FINANCE

 

July 20 - Aug 04, 2002

 

1.INTERNATIONAL

2. INDUSTRY

3. FINANCE

4. POLICY

5. TRADE

6. GULF

 

BOI SEES $600M FDI IN 02-03

The Board of Investment (BoI) is projecting $600 million Foreign Direct Investment (FDI) for 2002-2003. It also said that there has been a 50 per cent increase in the flow of FDI during 2001-2002 compared to 2000-2001.

 

The flow of FDI during 2000-2001 were $322.4 million while it rose to $484.7 million during the last financial year.

"This shows that foreign investors have started reposing confidence in improving investment climate of Pakistan and business-friendly policies of the government," says an official announcement on Wednesday.

The leading sectors, which attracted sizable FDI during the period 2001-2002 are oil & gas ($268.2 million), power ($36.4 million), trade ($34.2 million), transport ($21.4 million), textiles ($18.4 million), electronics ($15.9 million) and information technology & telecom ($12.7 million).

Major investing countries are the US ($326.4 million), UK ($30.3 million), UAE ($21.5 million), Germany ($11.2 million), Switzerland ($7 million) and Japan ($6.4 million).

The BOI is making extensive efforts for marketing the investment potential and opportunities of Pakistan to the foreign investors. During the year 2002-2003, the BOI is planning to hold investment conferences in Middle East, the US, the European Union, China and Japan.

It has chalked out an investment marketing plan and will tap opportunities, which are now arising as a result of change in the perception for Pakistan. The investor friendly measures taken in new Budget and Trade Policy will bring a positive change and speed up the revival of economic activity.

PAKISTAN'S RESERVES TOUCH $6.9B

Pakistan's foreign exchange reserves shot to an all time high of $6.9 billion on the back of inflows from the International Monetary Fund and the World Bank, a spokesman for the State Bank of Pakistan (SBP) said.

Pakistan received the $115.3 million third tranche of a $1.31 billion IMF loan under its poverty reduction plan, Syed Wasimu-ddin, the spokesman, said.

The IMF approved the three-year loan in December to keep afloat Pakistan's ailing economy, that had been hit hard because of the U.S.-led war on terrorism in Afghanistan and a slowdown in the world economy.

Last week, the World Bank also issued a $202.1 million grant to Pakistan for structural reforms, he said.

Of the reserves, $4.8 billion is held directly by the SBP, while $2.1 billion is with commercial banks, he said.

WAPDA & KESC TO GET RS30BN

The government will extend Rs15 billion each to WAPDA and KESC as part of the subsidy to help remove their losses.

The Economic Coordination Committee of the Cabinet (ECC) which was presided over by Finance Minister Shaukat Aziz on Wednesday was informed about the decision of the government to provide a total of Rs30bn subsidy to both the state run organizations.

The meeting was further informed that the KESC's past losses of around Rs93bn have been converted into government equities to make it viable for privatization.

AHSL ANNOUNCES PROFIT

Arif Habib Securities Limited (AHSL) on Thursday, reported record profit of Rs253.6 million for the financial year ended June 30, 2002, which the company claimed represented the "highest profit earned by a listed securities company in Pakistan".

T-BILLS RATE UNCHANGED

The State Bank on Wednesday left the six- month treasury bills rate unchanged, reinforcing earlier signals that a further easing in monetary policy is out of question at least for the time being.

The SBP sold Rs10.7 billion six-month T-bills at a cut-off of 6.43 per cent keeping it intact at the previous level. "By keeping the cut-off unchanged we have reinforced our earlier signals that no immediate rate-cut is under review," said a SBP official, who refused to be identified.

CRES GROUP ACQUIRES STRATEGIC STAKES

The Crescent group (Cres Group) on Monday purchased strategic equity interest held by Pak-Libya Holdings Limited in First Leasing Company and Paramount Leasing for Rs175 million, it is learnt from reliable sources.

Both publicly traded companies First Leasing Limited and Paramount Leasing Limited are already understood to be in advanced talks for merger, which would create "First Paramount". A week ago, Crescent Modaraba another Cres group company had initiated its merger with Altowfeek Investment Bank to form the "First Standard Investment Bank Limited".

42,341 CARS SOLD IN 2001-02

Automobile assemblers sold 42,341 motor cars during the last fiscal year ending on June 30, 2002 as against 38,047 cars sold during 2000-01.

Automobile buyers have been complaining of prolong waiting period of the popular makes and new models of motor cars during last several months. Automobile companies collected huge amounts as down payments from the customers but had been delaying the delivery and earning substantial profits on the deposits.

BUDGET IMPACT ON CONSUMER BANKING

How the budget 2002-03 is going to impact on consumers banking is an important issue because people falling in the middle income group make up a significant part of the retail clients of the banks. Let us see how the bankers see it.

Says country corporate officer of Citibank in Pakistan and the chairman of Pakistan Banks Association Zubyr Soomro: "The major contribution of this budget from the consumers' perspective is the introduction of the Universal Self-Assessment scheme under which people will be responsible for their own tax assessment."

"Similarly for major corporates and other substantial tax payers the setting up of large tax payers unit should ensure senior and thus quality attention and recourse and therefore build confidence," Soomro says in a statement.