Pakistan Daily Economy Update - 15 May

Transcription

1. May . 14-15, 2017 KCCI - eBulletin China pledges $ 124Bn for new Silk Road Chinese President Xi Jinping has pledged $ 124Bn for new Silk Road plan to forge a path of inclusiveness and free trade. The Belt and Road forum is showcasing One Belt, One Road (OBOR) initiative which China has touted as a new way to boost global development, aiming to expand links between Asia, Africa, Europe and beyond. Chinese President has pledged a major funding boost to the new Silk Road, including an extra 100Bn yuan ($ 14.50Bn) into the existing Silk Road Fund, 380Bn yuan in loans from two policy banks and 60Bn yuan in aid to developing countries and international bodies in nations along the new trade routes. The Nation – Mon. Pakistan, China ink six accords of cooperation Pakistan and China have inked six accords of cooperation in diverse fields. The Memorandum of Understandings (MoUs) signed between the two countries include framework agreements on Silk Road Economic Belt and 21st Century Maritime Silk Road Initiative, economic and technical cooperation on 1.5Bn RMB for Gwadar Airport, implementation of upgrading ML-1 and establishment of Havelian Dry Port in Pakistan, MoU on implementation of upgrading ML-1 and establishment of Havelian Dry Port, Economic and Technical Cooperation for 0.8Bn RMB for Gwadar Airport and economic and technical cooperation of 1.1Bn RMB for East bay Expressway. BR – Sun. SBP grants operating licenses to Bank of China The State Bank of Pakistan (SBP) has issued a banking license to Bank of China, which will commence its business in branch mode after meeting other regulatory requirements. The bank will initially bring $ 50Mn to fulfil the minimum capital requirements of the SBP. The Bank of China is a subsidiary of China Central Huijin, an investment arm of the Govt. of China. It is the 4th and 5th largest global bank in terms of Tier-1 capital and total assets, respectively, and its footprints have reached 50 countries. The long-term objective of Bank of China is to increase its market penetration by opening branches in major cities of Pakistan, aiming to be one of the largest foreign banks in Pakistan. The News – Sun. FBR mulling withdrawing fixed tax schemes FBR is reviewing all fixed tax schemes for withdrawal of fixed regimes which failed to achieve the desired results, in the upcoming budget (2017-18). FBR is reviewing all fixed tax schemes for withdrawal of fixed regimes which failed to achieve the desired results, in the upcoming budget (2017-18). Fixed tax schemes like scheme for developers and builders would also be withdrawn as large builders and developers groups have reportedly got away without declaring their expenses and incomes. BR – Mon. Budget (2017-18): Host of legal, procedural changes in tax laws likely A number of legal and procedural changes in federal tax laws are expected in upcoming budget (2017-18) to simplify sales tax/excise laws including possible adjustment of Federal Excise Duty (FED) on accrual basis and concept of group taxation in the Sales Tax Act, 1990. The FBR is considering various budget proposals of the Tax Reform Commission's sub-committee for simplifying indirect tax laws. BR – Sun. SECP, SBP to introduce e-IPO, e-dividend concept for capital market The Central Depository Company (CDC) has introduced the concept of centralized e-IPO system (CES), under which subscription of securities can be made electronically. Investors having a valid CNIC, bank account and CDC account can electronically register themselves 24/7 throughout the year. Moreover, registered investors can apply for the subscription of securities through any of the banking channels (ATM, net banking, mobile app and over the counter). The News – Sun. Mango exports at risk of disruption as season closes in Pakistan’s mango exports which will start in next week of May’17, are at increasing risk from the ongoing strike by goods transporters in Karachi. Fruit exporters fear a disruption to mango shipments as talks between the Sindh govt. and associations of transporters have reached a deadlock. The goods carriers’ are protesting against the 24-hour a day restriction imposed by the Sindh High Court (SHC) on the movement of heavy vehicles within Karachi’s jurisdiction. Tribune – Sun. SHC orders formation of body to review heavy vehicles’ movement in Karachi The Sindh High Court has ordered the constitution of a high-level committee headed by the city mayor and all stakeholders to review the movement of heavy vehicles in the city. The transporters’ counsel requested the judges that they should be allowed to use the following routes: from Sohrab Goth to Gulshan Chowrangi; Sharea Faisal to Korangi; from Sohrab Goth to Korangi; and from Mai Kolachi bypass to Korangi via Seaview. Dawn-Sun. NJHP electricity cost to decrease to PKR 9.15/unit Reduction in the mark-up rate on the re-lending for 969MW Neelum Jhelum Hydroelectric Power (NJHP) project is likely to reduce its electricity cost to PKR 9.15/unit. In this regard, Wapda has requested govt. to reduce the mark-up rates as govt. is borrowing money from foreign creditors at a lower mark-up, but the Economic Affairs Division is charging 15% on the re-lending of these loans to different govt. entities. Out of the total cost of PKR 500Bn of the Neelum Jhelum, around PKR 90Bn is “Interest During Construction” (IDC). The Nation – Mon. IFC helps generate $ 238Mn financing for Pakistan’s largest wind power farm IFC will provide and arrange $ 238Mn in a landmark transaction to help build Pakistan's largest wind power farm. World Bank Group’s member, IFC will provide $ 66Mn and mobilize a further $ 172Mn in financing of Triconboston Consulting Corporation to construct and operate three new 50MWs wind farms in Sindh province. Other financiers include the ADB, IDB, and DEG-Deutsche Investitions-und Entwicklungsgesellschaft. The plant is expected to be fully commissioned by the end of 2018 and will provide clean power to about 600,000 residential customers. BR - Sun. Polish co poised to take oil, gas exploration to Rs100b per year The PGNiG, a Polish oil and gas company operating in Pakistan since 1997, has planned to step up its exploration and production activities and take the business volume to PKR 100Bn per year. In 2015, PGNiG discovered the Rizq Gas field which was the second Tight Gas Field in Kirthar Block and commissioned the Rehman Production Facility with a capacity of processing up to 40 mmscfd gas. The company has so far invested more than $ 125Mn in Pakistan. The Nation – Mon. Oil companies oppose govt move to introduce higher quality diesel OMCs and refineries have rejected outright the government’s directive to introduce Euro-III & Euro-IV compliant HSD in the country, claiming that it is not feasible to sell the higher grade product in the Pakistani market. The ministry proposed to do so through imports in a deregulated environment, and subsequently upgrade local refineries capable of matching the quality of the imported product. Higher grade fuels are considered more efficient and environment-friendly, but are expensive. Pakistan used to have 0.5% sulphur content HSD, which produced 5,000ppm until recently. This is currently being replaced with 0.05% Euro-II having 500ppm. Euro-III should have 0.035% (350 ppm) and Euro-IV 0.005% (50ppm). Dawn-Mon. Economic Indicators List of Indicators Date / Period Unit Value Change Daily 12-May 12-May 12-May 12-May 12-May 12-May 12-May 12-May 12-May 12-May PKR PKR Pts. $ Mn $/bbl $/oz PKR $/oz PKR % 104.81 106.05 51,751 -2.07 48.19 1,228 42,685 16.41 7,180 6.15% 5-May $ Bn 20.79 -0.01% 0.19% 1.27% NM** 1.69% 0.75% -0.20% 1.53% 0.00% -0.01% WoW -1.00% YoY -2.79% -2.29% 19.88% -40.12% -160.74% USD-Interbank USD-Open MKT KSE-100 index FIPI Crude (JU'17) Gold (JU'17) Gold (10g) Local Silver (JU'17) Cotton(KHI)-40 kg Kibor-6M Forex Reserves Jul-Apr 17 Remittances $ Bn 15.60 Jul-Apr 17 Exports* $ Bn 16.92 Jul-Apr 17 Imports* $ Bn 43.47 Jul-Apr 17 Trade Balance* $ Bn -26.56 Jul-Mar 17 Current Account $ Mn -6,130 % 4.09 Avg. CPI-FY17* Jul-Apr 17 Mar-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 May-16 GBP, 14-May-17, 135.0 EUR, 14-May-17, 114.5 USD, 14-May-17, 104.8 Aug-16 USD GBP Nov-16 Feb-17 May-17 Source: KCCI Research ; Oanda.com EUR Quote of the Day “Leadership is not about titles, positions or flowcharts. It is about one life influencing another.” John C. Maxwell Chart of the Day Pakistan's Remitance received From Top 10 Countries (10MFY17) Saudi Arabia 4,517 UAE 3,468 USA 1,929 U.K. 1,847 Oman 631 Kuwait 627 Bahrain 319 Qatar 305 Australia 165 Canada 147 0 1,000 2,000 3,000 4,000 5,000 Work on KCR to start by December, says Shah Value in Mn US $ Source: KCCI Research, SBP Sindh CM has said that the groundbreaking ceremony of the Karachi Circular Railway project, a part of the CPEC, will be held by the end of Disclaimer this year. The Central Development Working Party (CDWP) has given its approval to the project and work will start by the end of Dec‘17. Dawn-Mon. 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 Bank borrowing rises Deposits and other accounts of all scheduled banks stood at PKR 11,214.04Bn after a 1.82% increase over the preceding week’s figure of independently verified. icon represents the sole viewpoint of the KCCI R&D Cell, and is stated to enrich the readers' PKR 11,013.88Bn. Compared with last year’s corresponding figure of PKR 9,767.624Bn, the current week’s figure was higher by 14.81%. understanding of the news item. The R&D Dept. bears no responsibility for its correctness or Dawn-Mon. accuracy. Contact: res@kcci.com.pk