Russia will issue government bonds denominated in yuan on December 8, with maturities between 3 and 7 years, to attract investments from trade with China.

The Russian Ministry of Finance announced that on December 8 it will issue its first domestic government bonds denominated in yuan, with maturities ranging from three to seven years. Demand for these bonds is anticipated mainly from Russian firms engaged in trade with China, considering that bilateral trade reached a record of 245 billion dollars last year. The issuance of the bonds will provide investment options for the massive liquidity in yuan accumulated by exporters and Russian banks. The ministry will organize the placement through Gazprombank, Sberbank, and VTB Capital, all under Western sanctions. It is estimated that the total value of the issued bonds will reach up to 400 billion rubles (approximately 5 billion dollars). The sale of these bonds could help Russia cover the budget deficit, which is expected to reach 2.6% of GDP by 2025, in the context of increasing defense spending and declining revenues. However, economists do not expect significant demand from investors in Asia or other regions for these bonds.