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Feb 14 - 20, 2000

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

ADB to start $490m new lending programme

The Asian Development Bank (ADB) will provide another $490 million to Pakistan for five projects to be undertaken in 2000, in addition to $267.9 million, already sanctioned for existing programme.

"We have discussed and agreed with the Pakistani authorities to start a new lending programme of $490 million which includes $290 million ADB's soft loan window under Asian Development Fund (ADF) and $200 million under Ordinary Capital Resource (OCR) facility", said the head of the visiting Country Programme Confirmation Mission Bruce Carrad.

He said that ADB operational focus in 2000 will be on undertaking series of studies on poverty reduction to provide a clear strategy for Bank's long term involvement and broadening and deepening portfolio management practices to improve governance. Also the purpose was to strengthen poverty impacts of ADB's assistance, encourage reforms and continue to support province-based interventions to promote decentralization.

He pointed out that the agreed lending programme to Pakistan for 2000 was $490 million im addition to a Power Sector Restructuring Programme of $267.9 million and 15 technical assistance projects for total of $12.9 million.

Giving details, Carrad said that new lending has been agreed for five projects to be undertaken during 2000. The second NWFP Barani Area Development Project which will cost $40 million was being designed to improve social and nutritional well-being of the rural population, including women. The main components of the project include agriculture, rural roads, community infrastructure, rural credit and community organization.

ADB funding

The Asian Development Bank (ADB) has approved a technical assistance worth $995,000 for the purpose of capacity building for Debt and Risk Management of the Finance Ministry.

According to the official sources, under this techincal assistance, a professional treasury group will be created to manage the bond portfolio.

Conservative estimates show that effective debt and risk management would reduce total borrowing and debt service cost by at least 0.5 percent, the sources said.

It will also yield savings of at least $ 30 million annually, it added.

25 Modaraba cos declare cash dividend at 7.17pc

Twenty-five out of 48 Modaraba companies declared cash dividend for their certificate holders in 1999 at the average rate of 7.17 per cent, Modaraba Association of Pakistan (MAP) announced.

As a result of this performance, MAP office-bearers told newsmen, Modaraba sector had emerged as the leader among all the other non-bank financial institutions.

This was evident from the fact that the percentage of cash dividend declared by the mutual funds came to 6.9%, while the rates of dividend declared by leasing companies and investment companies came to 6.78% and 6.7% respectively.

Present on the occasion were MAP chairman, Mr Aminullah, vice-chairman Basheer Chowdhry and executive committee member Adil Ghaffar.

Foreign investment

Pakistan attracted US$ 306m worth of direct foreign investment in 17 specified sectors during the first six months of the current financial year, says a report of the ministry of finance.

The MoF report says that the largest foreign investment during this period was realized in the chemical, pharmaceutical and refineries sectors ($ 102.9m). The largest amount of investment received in this sector was in September 1999 ($ 58.6m).

Other sectors received the foreign investment during this period as follows: food, beverages and tobacco ($ 45.8m); mining, power ($42.4m); quarrying and oil exploration ($ 31.5m); financial business ($ 16.6m); transport, storage and communication ($ 14m), petro chemical and refining ($ 11m); construction ($ 10m); cement and sugar ($ 6m); trade ($ 4.7m); machinery, other than electrical ($ 2m), electrical machinery ($ 1.4m); metal products ($ 1.3m); textile ($ 0.9m); electronics ($ 0.6m); tourism, paper and pulp ($ 0.4m).

Banks asked to extend lending to smaller units

The Chief Executive, General Pervez Musharraf, has said that concentration of credit among selected few bank borrowers, large scale enterprises and that, too, in few cities, has led to the distortion of the economy.

He was addressing the heads of banks and financial institutions in the State Bank head Office on Wednesday.

He said only 1.2 percent of the total borrowers got 60 percent of the bank credit, four percent got 83 percent, while the remaining 96 percent got 17 percent of total credit, disbursed by banks.

UBL TezRaftaar

United Bank says its home remittance service TezRaftaar has been a success.

"There has been a 390% increase in the number of transactions processed till now as compared to those processed in the same period last year," a UBL press release said. "In terms of value the increase has been 350 per cent."

ATM service

Muslim Commercial Bank says it has signed an agreement with ANZ Grindlays to provide 24 hours ATM service to the customers of the two banks.

A press release said the agreement was signed on by Haroon Basheer of MCB and Abid Sattar of ANZ Grindlays.

MCB runs a network of over 1200 branches. ANZ Grindlays has 15 branches in Pakistan.

Rsl2bn accepted

The State Bank injected Rs 12.20 billion in interbank market by purchasing one-month treasury bills from banks at a maximum yield of 6.50 per cent.

SBP said it received Rs 13.10 billion offers for one-month bills at its open market operation of which it accepted offers worth Rs 12.20 billion and scrapped the rest.

SBP said it also scrapped Rs 2.0 billion offers for treasury bills of one week.