Pakistan Daily Economy Update - 30 January

Transcription

1. Jan . 29-30, 2017 KCCI - eBulletin SBP keeps policy rate unchanged at 5.75% Predicting an inflation rate lower than the target, the SBP has decided to maintain the main policy interest rate at 5.75%. The monetary policy has been unchanged since May 2016 due to stable economic indicators during 1HFY17. The average inflation rate was clocked at 3.9% during 1HFY17 where current trends suggest that the actual inflation would be lower than the target rate of 6% at the end of FY17. Yet the country’s current account deficit grew from $ 1.7Bn to $ 3.6Bn in the same period. Behind the deficit growing CPEC-related imports, a fall in exports, non-payment of the Coalition Support Fund, and a decline in remittances are some of the reasons of the ballooning deficit. Dawn. Sindh CM inspects ongoing development schemes in Karachi Sindh Chief Minister Murad Ali Shah has paid a surprise visit to various areas of Karachi in order to inspect ongoing development schemes. The Chief Minister said that the road from Karachi University to Safoora Chowrangi is in a bad shape and that the road on this portion be completed by Jul.’17. The Chief Minister was given a briefing about the Lyari Expressway being constructed with PKR 643Mn and would be completed by Feb.’18. BR. Assemblers decry non-utilisation of local trucks in CPEC projects The import of heavy vehicles (buses, trucks) has jumped 95% during 1HFY17 to $ 172Mn compared with $ 88Mn in 1HFY16 as all the items; machinery, raw material and even labor is now finding way from China for CPEC projects. The duty-free import of vehicles from China and other countries is eating into the share of local assemblers. The share of second-hand vehicles in total truck and bus sales has dipped to just 2-5% as compared to 30% few years back. Dawn. Dastgir offers huge relief to tanners Commerce Minister Khurram Dastgir Khan has announced the revival of 75% refund to the tanneries from Export Development Fund to share leather testing charges from international labs. While responding to the demand for abolition of 4% import duty on the raw hide and skin, the Minister promised to take up the issue with the FBR/ Finance Ministry so that it could be withdrawn to slash the input cost. BR. WB CEO sees progress in water dispute World Bank Chief Executive Officer Kristalina Georgieva ended a three-day Pakistan visit after having constructive discussions fully to understand all perspectives on the Indus Waters Treaty. The CEO has said that the govt. should speedily implement structural reforms needed to spur private investments. India, Pakistan and the World Bank are signatories to the Treaty and are in discussions about how to resolve disagreements the two countries have over India’s construction of two hydroelectric power plants. BR. SBP, WB ink agreement to achieve strategic goals SBP and World Bank (WB) have inked an agreement on technical cooperation for achieving the strategic goals under SBP's Vision 2020. This is the first such agreement signed by the WB on Reimbursable Advisory Services (RAS) with any country in South Asia region. SBP Strategic Plan (2016-2020) has been framed and built to focus on resolution of strategically important issues facing Pakistan's economy and the financial sector. Daily Times. Govt. urged to remove anomalies FBR-notified valuation tables Pakistan Real Estate Investors have urged the Federal govt. and FBR officials to remove anomalies in the FBR-notified valuation tables as they are acting as deterrents in the momentum of real estate activity which is now picking up in the country. They mentioned that property valuation tables for areas all over Pakistan were notified by FBR after consultation with the stakeholders however there were some exceptions where there were glaring valuation anomalies. Daily Times. FBR plans to spend PKR 512.88Mn on capacity building FBR is planning to spend an amount of PKR 512.88Mn ($ 5Mn) for strengthening the FBR's capacity in fiscal research & tax policy analysis and establishing a Private Cloud Data Centre under the Trust Fund for Accelerating Growth and Revenue (TAGR). The new tax reform initiatives have been agreed between the FBR and the World Bank (WB) under the implementation of the tax component of the Trust Fund for Accelerating Growth and Revenue (TAGR). BR. Economic Indicators List of Indicators Date / Period Unit Value Change Daily USD-Interbank 27-Jan PKR 104.86 0.01% USD-Open MKT 27-Jan PKR 107.55 0.00% KSE-100 index FIPI 27-Jan Pts. $ Mn 49,964 1.85 -0.46% NM** $/bbl 53.12 0.43% $/oz 1,192 -0.61% Crude (MA'17) 27-Jan 27-Jan Gold (FE'17) 27-Jan Gold (10g) Local 27-Jan PKR 42,600 -1.68% Silver (FE'17) 27-Jan $/oz 17.14 1.00% Cotton(KHI)-40 kg 27-Jan PKR 7,218 1.50% Kibor-6M 27-Jan % 6.12% 0.00% Forex Reserves 20-Jan $ Bn 23.25 WoW 0.24% 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% Trade Balance* Jul-Dec 16 $ Bn -14.49 -22.20% Current Account Avg. CPI-FY17* Jul-Dec 16 $ Mn % -3,585 3.88 -92.23% YoY Jan-17 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 Pakistan’s inclusion in emerging market list to boost investment Pakistan's inclusion in the emerging market list will be a great achievement which will create more investments opportunities, despite the challenging environment. The global index provider MSCI has reclassified its Pakistan Index to the higher status of 'Emerging Markets'. The MSCI is expected to announce this decision at a Semi-Annual Index Review in May’17. The decision will upgrade Pakistan from the status of 'Frontier Markets' to 'Emerging Markets' and is expected to generate inflows of global portfolio investment, amounting to $ 475Mn by the middle of 2017. Daily Times. Pakistan’s first Internet Exchange Point needs to be lauded The inauguration of Pakistan’s long-delayed first Internet Exchange Point (IXP) by the IT minister on 27th Jan’17, is a landmark in the country’s Information Communications Technology (ICT) history. Without a domestic the Internet Exchange Point (IXP), the entire internet traffic of the country goes outside its borders to get routed to its destination, even if the destination happens to be in the same room as the origin. Hence, by keeping the local internet traffic within the country, IXP helps in immense cost savings and improved quality. It also enables and encourages global players like Google to bring their servers to the country. More IXPs are planned at other locations in the country. Tribune. GBP, 29-Jan-17, 131.5 135 125 115 EUR, 29-Jan-17, 112.1 USD, 29-Jan-17, 104.8 105 95 85 75 Jan-16 Apr-16 USD GBP Jul-16 Oct-16 Jan-17 Source: KCCI Research ; Oanda.com EUR Quote of the Day “Protect your good image from the eyes of negative viewers, who may look at your good appearance with an ugly fiendish eye, and ruin your positive qualities with their chemical infested tongues.” Michael Bassey Johnson US hints at extending visa ban to Pakistan A day after US President Donald Trump ordered no-visa policy for seven Muslim states. White House official hinted that the ban could be extended to other countries, including Pakistan. Earlier, Trump signed an executive order on 27th Jan’17 to pause the entry of travelers from Iran, Iraq, Libya, Somalia, Sudan, Syria and Yemen for at least 90 days. Daily Times. CASA-1,000 delayed as French firm seeks more time The award of contract for the supply of converter stations under the Central Asia-South Asia (Casa) 1,000-megawatt power import project has been put off again following a request from French company Alstom to extend the bid-filing deadline to Apr’17. Four countries that are part of the project: Tajikistan, Kyrgyzstan, Afghanistan and Pakistan have agreed to give relaxation in the time frame keeping in view the request of Alstom, which is a credible name and a major supplier of converter stations across the world. Earlier, the Casa-1,000 project was expected to be completed by the end of 2017 or the beginning of 2018. However, the target will be missed due to the delay in the award of tender for the setting up of converter stations. Now, the project is likely to be ready in 2020. Tribune. Jul-Dec 16 Chart of the Day Pakistan's Import of Core Oil Products (Mn Tons) 9.0 8.0 7.0 6.0 5.0 4.0 3.0 2.0 1.0 Diesel Furnace Oil Crude Petrol Source: KCCI Research ; OCAC 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