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Jan 03 - 16, 2000

  1. International
  2. Finance
  3. Industry
  4. Policy
  5. Trade
  6. Gulf

Pact with non-Paris Club within two months

Negotiations with six non-Paris club countries for signing debt rescheduling accord worth $500 million are believed to be concluded within two months span, well placed sources told.

However agreements with 12 out of 18 Paris Club countries have already been inked while another rescheduling agreement with Russia will be signed on Friday, the sources stated.

Negotiations for debt relief accord with remaining five Paris Club member countries are presently at advanced stage and would be completed by the end of next month (January 2000).

Loan rescheduling accords signed with 13 countries amounted to around $2 billion including an agreement signed with France for $395 million, sources added maintaining, the whole process of signing agreements with 18 Paris Club countries worth $2.8 billion would be finalized by the next month.

The negotiation process for signing debt relief pact with non-Paris club member countries including China, Saudi Arabia, Kuwait, UAE, Libya and Czech worth $500 million will be completed by February 2000, sources stated.

The sources said that Pakistan will not be facing any problem in getting debt relief from the non-Paris and remaining Paris Club member countries.

Pakistan has already requested the Paris Club Secretariat for extension in the final date for negotiation beyond Dec 31, 1999 sources said hoping, all agreements would be finalized within the extended span.

The bilateral agreements, signed so far, included $926 million accord with US, $255 million with Germany, $11.63 million with Norway, $81 million with Sweden, $22 million with Austria, $23 million with Spain, $4 million with Denmark, $30 million with Netherlands, $42 million with (CIDA, $27 million, Canadian Wheat Board, $15 million) with Canada, $35 million with South Korea and $395 million with France.

Bank deposit

Banks did not experience much of the Y2K heat in Pakistan —not at least in terms of panic driven withdrawals.

Nobody can say how many people withdrew how much money in fear or fever of millennium bug during past two weeks. But top bankers estimate the withdrawals that might be linked to the Y2K problem around Rs10-12 billion or slightly more. The amount represents just one per cent of total deposits of RsllOO billion of all the banks.

They say around Rs30 billion had been withdrawn from banking system during past two weeks of which withdrawals of Rsl5-20 billion fell in the routine category. Bankers say the system sees withdrawals of Rsl5-20 billion almost every year toward the end of Ramazan and at the closing of the year. "This year the routine withdrawals should be closer to Rs20 billion because of a three -day bank holiday," one of the bankers said.

That is why senior bankers estimate Y2K-related withdrawals from banks around Rs10-12 billion or more.

Reserves down at $ 1. 503bn

Foreign exchange reserves fell $32m to $1.503bn on Dec 25 from $1.535bn on Dec 18.

The latest State Bank statement reveals that on Dec 25 approved foreign exchange reserves worth $1.240bn whereas balances held abroad totalled $263m.

On Dec 18, the approved forex reserves stood at $1.295bn whereas balances held abroad in foreign currencies and short term securities totalled $240m.

SBP pumps in Rs4.5bn

The State Bank on Thursday pumped in Rs4.45bn in inter-bank market through purchase of treasury bills of one-week to maturity at 11%.

Senior bankers said the SBP pumped in the amount at its open market operation. They said the two-way OMO attracted total bids worth Rs 13.175bn. Of this SBP scrapped Rs5bn bids for one month T bills and accepted Rs4.450bn bids out of Rs 8.175bn bids for one-week TBs.

Rs1.27bn loan for Rabi crop

The Punjab Provincial Cooperative Bank Limited (PPCBL) has so far disbursed Rabi crop production loans worth Rs 1.27 billion to 83305 farmers through 8702 cooperative societies.

The bank plans to advance Rs 2.7 billion to the growers of wheat, oilseed and fodder crops by Jan 31.

A spokesman of the PPCBL said here on Thursday that the bank had also recovered an amount of Rs 1.17 billion advanced to the growers for Kharif-1999 crop.

$ 400m French loan rescheduled

France rescheduled $400 million loan to Pakistan, according to a handout issued here on Thursday.

In the framework of the agreement signed with the Paris Club in January 1999, Pakistan and France reached an agreement on December 24 in Paris regarding the rescheduling of Pakistan's debt.

Under the terms of this agreement, the debt servicing of French bilateral loans of $400 million due from July 1,1998 to December 31, 2000, has been rescheduled. It represents a significant contribution of 14 percent of the total debt re-scheduling of Pakistan. The interest rate applicable to the re-scheduling of the ODA loans will be the average rate of the initial credits, concludes the handout.

Rupee gains 25 paisa

The Eid shopping spree has led the rupee to gain another 15 paisa against the dollar in the open market.

Currency dealers said the rupee closed at 53.90/53.95 for spot buying and selling on Wednesday down from 54.05/54.10 on Tuesday. The total gain the rupee has made against the greenback in two days comes to 25 paisa. On Monday the rupee had traded at 54.15/ 54.20 to a dollar.

PTCL earns

Pakistan Telecommunication Company Limited (PTCL) has earned a net profit of Rs4.547 billion before tax for the quarter ended September 30,1999.