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Mar 05 - 11, 2001

Govt. may invite EoI for PTCL sell off in March

The government has finalized all arrangements to privatize the Pakistan Telecommunication Company Limited (PTCL), said a spokesman of the Privatization Commission.

He said on Tuesday as various concerns have been addressed, the company is ready for privatization particularly, to benefit the consumers and the taxpayers and the government is likely to invite Expressions of Interest (EOI) in late March.

The process has taken several years to address strategic and consumer concerns and ensures a competitive and level-playing field for the future.

"Through privatization, the government expects to achieve expansion of the telecommunications infrastructure, an enhancement in the variety and quality of services and fiscal revenues that would be used to retire high interest debt", he added. These would be particularly beneficial to the average consumer and taxpayer, the spokesman pointed out.

He further stated that the current effort to privatize PTCL began in 1998 with the appointment of a top quality Financial Advisor (FA), which is consortium of firms led by Goldman Sachs International. The FA has advised on a privatization strategy and restructuring of PTCL, completed a legal technical and financial due diligence, and is conducting a valuation of the company.

He said the FA is now conducting a soft marketing of the company to leading telecommunications companies and potential investors worldwide. To enhance its capacity for marketing, Goldman Sachs plans to add another investment bank to its consortium, which is in accordance with the Financial Advisory agreement. The FA will be submitting its soft marketing report in early March, the PC spokesman explained.

He added that the government would invite EOI in late March. As required by the Privatization Ordinance advertisement for this purpose will be placed in both national and international newspapers.

Can Pakistan qualify for debt write-off?

Can Pakistan qualify for a debt write-off under the Enhanced HIPC Initiative that has recently changed the eligibility criteria for debt relief.

To be eligible, a country must be very poor, have an unsustainable debt burden and pursues good policies. And poor has been defined as both eligible for support under the IMF's Poverty Reduction and Growth Facility (PRGF) and for concessional financing from the World Bank, through International Development Agency (IDA). Currently, Islamabad is working hard to obtain PRGF package and concessional loans from the Bank to move towards sustenance level of debt.

Welcoming the debt rescheduling of $1.7 billion by Paris Club, Pakistan's Ambassador to the USA Dr Maliha Lodhi made a strong plea for "debt forgiveness." Addressing the G-8 summit the chief executive, Gen Pervez Musharraf, stressed that the developing world needed large scale debt relief to bring about stability necessary for development.

IMF may release second tranche

The review mission of the International Monetary Fund (IMF), headed by Ms Sena Eken, left Islamabad on Monday morning, giving a positive signal that the Fund might release second tranche under $596 million Stand By Arrangement (SBA), a senior finance ministry official told NNI.

"The mission that was due to leave for Washington on Friday (Feb 23) extended its stay in Pakistan for three more days to renegotiate the targets projected for this financial year," the official said.

The official did not give the details of the new targets negotiated between Pakistan and the IMF. He, however, said that due to drought-like situation, the new targets at macro-economic level had been settled with the Fund for this financial year.

Railways to raise fares

Pakistan Railway has decided to increase fares of economy class with effect from March 1. Informed sources said the railway has decided to increase the fares of economy class by about 10 per cent. However, there will be no change in the fares for journey upto a distance of 350km.

Chinese PM to visit Pakistan

Chinese Premier Zhu Rongji is expected to visit Pakistan before July, official sources said on Monday. "While Premier Zhu's exact schedule has not yet been conveyed to us, we expect him to visit South Asia within the first half of this year," an official told newsmen.

NIT-UBL venture

A joint venture agreement was signed between NIT and UBL on Monday, whereby NIT sales counters are proposed to be established at prime UBL branches, a press release issued by NIT said.

In the initial phase, NIT's sale/repurchase operations would begin from two designated branches of UBL, namely Shamsheer branch and North Nazimabad branch.

KSE MD appointed

The Karachi Stock Exchange on Monday announced the appointment of Noman Ahmed as managing director of the exchange.

A KSE press release introduced Noman Ahmed as a holder of first class honours degree in Technology and Business Studies from the University of Strathclyde in Glasgow and a member of the Institute of Chartered Accountants of Scotland. He completed his articleship with KPMG Peat Marwick McLintock in 1988.

No down-sizing in GCB after buyout: Khoja

Pakistan Industrial Credit & Investment Corporation (PICIC) that has bought controlling shares of Gulf Commercial Bank does not intend to close down any of its branches or lay off employees.

Managing Director of PICIC Muhammad Ali Khoja said this in response to a question while speaking at a press conference at GCB head office on Monday.

Khoja said after buying 60 per cent of GCB shares for Rs670 million, PICIC had taken over the management control over the bank and inducted six directors on an eight-member board of directors of GCB. "But we are not going to close down any of the 15 branches of Gulf Commercial Bank nor we are laying off any of its 260 employees," he said.