Pakistan Daily Economy Update - 22 August

Transcription

1. Aug . 22, 2017 KCCI - eBulletin CA posts over $ 2Bn deficit in Jul.’17 Pakistan's current account has posted a deficit of $ 2.05Bn during Jul.’17 compared to $ 662Mn in Jul.’16, depicting an increase of $ 1.39Bn mainly due to rising goods' imports/exports disparity. The cumulative deficit of goods, service and income surged by 65% during the period under review. With current increase, combined deficit of goods, services and income reached $ 3.74Bn compared to $ 2.30Bn in Jul.’16. The country's current account posted $ 12Bn deficit, up 148%, during FY17 on the back of a widening trade deficit and slowdown in remittances. BR. Govt mulls short-term steps to fund record C/A deficit The government is mulling measures to drum up finances to fund a record high current account deficit, exhibiting overreliance on CPEC related inflows and FDI to fill the gap in the near term. Finance Minister Ishaq Dar, at a meeting to review the external account position, also mulled tapping capital markets to check the current account deficit. Dar said the economy is passing through an expansionary phase and the ensuing dividends would be much higher than the cost currently being borne as a result of a widening trade deficit, which is only a short-term phenomenon. A significantly higher export target should be achieved to improve the trade deficit, Dar said. The News. Sindh moves CCI The govt. of Sindh has approached the Council of Common Interests (CCI) to bar federal govt. from misuse of forums such as the Economic Co-ordination Committee (ECC) and Cabinet Committee on Energy (CCoE) against Article 154 of the Constitution, by taking decisions which negatively impact provinces. The CCI, which is scheduled to meet on Aug. 28, 2017 with Prime Minister Shahid Khaqan Abbasi in the chair, is expected to discuss this issue in detail. Sindh is expected to get support from KPK govt. BR. K-P to demand right to award oil blocks in CCI meeting The K-P government has decided to discuss the devolution of concession powers over petroleum blocks from the federal to provincial governments in the Council of Common Interests (CCI) meeting scheduled on Wed (23rd Aug’17). Directorate General of Petroleum Concessions (DGPC) has reportedly been delaying the grant of concessions for blocks located in K-P which, after the 18th Amendment to the Constitution, should legally be awarded by the provincial government. Tribune. Upset with tanker strikes, government plans to lay oil pipeline As oil tanker owners repeatedly threaten to stop oil supplies, the ECC is likely to allow Inter State Gas Systems (ISGS) to float a tender and invite companies to build an oil pipeline from Machike (Sheikhupura) to Tarru Jabba (Peshawar). Strikes by oil tanker owners as well as deadly tanker accidents have been a matter of grave concern for the government as is the oil theft at different depots of PSO and power plants. Since its creation, ISGS has been dealing with gas pipeline projects like Iran-Pakistan, TAPI and North-South gas pipelines. Tribune. LNG operations: First-ever LNG terminal earns $ 91Mn revenue Pakistan's first-ever LNG terminal at Port Qasim has earned revenue of approximately $ 91Mn from LNG operations since the inception of the first LNG terminal in Mar.’15. FOTCO Oil Terminal at Port Qasim handles roughly 6 to 8Mn tons per annum (MTPA) of petroleum products and PQA royalty is roughly $ 4 to 5Mn per annum whereas SSGC and Engro Vopak Terminal (EVTL) handles roughly 500 kt LPG per annum through which PQA earns approximately $ 2.4Mn. BR. China offers high-yielding rice variety to boost Pakistan’s food security Prof Yuan Longping, globally known as ‘Father of the Hybrid Rice’, has claimed to have developed Super-Hi Hybrid Rice seed, having more than double the yield potential of the paddy varieties currently under cultivation around the world. He is of the view that the latest tier variety can help Pakistan in increasing rice yield very significantly and China will be \ happy to share newly developed very high-yielding rice variety with its friendly neighbor. The News. Cotton crop hit by severe pest attack The cotton zone districts of Punjab have come under pest attack, and the agriculture department has advised growers to carry out pest scouting twice a week. Sowing season for the cash crop during kharif has already been completed, and harvesting will begin from Sept.’17 to be completed in Oct.’17. The govt. has revised down the production target which is now fixed at 12.6Mn bales against the original target of 14Mn bales. Dawn. Cement prices slashed in Punjab, KP Cement manufacturers in the northern region (comprising KP and Punjab) have slashed prices of the commodity by PKR 10-25 per 50kg bag. The decline in prices has taken the investors by surprise since cement prices in North were anticipated to remain stable after the pass on of the FED where prices increased by PKR 26 per bag (average) on Jun. 8, 2017. However, cement players in the southern region have kept the prices intact so far. Proximity to the Karachi Port might lure manufacturers to further tap into the export markets and should provide some relief to the producers in South. Dawn. Competition Commission retains its three-star rating The Global Competition Review (GCR) has maintained the three star status for the Competition Commission of Pakistan (CCP) for its consistent performance in the annual ranking of the world’s top antitrust competition authorities. The three-star rating out of five, keeps the CCP at par with the competition authorities of Turkey, Portugal, Switzerland, Sweden, Singapore, Poland, New Zealand, Austria and Mexico. Dawn. SECP initiates show cause actions on non-compliance SECP has initiated 15 show cause proceedings against companies for their non-compliance with regulatory principles since the start of the current fiscal year. The proceedings are related to various non-compliances with legal requirements regarding directors’ powers, holding of annual general meetings, investment in associated companies, circulation of financial statements and misstatement in financial statement. Moreover, winding up proceedings against non-operational companies have also been initiated. The News. Economic Indicators List of Indicators Date / Period Unit Value Change Daily Crude (AU'17) Gold (JY'17) Gold (10g) Local Silver (JY'17) Cotton(KHI)-40 kg Kibor-6M 21-Aug 21-Aug 21-Aug 21-Aug 21-Aug 21-Aug 21-Aug 21-Aug 21-Aug 21-Aug PKR PKR Pts. $ Mn $/bbl $/oz PKR $/oz PKR % 105.40 106.40 42,153 -4.42 47.64 1,293.4 43,714 17.00 6,430 6.15% Forex Reserves 11-Aug $ Bn 19.94 0.00% 0.00 -2.15% NM** 1.06% 0.36% 0.00% -0.02% 0.83% 0.00% WoW -0.31% YoY 16.04% 10.58% 36.74% -55.46% -210.12% 162.81% USD-Interbank USD-Open MKT KSE-100 index FIPI Jul-17 Remittances $ Bn 1.54 Jul-17 Exports* $ Bn 1.63 Jul-17 Imports* $ Bn 4.84 Jul-17 Trade Balance* $ Bn -3.20 Jul-17 Current Account $ Mn -2,053 Foreign Direct Inv. $ Bn 0.22 Jul-17 Jul-May 17 LSM Growth* % 5.69 % 2.91 Jul-17 Avg. CPI-FY17* Discount Rate % 5.75 Jul-17 WoW= week Sources: KCCI Research, PMEX , NCCPL, KSE, SBP, PBS* ** Not Meaningful on week; Major Currencies 145 GBP, 21-Aug-17, 135.7 135 125 EUR, 21-Aug-17, 124.0 115 105 95 Aug-16 USD USD, 21-Aug-17, 105.3 Nov-16 GBP EUR Feb-17 May-17 Aug-17 Source: KCCI Research ; Oanda.com Quote of the Day "Success consists of going from failure to failure without loss of enthusiasm." Winston Churchill Chart of the Day 55,000.00 KSE-100 Index 50,000.00 45,000.00 40,000.00 35,000.00 30,000.00 25,000.00 20,000.00 Source: KCCI Research, SC Trading Disclaimer This report has been prepared by KCCI Research & Development Cell. The information contained herein have been compiled or arrived at based upon information obtained from sources believed to be reliable and in good faith. Such information has not been independently verified. icon represents the sole viewpoint of the KCCI R&D Cell, and is stated to enrich the readers' understanding of the news item. The R&D Dept. bears no responsibility for its correctness or accuracy. Contact: res@kcci.com.pk