NAIROBI: The Africa Export-Import Bank (Afreximbank) has raised 2.2 billion renminbi ($299.9 million) through its first issuance of a Chinese panda bond, it said on Tuesday, charting a path for other African entities seeking new fundraising avenues.

China has pledged to open up its domestic markets for African issuers to borrow money through the so-called panda bonds - debt issued on its domestic bond market, denominated in yuan.

However, those looking to do so face several hurdles, including issuing in a currency that is not globally freely traded.

Afreximbank, which is the main trade financier for the continent with assets of $40 billion, said it will press ahead with a secondary listing of depositary shares, which are currently listed on the Stock Exchange of Mauritius.

"The market has not been very good for us to make the foray. But I can assure you that it is still on our radar," Benedict Oramah, the lender's president and chairman, told an investor briefing.

The board of the Cairo-based bank, which is mainly owned by African states, is working to identify a replacement for his job as president, he said, to be unveiled to shareholders in June.

Asked about the impact of turmoil sparked by sweeping trade tariffs by U.S. President Donald Trump last week, Oramah said it is an opportunity to boost intra-Africa trade.

"It will open the opportunity we all want for us to trade more amongst ourselves, trade more in value-added products," he said, adding it would encourage the bank to lend more to develop industrial power, including through economic zones.

"We do not want commodities to be the driver of our business."

Afreximbank's new panda bond has a 2.99% interest rate, it said. Bank of China Limited was the lead underwriter and bookrunner, and Exim Bank of China and ICBC the joint lead underwriters.

The panda issue is the first by an African financial institution, but the second by any African entity, after Egypt issued a panda bond in 2022.

Panda bonds were first launched in 2005, pioneered by the Asian Development Bank and the International Finance Corporation, the World Bank's private investment arm. Issuance hit a record 195 billion yuan in 2024, according to Deutsche Bank calculations.

($1 = 7.3358 Chinese yuan renminbi) (Reporting by Duncan Miriri; Editing by Kim Coghill)