Pakistan Daily Economy Update - 20 October

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1. Oct . 20, 2017 KCCI - eBulletin Revised PMs Package notified Commerce and Textile Ministry has notified revised Prime Minister's incentive package for exporters (non-textile sectors), under which 50% of the drawback of local taxes and levies shall be provided without condition of increment in exports. In this regard, SRO 1062 (1)12017 has been issued which extends to the whole of Pakistan including export processing zones and shall come into force at once. The drawback under this Order shall be provided for the shipments made from Jul. 1, 2017 to Jun. 30, 2018. The drawback shall be provided to units on exports of products under specific tariff codes of the Pakistan Customs Tariff. The drawback shall be available only to units. BR. Reserves rise Pakistan’s total liquid foreign exchange reserves rose to $ 20.05Bn on 13th Oct from $ 19.6Bn a week ago where SBP’s foreign exchange reserves increased $ 370Mn to $ 14.15Bn in the week compared to $ 13.7Bn in the previous week. Net foreign exchange reserves held by commercial banks amounted to $ 5.9Bn. Dawn. Investors to provide IBAN for account in CDS Central Depository Company (CDC) has made it mandatory for account holders to provide International Bank Account Numbers (IBAN) as part of the registration details for existing and new accounts in the CDS. As per Section 242 of the Companies Act, 2017, all listed companies required to pay cash dividend directly into the bank accounts of their shareholders electronically. This amendment will facilitate the electronic payment of cash dividends directly into the bank account of shareholders, making the process more transparent, efficient, and in line with international best practices. The Nation. Revenue board urged to restrain officers from misusing AML laws Tax practitioners have urged FBR to restrain tax officials from misusing anti-money laundering laws and harassing taxpayers. Letter sent to FBR chairman, stated that tax officers were issuing notices under Anti-Money Laundering (AML) Act, 2010 to third parties seeking information with the argument that the person was being investigated for money laundering. The News. CDWP approves 31 development projects worth PKR 360Bn The Central Development Working Party (CDWP) has sanctioned 31 development projects worth PKR 360Bn, including 12 mega projects valuing PKR 342Bn. DWP, include projects worth PKR 3.71Bn for energy sector. Three of the energy projects worth PKR 41.38Bn were referred to Ecnec for further approval. The News. Economic Indicators List of Indicators Date / Period Unit Value Change Daily 19-Oct 19-Oct 19-Oct 19-Oct 19-Oct 19-Oct 19-Oct 19-Oct 19-Oct 19-Oct PKR PKR Pts. $ Mn $/bbl $/oz PKR $/oz PKR % 105.42 107.30 41,558 -4.35 51.59 1,289.1 45,428 17.25 6,591 6.17% 0.01% 0.19% 2.02% NM** -1.32% 0.66% 0.47% 1.55% 0.00% 0.00% WoW 1.93% YoY 1.05% 10.84% 22.19% -29.75% -102.10% 56.33% USD-Interbank USD-Open MKT KSE-100 index FIPI Crude (DE'17) Gold (NO'17) Gold (10g) Local Silver (NO'17) Cotton(KHI)-40 kg Kibor-6M Forex Reserves $ Bn 20.05 13-Oct FY18 Jul-Sep 17 Remittances $ Bn 4.79 Jul-Sep 17 Exports* $ Bn 5.17 Jul-Sep 17 Imports* $ Bn 14.26 Jul-Sep 17 Trade Balance* $ Bn -9.09 Jul-Aug 17 Current Account $ Mn -2,601 Foreign Direct Inv. $ Bn 0.66 Jul-Sep 17 Jul-17 LSM Growth* % 12.98 % 3.39 Jul-Sep 17 Avg. CPI Discount Rate % 5.75 Sep-17 WoW= week Sources: KCCI Research, PMEX , NCCPL, KSE, SBP, PBS* ** Not Meaningful on week; Major Currencies 155 GBP, 19-Oct-17, 138.5 145 135 125 EUR, 19-Oct-17, 123.9 115 105 95 Oct-16 USD Jan-17 GBP EUR Apr-17 USD, 19-Oct-17, 105.1 Jul-17 Oct-17 Source: KCCI Research ; Oanda.com Quote of the Day Fee dispute delays start of second LNG terminal A dispute between SSGC and Fatima Fertilizer over fee payment for handling LNG imports has prompted Pakistan LNG Terminal Limited to weigh the option of diverting gas imports from Qatar to the second LNG terminal. PSO and Qatargas have an agreement on LNG supply, which is being \ handled by the first LNG terminal set up by Engro’s subsidiary Elengy Terminal Pakistan Ltd at Port Qasim. The second LNG terminal has also been built but Pakistan LNG Terminal has been unable to put in place a mechanism to start handling gas imports at the new facility. Tribune. Lynda Resnick Chart of the Day 202.5 423.4 170.0 27.5 -78.2 239.5 -91.5 0 -46.9 100 38.6 200 124.8 Pakistan Oilfields earns PKR 2.53Bn Pakistan Oilfields Limited (POL) has earned a PAT of PKR 2.53Bn (EPS of PKR 10.71) for 1QFY18, up 9% over the PAT at PKR 2.32Bn (EPS of 9.80). Dawn. -100 300 96.3 400 263.0 500 397.1 600 SECP nod mandatory for bond pricing agency business SECP has made it mandatory for the bond pricing agencies to seek approval of the Commission for carrying out such business. According to the Bond Pricing Agency Rules, 2017 issued by the SECP, no person shall carry on a business as a bond pricing agency or hold himself out as carrying on such a business unless licensed by the Commission as a bond pricing agency. BR. Saudi needs Aramco billions as recession slows austerity drive Saudi Arabia’s plans to sell state assets including a stake in energy giant Saudi Aramco are becoming even more important to its finances as a recession slows Riyadh’s effort to close a budget deficit caused by low oil prices. Last December, Riyadh released a plan to abolish the deficit by 2020, cutting it from $79Bn or 12.3% of GDP in 2016 via steps such as domestic energy price hikes and tax rises. Dawn. 507.6 700 (1QFY11 661.9 Foreign Investments in Pakistan -1QFY18) 119.5 Withdraw tax on widows and pensioners, Dar orders FBR The government has decided to exempt profits of National Savings’ Pensioners Benefit Account (PBA) and Behbood Savings Certificates (BSC) from the levy of 10% income tax. PBA and BSC are two National Savings schemes which cater to pensioners and widows and are exempted from withholding tax. Dawn. "It takes a nut to sell a nut." 1QFY11 1QFY12 1QFY13 1QFY14 1QFY15 1QFY16 1QFY17 1QFY18 Foreign Direct Investment Foreign Private Investment Values in $ Mn 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