FINANCE

 

Sep 23 - 29, 2002

 

1.INTERNATIONAL

2. INDUSTRY

3. FINANCE

4. POLICY

5. TRADE

6. GULF


JULY-AUG REMITTANCES UP AROUND $700M

Overseas Pakistanis sent back home $591.51 million in July-August 2002, three times more than what they had remitted in a year-ago period: In July-August 2001, the country had received only $172.65 million from Pakistanis working abroad.

 

The State Bank said in a statement that gross home remittances stood at $699.85 million in July-August 2002, up from $181.63 million in July-August 2001.

Gross home remittances include i.e. money sent back home by overseas Pakistanis plus encashment of foreign exchange bearer certificates and foreign currency bearer certificates; Haj remittances and remittances from Iraq-Kuwait war victims.

The central bank said that in August 2002 gross remittances rose to $286.07 million up from $87.91 million in August 2001.

The phenomenal rise in home remittances through official channels can be attributed to the fact that the gap between the official and open market exchange rates was almost negligible in July-August: At times the US dollar was dearer in the kerb market. This encouraged overseas Pakistanis to channelize their remittances through the banks.

Besides, the golden and silver cards scheme initiated by the government for those sending money back home through official channels also helped raise the remittances level.

Money changers say one of the reason for the levelling out of official and kerb market exchange rates was that the State Bank stopped dollar buying from money changers from July this year.

In fiscal July-June 2001-02 gross home remittances totalled around $2.39 billion up from about $1.09 billion a year earlier.

TEN-YEAR FDI IMPROVES MARGINALLY

Pakistan's potential to attract foreign direct investment (FDI) has improved marginally from 141 points in 1990 to 159 points in 2000, but its relative performance to secure FDI has reduced significantly from six points to two points.

This was the gist of "World Investment Report 2002" of the United Nations Conference on Trade and Development (UNCTAD), released by secretary, Board of Investment (BoI), Shuja Shah, on Tuesday.

The report revealed that FDI to Pakistan reduced from $530 million in 1999 to $305 million in 2000 and improved to $385 million in 2001. As percentage of gross capital formation, the $530 million FDI was 6.7 per cent, which has reduced to 3.9 per cent in 2000.

PETROLEUM PRICES RAISED BY 34 PAISA

The Oil Companies Advisory Committee (OCAC) on Thursday increased the prices of oil products by 20 to 34 paisa per litre after putting on hold the price revision for four days.

The PSO and Shell also raised the price of diesel by 1.4 per cent, thus making a total increase of 3.5 per cent since Sept 1, 2002. The PSO's new diesel price is Rs19.76 per litre, up 28 paisa from the previous rate of Rs19.48 per litre.

Shell has fixed the diesel price at Rs19.75, higher by 28 paisa when compared with the just-revised price of Rs19.47.

Caltex has set the rate at Rs19.76 per litre, up 27 paisa from Rs19.49 per litre.

Kerosene will now carry new price of Rs18.61 per litre as compared to Rs18.41 per litre, showing a rise of 20 paisa per litre. Light diesel oil (LDO) price was increased by 28 paisa per litre to Rs16.93 per litre.

PAKSAUDI FERTILIZER GOES TO FFC

The Privatization Commission on Thursday transferred the remaining 10 per cent shares (6 million) of Paksaudi Fertilizer Limited to the Consortium led by Fauji Fertilizer Company Limited at the rate of Rs135.85 per share.

CUT IN MARKUP ON LMM FINANCING

The State Bank has reduced the markup rate from 11 to 10 per cent for the borrowers availing of part-A of Locally Manufactured Machinery (LMM) scheme which relates to the local sales.

The State Bank's markup rate for providing refinance to banks and development financial institutions against LMM has also been reduced from 9 to 8 per cent.

SBP AGAIN SUCKS IN RS26.3BN

The State Bank on Wednesday had to suck in Rs26.3 billion from the inter-bank market against the target of Rs16 billion to avoid reduction in cut-off yield on six-month treasury bills. On Monday and Tuesday also the SBP had siphoned off Rs9.8 billion and Rs7.1 billion, respectively, through its open market operations from a highly liquid inter-bank market.

BANK DEPOSITS

The State Bank of Pakistan (SBP) is now working on bank deposit insurance scheme to assure small depositors that their funds are secure. The bulk of the bank deposits come from small savings.

Sources said that with the United Bank sell-off, more than 50 per cent of the assets of the banking system would be in the private sector as against well over 90 per cent in state sector in 1990.

RUPEE SHINES

The US dollar that held firm around Rs59.50 till last month and around Rs59.30 by the weekend fell below the crucial level of Rs59.20 in the inter-bank market on Tuesday.

SBP MOPS UP RS7.1BN THRU OMO

The State Bank on Tuesday started up to three-month dollar/rupee swaps with the banks to suck in surplus rupee liquidity from the inter-bank market.

Senior bankers said the central bank swapped $10-$15 million for rupees thereby mopping up Rs900 million to Rs1.2 billion from a highly liquid inter-bank market.

JULY-AUG FDI RISES BY 43.3PC

Inflows of foreign direct investment (FDI) during first two months of the current financial year amounted to $72.8 million.

In July-August last year, the FDI stood at $50.8 million which means that the FDI flow during July-August 2002 is around 43.3 per cent higher than last year, figures compiled by the State Bank showed. The government has projected a target to fetch $1 billion FDI during the fiscal 2002-03.