Pakistan Daily Economy Update - 6 November

Transcription

1. Nov . 5-6, 2017 KCCI - eBulletin List of Indicators Informal trade rampant: banking channels with Iran not established yet Pakistan has not yet established banking channels with Iran for formal trade due to which exporters use third party means or informal ways to export their goods. Rice is being exported through informal channels (smuggling) at the border or via Dubai where Iranian companies purchase rice and dispatch it to Iran by using small ferries. Pakistan may not start trade with Iran through banking channels due to US pressure However, one Dubai-based Iranian party, namely Mohsin, has defaulted with a number of Pakistani parties which is why Iranian purchases are much less compared to previous years. Pakistan’s total rice exports have posted a 32% growth during 1QFY18 in terms of quantity and value.. BR – Sun. Crude (DE'17) Gold (DE'17) Gold (10g) Local Silver (DE'17) Cotton(KHI)-40 kg Kibor-6M Measures to cut trade deficit on the cards The Ministry of Commerce has suggested measures to curtail the widening trade deficit in the next few months. It has identified several factors that caused an increase in the trade deficit during the last few years. The measures are part of a report that was compiled after deliberations with different government agencies, including SBP and FBR. The trade deficit reached an all-time high of $ 32Bn last year. In 1QFY18, the trade deficit posted a growth of 30%. Imports of vehicles for CPEC-related projects and public transport also contributed to the rising import bill of the country. Dawn-Sun. Forex Reserves IBI assets grow by 16.6%, deposits expand by 17.7% Pakistan’s Islamic Banking Industry (IBI) continued its growth momentum and witnessed 16.6% expansion in assets while its deposits increased by 17.7% during FY17. According to SBP data, during the period under review, the IBI assets reached PKR 2.04Tn while deposits of the industry touched PKR 1.72Tn figure. The IBI share in overall banking assets and deposits also increased from 11.4% and 13.2% during FY16 to 11.6% and 13.7% respectively during FY17. The Nation – Mon. 125 EUR, 5-Nov-17, 122.7 115 105 95 Nov-16 USD Feb-17 GBP EUR May-17 USD, 5-Nov-17, 105.6 Aug-17 Source: KCCI Research ; Oanda.com Quote of the Day "To retain the loyalty of those who are present, be loyal to those who are absent." Stephen R. Covey Chart of the Day 91 82 500 89 Pakistan's Balance of Payments Position (1QFY14-1QFY18) 0 -2,000 -2,500 -1,058 -1,500 -1,637 -1,000 -1,932 -500 -3,000 -3,500 -4,000 -3,557 FBR mistreating businessmen: Asad Parliamentarian and former CEO of Engro, Asad Umar has condemned FBR for mistreating businessmen. Supporting the Fixed Tax Regime (FTR) for builders and developers, he said abolishment of FTR would open doors of corruption. He assured builders for raising this issue in the Standing Committee of the National Assembly meeting. Parliamentarian further said the ban on construction of high-rise buildings in Karachi would not affect only Karachi but also hit the country’s economy. Dawn-Sun. GBP, 5-Nov-17, 138.1 135 -1,675 Govt working on LPG price formula to curb excessive profit-making The govt. is reportedly working on a formula of “controlled deregulation” of liquefied petroleum gas (LPG) prices in an attempt to force the market to behave responsibly and rein in excessive profit-making. Under the plan, the govt. will not set the prices itself, rather LPG producers and marketing companies will fix gas rates in line with the given formula. At present, LPG prices are set by market forces but they do not follow any set formula. Petroleum product prices are set taking cue from the international crude oil market and after adjusting sales tax and petroleum levy; a similar pattern will be followed in the case of LPG prices too. Tribune. 145 -581 Deregulation of CNG price proving burden on motorists The deregulation of CNG price in Sindh has become a sheer burden on vehicle owners as some dealers have pushed up gas price by PKR 1 to 2 per kg. A rift among the members of the All Pakistan CNG Association has emerged over the past two days as some have raised the price while others are reluctant to follow suit. Some members have increased the CNG price on the pretext that price of petrol was also increased by PKR 2.49 per liter on 1st Nov’17 which obviously has no direct and indirect relation with CNG. DawnSun. Major Currencies 155 59 After Panama Papers: Paradise Papers shake and shock world A treasure trove of documents has further unmasked the secretive world of tax havens, shedding light on the connection between \ money and power, and further expanding the offshore club of Pakistanis. The new leak, named Paradise Papers, has shaken the world capitals with 13.4Mn documents. The newly-released documents were obtained by German newspaper Süddeutsche Zeitung and shared with the International Consortium of Investigative Journalists and a network of more than 380 journalists in 67 countries. As many as 135 Pakistani individuals with accounts in a Swiss bank have also been identified which they either created in their own name or through offshore companies. The News-Sun. 0.01% 0.00% 1.40% NM** -0.40% -0.51% -0.09% -1.75% 0.81% 0.00% WoW -0.30% YoY 1.05% 10.84% 22.19% -29.75% -117.29% 56.33% -1677 Country to face shortfall of around 4,500 megawatt The country is subjected to massive power load shedding with electricity shortfall hovering around 4,500MW. The reasons are low water level in reservoirs and smog-triggered tripping of system and fuel supply. The Power Division has claimed that there is no unscheduled load shedding in any part of the country which is clearly contrary to the ground realities. At present, shortfall is hovering around 5,000MW as power generation is 9,000MW while demand is 14,000MW, and all Discos are managing their loads according to their demand. BR – Sun. Change Daily 105.40 107.70 41,064 -8.45 54.51 1,270.6 45,471 16.83 6,752 6.17% 45 Commercial loans: $ 703Mn short-term agreements signed in 1QFY18 Economic Affairs Division (EAD) has revealed that govt. has signed short-term commercial loan agreements of $ 703Mn during 1QFY18 with different foreign banks of which $ 458Mn have materialized so far. The govt. budgeted $ 1Bn commercial loans from foreign banks for the entire year of which $ 458Mn i.e. 46% were procured during the period under review. The govt. is in negotiations with some other foreign banks and is expected to sign more agreements in the coming months to procure more commercial loans for budgetary support. BR – Mon. Value PKR PKR Pts. $ Mn $/bbl $/oz PKR $/oz PKR % -489 BoI to implement new investment concept to enhance FDI The Board of Investment (BoI) would implement the modern concept of super ministry and one-window operations for enhancing foreign investment through reforms and reconstructing of the institutions. In this regard, a consultative committee has been formed, which consists of senior officials of the establishment division and BoI to review and execute the reconstruction plan on modern lines. The News-Sun. Unit 3-Nov 3-Nov 3-Nov 3-Nov 3-Nov 3-Nov 3-Nov 3-Nov 3-Nov 3-Nov $ Bn 19.84 27-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-Sep 17 Current Account $ Mn -3,557 Foreign Direct Inv. $ Bn 0.66 Jul-Sep 17 Jul-Aug 17 LSM Growth* % 11.30 % 3.50 Jul-Oct 17 Avg. CPI Discount Rate % 5.75 Sep-17 WoW= week Sources: KCCI Research, PMEX , NCCPL, KSE, SBP, PBS* ** Not Meaningful on week; -1,315 Engro eyes 2019 start for new LNG terminal in Karachi Pakistani conglomerate Engro Corp expects to complete building its second LNG terminal in early 2019 which would easing gas shortages that have hobbled Pakistan's manufacturing sector and wider economy for more than a decade. Chief executive of Engro's LNG unit, Elengy Terminal Pakistan, said his consortium expects to sign a Final Investment Decision (FID) in the next few months and would then build the terminal in about a year. In this regard, all the technical studies have been completed. BR – Sun. Date / Period USD-Interbank USD-Open MKT KSE-100 index FIPI -1,179 PM’s package: government releases PKR 14Bn for phase-I In the 7th meeting of the reconstituted Federal Textile Board, Commerce Minister informed that govt. has released PKR 14Bn for the implementation of phase-I of the Prime Minister's Export Incentives Package against the exporter' claims of PKR 21.5Bn submitted to the SBP so far. It was further revealed that against the claims of PKR 21.5Bn, PKR 9.8Bn were disbursed to exporters while clearance of more claims are under process. PKR 4.5Bn are still available with SBP, but exporter' claims are under verification and the funds would be released after verification. However, PKR 30Bn under the sales tax refunds and PKR 7.5Bn under the customs duty refunds are still pending as of Jun. 30, 2017. BR – Sun. Economic Indicators 1QFY14 1QFY15 Current Account 1QFY16 Capital Account Values in $ Mn 1QFY17 1QFY18 Financial Account 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