Pakistan's Economy - News and Updates

[EagleEyes]

Please post all your Pakistan economy news and updates here.

The old thread can be found here: http://www.defence.pk/forums/economy-development/27788-pakistan-economy-news-updates.html

 

[ameer219]

17% growth in remittances good: ICCI

Daily Times - Leading News Resource of Pakistan

ISLAMABAD: President Islamabad Chamber of Commerce Zahid Maqbool said the country has witnessed an impressive growth of more than 17 percent in remittances, which have reached to about $5.79 billion during July-Feb 2010 and the government should take measures to channelise these remittances towards the long-term investment for achieving better results for the country. He said Small & Medium Entrepreneur (SME) sector is the engine of growth for Pakistan and one good option for the government is to motivate the returning migrants to set up small and medium size businesses, which will help in boosting SME sector. For this purpose, the government should provide them fiscal incentives like tax breaks and other concessions. staff report

 

[Mani2020]

Gilani for more Pak-Saudi cooperation in banking sector

Saturday, April 10, 2010

ISLAMABAD: Prime Minister Syed Yusuf Raza Gilani said the government would extend all cooperation to the Saudi Arabian investors to encourage their investment in banking sector.

The Prime Minister was talking to Prince Amr Mohamed Al-Faisal Al-Saud, Chairman of Ithmaar BSC and Faysal Banks of Saudi Arabia, who called on him at the Prime Minister House here Friday afternoon.

He was accompanied by Khalid Abdullah Jamani, Executive Vice Chairman and Naveed A. Khan, President and CEO of Faysal Bank.

Welcoming the visiting delegation, the Prime Minister said the government has provided an investor-friendly atmosphere in the banking sector to foreign investors and is extending all out cooperation.

The Prime Minister said greater cooperation in banking business between Saudi Arabia and Pakistan would help adopt better risk management techniques in the sector.

He said Faysal Bank’s operation in Pakistan was playing an important role in the country’s economy by consumer financing and industrial development.

He said the bank’s assets base of over Rs180 billion with a shareholder equity of Rs.12 billion was a remarkable contribution in the banking sector of Pakistan.

The Prime Minister invited the Faysal Bank’s further investment in Pakistan’s banking sector and assured government’s continued support and cooperation in this regard.

The Premier thanked the Prince and said that it was the blessing of Almighty Allah that the unity and harmony displayed by the political parties after the 2008 elections is still heading peacefully.

 

[ameer219]

Japanese taking interest in Pakistani stocks
Saturday, April 10, 2010
By Irfan Siddiqui

Japanese taking interest in Pakistani stocks

TOKYO: Japanese banks and financial institutions have started taking interest in the Pakistani stock markets, said an investment advisor on Friday.

“We can hope that in the near-future reasonable investment will be put in Pakistan stock market,” said Shizuka Sasaki a financial and investment advisor.

“The Japanese banks are offering Pakistani bonds to their clients as high-risk-high-return investment and going forward, the option of investing in Pakistani stocks is also seen as a strong possibility owing to high return on investment.”

She said that Pakistan used to be a potential financial investment target, but due to the global recession and some other factors, Pakistan economy got worse and Karachi stock market fell more than 58 per cent in 2008.

After its major slide, the Karachi stock market has recovered in the last calendar year and recent inflow of foreign funds in Pakistani bourses may convince the risk-averse Japanese investors to add Karachi and Lahore to their portfolio destination, Sasaki said.

Japanese banks and financial institutions keep Pakistani bonds in high-risk-high-return category, Sasaki said, explaining that though majority of Japanese wants secure investment even on low return, investors seeking high returns on the short-term investments are offered Pakistani stocks.

 

[ameer219]

Improvement in fundamentals to attract new funds




LAHORE - The improvement in economic fundamentals and parliamentary approval for the 18th amendment enhanced the investors’ sentiments in the market, resulting in a 45 per cent weekly jump in volumes to 252 million shares, a 26-week high.

Experts said that a host of macro and micro events encouraged activity at the KSE while concerns on the macro front following reports of the fiscal deficit target being missed, were allayed with the Rupee strengthening against the dollar and T-bill yields going down, indicating interest rates are due to follow suit in the medium term.
In a historic move the National Assembly unanimously passed the 18th Amendment Bill 2010 on 8th Apr10. 1973 Constitution has now been restored to its original shape and all the clauses from the Constitution incorporated by the military dictators in the past have been removed. Furthermore, the Bill also included repealing of 17th Amendment in the constitution and Legal Framework Order (LFO) included by General (Rtd.) Pervez Musharraf during his regime.

Firmness prevailed on the local currency market during the outgoing week as comfortable supply of dollars helped the rupee to retain its gains. PKR closed the week at 84.05/USD from 84.43/USD on 2nd Apr10, 0.5% higher than WoW. This certainly bodes well for our BoP in the shape of lower debt servicing charges and a lower import bill. Experts are of the view that after dismal performance in 4Q2009, Pakistan’s benchmark equity index posted 8% return during 1Q2010 (Jan-Mar 2010) in spite of political and security issues. This is the second highest quarterly gain in last one year, thanks to robust foreign activity and gradual improvement in macro imbalances.

Hence overall market capitalization reached US$34b whereas average volume during 1Q2010 stood at $76m. In the month of March alone the equity prices rallied 5% led by $100m net buying by foreign investors, after $32m net inflow in the first two months of this year that inched up the Index by 3%.

If we compare last 10 year 1Q returns, the last quarter gains are lower than the average gains. Interestingly, during last decade, market average 1QCY return was 14%. The lower return this time is mainly due to exceptional gains of 60% (51% in US$ terms) in 2009 coupled with severe liquidity crunch being faced by local investors. Only local mutual funds net selling was at $54m until March 30 due to continuous redemption pressure.

Improvement in fundamentals to attract new funds | Pakistan | News | Newspaper | Daily | English | Online

 

[ameer219]

‘Pak-Malaysia FTA to boost trade, investment’

Kuala Lumpur: Number of certificates of origin issued to Malaysian businessmen by its government to claim reduced duties, taxes under Free Trade Agreement (FTA) registered three-fold increase in the last two years, leading to more trade, investment between the two countries, said Malaysian Deputy Minister of International Trade & Industry, Mukhriz Tun Mahathir.

In a meeting with Pakistan’s acting high commissioner, Dr. Imtiaz Ahmad Kazi said trade volume between both the countries reported upward trend after FTA signing in 2007.

Mukhriz said palm oil export to Pakistan is important component in trade and Malaysia would like to pursue exports of its service, electronic, manufactured goods to Pakistan to further diversify its export base. Dr. Kazi said Pakistan Chapter of Joint Business Council (JBC) was constituted and forming of Malaysian Chapter is expected soon. JBC could be launched when Prime Minister Yusuf Raza Gilani visits Kuala Lumpur to attend World Islamic Economic Forum (WIEF) from May 18 to 20 2010.

He suggested holding overdue meeting of Joint Ministerial Commission (JMC) and said proposal is under discussion to look at the possibility of JMC to deputy minister’s level. ppi

http://www.dailytimes.com.pk/default.asp?page=2010\04\13\story_13-4-2010_pg5_3

 

[ameer219]

Pak Suzuki, Indus remain primary growth drivers
March auto sales up 80pc year-on-year basis


Pak Suzuki, Indus remain primary growth drivers


Tuesday, April 13, 2010
By Hina Mahgul Rind

KARACHI: Auto sales during March depicted an impressive performance, rising by 80 per cent on year-on-year basis and 8.0 per cent on month-on-month basis, according to the data released by Pakistan Automotive Manufacturers Association on Monday.

Auto sales during the first nine months of FY10 registered an increase of 34 per cent on year-on-year basis to touch 97,992 units. Pak Suzuki and Indus remained the primary growth drivers during the period under review.

Indus Motor sales rise by 57 per cent on year-on-year basis in March, the companyís highest-ever sales in a single quarter. Pak Suzuki sales, which touched a 17-month high, posted a significant increase of 211 per cent on year-on-year basis amid economic slowdown and high interest rates. Analysts are of the view that Pak Suzukiís swift sales averaged 471 units per month during the first quarter of its launch.

Despite positive feedback, it seems that swift sales trend is loosing its charm due to higher price tag for a hatch-back and fuel costs, ie, available in petrol-variant vehicles. Strong performance by smaller cars, recovery in LCV sales and low base effect has lifted the volumes of Pak Suzuki by 3x during the first quarter of 2010.

Indus Motor has also benefitted from a superior model of Corolla and increase in prices by Honda Car. Honda Carís performance remained dismal, with sales depicting a fall of 31 per cent on year-on-year basis.

Cumulative auto sales during 9MFY10 registered a growth of 34 per cent on year-on-year basis with Indus Motor continue to outperform others. With the sales for the company rises by 53 per cent on year-on-year basis during the period under review, its market share increased to 36 per cent from 31 per cent earlier.

Despite an increase of 30 per cent in Pak Suzuki sales on year-on-year basis, the market share declined to 53 per cent from 55 per cent. Atif Zafar, analyst at the JS Research, said that although auto sales have posted a growth of 34 per cent on year-on-year basis during 9MFY10, it is expected that easing of monetary policy by the central bank should further stimulate sales.

However, rupee depreciation against the dollar and Japanese yen and rising steel prices remain major concerns for the auto assemblers. Another analyst Furqan Punjani attributed the recent surge in car sales to renewed consumer financing, improvement in the macroeconomic indicators and enhanced liquidity in the rural economy.

Due to gaining momentum in sales, Pak Suzuki has started to pass on the cost impact to the customers. Pak Suzuki has recently increased its prices by 5-6 per cent, improving the companyís gross margins to 3.6 per cent during the current year against 2 per cent last year.

 

[Omar1984]

One window operation in Sindh to facilitate investors ​

Earlier, inaugurating the conference Governor Dr Ishratul Ebad Khan said the high profile event would make a significant and worthwhile contribution in attracting investment which would lead to economic prosperity of the people. - Photo by APP.


KARACHI: Sindh Chief Minister Syed Qaim Ali Shah said here on Saturday that the Sindh Board of Investment (SBI) will facilitate investors through one-window in setting up industries to promote industrialisation.

The chief minister made this announcement at the conclusion of an investors’ conference organised by the Sindh Board of Investment at a local hotel on Saturday, says an official handout.

Stressing the need for promoting local and foreign investment in the province, he said that Sindh is blessed with abundant natural resources, but to benefit from them, “we have to make strenuous efforts.”

The Sindh government, he said, wanted to promote investment in the province as there were vast opportunities for setting industries especially agro-based units.

He said that foreign investors were showing interest in investment in Karachi and rural areas of the province, and the government was also facilitating them by making the infrastructure available and providing basic facilities.

However, prompt practical measures are needed to resolve the problems of people by providing them jobs.

He said that raw material, agriculture produce, fruits, meat and fish and its products are in abundance in Sindh.

“Promoting agro-based industries, we can make Pakistan a modern industrial state”.

He expressed the hope that the large presence of investors at the conference shows that they want to join hands with the government in development efforts so that its fruits reach the people.



Earlier, inaugurating the conference Governor Dr Ishratul Ebad Khan said the high profile event would make a significant and worthwhile contribution in attracting investment which would lead to economic prosperity of the people.

 

[Omar1984]

Country to harvest 23.8m metric tons of wheat ​

ISLAMABAD: Pakistan is estimated to harvest 23.87 million metric tons of wheat this year, against a target of 25 million tons, and a little less than last year’s 24.03 million tons.

Addressing a news conference after a meeting of the federal committee on agriculture (FCA), Minister for Food and Agriculture Nazar Mohammad Gondal said the government had decided to export 2 million tons of the surplus commodity because of 3.5 million tons of carryover stocks.

He said the crop output had been satisfactory if seen in the context of a substantial water shortage during the season.


He said the committee had fixed cotton production target at 14 million bales for the current Kharif season, compared to last year’s output of 12.7 million bales.

Last year, too, the government had set a production target of 14 million bales. He said that this year eight approved varieties of BT-Cotton would be introduced in the country.

Mr Gondal said that most of the crops in the just concluded Rabi season had been short of target mainly because of inadequate rainfall.

The gram production has now been estimated at 571,000 tons against last year’s production of 740,000 tons, showing a decrease of 23 per cent.

The gram output, he said, was sufficient for domestic consumption estimated at 550,000 tons.

Lentil production has been estimated at 11,660 tons as compared to 14,400 tons produced last year, reflecting a reduction of 19 per cent.

Onion production stood at 1.53 million tons as against last year’s 1.7 million tons, down by 10 per cent.

Potato production was 2.4 per cent higher than last year’s and stood at 3.01 million tons compared to last year’s 2.94 million tons.

Mr Gondal said the good news for the ongoing Kharif season was that water availability would be around 65.80 million acre feet (MAF) against the average requirement of 67.11 MAF, thus showing a shortfall of about 2 per cent.

The committee set a rice production target of 6 million tons against last year’s production of 6.7 million tons while sugarcane target was set at 53.7 million tons against last year’s production of 47 million tons.

 

[Omar1984]

Flour still being sold at higher prices ​

KARACHI: Flour millers have reduced ex-mill price of flour (No 2.5) to Rs28 from Rs30 per kg after a decline in wheat prices, but retailers are reluctant to pass on benefit to consumers.

The Karachi Atta Chakki Association (KACA) has also slashed Chakki flour price to Rs32 from 36 per kg.

Consumers till Monday had been paying Rs32 per kg for flour (No 2.5) at the retail level. Besides, there was also no change in the price of Chakki flour on the retail side as prices were hovering between Rs35 and 36 per kg.

A spokesman for Karachi Retail Grocers Group (KRGG) said that retailers had purchased old stocks at higher rates and it may take few more days to clear the piled up stocks.

The rates would come down after lifting of flour at reduced rates, he added.

KACA General Secretary Mohammad Anis Shahid said the association had already ensured supply of Chakki atta at reduced rates of Rs32 per kg at 800 small Chakkis in the city and even supply was being maintained at a full pace on Monday.

In view of huge supply of wheat from the interior of Sindh after a good crop, he said Chakki flour price may come down by Rs1 kg more in the coming days.

He said the association had also been asking retailers not to charge more than Rs33 per kg on Chakki flour from consumers.

He said the rate of highly clean wheat had come down to Rs25 from Rs27 per kg in the open market while unclean wheat price hovers between Rs23 and 24 per kg which was earlier being sold at Rs25-26 per kg.

He said there was an oversupply of wheat in the open market after ample supplies from interior of Sindh.

Besides, in summer demand for flour usually remains slow as people usually shift to soft foods, like rice, fruits etc.

Anis urged the Sindh and City governments to strictly monitor retailers now.

Sindh Zone Chairman of Pakistan Flour Mills Association (PFMA) Mohammad Yousuf said that the 100 kg wheat bag is now priced at Rs2,300 as compared to Rs2,500 last week, while the government’s wheat is available at Rs2,524.

The Sindh government has, so far, procured 550,000 tons of wheat against the storage capacity of 640,000 tons, while the government has set a procurement target of 1.5 million tons. The government also had 225,000 tons from previous crop.

When asked about any further price cut in flour, he ruled out any possibility, saying this was the most appropriate price of flour right now.

 

[ameer219]

ADB predicts improvement in GDP growth


ADB predicts improvement in GDP growth | Pakistan | News | Newspaper | Daily | English | Online

ISLAMABAD - Asian Development Bank, in its recent report, forecasted that Pakistan’s GDP growth would modestly improve to 3.0 percent in the ongoing year of 2010 due to recovery in the manufacturing sector.
According to “Asian Development Outlook 2010 (ADO 2010)”, released on Tuesday, the recovery in manufacturing sector is due to higher production of the cement products in the local market and stronger domestic demand for automobiles in the first half of 2010. Textiles manufacturing, however, has continued to show decline on account of the lower cotton availability, electricity and gas shortages and poorer relative product competitiveness in the international markets.
The ADO further said that Pakistan’s economic prospects were predicated on the basis of a successful completion of the current IMF programme by end-2010; a gradual improvement in the security situation; a phased reduction in electricity shortages, as tariffs meet cost of supply and new power plants were commissioned; sustained implementation of fiscal reforms, particularly for tax and administration; a gradual economic recovery in the main trading partners and political stability.
The GDP growth is expected to reach about 4.0 percent in the fiscal year 2011, as the private sector investment picks up following gradual improvement in the security situation and fewer electricity shortages, as public investment accelerates, supported by an improved fiscal situation with the Value-Added Tax (VAT) and other administrative tax reforms from 1 July 2010.
The modest growth projected for 2010 will make it hard for the Federal Board of Revenue to achieve its revenue target. However, higher oil and electricity prices (by way of larger customs revenues and sales tax receipts) will compensate somewhat for lower direct tax collections.
Yet with higher than budgeted defence spending, the fiscal deficit target of 4.9 percent of GDP for 2010 will be missed, and the Government is now targeting a deficit of 5.1 percent. But this too could be overshot in case of further shortfalls in tax and non-tax revenues.
The ADO said that inflation in 2010 is projected at 12 percent from its peak of the previous fiscal year. Looking ahead, domestic oil prices will increase in line with international prices. Similarly, phased increases in electricity tariffs will also contribute to maintaining momentum in inflation during the fiscal year.

 

[Hyde]

Cruise with over 600 tourists aboard docks at city's port after 15 years​

KARACHI (April 14 2010): The local authorities are rejoicing as hundreds of maritime tourists from across the globe turned up to the shores of terrorism-hit country in a world class passenger cruise after about 15 years. MS ALBATROS, a German cruise whose local agent is United Marine Agencies (UMA) and the operator is Phoenix Riesen, docked at Berth Number 5 of the Karachi Port after more than a decade with some 608 multinational passengers aboard.

The vessel, which had started its 140-day journey from the German port of Hamburg on December 23, would end its cruise on May 9 in Italy. The cruise was scheduled to sail off Karachi Port for Muscat at 7pm. "I would encourage the tourists to come up and visit Pakistan. I would like such (ship) calls to be made repeatedly," Chairperson Karachi Port Trust (KPT) Nasreen Haque, as a chief guest, told a welcome ceremony hosted by the UMA at the East Wharf.

Earlier, Chief Executive Officer of UMA Suhail Shams in his opening remarks said Pakistan needed more events of such type to make a mark in maritime tourism. "It is very reassuring to see that such a classic vessel has called at our port despite all the negatives that we keep hearing about Pakistan in the world media," he added.

Stressing the need to leave a lasting impression of Pakistani hospitality in the minds of over 600 maritime tourists, the UMA chief expressed hope that the multinational guests would introduce Pakistan as a peace-loving and worth-visiting place to their compatriots.

In his address, Captain Mortan Arne Hanson, the master of MS ALBATROS, thanked hosts saying it was a milestone for Karachi to host a passenger ship after 15 years. In his pre-ceremony media talk UMA CEO Suhail Shams said some 400 passengers had left the ship for a visit around the port city.

 

[Omar1984]

Exports register 38 per cent rise in March ​

Looking at the current pace of increased exports the TDAP believes that exports for the current fiscal will surpass the target of $18.8 billion and may even cross the $19 billion threshold achieved in the year 2007-08. - Photo by APP.


KARACHI: Exports grew by a record 38 per cent to over $1.8 billion in March 2010 indicating that the country has overcome global recession challenges and is poised to achieve better economic growth.

According to Trade Development Authority of Pakistan, exports during March stood higher by 37.8 per cent at $1.807 billion as compared to $1.312 billion in March 2009.

The export performance in the month under review has been the highest recorded in any month of the current year as well as for the corresponding month of last five years, say TDAP sources.

The authority further claimed that exports during Dec to March of current fiscal have grown at an average of 28.3 per cent over the corresponding period last fiscal.

Looking at the current pace of increased exports the TDAP believes that exports for the current fiscal will surpass the target of $18.8 billion and may even cross the $19 billion threshold achieved in the year 2007-08.

While reviewing the sector-wise trends of exports the TDAP disclosed that textiles and clothing, agro-food and metals and minerals have shown an upward trend over the previous year.

However, the authority feels that the main drivers of this growth in exports are raw cotton, cotton yarn, art silk and synthetic textiles, readymade garments and towels. In agro-food sector commodities such as rice, fruits and vegetables have recorded handsome growth in exports.

But a fabulous growth of 70 per cent was recorded in exports of jewellery in metal and mineral sector during the period (July to Feb) of current fiscal over the same period last year.

The TDAP pointed out that the global recession, which resulted in the shrinkage of the western and developed economies by 5 per cent on an average in the year 2009 saw the developing economies maintain a robust growth averaging 6 per cent.

This phenomenon has also had a positive impact on the geographic diversification of country’s exports, which now accounts up to 45 per cent in Asian markets.

Looking at the rapidly changing trends in global markets and shifting of buying power, the TDAP is now doubling its levels of participation in Asian markets through increased delegations, exhibitions and incentives to exporters to take advantage of the opportunities in these countries.

 

[SHAMK9]

Cruise with over 600 tourists aboard docks at city's port after 15 years​

KARACHI (April 14 2010): The local authorities are rejoicing as hundreds of maritime tourists from across the globe turned up to the shores of terrorism-hit country in a world class passenger cruise after about 15 years. MS ALBATROS, a German cruise whose local agent is United Marine Agencies (UMA) and the operator is Phoenix Riesen, docked at Berth Number 5 of the Karachi Port after more than a decade with some 608 multinational passengers aboard.

The vessel, which had started its 140-day journey from the German port of Hamburg on December 23, would end its cruise on May 9 in Italy. The cruise was scheduled to sail off Karachi Port for Muscat at 7pm. "I would encourage the tourists to come up and visit Pakistan. I would like such (ship) calls to be made repeatedly," Chairperson Karachi Port Trust (KPT) Nasreen Haque, as a chief guest, told a welcome ceremony hosted by the UMA at the East Wharf.

Earlier, Chief Executive Officer of UMA Suhail Shams in his opening remarks said Pakistan needed more events of such type to make a mark in maritime tourism. "It is very reassuring to see that such a classic vessel has called at our port despite all the negatives that we keep hearing about Pakistan in the world media," he added.

Stressing the need to leave a lasting impression of Pakistani hospitality in the minds of over 600 maritime tourists, the UMA chief expressed hope that the multinational guests would introduce Pakistan as a peace-loving and worth-visiting place to their compatriots.

In his address, Captain Mortan Arne Hanson, the master of MS ALBATROS, thanked hosts saying it was a milestone for Karachi to host a passenger ship after 15 years. In his pre-ceremony media talk UMA CEO Suhail Shams said some 400 passengers had left the ship for a visit around the port city.

thats awesome i can clearly see queen marry 2 and oasis of the seas docking at karachi port

 

[DESERT FIGHTER]

Foriegn exchange reaches almost 15 Billion $$