FINANCE

 

Nov 04 - 10 , 2002

 

1.INTERNATIONAL

2. INDUSTRY

3. FINANCE

4. POLICY

5. TRADE

6. GULF


THREE DEBT RESCHEDULING ACCORDS SIGNED

Pakistan has signed three bilateral agreements with Spain, Austria and Turkey for the rescheduling of $200 million debt in line with last year's decision of Paris Club, a senior government official said.
Secretary Economic Affairs Division Dr Waqar Masood Khan told that dates were now being finalized for rescheduling of debt with Japan ($5.3 billion), Germany ($1 billion) and France ($1 billion).

 

"Hopefully we will sign these three new agreements by November this year to complete the process of bilateral agreements with donor countries," he added.

He said an agreement with Canada had been signed for the rescheduling of non-official development assistance (ODA) debt. An agreement for rescheduling of ODA was likely to be signed by next month, he added.

Pakistan is believed to have been told that Japan would reschedule its loans on a reduced mark up rate.

Informed sources said since the Bush administration had indicated that it would write off Pakistan's $1 billion debt out of total $3.2 billion debt, Japan could also follow suit.

They said there was also a possibility of debt swap by Japan for social sector funding as Britain and Canada had done the same after re-profiling of Pakistan's $12.5 billion debt by the Paris Club.

Sweden and Norway were also expected to reschedule their $200 million debt within this month.

Out of $12.5 billion debt, the US government has so far rescheduled its $3.2 billion debt for which a formal agreement has been signed between the two sides.

England and Canada have written off about $200 million loans, while a portion of their loans has also been converted into debt swap for poverty alleviation.

PETROLEUM PRICES CUT BY 43 PAISA

The Oil Companies Advisory Committee (OCAC) revised the petroleum products prices down by 0.21 to 1.21 per cent. The revised rates will be effective from Nov 1.

The petrol was brought down by 43 paisa to Rs35.21 per litre, HOBC by 41 paisa to Rs39.70 and kerosene by 4 paisa to Rs19.23 per litre. However, the light diesel oil was raised by 5 paisa to Rs17.88 per litre, says an OCAC press release.

The committee said during the last few fortnights, international product prices had risen sharply and this increase was primarily related to the volatile situation in the Middle East.

The situation somewhat eased during the last fortnight, reflecting on the international prices, which started declining.

The crude oil during the period on average has decreased from $27.55/barrel to $26.71 barrel, a decline of $0.84, while the fortnightly exchange rate improved by Rs0.19.

RUPEE SHINES

The rupee has gained 10 paisa against the US dollar in two days in the inter-bank market falling rising from 58.99 to 58.89.

Bankers said the rupee gained on increased inflow of foreign currencies both through exports as well as through remittances from expatriate Pakistanis. They said the demand for the dollar was low.

In the kerb market the rupee gained 10 paisa in two days. Money changers said it inched up to 58.85/58.90 for spot buying and selling against 58.95/59.00. But the Forex Association of Pakistan said the rupee gained five paisa in spot selling rising from 58.97/59.05 to 58.95/59.00.

YIELD ON ONE-YEAR TBS DOWN SLIGHTLY

The State Bank slightly lowered the cut-off yield on one-year treasury bills to mop up Rs37.4 billion from a not-so-liquid market.

Senior bankers said the central bank sold Rs40 billion one- year bills at a maximum yield of 6.91 per cent against the last cut-off of 6.99 per cent thus draining out Rs37.4 billion from the market. The auction of the bills had generated bids worth Rs62.7 billion at face value of which the SBP picked up Rs40 billion and rejected the remainder.

LENDING, DEPOSIT RATES GAP WIDENS TO 8.3PC

The gap between weighted average lending and deposit rates has widened from 4.8 per cent in June 1991 to 8.3 per cent at the end of June 2001. The State Bank makes this startling revelation in its annual report for fiscal year 2001/02.

The report admits that this increase in the banking spread is often cited to conclude that the financial reforms pursued in the 1990s were a failure. But it says that this interpretation is not correct.

PIA EARNS RS853M PROFIT

PIA has earned an operating profit of Rs853 million for the 3rd Quarter of the current financial year.

The results for the period January-September 2002 shows a pre-tax profit of Rs.1.40 billion, according to the report presented by PIA's Director Finance.

PSO PROFIT RISES TO RS1.04BN

Pakistan State Oil (PSO) posted after tax profit of Rs1.04 billion for the first quarter of the current fiscal year ended September 30, 2002, an increase of 176 per cent over the same period last year.

Profit before tax rose to Rs1.4 billion, registering an impressive growth of around 143 per cent.

SUBSCRIPTION FOR UMF

United Money-Market Fund (UMF) is being offered to investors for subscription from November 1.

An spokesman of the fund said UMF is an open-ended money market fund that will offer its units for investment to investors on a continuing basis. The fund will invest in securities such as treasury bills, government securities and corporate debt securities.

UMF will be managed by United Asset Management Company Limited (UMAC), a United Bank Limited group company.