Pakistan Daily Economy Update - 3 February

Transcription

1. Feb . 3, 2017 KCCI - eBulletin Dar asks FBR to meet tax revenue target Finance Minister Ishaq Dar while appreciating the FBR efforts, urged the board to meet the tax revenue target set at the beginning of FY17. The Minister further said that accession to the Organization for Economic Co-operation and Development (OECD) Multilateral Convention on Mutual Administrative Assistance in Tax Matters has enabled Pakistan to benefit from automatic exchange of information for tax purposes with other countries that are signatories to the Convention. BR. Govt. to share 75% cost with leather industry Commerce Minister Khurram Dastagir has assured the local tanners of allowing 75% cost sharing by government on expensive international lab testing on leathers for various chemicals to ascertain various compliance standards set by EU and different customers. The minister has further vowed support to waive 4% customs duty on hides and skins import. The Nation. TRC panel forms sub-committees to expedite reforms Tax Reforms Commission (TRC) has constituted sub-committees on functional and territorial jurisdiction, mapping of retail outlets, simplification of laws, electronic monitoring of production of the tobacco industry, underground economy and forensic audit for speedy implementation of reforms in these areas. In this regard, these sub-committees would submit their recommendations during the next meeting to be held on Feb. 23, 2017. BR. Tax authorities begin probe into sources of individual remittances FBR has started probe into the sources of remittances received by the individuals after the board withdrew the audit exemption for them. The exemption paved the way for inflows of black money into the economy as tax authorities were restrained from questioning a person about the details of foreign remittance source. The News. Relocation of industries: FBR to discourage fiscal incentives under new policy In a third meeting for industrial relocation formulating policy, issues pertaining to tax exemptions and concessions have been discussed wherein FBR representatives provided a consolidated document to the Board of Investment (BoI) containing exemption details in customs duty and sales tax provided to various sectors. It has been pointed out in the document that more liberal fiscal incentives should be discouraged on federal level as FBR is now phasing out concessional regimes. BR. WB report reveals nepotism in public sector loans between 1996-2002 A World Bank (WB) report on governance and law disclosed that politically connected firms in Pakistan received 45% more loans from public sector than other firms during 1996 to 2002 even after the fact came to fore that the default rate of such well-connected firms was 50% higher. The report states that based on the productivity gap between firms, the annual cost of this credit misallocation could have been as high as 1.6% of GDP. A new World Bank policy report urges developing countries and international development agencies to rethink their approach to governance, as a key to overcoming challenges related to security, growth, and equity. The News. US company to install second FSRU at Port Qasim A consortium of Pakistan’s private companies have struck an agreement with a US firm to install a LNG floating storage and regasification unit (FSRU) at Port Qasim. Unit will have a capacity of 400 mmBtu which could be upgraded to 600 mmBtu. Combined both FSRU would be enough to generate around 6,000 megawatts of power. Dawn. Economic Indicators List of Indicators Date / Period Unit Value Change Daily Crude (MA'17) Gold (FE'17) Gold (10g) Local Silver (FE'17) Cotton(KHI)-40 kg Kibor-6M 2-Feb 2-Feb 2-Feb 2-Feb 2-Feb 2-Feb 2-Feb 2-Feb 2-Feb 2-Feb PKR PKR Pts. $ Mn $/bbl $/oz PKR $/oz PKR % 104.80 107.90 49,666 -6.20 53.63 1,216 43,028 17.47 7,218 6.13% Forex Reserves 27-Jan $ Bn 22.44 0.00% 0.09% 0.42% NM** 0.19% 0.58% 0.00% -0.51% 0.00% 0.02% WoW -3.49% YoY -2.27% -3.82% 10.10% -22.20% -92.23% USD-Interbank USD-Open MKT KSE-100 index FIPI Jul-Dec 16 Remittances $ Bn 9.46 Jul-Dec 16 Exports* $ Bn 9.91 Jul-Dec 16 Imports* $ Bn 24.40 Jul-Dec 16 Trade Balance* $ Bn -14.49 Jul-Dec 16 Current Account $ Mn -3,585 % 3.85 Avg. CPI-FY17* Jul-Jan 17 Jan-17 Discount Rate % 5.75 Sources: KCCI Research, PMEX , NCCPL, KSE, SBP, PBS* ** Not Meaningful WoW= week on week; YoY=Year on Year Major Currencies 175 165 155 145 135 125 115 105 95 85 75 Feb-16 GBP, 2-Feb-17, 132.4 EUR, 2-Feb-17, 113.2 USD, 2-Feb-17, 104.9 May-16 USD GBP Aug-16 Nov-16 Feb-17 Source: KCCI Research ; Oanda.com EUR Quote of the Day 21 OMCs given licenses in six months vs 20 in 70 years OGRA has opened floodgates to OMC by granting 21 fresh licenses in just 6 months compared to only 20 over the past 70 years. The new 21 companies given licenses are expected to invest about PKR 10.5Bn over the next few years to set up storages and filling stations in various parts of the country. Dawn. “A man who dares to waste one hour of time has not discovered the value of life.” Govt. to raise PKR 2.4Tn in 3 months The government plans to raise PKR 2.4Tn in the next 3 months to pay back the domestic debt, including debt servicing, and meet the fiscal gap. SBP informed that government will raise the money mostly through the auction of market treasury bills. Dawn. Chart of the Day Punjab revenue dept. to receive PKR 5Bn from FBR The Punjab Revenue Authority (PRA) is expected to receive at least PKR 5Bn from the FBR on account of claims related to the input adjustment tax pending for the past 4 year. The MOU would be helpful in getting the taxpayers rid of double taxation and settling the claims of billions of rupees. Under the agreement, the FBR and PRA will scrutinize each other claims for necessary verification on priority basis. The News. Theft or leakage: 22 tons of coal goes ‘missing’, Railways comes under pressure The management of Pakistan Railways (PR) was dealt a blow on 2nd Feb’17 after an entire hopper wagon of a freight train, which transported imported coal from Port Qasim to a power plant in Sahiwal, was found empty. It was the second coal consignment for the 1,320MW Sahiwal coal-fired power plant to test the expertise of PR in timely delivering the cargo. Officials working on the power plant have voiced concern over the missing coal, which was imported from South Africa. The PR insisted that in order to avoid such incidents in the future, the railways had decided to design a locking device for the freight wagons. Tribune. Charles Darwin PAKISTAN'S AVERAGE YEARLY INFLATION (1HFY10-1HFY17) 3.85% 1HFY17 1HFY16 1HFY15 1HFY14 1HFY13 2.26% 5.77% 8.75% 8.28% 10.76% 1HFY12 14.26% 1HFY11 1HFY10 9.06% Foreign reserves decline on the back of debt payment 0.0% 5.0% 10.0% 15.0% The total liquid foreign reserves held by the country stood at $ 22.43Bn as on Jan. 27, 2017 as against $ 23.25Bn in the Source: KCCI Research, PBS Values in (%) preceding week. During the week, reserves held by the SBP stood at $ 17.59Mn compared to $ 18.38Bn a week earlier. Disclaimer Similarly, net foreign reserves held by commercial banks stood at $ 4.84Mn in comparison to $ 4.86Bn week ago. The decrease is mainly attributed to external debt servicing, including $ 500Mn loan repayment to State Administration of 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 Foreign Exchange (SAFE), China. The Nation. Amreli Steels’ profit surges 17% Amreli Steels Limited (ASTL) has posted net earnings of PKR 256Mn (EPS: PKR 0.88) in 2QFY17, up 17% compared with PKR 218Mn (EPS: PKR 0.86) in 2QFY16. Tribune. 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