Pakistan Daily Economy Update - 17 March

Transcription

1. Mar . 17, 2018 KCCI - eBulletin Pakistan happiest country in region: UN report Pakistan ranked 75 in the global list of the happiest countries, and came at the top of the Saarc nations, while Finland topped the list, according to the United Nations' Sustainable Development Solutions Network’s 2018 World Happiness Report. The report ranked 156 countries based on criteria including per capita income, social support, healthy life expectancy, social freedom, generosity and absence of corruption. Pakistan rose from 80th place in 2017 to 75th place this year while all of its neighbors slid from last year's happiness rankings. India dropped 11 places from its previous rank of 122, Bangladesh came at 115 while Sri Lanka was ranked 116; Afghanistan stood at 145. The News. Economic Indicators List of Indicators Date / Period Unit Value Change Daily 16-Mar PKR PKR 110.57 111.55 0.00% -0.04% Pts. $ Mn $/bbl 43,363 -10.18 61.25 -0.30% NM** 0.44% USD-Interbank USD-Open MKT Crude (MY'18) 16-Mar 16-Mar 16-Mar 15-Mar Pakistan’s economy in no dire straits, says Ismail Pakistan will have no issues in arranging foreign financing to meet its emerging needs, said Adviser to the PM on Finance Dr. Miftah Ismail, a day after the IMF said the country’s net international reserves, after excluding its foreign exchange liabilities, stand at negative $724 Mn. Ismail, while addressing the media, said IMF’s methodology through which it arrived at the figure, is different. He said that external debt payments capacity weakened due to contraction in exports for three consecutive years. The trend in exports has reversed and Pakistan’s external sector position would now start improving. Tribune. Gold (AP'18) Gold (10g) Local 15-Mar 16-Mar $/oz PKR 1,316.2 48,600 -0.69% 0.18% Silver (AP'18) Cotton(KHI)-40 kg 15-Mar 16-Mar $/oz PKR 16.35 8,038 -1.00% -1.31% Kibor-6M 16-Mar % 6.48 $ Bn 18.24 0.00% WoW -0.49% Business turnovers growing: Miftah PM’s Financial Advisor Miftah Ismail has said that state of Pakistan's economy is very good and "there is no issue" while increase in revenue indicates that business turnovers are increasing. Speaking after the IMF first post-program monitoring report, the advisor said that in FY18, 6% GDP growth rate is expected, which will be the highest in the decade, inflation is below 4% and revenue collection is increasing. He, however, acknowledged some challenges to the current account deficit and budget deficit. BR. Remittances 9-Mar FY18 Jul-Feb 18 $ Bn 12.83 YoY 3.41% Exports* Imports* Jul-Feb 18 Jul-Feb 18 $ Bn $ Bn 14.85 39.13 11.66% 17.19% Jul-Feb 18 Trade Balance* $ Bn -24.28 Jul-Jan 18 Current Account $ Mn -9,156 Foreign Direct Inv. $ Bn 1.94 Jul-Feb 18 Jul-Jan 18 LSM Growth* % 6.33 % 3.84 Jul-Feb 18 Avg. CPI Discount Rate % 6.00 Jan-18 WoW= Sources: KCCI Research, PMEXweek , NCCPL, KSE, SBP, PBS* ** Not Meaningful on week; -20.85% -48.11% 15.64% China FTA nearly done Pakistan and China have agreed to offer 0% duty on 70% tariff lines to each other under the revised Free Trade Agreement, where Pakistan will do it in a period of 15 years while China will reduce tariffs in 5 years. The understanding was reached in the 9th round of negotiations on China-Pakistan FTA held in China recently and both sides are expected to strike a deal soon. The attempt to seek unilateral concessions did not materialize as China is unwilling to open its market unilaterally for Pakistan and wants similar concessions in return. During FY17, Pakistan lost PKR 32Bn on account of duty exemption on imports from China under the FTA. Dawn. FDI jumps 15.6% on massive Chinese inflows Pakistan’s foreign direct investment (FDI) surged by 15.6% in 8MFY18, largely drawing strength from massive Chinese inflows under CPEC. Data released by the SBP showed that FDI during the period increased to $ 1.94Bn from $ 1.68Bn in 8MFY17. FDI inflows from China reached $ 1.28Bn, an increase of 139% while investments from the UK rose to $ 205.5Mn against $ 139.9Mn last year. Most of the investment went into power, construction and financial sectors. In Feb’18 alone, the FDI inflows were recorded at $ 340.8 Mn, compared to $ 146.7Mn in Feb’17. During period under review. FDI for full year 2018 is expected to be around $ 3-3.5Bn.The News. LSM growth speeds up 9.44% in January to highest in nearly a year The Large scale manufacturing (LSM) sector posted a gigantic 9.44% y-on-y growth in Jan’18 on increase in cement and steel consumption attributed to CPEC related developments and rising auto sales. Pakistan Bureau of Statistics (PBS) data showed that cumulative LSM growth was recorded at 6.33% 7MFY18 as compared to 3.45% for 7MFY17. Iron and steel production rose around 34%, followed by automobiles (21.23%) and non-metallic mineral products (12%). The News. \ Asian Bank backs PIA, PSM privatisation Asian Development Bank has assured Pakistan that it could extend financial and technical support for the privatisation of PIA and the Pakistan Steel Mills (PSM). During a meeting with Werner E. Liepach, ADB Director-General for Central and West Asian Department, Privatisation Minister Daniyal Aziz informed that the Cabinet Committee on Privatisation (CCOP) has already approved a 30-year concession transaction structure for PSM which includes a tripartite concession agreement between the govt., PSMC and the investor for a period of 30 years on the basis of revenue sharing. Dawn. Govt. to obtain $ 6.89Bn from development partners, NA told Pakistan will obtain $ 6.89Bn from various bilateral and multilateral development partners along with economic assistance/loans this year. State Finance Minister informed that as per the break-up, country intends to obtain $ 1.82Bn from ADB; $ 1.22Bn from WB; $ 1Bn from International Islamic Trade Financing Corporation (ITFC); $ 1.80Bn from Asian Infrastructure Investment Bank and loans from other multilateral sources. BR. IMF expects Pakistan’s external debt to reach $ 144Bn by 2023 The IMF, Post-Program Monitoring report, has projected Pakistan’s external debt and liabilities could peak to $ 144Bn in the next five years from $ 93Bn in current FY18. The IMF has also estimated that the country’s foreign currency reserves would continue to decline and could touch $ 7.08Bn by 2023 from $ 12.09Bn currently held by the SBP. More alarmingly, total external debt servicing would reach $ 19.7Bn by 2023 against $ 7.74Bn the FY18, indicating immense pressure on the country’s external accounts. The News. Mega Conglomerate acquires 15.7% shareholding in Hubco for $174m Pakistan has got another investment of approximately $ 174 Mn in the power sector. Mega Conglomerate has acquired a substantial shareholding in Hubco from Dawood Hercules and Cyan Limited. The conglomerate has purchased a total of 182.58 Mn shares in at PKR 106.50 per share. Tribune. Provinces can face up to 40% water shortage in Kharif Indus River System Authority (Irsa) has convened meeting of technical committee on Mar. 22, 2018 to determine the provincial water share for the upcoming Kharif season. As per rough estimates, provinces can face up to 30% to 40% water shortage during the first month of Kharif season, starting Apr. 1, 2018. The Nation. KSE-100 index FIPI Forex Reserves Major Currencies 165 GBP, 15-Mar-18, 154.4 155 145 EUR, 15-Mar-18, 136.6 135 125 115 105 USD, 15-Mar-18, 110.6 95 Mar-17 USD Jun-17 GBP EUR Sep-17 Dec-17 Source: KCCI Research ; Oanda.com Quote of the Day "Any fact is better established by two or three good testimonies than by a thousand arguments." Nathanial Emmons Chart of the Day BREAK UP OF FOREIGN DIRECT INVESTMENT RECEIVED BY PAKISTAN (8MFY18) Netherlands 2% Hungary 3% Switzerland 3% Others 6% US 3% Malaysia 6% China 66% UK 11% 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