Pakistan Daily Economy Update - 17 January

Transcription

1. Jan . 17, 2017 KCCI - eBulletin December 2016: Backed by Engro transaction, FDI up massive 328% The foreign direct investment (FDI) in Pakistan turned positive year-on-year in Dec’16 with inflows of $595 million, up 328% from $139Mn in the same month of the previous year, according to SBP. However, the majority portion of the Dec increase was due to a one-off investment transaction conducted by a Dutch company for the acquisition of Engro Foods. Net flows to the country from foreign companies increased to $ 1.08Bn during 1HFY17 from $ 978.5Mn in 1HFY16. Netherlands emerged as the biggest source of FDI for the country during the 6 months of FY17. Investments include acquisition of assets. However, foreign investment from China dropped to $ 204Mn in 1HFY17 from $ 443.8Mn a year ago. Tribune. Over 78% US Cos keen to invest in Pakistan: Survey Perception Survey conducted by American Business Council (ABC) showed that there is a significant improvement of over 30% in the law and order situation of Pakistan as compared to last year. For 2015-16, the vast majority of respondents rated the business climate of Pakistan as satisfactory with only 8% giving it a poor rating compared with 11% participants rated the business climate as poor last year. However, the members have separately commented about the government's tendency to introduce mini budgets as well as sudden changes in policies or rules during course of a fiscal year as such steps negatively impact on the existing as well as new investments. The Nation. KCCI demands effective strategy to curb rising street crimes President of Karachi Chamber of Commerce and Industry (KCCI) Shamim Ahmed Firpo has urged the Law Enforcement Agencies to devise an effective and result-oriented strategy to completely thwart rising street crimes in Karachi. He urged the federal and provincial governments to pay special attention to the issues of Karachi. The KCCI president acceded that around 60 motorcycles and 35-40 mobile phones are either being snatched or stolen daily in Karachi which is intolerable. The Nation. Pakistan leaves India behind in WEF’s development index Pakistan has been ranked 52nd, ahead from India (60th), among 79 developing economies in the Inclusive Development Index (IDI), according to a World Economic Forum (WEF) report. The index is based on 12 performance indicators. In order to provide a more complete measure of economic development than GDP growth alone, the index has three pillars — growth and development, inclusion and intergenerational equity, and sustainability. China is ranked 15th, Nepal 27th, Bangladesh 36th and Pakistan 52nd. Two BRIC nations, Russia and Brazil, are at 13th and 30th places, respectively. Dawn. Diamer-Bhasha Dam will also be part of CPEC: Ahsan While briefing the Parliamentary Committee on CPEC, Planning & Development Minister Ahsan Iqbal has said that DiamerBhasha Dam would also be part of the CPEC and that 11,000MW of electricity would be added to the national grid by 2018, 5,000MW under the CPEC and 6,000MW under non-CPEC projects. The Minister also explained that there is an agreement on giving priority to the construction of the western route of the CPEC as well as up-gradation and dualisation of KarachiTorkham railway line at the cost of $ 8Bn. Furthermore, all four provincial capitals, Lahore, Karachi, Quetta and Peshawar would have rail-based mass transit system as part of the CPEC. BR. Second LNG regasification vessel to arrive in Jun’17 Work on the second liquefied natural gas (LNG) floating storage and regasification unit (FSRU), which will be deployed in Pakistan, has finished and it will set sail for Karachi in Jun’17. It will provide 600Mn cubic feet per day (mmcfd) of regasification facility to state-owned Pakistan LNG Terminals Limited (PLTL) under a 15-year contract at a tariff of $ 0.4177 per million British thermal units (mmbtu). Tribune. OGDCL to add 100mmscfd gas in winter The Oil and Gas Development Company (OGDCL) is all set to add 100Mn cubic standard feet per day (mmscfd) gas, 400 metric tons of liquefied petroleum gas (LPG) and 4,000 barrels per day (bpd) of crude oil during the current winter. The govt. has planned to add at least 180 mmscfd of natural gas in the national transmission system in the current season to meet growing energy needs. OGDCL, being the largest exploration and Production Company in Pakistan, recently achieved the highest ever crude oil production of 50,157 bpd. The News. Plan to lease out Pakistan Steel Mills for 45 years As Pakistan Steel Mills (PSM) continues to pile up liabilities, the government is considering leasing the country’s largest industrial complex to a private concern for 45 years under a revenue sharing arrangement, and laying off almost 5,000 employees. Transaction committee discussed various options in this regard, based on which the Privatization Commission’s board will meet to decide the duration of the lease. The PSM’s accumulated losses and liabilities, which stood at PKR 26Bn at the end of 2008, have increased to around PKR 415Bn, including PKR 166Bn payable liabilities. The government has injected over PKR 85Bn out of the federal budget for various bailout packages since then. Dawn. Hydropower projects: mismanagement of Wapda inflicts huge losses to exchequer Wapda has reportedly mismanaged different hydropower projects, including 969MWs Neelum Jhelum hydropower project and 1,410MW Tarbela Fourth Extension inflicting billions of rupees financial loss to the national exchequer. The cost of Neelum Jehlum has increased from PKR 15Bn to PKR 500Bn whereas billions of rupees have been wasted on Tarbela 4th Extension under the guise of accelerated work. BR. Net assets in cash: AMCs directed to maintain at least 5% The SECP has made it mandatory for all Asset Management Companies (AMCs) to maintain at least 5% of net assets in cash under the head of equity funds in line with the new liquidity requirements for mutual funds. The SECP has directed all AMCs to comply with the new requirements by Feb. 15, 2017. An AMC shall arrange committed credit lines from banks/DFls equivalent to 15% of net assets of each fund latest by Mar. 1, 2017 for redemption purposes. BR. Punjab govt. releases PKR 282Bn for development during six months Punjab released PKR 282Bn of the total development budget of PKR 550Bn during the first 6 months of the ongoing fiscal year, which was 38% higher than the amount released in the comparative period of the previous year. The released amount was meant for 6,080 development projects across Punjab, this included PKR 44.5Bn for education, PKR 29.8Bn for health, PKR 24Bn for water supply and sanitation and PKR 3Bn for sports and youth affairs. Out of the full-year development budget, PKR 169Bn has been earmarked for social sectors, PKR 42.5Bn for health, PKR 68Bn for education, PKR 158Bn for infrastructure development, which includes roads, irrigation and public building sectors, and PKR 29.2Bn has been allocated for agriculture and livestock sectors. Tribune. Economic Indicators List of Indicators Date / Period Unit Value Change Daily USD-Interbank 16-Jan PKR 104.86 0.01% USD-Open MKT 16-Jan PKR 104.86 -3.27% KSE-100 index FIPI 16-Jan Pts. $ Mn 48,889 -12.14 -1.27% NM** -0.49% Crude (MA'17) 16-Jan 16-Jan $/bbl 53.06 Gold (FE'17) 16-Jan $/oz 1,202 0.40% Gold (10g) Local 16-Jan PKR 43,500 -0.10% Silver (FE'17) 16-Jan $/oz 16.82 0.15% Cotton(KHI)-40 kg 16-Jan PKR 6,977 0.00% Kibor-6M 16-Jan % 6.11% -0.01% 6-Jan $ Bn 23.20 WoW 0.16% Remittances Jul-Dec 16 $ Bn 9.46 -2.27% Exports* Jul-Dec 16 $ Bn 9.91 -3.82% Imports* Jul-Dec 16 $ Bn 24.40 10.10% Forex Reserves YoY Trade Balance* Jul-Dec 16 $ Bn -14.49 -22.20% Current Account Avg. CPI-FY17* Jul-Nov 16 $ Mn % -2,601 3.88 -90.97% Jul-Dec 16 Nov-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 175 165 155 145 GBP, 16-Jan-17, 126.4 135 125 115 EUR, 16-Jan-17, 111.3 USD, 16-Jan-17, 104.8 105 95 85 75 Jan-16 Apr-16 USD Jul-16 GBP Oct-16 Jan-17 Source: KCCI Research ; Oanda.com EUR Quote of the Day "Choose a job you love, and you will never have to work a day in your life." Confucius Chart of the Day Pakistan's Foreign Private Investment (1HFY06-1HFY17) 1HFY17 0.83 1HFY16 0.74 1HFY15 1HFY14 0.76 0.45 1HFY13 1HFY12 0.70 0.42 1HFY11 1.07 1HFY10 1.28 1HFY09 2.19 1HFY08 2.45 1HFY07 2.49 1HFY06 1.48 0.00 0.50 Value in $ Bn 1.00 1.50 2.00 2.50 3.00 Source: 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