By Fiona Law 

Looking to borrow cheaply, companies and governments across Asia have stepped up sales of debt in Europe, where interest rates are at rock-bottom levels and the euro has been falling.

Issuance of euro-denominated bonds from Asia excluding Japan this year has jumped fivefold from a year earlier, to $2.29 billion, according to data provider Dealogic. That comes on top of $12.7 billion sold during all of last year, a 43% jump from the 12 months before, although Asian borrowings are still mainly in the U.S. dollar and local currencies.

The push into Europe brings gains for both buyers and sellers of the debt. Asian issuers get access to another source of funding and at some of the lowest rates in the world, thanks to the European Central Bank's asset-purchase program, which has sent yields plummeting. European fund managers, meanwhile, are thirsty for the yields on offer, which are typically higher than those for borrowers from Europe, where yields on a number of countries' bonds are in negative territory.

Chinese state-owned companies have been leading the charge. Electricity network operator State Grid Corp. of China and China Construction Bank Corp.'s Hong Kong unit have sold a combined $1.63 billion worth of bonds in euros. Last week, China State Shipping Corp., a state-owned shipbuilder, sold EUR500 million ($570 million) worth of bonds. Chinese steel company Baosteel Group Corp. is considering its first bond in euros.

Asian companies are eager to take advantage of lower borrowing costs in Europe, said Jon Pratt, head of debt capital markets in the Asia-Pacific region for Barclays Capital. "I wouldn't be surprised if [Asia's] issue volume in euros quadruples this year from 2014," he said.

Chinese companies "are also in need of euros as they have done acquisitions or have businesses in Europe," he said.

Other big recent borrowers include Hong Kong conglomerate Hutchison Whampoa Ltd., controlled by Asia's richest man, Li Ka-shing, sovereign issuers like Indonesia, and Chinese banks that need a broader investor pool to beef up their capital.

The potential savings can be seen in a debt sale by India's state-owned Oil & Natural Gas Corp. Last July, the company sold $2.2 billion worth of bonds in euros and dollars. It set a 2.75% coupon for the euro-denominated debt with a longer maturity, compared with a 3.25% interest rate for the dollar bond.

Many European funds searching for returns beyond home are snapping up assets denominated in the greenback, which has been strengthening against most other major currencies. "Generally a lot of emerging-market debt is denominated in U.S. dollars, particularly Asian debt," said Ben Bennett, a London-based credit strategist at Legal & General Investment Management. Asia's stronger economic health also helps draw "reasonable inflows" from Europe, he said.

Hayden Briscoe, director of Asia Pacific fixed income at AllianceBernstein, said, "We find increasing interest from our European clients for Asia bonds, both denominated in euros and U.S. dollars, as they are more comfortable with the region's macro outlook." AllianceBernstein oversees $474 billion of assets.

"In the market, there's apparently substantial demand for Asia bonds recently," he said. "It's especially hard to find supply of sovereign papers, such as those from Indonesia."

Some investors, however, are wary of China. It is growing at the slowest rate in a quarter century, and many companies there are highly indebted.

"I'm nervous on China, given its economic backdrop has been shaky since the middle of last year," said London-based Mike Riddell, portfolio manager at M&G Investments, with $417 billion of assets. His fund has recently been interested in Japanese government bonds, which began to offer value especially as German-government-bond yields have dropped to levels lower than their Japanese counterparts.

Barclays's Mr. Pratt, whose bank helps sell Asia bonds to Europe, said there is interest in Chinese issuers, but "a significant amount of investor education" is required.

Write to Fiona Law at fiona.law@wsj.com

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