Pakistani foreign reserves starts to rise. $17.07 billion reached

[ziaulislam]

The Situation is really bad. Loans after loans after loans for just about everything.

Standard Chartered Bank to give $200m loan to Pakistan

The Standard Chartered Bank will give a $200-million commercial loan to Pakistan to help the country finance its liquefied natural gas (LNG) imports, as Islamabad continues to weigh options to meet gross external financing needs.

With the fresh facility, SCB-London’s exposure to Pakistan has increased to over $1.1 billion in the last two years, said officials in the Ministry of Finance and Economic Affairs. They said the new loan has been secured at a 12-month floating London Interbank Offered Rate (Libor) plus 1.4%. This brings the total cost at the current Libor rate to over 4.2%.



SCB Pakistan declined to comment on the terms of the deal.

Officials in the ministry said the agreement has a provision of additional financing.

Earlier, in fiscal year 2017-18, SCB-London had provided a $200-million commercial loan in three tranches received between November and January. The last $200 million loan will mature next month.

The fresh facility will be used to finance LNG imports, which are growing after the fuel-based power plants started commercial operations. In the last fiscal year, Pakistan imported $2.5 billion worth of LNG to run power plants, which was 87% higher than the preceding year, according to the Pakistan Bureau of Statistics (PBS).

Pakistan trying to ink fresh LNG deals at lower rates

Last week, China also agreed to extend $2 billion in loans to Pakistan to offset pressure from foreign exchange reserves. The Islamic Development Bank (IDB) has also activated $4.5 billion worth three-year facility for oil imports. These two facilities have helped take the pressure off the rupee with the currency recovering some of its value against the US dollar in the inter-bank market.

During the week ending 27 July, SBP’s gross official reserves increased by $1.339 billion to $10.35 billion due to official inflows, the central bank reported on Thursday.

However, these measures provide short-term relief, and are not sufficient to address overall financing needs of the country, estimated in the range of $25 billion to $28 billion.

In an interview with Bloomberg, Pakistan Tehreek-e-Insaf (PTI) leader Asad Umar, the man tipped to be finance minister, said the decision to overcome external financing challenges needs to be taken in the next six weeks. He listed the International Monetary Fund (IMF), friendly countries and issuance of diaspora bonds among options to bolster depleting reserves.

Even after the arrival of Chinese aid and activation of the IDB’s facility, Pakistan’s external financing gap is in the range of $8 billion to $9 billion for this fiscal year, said officials in the finance ministry.

Caretaker Finance Minister Dr Shamshad Akhtar on Thursday said that work on IMF programme was under way, although Pakistan has not yet formally approached the Fund. She said that the caretaker government would hand over the plan to the incoming government.

Unlike the last programme, Pakistan’s chances of getting an IMF bailout on favourable terms are not very high due to explicit opposition by the United States. US Secretary of State Mike Pompeo has already warned against the IMF bailout being used to repay Chinese debt, extended in large part due to CPEC, to Pakistan.

The caretaker finance minister reiterated that there was no relation of CPEC with the IMF programme.

She said that there was no immediate pressure on the government for loan repayments, as some major debt and interest payments were due in the second quarter of this fiscal year.

Third LNG-based power plant completed

To a question, the minister said that the value of dollar-rupee parity is decided by market forces and it is difficult to forecast the exact value.

Shamshad said that Pakistan was facing challenges of acute macroeconomic instability and fiscal deficit. The country needs strict financial discipline and consistent policies to overcome this challenge.

She stated that the government needs to take on board experts and modernise statistical data production services, which would ultimately help in effective policymaking and rationalising goals.

Umar said on Wednesday that the PTI would set up two consultative forums – an Economic Advisory Council and a Business Advisory Council. He said the prime minister will himself chair the EAC meeting.

Published in The Express Tribune, August 3rd, 2018.

https://tribune.com.pk/story/1772153/2-standard-chartered-bank-give-200m-loan-pakistan/

Loans,Loans and more loans..... How is this any different than what was happening with the PML-N regime?

Sorry to disappoint you man but in next 20 years i dont see Pakistan havibg a surplus budget and i dont see india doing that either..so there will be more loans..
The goal is to bring the debt to gdp ratio back to 60% from 69% (india was at 84% in 2006 and now its at 70%) and to correct the CAD ...at this moment the increase has arrested and its at 4% of GDP vs 1.8% of india(india was at 4% in 2008)

Most of Pakistan probelms are mis management and are easily correctable if no pressure is put in by some influential people

Pakistan will need in total of 20 billion dollars in next 5 years to repay 6 billion of IMF loans
It has already acheived 5 billion from IDF and 2 from china..and is aiming for 12 billion IMF (vs 20 billion before he came in) bailout unless asad umar can arrange this from AIID, AB,WB, CHINA and BONDs or investment bonds

 

[volatile]

lol with advent of Chinese 2 Billion Loan plus IDP extended credit offers no miracle has happened by the way both contracts were signed and negotiated in April 2018

 

[SunilM]

Sorry to disappoint you man but in next 20 years i dont see Pakistan havibg a surplus budget and i dont see india doing that either..so there will be more loans..
The goal is to bring the debt to gdp ratio back to 60% from 69% (india was at 84% in 2006 and now its at 70%) and to correct the CAD ...at this moment the increase has arrested and its at 4% of GDP vs 1.8% of india(india was at 4% in 2008)

Most of Pakistan probelms are mis management and are easily correctable if no pressure is put in by some influential people

Its sad that blatantly false statements are made by posters here without providing any source. For example CAD was at 5.7 % and this does not include Circular r debt of over Rs 1000 Crors,. The actual CAD comes out to be 10 - 11 % of GDP.


"The current account deficit, which remains the single largest challenge for economic managers, shot to a record high of $17.994 billion (5.7% of GDP) at the end of fiscal year ended June 30, 2018 mainly due to exorbitant imports and less-than-projected inflows.

https://tribune.com.pk/story/1762078/2-pakistans-current-account-deficit-peaks-17-99b/

Its completely out of control. How does one debate with people who present incorrect and false facts. And for gods sake look at your FDI and export figures and then make an agrument.

Debt to gdp figures are also incorrect .

"Pakistan’s debt-to-GDP ratio projected at alarming 74pc, expected to increase further by year end"

https://profit.pakistantoday.com.pk...d-of-current-financial-year-finance-minister/

With the devaluation and the recent Chinese loan, expect the figures to be even worse.

 

[ziaulislam]

Its sad that blatantly false statements are made by posters here without providing any source. For example CAD was at 5.7 % and this does not include Circular r debt of over Rs 1000 Crors,. The actual CAD comes out to be 10 - 11 % of GDP.


"The current account deficit, which remains the single largest challenge for economic managers, shot to a record high of $17.994 billion (5.7% of GDP) at the end of fiscal year ended June 30, 2018 mainly due to exorbitant imports and less-than-projected inflows.

https://tribune.com.pk/story/1762078/2-pakistans-current-account-deficit-peaks-17-99b/

Its completely out of control. How does one debate with people who present incorrect and false facts. And for gods sake look at your FDI and export figures and then make an agrument.

Debt to gdp figures are also incorrect .

"Pakistan’s debt-to-GDP ratio projected at alarming 74pc, expected to increase further by year end"

https://profit.pakistantoday.com.pk...d-of-current-financial-year-finance-minister/

With the devaluation and the recent Chinese loan, expect the figures to be even worse.

Its 74% if you count govt owned entities liabilities and 69% if you dont

SBP doesnt count it
So whats in correct?

I said arrested...meaning it will be less than 2018..check last 6month data

 

[SunilM]

Its 74% if you count govt owned entities liabilities and 69% if you dont

SBP doesnt count it
So whats in correct?

I said arrested...meaning it will be less than 2018..check last 6month data

For gods sake man, the figure is provided by your Finance Minister, no need to create confusion and what about the blatant lie on the CAD figures. next time you post figures give sources too. But its expected that you will post incorrect figures like some other posters on this thread.

The real question is how is whats happening now different from what the PML-N was doing i.e taking loans...

 

[Imran Khan]

For gods sake man, the figure is provided by your Finance Minister, no need to create confusion and what about the blatant lie on the CAD figures. next time you post figures give sources too. But its expected that you will post incorrect figures like some other posters on this thread.

The real question is how is whats happening now different from what the PML-N was doing i.e taking loans...

aby ery ko kya hai tu apni jaan dena chahta hai is thred main ?
hum yahan aram se AC ke neechy so rahy hai tu tension se mara ja raha hai

 

[SunilM]

aby ery ko kya hai tu apni jaan dena chahta hai is thred main ?
hum yahan aram se AC ke neechy so rahy hai tu tension se mara ja raha hai

Saach me? Jhoot mat bol yaar, mughe pata hai waha load shedding ho rahi hai !! On a serious note though, PML-N did take care of the load shedding atleast whaetver the per unit cost was!!

 

[Maarkhoor]

@SunilM
Stop obsessing with Pakistan and Muslims.

 

[Imran Khan]

Saach me? Jhoot mat bol yaar, mughe pata hai waha load shedding ho rahi hai !! On a serious note though, PML-N did take care of the load shedding atleast whaetver the per unit cost was!!

Islamabad is load shedding free tu shaheed na ho jana is threa main

 

[SunilM]

Not so fast on the Islamic welfare state promise

https://www.samaa.tv/economy/2018/08/not-so-fast-on-the-islamic-welfare-state-promise/

 

[waz]

The timing coincides with the Chinese shore up. We would have to wait on a quarterly reading to see if things are beginning to improve.

 

[Hiraa]

Not so fast on the Islamic welfare state promise

https://www.samaa.tv/economy/2018/08/not-so-fast-on-the-islamic-welfare-state-promise/

Damn.

 

[SunilM]

The timing coincides with the Chinese shore up. We would have to wait on a quarterly reading to see if things are beginning to improve.

Yes. But what is very worrying is what happened in June,2018. The exports fell massively by 11% and that after record devaluation.

"On month-on-month basis, exports in June massively reduced by 11.99 percent to $1.89 billion over June from $2.14 billion of May 2018. Similarly, imports in June have also decreased by 2.06 percent to $5.69 billion from $5.8 billion of May. The month-on-month trade deficit this time was up by 3.73 percent and recorded at $3.81 billion during June 2018."

https://nation.com.pk/12-Jul-2018/trade-deficit-surges-to-all-time-high

 

[Hamza913]

I told you fear Allah

Why is a Mushrik telling us to fear Allah (The Most Gracious and The Most Merciful)?

 

[BetterPakistan]

Also initially you shamelessly stated that the rise was only due to imports.

It was you who misquoted me, i just said that imports also decreased. I can't do anything if pseudo economists are present everywhere specially Indiots.

Chinese $1bln loan pushes forex reserves up to 3-month high of $10.349 billion


KARACHI: Chinese $1 billion loan helped the country’s foreign exchange reserves to snap up downward trend of the last one year and clock in at a three-month high of more than $10 billion, people familiar with the development said on Thursday.

The State Bank of Pakistan’s (SBP) foreign currency reserves increased to $10.349 billion last week from $9.010 billion in the previous week.

“During the week ending 27 July, 2018, SBP’s reserves increased by $1,339 million to $10,350 million, due to official inflows,” the State Bank of Pakistan said in a statement.

The SBP’s Chief Spokesman Abid Qamar declined to comment on whether or not Chinese loan was transferred to the central bank account.

“We have no idea about the source of the inflows,” Qamar added. “We have already said in our statement that the surge in the reserves is due to official inflows.”

The reason for the latest rise in the reserves is still unconfirmed. Sources, however, attributed it to the official inflows received from China last week.

“The reason for which the reserves increased is the inflows from China under the head of China-Pakistan Economic Corridor funding,” a well-placed source told The News.

People said China agreed to provide $2 billion to Pakistan and out of that $1 billion was received in the previous week, while another $1 billion will come shortly.



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Would like to comment on this situation:- ????

https://www.thehindu.com/business/E...fell-11-bn-in-a-month-rbi/article23993718.ece