FINANCE

 

Aug 05 - 11, 2002

 

1.INTERNATIONAL

2. INDUSTRY

3. FINANCE

4. POLICY

5. TRADE

6. GULF

 
WB TO GIVE $150M FOR BETTER FISCAL MANAGEMENT

The World Bank will extend $150 million for strengthening the accountability and reporting project which supports the government goals to improve public financial management and restore the integrity of state institutions.

 

Official sources said the objective of the plan was to increase the "accuracy, completeness, reliability, and timeliness of intra-year and year-end government financial reports in Pakistan at the national, provincial and district level."

The project aims at providing the government and the people of Pakistan with credible financial data in a reliable, comprehensive and timely manner at the national, provincial, district and tehsil levels with vital financial performance information throughout the year.

The project will also enhance the government capacity for designing a medium-term framework to prepare budgets on a rolling three-year basis and strengthen the government's administrative and management powers. However, the World Bank believed that the sustainability of the projects depended upon continued government commitment to the reform agenda.

The World Bank said that learning lessons from the past operations, a comprehensive reform was essential for the implementation of the capacity enhancement projects to succeed, and implementing agencies must include staff who were prepared to act as agents of change in order to maintain the momentum of improvements.

PETROL PRICES RAISED BY 25 PAISA

Except for cut in high speed diesel (HSD) and light diesel oil (LDO) prices by 27 paisa and nine paisa per litre respectively, the Oil Companies Advisory Committee (OCAC) on Wednesday increased the prices of petrol by 25 paisa per litre.

The committee has also raised the prices of high octane blending component (HOBC) by 26 paisa, kerosene by 42 paisa, JP-4 by 35 paisa and JP-1 by 38 paisa per litre respectively.

The new ex-depot fixed sale price will be effective from August 1 to 15 at the 29 designated locations, says a press release.

The new price of petrol has been enhanced to Rs33.84 per litre from Rs33.59 per litre, while kerosene will now cost Rs17.64 per litre as against Rs17.22 per litre.

The new rate of HOBC has been fixed at Rs38.33 per litre as compared to Rs38.07 per litre. The new ex-depot prices of JP-4 and JP-1 will be Rs16.19 per litre and Rs12.65 per litre as against previous rates of Rs15.84 per litre and Rs12.27 per litre respectively.

The price of diesel has been decreased to Rs19.08 per litre from Rs19.35 per litre, while LDO prices have been slashed to Rs16.16 per litre from Rs16.25 per litre.

POL PRODUCTS' PRICES ROSE

The prices of petroleum products have increased by an average of 67 per cent, including 126 per cent rise in the furnace oil's prices, since October 1999, according to official statistics.

After the increase in the prices of furnace oil, the prices of light diesel oil (LDO) went up by 90 per cent, high speed diesel by 79 per cent, kerosene by 68 per cent, JP-4 by 41 per cent, HOBC by 33 per cent and premium by 30 per cent.

The increase in the prices of the top two products furnace oil (126 per cent) and LDO (90pc) has had a direct bearing on the two largest and the most important sectors of the national economy, namely power and agriculture sectors.

FCY RETURN

The State Bank will pay 1.32 per cent return to the banks and non-bank financial institutions in August on their 20 per cent special foreign currency reserves, according to a SBP press release.

IN JULY BANKS AND NBFIS WERE GETTING 1.34 PER CENT RETURN.

The banks are supposed to keep 5 per cent of their new foreign currency deposits with the State Bank as mandatory cash reserves and 20 per cent as special reserves. Whereas there is no return on mandatory reserves the SBP pays a monthly return on special reserves. The rate of return is linked with LIBOR (London Inter-bank offered rates).

The two basis points cut in the return announced for August is thus attributable to falling LIBOR.

EXCHANGE COMPANIES

Money changers are divided over the minimum paid-up capital requirement set for the proposed foreign exchange companies: Big money changers say Rs100 million paid-up capital is affordable but smaller ones represented by Forex Association of Pakistan say it should be lowered to Rs50 million to prevent monopoly.

EXIDE, AUTOMOTIVE POST LOSSES

Exide Pakistan Limited and its independently listed subsidiary, Automotive Battery Company Limited posted after tax losses for the quarter ended June 30, 2002. Exide reported after tax loss amounting to Rs0.5 million and Automotive taxed loss of Rs1.2 million.

NWFP GETS $95M WB LOAN UNDER SAC

The World Bank has released over $95m loan to the North West Frontier Province (NWFP) from its Structural Adjustment Credit (SAC) facility, according to official sources.

In his budget speech on June 28, the provincial finance minister Farid Rehman had announced that World Bank would provide $90m loan to NWFP government during the 2002-03 financial year.

PUNJAB RECEIVES 71PC OF FARM LOAN

For a variety of reasons, farmers in Punjab continue to receive out of proportion bulk amount of agricultural production and development loans keeping farmers of Sindh, Balochistan, NWFP and Azad Kashmir fund starved.

Official figures show that during 01-02 fiscal farmers in Punjab were given more than Rs31 billion loans as against hardly Rs13 billion given to farmers in Sindh, Balochistan, NWFP and Azad Kashmir.