Pakistan Daily Economy Update - 16 January

Transcription

1. Jan . 16, 2018 KCCI - eBulletin Pak-China FTA phase-II talks hit snag Pakistan has reportedly refused to finalize negotiations with China on second phase of Free Trade Agreement (FTA) until Beijing allows export of at least 70 high priority items of Pakistan's interest duty free. The 8th meeting of 2nd Phase Negotiations of China-Pakistan FTA (CPFTA) is expected to be held in Feb.’18 in Islamabad but so far discussions are facing a deadlock. Pakistan has sought some safeguards for local industry, Trade Reduction Modalities (TRMs) and specific mechanism for balance of payment clause. BR. Date / Period Unit Value Change Daily 15-Jan PKR PKR 110.30 112.13 -0.18% 0.02% Pts. $ Mn $/bbl 42,347 8.30 64.60 -1.37% NM** 1.56% USD-Interbank USD-Open MKT Work on Fiscal Year 2019 budget in full swing The govt. wants to present next fiscal year budget in May.’18 and preparations to this effect are going on in the Finance Division. Finance Division has issued budget circular to ministries and divisions with request for submission of revised estimates for FY18 and budget estimates for FY19 along with medium-term budget estimates till FY21. Finance Division has been asked to prepare budget strategy paper by Feb. 1, 2018 and it will be presented to the federal cabinet for approval. BR. Crude (MA'18) 15-Jan 15-Jan 15-Jan 15-Jan Gold (FE'18) Gold (10g) Local 15-Jan 15-Jan $/oz PKR 1,340.9 49,542 1.37% 0.35% Silver (FE'18) Cotton(KHI)-40 kg 15-Jan 15-Jan $/oz PKR 17.33 8,145 2.37% 0.00% Kibor-6M 15-Jan % 6.20% Consumer confidence in Pakistan at all-time high Pakistan’s consumer confidence has reached an all-time high of 111, up by nine points in 3QCY17, from 102 points in 2QCY17, according to the Nielsen Global Survey of consumer confidence and spending intentions. The score, highest since the launch of the survey, depicts an improving outlook for the country that can be attributed to growth in agriculture, controlled inflation, strengthened power supply and an uplift in the job market, amongst other factors. Tribune. Forex Reserves $ Bn 20.02 0.00% WoW -0.66% Remittances 5-Jan FY18 Jul-Dec 17 $ Bn 9.74 YoY 2.51% Exports* Imports* Jul-Dec 17 Jul-Dec 17 $ Bn $ Bn 11.01 28.97 11.27% 19.11% Jul-Dec 17 Trade Balance* $ Bn -17.96 Jul-Nov 17 Current Account $ Mn -6,430 Foreign Direct Inv. $ Bn 1.15 Jul-Nov 17 Jul-Oct 17 LSM Growth* % 9.64 % 3.75 Jul-Dec 17 Avg. CPI Discount Rate % 5.75 Sep-17 WoW= Sources: KCCI Research, PMEXweek , NCCPL, KSE, SBP, PBS* ** Not Meaningful on week; -24.48% -90.74% 57.12% Financial details of individuals/entities: FBR compiles list of 101 states on AEFI FBR has compiled a list of 101 countries under global treaties on Automatic Exchange of Financial Information (AEFI) to exchange financial details of individuals/entities with tax jurisdictions of these countries. The AEFI is an initiative of Organization of Economic Cooperation and Development (OECD) members and Pakistan has committed to start exchange of financial information on automatic basis. BR. Foreign banks $ 7.9Bb loans procured at higher interest rates The govt. has procured $ 7.9Bn worth of commercial loans from foreign banks from Jun.’13 to-date at considerably higher interest rates ranging between 2.5% to 4.5%+ LIBOR. Economic Affairs Division shared details with the Finance Committee which revealed that govt. borrowed $ 323Mn in FY14, $ 150Mn in FY15, $ 1.39Bn in FY16, and a whopping $ 4.37Bn in FY17. The govt. borrowed an additional $ 1.09Bn from foreign banks during 5MFY18. BR. SECP rationalizes licensing regime for securities brokers SECP, with an objective to reduce regulatory burden and to promote ease of doing business, has approved rationalization of existing licensing regime for securities’ brokers. In order to provide ease of doing business, without compromising on regulatory objectives, the Commission has approved that a single licence would be issued to a securities broker. A licensed securities broker would not require all other mandatory licenses including futures broker, securities advisor, futures advisor and accredited representative. The Nation. Govt. ought to privatize PIA by April 15 under a law: privatisation minister Govt. will privatize the state-owned PIA by 5th Apr’18, but it will continue to hold the airline’s management control. The privatisation minister, Daniyal Aziz, said that the govt. would only privatize air transport business of the PIA and rest of the business of the airline would be given to another company (on contract basis). PIA’s privatisation was included in the early-year agenda of the ruling government as its losses amount to PKR 325Bn. The News. \ Economic Indicators List of Indicators CDWP approves 20 development projects worth PKR 80.6Bn The Central Development Working Party (CDWP) has approved 20 projects worth PKR 80.6Bn of which five projects with an estimated cost of PKR 60.9Bn were referred to Executive Committee of National Economic Council (ECNEC) for further approval. The projects presented for approval were from energy, transport and communications, physical planning and housing, science and technology, governance, devolution and area development, industries and commerce, health and mass media sectors. The News. NEPRA fixes tariff for solid waste based power plants NEPRA has determined the first ever upfront tariff for power generation from Municipal Solid Waste (MSW). A levelised tariff of US cents 10/kWh based on 25 years’ operational period has been announced with an overall capacity cap of 250 MW, wherein share of each province and Federal Territory has been kept at 50MW each. The News. Govt. allows awarding of contract for DigiSkills project The federal govt. has approved the award of contracts for the flagship DigiSkills Training Project and National Incubation Center Karachi. The DigiSkills programme is being initiated to fill the industry-academia gap and is aimed to impart state-of-the-art skills to one million youth through proper training and mentorship. The News. NBP, Bank of China sign MoU to enhance banking services National Bank of Pakistan (NBP) and Bank of China Pakistan Operations (BOCP) have signed a MoU to promote banking services in the country. The MoU will further extend cooperation in the areas of trade finance, cash management and international transactions, corporate lending and project financing, infrastructure financing, investment banking and various other fields. Daily Times. Russian central bank, SBP sign MoU The SBP has signed a MoU on bilateral central banking cooperation with the Central Bank of the Russian Federation (CBRF). The MoU aims at promoting cooperation between the two authorities primarily in disciplines of financial systems development, payment systems, financial infrastructure and financial institutions supervision. Dawn. KSE-100 index FIPI Major Currencies GBP, 15-Jan-18, 152.0 155 145 135 EUR, 15-Jan-18, 135.1 125 115 105 95 Jan-17 USD, 15-Jan-18, 110.4 USD Apr-17 GBP EUR Jul-17 Oct-17 Source: KCCI Research ; Oanda.com Quote of the Day "Macroeconomic policy can never be devoid of politics." Joseph Stiglitz Chart of the Day Private Sector Outstanding Loan Break-up , Commerce & , Electricity, gas Trade, 322.26 , and water 8.59% supply, 383.17 , 10.21% Construction, 138.30 , 3.69% , Transport & Communication , 215.82 , 5.75% , Agriculture, 304.17 ,… Manufacturing, 2,347.38 , 62.55% , Mining and Quarrying, 41.60 , 1.11% Figures as on Nov'17- PKR Bn KCCI Research, SBP 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