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Pakistan Daily Economy Update - 14 May

IM Insights
By IM Insights
1 week ago
Pakistan Daily Economy Update - 14 May

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  1. May 14 , 2022 KCCI - eBulletin Karachi remains on radar of investors: CM Sindh CM Syed Murad Ali Shah has said that Karachi is an economic hub of the country and his govt. will not allow terrorists, anti-state and anti-social elements to destroy peace in the city, which has been achieved at a heavy price. While speaking at the launch of “My Karachi – Oasis of Harmony” exhibition, which is a 3-day fair organized by KCCI at the Expo Centre, CM Shah said that he was glad that KCCI resumed the tradition of organizing the annual expo after a two-year suspension amid the Covid-19 pandemic. He welcomed the national and international exhibitors for putting in efforts to promote business activities and attracting local and foreign buyers and counterparts. He pointed out that the event was Former Chairman BMG late Mr. Siraj Kassim Teli’s brilliant initiative as the then president of KCCI in 2004 to change the perception of Karachi. Speaking on the occasion, BMG Chairman Zubair Motiwala said that the full house at the Expo Centre with the presence of chief minister, provincial ministers and diplomats showed the resilience of the city’s business community. KCCI President Muhammad Idrees stated that since its inception in 2004, the My Karachi exhibition kept improving every year. More than 250 stalls have been established. Tribune. Unit Value Change Daily 13-May PKR PKR 192.53 192.10 0.40% 0.05% KSE-100 index FIPI 13-May 13-May Pts. $ Mn 43,486 -0.68 1.37% NM** Crude Oil 13-May $/bbl 110.49 4.11% Gold 13-May $/oz 1,808.2 -0.90% Gold (10g) Local 13-May PKR 116,170 0.00% Silver 13-May $/oz 21.00 1.10% Cotton(KHI)-40 kg 13-May PKR 22,506 0.00% Kibor-6M 13-May % 15.00 0.02% 6-May $ Bn 16.38 WoW -1.07% Remittances Jul-Mar 22 $ Bn 22.95 7.04% Dollar crosses PKR 192 mark on strong demand The rupee continued its slide against the dollar on Friday (13th May’22) with the international currency hitting an all-time high of PKR 192.53 in the interbank market. According to SBP, rupee lost 0.39% or 76 paisa against the dollar on a day-on-day basis. The Pakistani currency has depreciated 8.32% since the beginning of 2022. Dawn. Exports* Jul-Apr 22 $ Bn 26.23 25.46% Imports* Jul-Apr 22 $ Bn 65.49 46.41% Trade Balance* Jul-Apr 22 $ Bn -39.26 -64.79% OGDC added to MSCI Pakistan Index Global index provider MSCI retained only two stocks — Lucky Cement Ltd and MCB Bank Ltd — in the MSCI FM Pakistan index as part of its latest semi-annual review. MSCI provides investment tools like indices that many global passive funds use to make investments with distributed risks around the world equity markets. Dawn. Current Account Foreign Direct Inv. Jul-Mar 22 Jul-Mar 22 $ Bn $ Bn -13.17 1.29 -4688.7% -1.99% Jul-Mar 22 LSM Growth* % 9.40 % 11.04 Jul-Apr 22 Avg. CPI Discount Rate % 12.25 Apr-22 Sources: KCCI Research, PMEX , NCCPL, KSE, SBP, PBS* ** Not Meaningful, WoW= week on week; YoY=Year on Year Fuel subsidy to cost govt PKR 75Bn over next fortnight The prices of petroleum products may increase by up to PKR 86 per litre for the next fortnight — with no taxes included — in case the govt. decides to do away with the subsidy payable to oil companies as Price Differential Claims (PDCs) under IMF conditions. At present, the govt. is providing about PKR 31 per litre out-of-pocket subsidy on petrol and PKR 73 per litre on diesel, besides a subsidy of PKR 5 per unit on electricity. An IMF team would start a staff mission on 18th May’22 with Pakistani authorities in Doha, Qatar. Dawn. Industries assured of gas supply Federal Minister for Commerce Syed Naveed Qamar has assured the textile industry that every effort will be made to supply gas to the industrial units in order to boost the country’s economy. Tribune. 450MW BQ unit to be commissioned by month-end: KE K-Electric has given yet another new date for the commissioning of its much-awaited 450 megawatt unit of Bin Qasim Power Station-III and the plant is expected to come online ‘with optimum generation capacity’ by the end May’22. BR. Two ADB executive directors due today Two Executive Directors of Asian Development Bank (ADB), Dr. Wan Farisan Bin Wan Sulaiman (representing Brunei Darussalam, Malaysia, Nepal, Singapore and Thailand) and Noor Ahmed (representing Kazakhstan, Maldives, Marshall Island, Magnolia, Pakistan, Philippines and Timor-Leste) will be visiting Pakistan from 14th-21st May’22. During the visit, the Executive Directors will hold meetings with Ministers and senior Federal and Provincial govt. officials. The Board of Directors, among other business, sets policy direction for ADB and takes decisions on approval of loans, guarantees, investments and technical assistance by ADB to developing member countries. BR. List of Indicators Date / Period USD-Interbank USD-Open MKT 13-May Forex Reserves YoY Major Currencies 255 245 235 225 215 205 195 185 175 165 155 145 May-21 Govt to review ban on new gas connections, NA told The National Assembly has been informed that the ban imposed on new gas connections by the previous govt. will be reconsidered by the federal cabinet. The News. Intra-Karachi Peoples Bus Service to be launched this month: transport minister Sindh Information and Transport Minister Sharjeel Inam Memon has directed the Karachi Metropolitan Corporation (KMC) and District Metropolitan Corporations to clear all the hurdles and encroachments and complete the repair work along the routes of the intra-city \ Peoples Bus Service. The Sindh govt. would launch the project in the last week of May’22. The News. New govt buys LNG at 40% higher prices Despite a large majority of cargoes imported at cheaper long term contracts, the basket price for imported Degasified Liquefied Natural Gas (RLNG) has surged 40% to a record $ 22-24 per Mn British Thermal Unit (mmBtu) for May’22 owing to a string of spot cargoes procured to meet energy shortages. Dawn. President approves reconstitution of CCI President Dr. Arif Alvi has approved the reconstitution of the Council of Common Interests (CCI), which will be headed by PM Shehbaz Sharif. CCI is responsible for formulating and regulating policies in relation to matters included in the federal legislative list and exercising supervision and control over related institutions. BR. SBP injects PKR 3.55Tn into money market SBP has injected PKR 3.55Tn worth of liquidity into the money market via Open Market Operation (OMO) to help ease liquidity constraints of banks. SBP injected funds for a seven-day period at 12.31%. The central bank also conducted Shariah-compliant Mudarabah based OMO on the same day, pumping PKR 499.9Bn liquidity for seven days at 12.32% into the Islamic banking institutions. The News. Large-scale manufacturing grows 26.6% in March PBS has reported that Large-Scale Manufacturing (LSM) grew 26.6% year-on-year in Mar’22. In 9MFY22, LSM grew by 10.4% on a yearon-year basis as per the new base. However, the growth is calculated at 7% in 9MFY22 on the basis of the old base of FY06. Dawn. EUR, 13-May-22, 199.1 USD, 13-May-22, 192.1 USD Aug-21 GBP Nov-21 EUR Feb-22 May-22 Source: KCCI Research Quote of the Day "Great things are done by a series of small things brought together." Vincent Van Gogh Record $ 3.1Bn remittances sent in April For the first time, remittances crossed the figure of $ 3Bn in a month, which gave hope that the country would achieve its annual remittance target of $ 30Bn. The country received a collective $ 26.1Bn during 10MFY22, very close to the expected target of $ 30Bn for FY22. Pakistan received the highest amount of remittances from Saudi Arabia, which reached $ 6.52Bn. Dawn. CPEC Authority to be abolished, Senate panel told The govt. is to abolish the China-Pakistan Economic Corridor (CPEC) Authority and all matters relating to various CPEC projects will be handed over to the Planning Commission with designating a special secretary to deal with the matters. The ministry is working on the modalities and a final decision in this connection will be taken soon. The step is being taken for facilitating the Chinese investors and contractors working on CPEC projects who are facing serious problems for the past many years. Chinese investors and contractors were also facing problems in getting visas and the govt. is to make the process swift. BR. GBP, 13-May-22, 233.6 10 9 Outstanding Credit to the Private Sector (PKR Tn) 18.6% 17.6% 9.5% 8 1.9% 10.3% 6 5 3 4.65 5.47 5.99 6.11 40% 20% 7.99 7 4 18.6% 6.74 0% -20% -40% -60% 2 -80% 1 0 -100% July 2017 July 2018 July 2019 July 2020 July 2021 March 2022 Source: KCCI Research; SBP Note If any member is facing any issues pertaining to PakistanAfghanistan investment and trade policies or has project proposals is requested to share the information at secretary@kcci.com.pk for forwarding to the Board of Investment.