Pakistan Daily Economy Update - 17 August

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1. Aug . 17, 2016 KCCI - eBulletin Real estate sector FBR asks chambers to submit proposals in case of dispute According to the FBR, the chambers should submit their proposals to the tax collection authority if they do not agree with the FBR recently announced valuation of industrial lands. The Karachi Chamber of Commerce and Industry (KCCI) and the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has issued a statement in which they said the new valuation tables were not ‘acceptable’ to them. According to the KCCI President Younus Bashir, the govt. did not take stakeholders on board before issuing new rates and that the new valuation rates for the industrial land were too high. Therefore, urged the FM Ishaq Dar to take immediate notice of the issue and resolve the same on urgent basis so that transactions and dealings of the property sector could be resumed. Tribune. PM directs Wapda to speed up work on projects Prime Minister Nawaz Sharif has directed WAPDA to fast track developmental work on the ongoing projects and further explore the huge hydropower generation potential for maximum utilization to benefit the people of Pakistan. Talking to Chairman WAPDA Zafar Mahmood, PM said that the WAPDA needed to work efficiently for the development of water and hydropower resources in the country.The Nation. FDI falls 14.6% as inflows from China slow down Foreign direct investment (FDI) in Pakistan clocked up at $ 64.3Mn in 1MFY17, down 14.6% from FDI received in 1MFY16. China became the principal foreign direct investor in the last fiscal year, with a net inflow of almost $ 600Mn in FY16. As a result, FDI in Pakistan surged 38.8% year on year to $ 1.28Bn in 2015-16, with China contributing almost half of the inflows under the much-celebrated CPEC. The country received just $ 64.3Mn FDI in July 2016 compared to $ 75.3Mn in July 2015. Tribune. Country’s 1st dirty-cargo terminal to start work this year The country’s first-ever dirty-cargo terminal would come on line by the end of the year which would help innovate handling of cement, clinker and coal. The Pakistan International Bulk Terminal (PIBT) is being built at Port Qasim at an estimated cost of $ 225Mn by a local company in partnership with the World Bank and International Finance Corporation (IFC). The civil work of the terminal, spread over 72 acres, was almost complete and the company was currently importing and installing equipment, such as cranes and conveyer belt, to ensure that the first ship could call at the terminal in December. Tribune. NA committee clears draft bill prohibiting benami transactions The National Assembly Standing Committee on Finance approved the draft ‘Benami Transactions (Prohibition) Act 2016’ which aims at punishing people holding ‘benami’ properties and curb the practice. The draft law, which will also apply to global assets of Pakistanis, proposes up to seven years rigorous imprisonment and fine for people with benami properties. The term ‘benami properties’ refers to any property and assets which have been purchased in the name of a person other than the one financing it – a move which allows parking of undeclared money in the real estate sector. Dawn. SBP wants gold imports formalized to curb ‘abuse’ SBP has asked the Ministry of Finance to formalize gold imports as the existing two facilities to import the commodity were being misused. One of the policies allows import of gold against export of jewellery without any import payment; only jewellery making charges are received through banking channel from abroad. In a letter to the finance ministry, the State Bank said gold imports should be formalized by allowing payments through the interbank market. It has also suggested that the existing two modes of importing gold may be discontinued. Customs duty on gold import and other applicable taxes may be imposed on a par with India to discourage smuggling of gold. In case imported gold is converted into jewellery and then exported, duty drawback may be allowed to the jewellery exporter once export proceeds realized. Dawn. 17 EoIs received for 40% PSX stake The Pakistan Stock Exchange (PSX) received a total of 17 Expression of Interests (EOIs) from local and foreign investors for acquisition of 40% strategic shares in the bourse. According to the stipulated procedure, the Divestment Committee of PSX would assess all the EOIs received and forward them with comments to the SECP for pre-qualification. The SECP, after its own assessment, would declare any or all of the parties which have submitted EOIs as eligible to carry out due diligence of PSX and on its basis submit their binding offers for acquisition of requisite stake in PSX. Dawn. Economic Indicators Date / Period Unit Value Change Daily USD-Interbank List of Indicators 16-Aug PKR 104.71 0.07% USD-Open MKT 16-Aug PKR 106.30 1.75% KSE-100 index FIPI 16-Aug 16-Aug Pts. $ Mn 40,050 -2.60 0.05% NM** Crude (JU'16) 16-Aug $/bbl 47.15 1.81% Gold (MY'16) 16-Aug $/oz 1,338.5 0.00% Gold (10g) Local 16-Aug PKR 45,989 1.43% Silver (MY'16) 16-Aug $/oz 19.81 -0.08% Cotton(KHI)-40 kg 16-Aug PKR 7,165 0.00% Kibor-6M 16-Aug % 6.02% 0.00% Forex Reserves 5-Aug $ Bn 22.60 -1.67% Remittances Jul-16 $ Bn 13.28 -20.14% Exports* Jul-16 $ Bn 1.48 -7.45% Imports* Jul-16 $ Bn 3.56 5.52% Trade Balance* Jul-16 $ Bn -2.08 -17.20% Current Account Avg. CPI-FY17* Jul-Jun 16 Jul-16 $ Mn % -2,525 4.12 6.79% WoW YoY Jul-16 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 GBP, 14-Aug-16, 135.1 EUR, 14-Aug-16, 116.7 145 135 125 115 105 95 USD, 14-Aug-16, 104.5 85 75 Aug-15 Nov-15 USD Feb-16 EUR May-16 Aug-16 Source: KCCI Research ; Oanda.com Quote of the Day "Our actions are the results of our intentions and our intelligence. " E. Stanley Jones Chart of the Day 45,000.00 Pakistan Stock Exchange ends all-time high Pakistan shares closed at an all-time high on Aug, 17. 2016 helped by gains in food and personal care, oil and cement stocks. The benchmark 100-share index of the PSX closed 0.05% or 19.65 points higher at 40,050.17. The Nation. 40,000.00 SSGC wants OGRA to allow increase in gas price The Sui Southern Gas Company Limited (SSGC) has urged the regulator to allow increase in gas price by PKR 17.42 mmbtu, which would be invested in laying pipelines for transmission of imported gas and not impact existing consumers. The proposed increase will not impact SSGC’s (existing) consumers. The increase would be charged from consumers who utilize imported gas Re-gasified Liquefied Natural Gas. Tribune. 25,000.00 SECP to bring MFIs under framework of NBFCs SECP has decided to register all micro-finance institutions (MFIs) and related NGOs as non-banking financial companies with the commission to properly regulate/monitor these institutions under the non-banking finance companies (NBFCs) framework. BR. 0.00 Corruption rampant in USC, notes Senate body Prices of certain essential items are higher in government-run utility stores compared to the open market amid rampant corruption in the Utility Stores Corporation (USC), the Senate Sanding Committee on Industries and Production observed. “The main issue is that there is no permanent chairman of the USC and the government should take this issue seriously,” said committee’s chairman Senator Hidayatullah. Dawn. GBP KSE-100 POINT INDEX 35,000.00 30,000.00 20,000.00 15,000.00 10,000.00 5,000.00 Source: KCCI Research, SCS Trade 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