Pakistan to issue another $1 billion Eurobond this week

[Dragon4]

debt to pay debt

 

[$@rJen]

I heard Pakistan's Economy doing well recently.., what happened why this bond??

 

[Jzaib]

bhai bhutto ko mar dou privatize hojayega.

lekin jub tak bhutto zinda hai kuch privatize nahi hoga.

bhie agar yehi bahana har baar bana tu fidha . blame everythng on PPP to hide ur incompetence. Nawaz sharif promoted Mushad ullah brothers ( in PIA ) out of turn as soon as he come in power

Government of Pakistan seem to be bent on committing Financial suicide.

Issuing Euro or Dollar denominated bonds when their last issue fetched even higher interest rates than Greek bonds ( Pakistani Eurobond: 8.5% , Greek Eurobonds: 8.46%). How will Pakistan pay such high interest rate?


This may not look high to common Pakistanis who borrow in rupee, but this is horrendous interest rate for Euro or Dollar denominated debt.Dollar and Euro denominated sovereign debt fetches close to 0% (sometime even -ve but rarely) for most countries that access international debt market.

This is sacrilegious in view of the fact that GoP could get loans at 2% from WB,ADB,and IMF with longer term (30 years vs 10 years) by undertaking reforms

our people are noit every educated . This is how nawaz sharif always get in power. take loans make a big project. and people will vote him bcoz of these 1 or two projects

 

[ice_man]

bhie agar yehi bahana har baar bana tu fidha . blame everythng on PPP to hide ur incompetence. Nawaz sharif promoted Mushad ullah brothers ( in PIA ) out of turn as soon as he come in power


our people are noit every educated . This is how nawaz sharif always get in power. take loans make a big project. and people will vote him bcoz of these 1 or two projects

bhai your 90 days promise and "competent team" have failed in KPK and your bhana is we have been in government for only 2.5 years takes time.

bhai kaam karo kaam then speak don't make excuses for major failures on your promises in KPK.


but besides trolling this BOND IS SERIOUSLY A BIG BIG BIG MISTAKE BY PML N

and PTI should really do major objection to this on all forums and media. this is bigger problem than dhandli

 

[Jzaib]

bhai your 90 days promise and "competent team" have failed in KPK and your bhana is we have been in government for only 2.5 years takes time.

bhai kaam karo kaam then speak don't make excuses for major failures on your promises in KPK.


but besides trolling this BOND IS SERIOUSLY A BIG BIG BIG MISTAKE BY PML N

and PTI should really do major objection to this on all forums and media. this is bigger problem than dhandli

Dandli is the biggest problem. PMLN rigged election, now they are taking too much loans that pakistan will never be able to pay off .

 

[samlove]

they are going for suicide through there economy , an interest of almost 9% is too much ,are they crazy, u guys will get bankrupt while paying only interest if these money doesnt used properly , even last heard u guys were expecting 1 billion but it only fetch 500 million , even on tht price interest is enormous ,u should have issued bond for ur country man rather than going abroad with tht much interest ,even we have tax free bond of govt but interest in only 6.50% for indian only.

 

[ice_man]

Dandli is the biggest problem. PMLN rigged election, now they are taking too much loans that pakistan will never be able to pay off .

oh bhai dhandli could not be proven by PTI. but this loan will destroy our future generations. This should be addressed if Imran is serious about the country and not interested only in his PM seat.

 

[samlove]

bhai your 90 days promise and "competent team" have failed in KPK and your bhana is we have been in government for only 2.5 years takes time.

bhai kaam karo kaam then speak don't make excuses for major failures on your promises in KPK.


but besides trolling this BOND IS SERIOUSLY A BIG BIG BIG MISTAKE BY PML N

and PTI should really do major objection to this on all forums and media. this is bigger problem than dhandli

bond is good if issued in ur country mean money will stay here and spent here ,but going abroad is biggest mistake with tht interest ,u guys will have to invest in gold mines ,which can produce gold .

 

[Spectre]

What is the debt service ratio which is available revenue available to pay back the interest and principal component of debt for the year of Pakistani Govt?

If it is not good then this issue is no better than a ponzi scheme.

Regards

 

[Jzaib]

oh bhai dhandli could not be proven by PTI. but this loan will destroy our future generations. This should be addressed if Imran is serious about the country and not interested only in his PM seat.

first of all most of u should not tell him what to do. as u r the same people who support these corrupt politicians . secondly what do u expect them to do with the kinda of seats they got due to dandli. U people made nawaz so strong by giving him majority . PTI only have 10 % seats in parliament. If they will come out on streets u people will still talk against them

 

[ice_man]

first of all most of u should not tell him what to do. as u r the same people who support these corrupt politicians . secondly what do u expect them to do with the kinda of seats they got due to dandli. U people made nawaz so strong by giving him majority . PTI only have 10 % seats in parliament. If they will come out on streets u people will still talk against them

yes we saw the millions of supporters of imran in islamabad.

imran having 10% is what he actually got. nawaz has majority support proven by imran failed dharna and civil disobedience calls.

so bhai instead Imran should work as a true opposition and really raise this mess up of BOND ISSUED BY GOVERNMENT.

imrancan never be PM accept it at best be a good opposition

 

[Jzaib]

yes we saw the millions of supporters of imran in islamabad.

imran having 10% is what he actually got. nawaz has majority support proven by imran failed dharna and civil disobedience calls.

so bhai instead Imran should work as a true opposition and really raise this mess up of BOND ISSUED BY GOVERNMENT.

imrancan never be PM accept it at best be a good opposition

we dnt support him bcoz we want him to be prime minister. we support him bcoz he is honest .

 

[ice_man]

we dnt support him bcoz we want him to be prime minister. we support him bcoz he is honest .

yes honest if you say so i would believe you. But are the people under him honest? or lotas? and honest EDHI is also honest.

So are many Pakistanis but honesty itself is not worth being made PM you need to be able to work for it and deliver. KPK failure exposed his failures

can nawaz play cricket? NO!

can imran do politics? NO!

 

[Jzaib]

yes honest if you say so i would believe you. But are the people under him honest? or lotas? and honest EDHI is also honest.

So are many Pakistanis but honesty itself is not worth being made PM you need to be able to work for it and deliver. KPK failure exposed his failures

can nawaz play cricket? NO!

can imran do politics? NO!

I couldnt understand ur logic . u have problem with people under Imran not being honest but on other hand u dnt have any problem with nawaz or people under him being corrupt? u have problem with lota but have no problem with lotas in PMLN.. That is just stupid . blame imran for not doing opposition on loans but we all knows that nawaz sharif always do that still we vote them . so its imran fault?

KPK is doing exceptionally well. first province who have reformed institutions , made police better, made NAb better, first time in history etisaab is being done, schools and hospitals are improving. . ur criteria of success is just metro

 

[Echo_419]

Pakistan to issue another $1 billion Eurobond this week
By Shahbaz Rana
Published: September 23, 2015



ISLAMABAD: Pakistan will raise at least $1 billion from international debt markets in the next two days, choosing the easier but more expensive path of capital markets financing rather than implementing tough but necessary energy sector reforms and accessing the much cheaper financing available from international aid agencies.

Finance Minister Ishaq Dar left on Tuesday for the United States where he will lead the Pakistani team to launch a Eurobond. The bond will be priced on September 24 and is being underwritten by Citibank, Deutsche Bank and Standard Chartered Bank, which were appointed less than three weeks ago.

Finance Secretary Waqar Masood told Reuters that Pakistan was hoping to raise at least $500 million by selling its debt, but hinted that it could sell more. “We are not fixated on the size. We can definitely do more and we are open with regards to the tenor too,” he said.

Read: FDI remains flat, clocks in at $710.1 million

He hinted at issuing another bond, which was not part of original fiscal 2016 budget. “We will do a sukuk (Sharia-compliant bond) in … maybe the April to June quarter,” said Masood. Issuing a sukuk has become the government’s backup plan after it failed to implement the necessary energy sector reforms that would unlock funding from the World Bank, the Asian Development Bank, and Japan.

The Eurobonds are expected to be of either five or 10-year maturities, or possibly both. Based on the last issue, the interest rate is likely to be in the 7% range. By comparison, had the government implemented energy sector reforms, the country would have availed the same amount from the World Bank and ADB at a 2% interest rate for a period of 25 years.

The launching of the Euro bond, the third global issue in less than two years, highlights the government’s lack of commitment to structural reforms hampering economic growth, according to independent economists.

Although, the government had included $1 billion Eurobond in its annual budgetary estimates, it advanced the calendar and also decided to issue the sukuk. International lenders’ refusal to extend $1 billion in budgetary support before end of this month heightened the urgency to try luck in international debt markets.

The World Bank, ADB and Japan have withheld approval of $1 billion loan after they questioned the government’s commitment to reform the ailing energy sector. The government’s inability to implement promised reforms led to delay of approval of the loan, which was originally planned for April this year. It had hoped that the international lenders will disburse the amount before end of September, which is not happening, said sources familiar with the matter.

Under the Development Policy Credit-II, the WB was supposed to give $500 million in loan, the ADB $400 million loan and Japan $100 million in grant.

Earlier, in March last year, the government raised $2 billion by floating five and ten year dollar-denominated bonds at interest rates ranging between 7.25% and 8.25%. In the second attempt, the government issued five-year $1 billion Ijara-Sukuk bonds at 6.75%.

Read: Pakistan likely to issue $1b in Eurobonds in fiscal 2016

The government is raising the funds to meet the IMF’s conditions for the July-September period regarding increasing Net Foreign Assets, reduction in budgetary borrowings and increasing foreign currency reserves, the sources said.

As of September 11, the country’s official foreign currency reserves stood at $13.7 billion.

Published in The Express Tribune, September 23rd, 2015

Bad move