RMB1bn 1.80% Bonds due 2030 (the 2030 Bonds)
• RMB1.5bn 2.08% Bonds due 2035 (the 2035 Bonds)

This issuance marks the fifth consecutive year that A&O Shearman has advised on Shenzhen’s offshore RMB local government bond offering in Hong Kong since 2021. Net proceeds from the 2027 Bonds will be used for general governmental purposes, while proceeds from the 2030 Bonds will finance Greater Bay Area-themed eligible sustainability projects and proceeds from the 2035 Bonds will finance eligible social projects, each in accordance with Shenzhen’s Green, Blue, Social and Sustainability Finance Framework.

This transaction also represents Shenzhen’s inaugural issuance of Greater Bay Area–themed sustainable development bonds, further advancing financial interconnectivity across the Guangdong-Hong Kong-Macao Greater Bay Area, broadening the spectrum of offshore RMB bonds, and underscoring sustained overseas investor demand for RMB-denominated assets.

RMB5bn bond issuance by the Hainan People’s Government

The RMB5bn multi-tranche bonds issued by the Hainan People’s Government include:

• RMB2.5bn 1.73% Bonds due 2028 (the 2028 Bonds)
• RMB1.5bn 1.83% Bonds due 2030 (the 2030 Bonds)
• RMB1.0bn 2.10% Bonds due 2035 (the 2035 Bonds)

This issuance marks the fourth consecutive year that A&O Shearman has advised on Hainan’s offshore RMB local government bond offering in Hong Kong since 2022. Net proceeds from the 2028 Bonds will finance eligible projects under the Green and Social Eligible Categories, and net proceeds from the 2030 Bonds will finance eligible projects under the Blue Eligible Categories, each in accordance with Hainan’s Green, Social, Blue, and Sustainability Bonds Framework. Net proceeds from the 2035 Bonds – the first aerospace-themed local government bonds issued in China – will be used for general governmental purposes. The Bonds continued to be settled through a Hainan Free Trade Port multifunctional free trade account (EF account).

This issuance underscores the Hainan Free Trade Port’s drive to attract global capital to priority industries, deepens cooperation between Hainan Province and Hong Kong, and provides investors with diverse opportunities for high-quality RMB denominated asset investments.

RMB7.5bn bond issuance by the People’s Government of Guangdong Province

The RMB7.5bn multi-tranche bond issued by the People’s Government of Guangdong Province includes:

• RMB3.5bn 1.72% Bonds due 2028 (the 2028 Bonds)
• RMB2.5bn 1.80% Bonds due 2030 (the 2030 Bonds)
• RMB1.5bn 2.09% Bonds due 2035 (the 2035 Bonds)

This issuance is Guangdong’s second consecutive offshore RMB local government bond offering in Hong Kong, following its inaugural issue in 2024, and A&O Shearman participated in both. Net proceeds from the 2028 and 2035 Bonds will finance eligible Green and Blue projects, respectively, in accordance with Guangdong’s Green and Blue Finance Framework. The net proceeds of the 2030 Bonds will fund major infrastructure projects in Guangzhou’s Nansha District.

This repeat issuance will provide funding support for key infrastructure across the Guangdong-Hong Kong-Macao Greater Bay Area, further deepening regional cooperation, promoting high-quality development, and strengthening financial collaboration between Guangdong and Hong Kong.

The A&O Shearman deal team was led by partner Agnes Tsang, with support from Jiayin Yu and Jenny Chau.