Pakistan Daily Economy Update - 22 February

Transcription

1. February 22 , 2022 KCCI - eBulletin Govt required to come up with ‘effective’ strategy: KCCI President KCCI Muhammad Idrees has underscored that instead of further overburdening the masses, the govt. has to come up with an effective strategy to minimize the impact of inflation by subsidizing the rising POL prices, promote import substitution to shrink trade deficit, bring down the cost of doing business by reducing prices of utilities, taxes and duties so that the poor masses could survive and businesses could stay afloat. While referring to Finance Minister’s tweet about latest Numbeo’s cost of living index in which Pakistan was ranked the cheapest amongst 139 countries, he said that this ranking cannot be taken into consideration as it was mainly based on low rent and groceries index whereas the major components like low per capita income, rate of inflation, poverty and unemployment etc. have not been taken into consideration. He pointed out that the World Bank estimates that poverty ratio in Pakistan stood at 39.3% in FY21 using the lower-middle-income poverty rate of $ 3.2 per day income while 40% of households suffered from moderate to severe food insecurity. Pakistan’s major dependence on imported goods and its inability to diversify export commodities and markets remain major challenges for the country’s economy eating away valuable reserves. BR. Imran announces zero tax for IT freelancers PM Imran Khan has announced a zero tax rate for freelancers in the IT sector. Speaking at the launch of the National E-Tijarat Portal, he expected the country’s IT exports to reach $ 50Bn in a few years. Dawn. FBR’s sectoral audit selection illegal: SHC The selection of income tax audit of various sectors by the Commissioners on the instructions of FBR has been declared illegal by the Sindh High Court (SHC). These sectors include auto, cement, beverages, oil marketing, and ghee/ cooking oil companies. The root cause of this bunch of 96 petitions is sectoral audit notices of the FBR. According to the judgement, since there is no independent application of mind in giving reasons for selection of the petitioners, rather it is dependent on the directions of the FBR, it does not demonstrate a transparent exercise of powers by the Commissioner. BR. Pharma sector gets tax incentives The govt. has approved a tax incentive package for the Active Pharmaceutical Ingredient (API) industry to give a boost to its growth and ensure it is on a par with the industries in India, China and Bangladesh. Short-term incentives proposed in the policy included tax holidays, zero percent customs duty, imposition of regulatory duty and financial incentives like soft loans. For the long term, the establishment of API mega parks was proposed. Tribune. SBP to launch financing facility for maize crop SBP is all set to launch Electronic Warehouse Receipt Financing (EWRF) for maize crop today (22nd Feb’22), which will not only provide farmers with an adequate facility to store their produce but will also address their liquidity requirement as these receipts will be used as a collateral to avail financing from banks. Tribune. LG law: more proposed amendments approved by Sindh cabinet The Sindh cabinet, making further amendments in the Sindh Local Govt. (Amendment) Bill 2021, has approved placement of KMC mayor as member of the governing bodies of development authorities - KDA, MDA and LDA and chairman of Karachi Water & Sewerage Board and similarly the mayors/ chairmen of other districts where development and water authorities exist would be members of their bodies. BR. Electronic/online brokers: SECP decides to introduce concept SECP has decided to introduce the concept of electronic/online brokers in the stock market to provide investors with worldwide access to a variety of financial services. BR. Country set to become net phone exporter Pakistan’s telecom sector is witnessing a paradigm shift and as a result the country is on its way to become a net exporter of handsets from being an importer at present. According to statistics by PTA, Pakistan imported 28.02Mn handsets in 2019 alone. Now, the country produces around 25Mn phones. Tribune. 64% people dismayed over rising inflation Gallup Pakistan conducted the current survey regarding the major issue nagging the citizens from 22nd Dec’21 till 31st Jan’22 soliciting the viewpoint of 5,000 people across the country. A substantive increase was recorded in the number of respondents of a survey declaring inflation as their main source of concern and dismay from 44% in Jul’21 to 64% in Jan’22. The News. Security scenario: 132 grid stations declared ‘vulnerable’ The country’s 132 grid stations of Karachi Electric (KE), NTDC and Distribution Companies (Discos) have been declared ‘unsecure’ in the current security environment across the country. BR. \ Smuggled goods perturb FMCG sector The Fast Moving Consumer Goods (FMCG) companies in Pakistan have stated that smuggled or illegally imported products from Iran were posing significant threat to their profits and sales. According to a recent report from IPSOS, illicit trade in just five sectors was dealing a blow worth PKR 310Bn to Pakistan’s total annual tax collection. Tribune. Hardened criminals: Sindh govt decides to introduce electronic-tagging bill Sindh CM Syed Murad Ali Shah, presiding over a meeting to work out a strategy to eradicate street crimes in the megacity, decided to legislate on electronic tagging (E-tagging) of criminals involved in repeated crime and decided to start targeted operations against the muggers. BR. Raising loans from world capital markets: MoF given one-time umbrella permission The Federal Cabinet has reportedly granted one-time umbrella permission to the Finance Ministry to raise commercial loans from international capital markets through Eurobonds and Sukuks under Global Medium-Term Note (GMTN) Programs despite the fact that the Minister for Law and Justice termed umbrella approval as legally untenable. BR. Imports of petroleum products, foodstuffs surge Pakistan’s eatable import bill surged by 21.32% to $ 5.63Bn in 7MFY22 compared to $ 4.64Bn in 7MFY21 owing to higher international prices and massive depreciation of the rupee. Dawn. E&T collects PKR 76.636Bn in seven months Excise and Taxation (E&T) department has collected PKR 76.636Bn revenue in 7MFY22 as compared with PKR 54.408Bn during 7MFY21. PKR 6.86Bn was collected as motor vehicle tax while PKR 64.144Bn as infrastructure cess, PKR 530.77Mn as professional tax, PKR 127.134Mn as cotton fee, PKR 1.54Bn as property tax, and PKR 23.68Mn was collected under the head of entertainment duty. BR. LNG industry rebounds in 2021 As economies rebound from the impact of Covid-19 pandemic, the global trade of Liquefied Natural Gas (LNG) registered an increase of 6% to 380Mn tons in 2021. The rising LNG demand coupled with supply constraints kept gas prices volatile throughout the year. Tribune. EU Parliament’s top group suggests blacklisting Switzerland The main political grouping in the European Parliament has called for a review of Switzerland’s banking practices and for the country’s possible inclusion in the EU’s dirty-money blacklist after leaks of Credit Suisse documents. Media outlets published the results of investigations into a leak of data on thousands of accounts held at the bank in past decades and said they appeared to show clients which included human rights abusers and businessmen under sanctions. BR. List of Indicators Date / Period Unit Value Change Daily USD-Interbank USD-Open MKT 21-Feb 21-Feb PKR PKR 175.75 177.05 -0.06% 0.20% KSE-100 index FIPI 21-Feb 21-Feb Pts. $ Mn 45,363 0.12 -0.69% NM** Crude Oil 21-Feb $/bbl 92.65 1.12% Gold 21-Feb $/oz 1,912.1 0.21% Gold (10g) Local 21-Feb PKR 107,810 0.12% Silver 21-Feb $/oz 24.04 0.02% Cotton(KHI)-40 kg 21-Feb PKR 21,541 0.00% Kibor-6M 21-Feb % 10.83 0.00% Forex Reserves 11-Feb $ Bn 23.49 WoW -0.97% Remittances Jul-Jan 22 $ Bn 17.95 8.95% Exports* Jul-Jan 22 $ Bn 17.67 23.96% Imports* Jul-Jan 22 $ Bn 46.47 58.84% Trade Balance* Jul-Jan 22 $ Bn -28.80 -91.97% Current Account Foreign Direct Inv. Jul-Dec 21 Jul-Jan 22 $ Bn $ Bn -9.09 1.17 -829.11% 11.32% YoY Jul-Dec 21 LSM Growth* % 3.40 % 10.26 Jul-Jan 22 Avg. CPI Discount Rate % 9.75 Jan-22 Sources: KCCI Research, PMEX , NCCPL, KSE, SBP, PBS* ** Not Meaningful, WoW= week on week; YoY=Year on Year Major Currencies 255 245 235 225 215 205 195 185 175 165 155 145 Feb-21 GBP, 21-Feb-22, 240.3 EUR, 21-Feb-22, 200.5 USD, 21-Feb-22, 177.1 USD May-21 GBP Aug-21 EUR Nov-21 Feb-22 Source: KCCI Research Quote of the Day "A company is only as good as the people it keeps." Mary Kay Ash Sectors Attracting the Most FDI Inflows in 7M-FY22 ($ Mn) Power 794.70 Financial Business 240.44 Oil & Gas Explorations 158.71 Trade 119.66 Electrical Machinery 71.06 Telecommunications 65.04 Information Technology 37.93 Personal Services 33.77 Chemicals 33.54 Construction 32.69 0 200 400 600 800 Source: KCCI Research; SBP Note Smeda has invited applications for Growth Stage Start-up grants to provide financial support to entrepreneurs to meet capital or operating needs. The maximum grant size is of PKR 500,000 or 80% 1,400 Pakistanis having accounts? Names of 1,400 Pakistanis are also on the list of the world’s richest persons who have accounts in Credit Swiss Bank. On an average, each Pakistani of the total cost of goods / services. Please visit has over PKR 841.3Mn in his account. BR. http://nbdp.org.pk/nbdp_grants.php