The forex reserves rose shot up primarily due to
increased home remittances or money sent back home by overseas
Pakistanis. Monthly home remittances that averaged at less than $100
million before September 11, 2001 now stand around $350 million.
Overseas Pakistanis have been sending more money back home through banks
as the US and the UAE and other countries tightened anti-money
laundering rules after 9/11 to starve the terrorist financially.
Larger inflow of home remittances in the past two
years has not only helped Pakistan build up its foreign exchange
reserves but has also improved its balance of payments. In fiscal
July/June 2001-02 Pakistan posted a current account surplus of $2.8
billion that increased further to $5.2 billion in 2002-03. This has
helped Pakistan economy in several ways creating more room for the
economic managers to implement a mix of home-grown and IMF-World Bank
recommended set of reforms in key sectors of the country's economy.
The rupee has also gained substantially in the wake
of 9/11 enabling expatriate Pakistanis to send more money back home
through official channels. On September 11, 2001 the dollar was selling
at Rs64 in the inter-bank market and at Rs67.10 in the open market. Two
years after the greenback is now trading at Rs57.77 in the inter-bank
market and at Rs58.15 in the open market.
PAKISTAN BACKS CALL FOR CUT IN TARIFF
Pakistan has joined hands with what is called the
club of 21 developing countries at Cancun and added its voice to the
call for special and differential treatment (S&DT), reduction in
subsidies and blend formula approach for tariff reduction on agriculture
products by the developed countries.Commerce ministry sources said that
the decision was taken following the club's decision to provide an
option separate from that of the United States and the European Union (EU)
framework for the World Trade Organisation (WTO) members to consider at
the Cancun ministerial conference which began last week.
The 21 developing countries came up with their own
versions of a framework for negotiations on agriculture at Cancun as
counterproposal to one championed by the US and the EU so that there was
a potential in Cancun on a convergence between the two other papers.
The State Bank has relaxed reporting rules for the
banks with regard to home remittances or the money sent back home by
overseas Pakistanis. Banks are now required to report to SBP on a single
document details of remittances up to $10,000. Previously they limit for
this amount was only Rs10,000.
EPB OFFICE IN GWADAR
The Export Promotion Bureau (EPB) has set up its
office in Gwadar which will initially operate from the regional office
of National Bank of Pakistan.
Tritex Cotton Mills Limited presented the revised
rate per share for approval of its voluntary de-listing. In a letter to
the Stock Exchange, this textile unit of the Lakson group, calculated
minimum price per share on the basis of average market price
(annualized) at Rs9.82 per share. The Tritex Cotton's buy-back looks to
be lingering since 1997 when the company had made the initial offer at
Rs10 per share.
CAR PRICES COMPARISON
The government has asked the Pakistan Automobile
Manufacturers Association (PAMA) to provide a comparison of automobile
prices prevailing in the neighbouring countries so that a decision could
be made whether or not to allow import of reconditioned cars.
The Central Board of Revenue (CBR) has paid Rs12.2
billion refund/rebate to exporters in first two months (July-August) of
current financial year against Rs14.2 billion, it had paid to exporters
during the same months last year, showing a fall of 14 per cent.
SBP SEEKS CREDIT DATA IN 10 DAYS
The State Bank has asked all banks and other
financial institutions to submit to it online the monthly credit data of
their borrowers of half a million rupees or more by 10th of the next
month.In a circular (BSD 8) issued to all banks/development finance
institutions and non-bank finance companies the central bank said the
revised timeline would be applicable for submission of data for the
month ending September 30, 2003. That is by October 10 all banks and
other financial institutions would submit to SBP online the credit data
of their borrowers of Rs500,000 or more.
PAKISTAN'S GLOBAL INVESTMENT RATING
Pakistan's potential performance rating on foreign
direct investment (FDI) has dropped from 72 in 1989-90 to 129 in
1999-2001, according to an UNCTAD report. The rating tumbled following
nuclear blast, multilayer economic sanctions by US and European states,
tensions with India and adverse impact of re-negotiations on tariff with
EXCEPTIONAL FLEXIBILITY QUOTA
The European Commission authorities have finally
agreed to release 4,000 tons of Exceptional Flexibility quota for 2003
in categories 6, 9 and 20. According to an official announcement issued
recently, this facility had been made possible due to constant and
persistent follow up at the highest level.