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Pakistani Economic Stress Watch

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Peregrine
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Pakistani Economic Stress Watch

Postby Peregrine » 11 Oct 2017 20:39

X Posted on the Terroristan Thread

The Army is now worried about Terroristan's Economy! A sign that the Army is getting ready to "Take Over"

COAS General Qamar Bajwa raises serious concerns over economy, rising debts

ISLAMABAD – COAS General Qamar Bajwa has for the first time raised serious concerns over the economic conditions of the country and especially the rising debt of Pakistan.

He said it is high time that economic growth and sustainability was placed at highest priority.

“Growth has picked up but the debts are sky high. Infrastructure and energy have improved considerably but the current account balance is not in our favour,” he told the audience at the seminar on ‘Interplay of Economy and Security’ held in Karachi on Wednesday.

The COAS said the country’s tax to GDP ratio is abysmally low, which “needs to change if we are to break the begging bowl”, adding that economy remains “one of our highest concerns during National Security Council meetings”.

According to the finance ministry, each Pakistani owes Rs95,000 in debt with the country’s foreign debt and liabilities standing at $58 billion – around Rs6.11 trillion.

“In order to secure our future, we must be ready to take difficult decisions,” he said. “We have to increase our tax base, bring in fiscal discipline and ensure continuity of economic policies.”

Regarding the continuing security operation in Karachi, the army chief said when Pakistan’s enemies want to “choke Pakistan, they try to destabilise Karachi”.

“It is because of this sensitivity, that peace in Karachi has been our top priority,” he said. “We have worked very hard to restore peace and now hope that economic activity would return at a fast pace.”

He also spoke on external security and the need to pursue the National Action Plan, which was initiated after the 2014 Peshawar attack.

He appreciated the security for improvement in the country’s security environment.

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abhijitm
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Re: Pakistani Economic Stress Watch

Postby abhijitm » 11 Oct 2017 20:55

^^^ pakistan's enemy (read india) destabilizing karachi :rotfl:

what stability in that hell hole its enemy trying to destabilize?

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Pakistani Economic Stress Watch

Postby Peregrine » 13 Oct 2017 00:53

X Posted on the Terroristan Thread

Market watch: Index hits one-year low in intra-day trading
At close, the benchmark KSE 100-share Index registered a decline of 266.15 points or 0.66% to finish at 40,237.53 points.
Note : Historically, the Pakistan Stock Market (KSE100) reached an all time high of 52876.46 in May of 2017
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Pakistani Economic Stress Watch

Postby Peregrine » 14 Oct 2017 23:31

X Posted on the Terroristan Thread

Loanistan AKA Terroristan on a "LOAN" taking Binge!

$2b loans granted ex-post facto approval

ISLAMABAD: The federal cabinet has regularised nearly $2 billion foreign commercial loans that the government had obtained during second half of the last fiscal year without prior approval of the cabinet and also waived 10% tax on interest payments to foreign lenders.

It was the second time during the last nine months that the federal cabinet gave ex-post facto approvals of foreign commercial borrowings.

In February 2017, the federal cabinet had also regularised the $2.7 billion foreign commercial loans.

The Ministry of Finance had signed eight agreements between December 2016 and June 2017 with foreign banks to obtain $1.965 billion short-term loans to support the dwindling foreign currency reserves.

All the eight loan agreements had been signed without obtaining prior approval of the federal cabinet, which is necessary under the Rules of Business of 1973.

Rule 16(1)(d) of the Rules of Business states that ministries would bring “proposals for levy, abolition, remission, alteration or regulation of any tax and floatation of loans” for the approval of the federal cabinet.

However, the federal cabinet gave its ex-post facto approval of those loans on Tuesday, regularising the borrowings.

The ex-post facto approvals are in violation of the spirit of the Supreme Court judgment of August 2016. The apex court’s ruling binds the government to initiate all fiscal matters with the consent of the federal cabinet.

The finance ministry obtained the loans from foreign commercial banks, bypassing the competitive process which had also raised transparency concerns.

The cabinet gave the approvals amid growing criticism against the finance ministry’s strategy to remain afloat by taking ‘sky high’ debt.

During the four-year tenure of the PML-N government, the country’s external debt swelled from $61 billion to a record $83 billion. There was a net addition of $22 billion in the external loans in just four years.

The $1.965 billion borrowings were part of a record-breaking $4.4 billion short-term foreign commercial loan that the PML-N government had obtained during FY2016-17 that ended on June 30. Out of this, $2.3 billion came from Chinese financial institutions alone.

The finance ministry got $275 million from Citibank on June 30 – the last day of the fiscal year. It also signed a common term agreement with Standard Chartered Bank on June 20 for $700 million loan – just 10 days before the close of the fiscal year.

The finance ministry signed two agreements for $650 million loan with Credit Suisse[/] on June 7 and May 18.

[b]Two agreements for $245 million loan
were signed with the Dubai-based Noor Bank PJSC on May 15 and March 30.

Pakistan also got $40 million loan from the ECO Trade and Development Bank on February 17 this year, and $55 million from the Dubai Islamic Bank on December 8, 2016

The federal cabinet also waived 10% tax on interest payments to the financial institutions without involving the National Assembly.

The Ministry of Finance informed the federal cabinet that “foreign commercial loans are offered with the condition that taxes applicable in Pakistan would not be borne by the lenders”, showed the official documents.

“The Federal Board of Revenue supported the proposal to waive the taxes. It is a standard practice to waive taxes on foreign commercial loans to cut the cost of borrowings,” said Dr Mohammad Iqbal, spokesman for the FBR.

The government took the loans after it failed to attract sufficient non-debt creating inflows, like enhancing exports and foreign direct investment to meet its external financing requirements.

The country’s exports have been constantly declining since the PML-N government came into power. During the last fiscal year, the exports stood at only $20.44 billion, which were just 6.7% of the total size of the economy.

Pakistan’s official foreign currency reserves – largely built by borrowings – have again started depleting after the end of the International Monetary Fund facility. As of end September, the foreign currency reserves held by the central bank stood at $13.78 billion.

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Re: Pakistani Economic Stress Watch

Postby anupmisra » 17 Oct 2017 08:14

All is well. Keep calm. No need to press the panic button. You heard it here (from the renowned accountant sahib) first:

Economy strong, no threat of default: Dar

Finance Minister Ishaq Dar said the economy was strong and there was no threat of default.
There was no need to go back to the IMF programme for another bailout package
“All institutions belong to Pakistan and efforts should not be made to further deepen controversies,” Dar replied when journalists repeatedly sought his comments on the statements of the military regarding challenges faced by the economy at the FBR headquarters on Monday evening.
Dar said mixed signals were being given out about the economy as the World Bank wrongly projected the external financing requirements of $31 billion, which would be actually standing at $18 billion for the current fiscal year.


https://www.thenews.com.pk/print/237586 ... efault-Dar

Peregrine
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Pakistani Economic Stress Watch

Postby Peregrine » 22 Oct 2017 13:38

X Posted on the Analyzing CPEC & Terroristan Threads

Unsound projects

Capital suggestion

‘Unsound economic projects’ are the new weapons of war. In the 70s, President Richard Nixon ordered the CIA to “make the [Chilean] economy scream (declassified documents relating to the military coup, September 11, 1973)”. Lo and behold, Pakistan’s economy is screaming today.

For the record, Pakistani leaders stand convinced of taking on additional layers of debt on top of existing layers of debt.

For the record, Pakistani leaders stand convinced of ‘adopting economic policies that are bound to impoverish’ Pakistan.

For all of us to see, ‘uneconomical, financially non-viable and fiscally unsound’ projects are being bankrolled. The 27-kilometer Orange Line, the light rail rapid transit system, is expected to cost Rs162 billion. The estimated breakeven is Rs175 per ticket. At Rs20 a ticket, the Orange Line will lose Rs40 million a day or Rs14 billion a year every year. Plus, an additional Rs4 billion for operation and maintenance. Assuming that the Chinese loan is concessional, the debt payment of interest and principal is estimated at around Rs10 billion a year. Red alert: The debt burden is in dollars and the project loses money.

Imagine, the Government of Pakistan has guaranteed an annual Return on Equity (ROE) of 34.49 percent for the Thar Coal Block-I Power Generation Company (Private) Limited. The project cost is estimated at $767 million of which $575 million is debt. The interest rate used as the reference is Inter Bank Offer Rate (LIBOR) of 0.45 percent plus 450 basis points (https://nepra.org.pk/Tariff/IPPs/003%20 ... 6-2016.PDF).

For the record, the annual Return on Equity guaranteed by the Government of Pakistan on the Sahiwal Coal Power Project stands at a tall 27.2 percent. The interest rate used as the reference is Inter Bank Offer Rate (KIBOR) of 11.91 percent plus 350 basis points. The project cost is estimated at $956 million of which $723 million is debt (https://nepra.org.pk/Tariff/IPPs/Huanen ... 0(Pakistan)%20Energy%20(Private)%20Limited/TRF-308%20HUANENG%20UPFRONT%20COAL%20DETERMINATION%2031-03-2015%204385-87.pdf).

Red alert: This is awfully expensive electricity. Our industry cannot produce exportable competitive products with this electricity. Resultantly, we will have a huge dollar-denominated debt servicing burden but no additional exports.

Nandipur has gone from $329 million to $847 million. Neelum-Jhelum has gone from Rs15 billion to Rs414 billion. The New Islamabad Airport has gone from Rs37 billion to over Rs100 billion. Imagine, the tariff for Nandipur is: Refined Furnace Oil Rs18.17/kWh; High Speed Diesel Rs27.91/kWh and Gas Rs8.44/kWh.

Pakistan is getting crowded with ‘unsound economic projects’. Debt is the new weapon of war – debt that leads to ‘emergency managers’ and ‘emergency managers’ then “turn over the reins of the economy” to their political masters. The combination of unsound economic projects, debt, enforced austerity (by the IMF) and under-investment in health and education are the new weapons of war. This is what the 4th Generation War is all about.

Missiles, as weapons of war, are out. Unsound economic projects, as weapons of war, are in. Tanks, as weapons of war, are out. Debt, as a weapon of war, is in. Cold start, as a weapon of war, is dead. An economic strategy based on unsound economic projects is in. Open warfare is out; covert economic operations are in. Military force is out; financial warfare is in.

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Re: Pakistani Economic Stress Watch

Postby Vips » 22 Oct 2017 18:28

Pakistan is going to be free of load shedding by december this year. Total demand is 19,000 MW and new coal based power plants financed by China with capacity to generate 13,000 MW will be coming online in 4-5 years. In addition LNG terminals are either being set up or planned which will generate 3,000 MW of electricity. Also there are additional plants of varying size (Wind, Solar, Hydro based) coming up.

Pakistan has committed to pay huge interest (on chinese power plants) and annual LNG purchases to Qatar. Question is who is going to use all this power? Even if pakistan grows at 5% annually its power usage will be maximum 25,000 MW in 2022. what will happen to the extra and minimum 10,000 MW power capacity which will run idle? There are going to be ghost power plants in pakistan and you will see a situation where different lobbies representing the LNG and coal based power plants will be forcing pakistan to give them preference in buying power from.

Pakistan will have no option but to increase cost of power to the end consumer and to its industry. It is sinking deeper and deeper :rotfl:

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Pakistani Economic Stress Watch

Postby Peregrine » 26 Oct 2017 16:06

X Posted on the Terroristan Thread

Pakistan finalises two consortiums to raise another $2b

ISLAMABAD: Pakistan has finalised two consortiums of financial advisors to float dollar-denominated Euro and Sukuk bonds as the country seeks around $2 billion aimed at taking pressure off the balance of payments’ position.

The Eurobond consortium would comprise of four international commercial banks. The Sukuk bond consortium consists of six banks, said officials in the Ministry of Finance. The financial bids were opened on Tuesday.

Citibank, Deutsche Bank, Standard Chartered Bank and Industrial & Commercial Bank of China (ICBC) will be mandated to arrange the Eurobond transaction. The government will pitch a minimum $500-million bond but will try to raise at least $1 billion through the Eurobond, said the officials.

In September 2015, the government had issued Eurobonds valuing $500 million with a 10-year maturity in the international market at an interest rate of 8.25%. It offered 6.12% above the US Treasury rate for the bond, making it one of the most controversial deals.

The Sukuk bond consortium of financial advisors consists of Citibank, Deutsche Bank, Standard Chartered Bank, ICBC, Dubai Islamic Bank and Noor Bank JSPC, said the officials. Again the government will pitch $500 million Sukuk bond but will try to raise over $1 billion, said the officials. The M3 Motorway (Pindi Bhattian-Faisalabad) would be pledged in collateral to raise loans through the Sukuk bond.

In September last year, the government raised $1 billion by floating Sukuk bond at 5.5% interest rate.

The combined size of the two deals could go up to $2 billion or $3 billion, one banking official said on Wednesday.

The finance ministry did not respond to a request to comment.

The officials said that the DIB and ICBC had given the lowest financial bids, quoting 1.5% less fee than offered by three Europe-based banks. The finance secretary asked the three commercial banks to match the fee, if they wanted to become part of the consortium, said the officials.

They said that the Ministry of Finance was not officially announcing the financial advisors consortiums, as it was waiting written concurrence of three European-based banks to match the lowest bids. But their local representatives have already given the verbal concurrence, said the officials.

This time the government was expecting better price due to availability of liquidity in the international markets. In recent months, Abu Dhabi, Saudi Arabia, Jordan, and Yemen have raised debts from the international markets and their bids were significantly over subscribed.

But the fluid political situation in Pakistan and the desperation to raise loans to protect the official foreign currency reserves could affect the overall price, said the officials.

Pakistan is rated B by Standard & Poor’s, B3 by Moody’s and B by Fitch. Pakistan’s ratings are stable for the last couple of years that could also help it get a better price.

The finance ministry is targeting November 15 to conclude the transactions. The country’s external sector position has significantly weakened due to the current account deficit that swelled to $3.6 billion in the first quarter – 117% more than the corresponding period of the previous year.

Due to the growing current account deficit, official foreign currency reserves are constantly under pressure and depleted over $2 billion in the past three months alone. The official reserves stood at $14.2 billion as of October 13.

The global bonds and borrowings from the commercial banks has remained the preferred choice of the finance ministry that has raised $10.8 billion by utilising these two modes since 2014.

The Senate Standing Committee on Finance is already investigating the 2015 Eurobond issuance. The Standing Committee has been trying to determine whether the money invested by foreigners in the dollar-denominated bonds had actually flown from Pakistan.

It has twice decided to call the representatives of three international banks, which the government had hired to float $500 million worth of Eurobonds. The government hired Citibank, Deutsche Bank and Standard Chartered Bank for the bond float.

But each time the finance ministry did not let it happen but the issue remains pending till date.

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Aditya_V
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Re: Pakistani Economic Stress Watch

Postby Aditya_V » 26 Oct 2017 18:30

Vips wrote:Pakistan is going to be free of load shedding by december this year. Total demand is 19,000 MW and new coal based power plants financed by China with capacity to generate 13,000 MW will be coming online in 4-5 years. In addition LNG terminals are either being set up or planned which will generate 3,000 MW of electricity. Also there are additional plants of varying size (Wind, Solar, Hydro based) coming up.

Pakistan has committed to pay huge interest (on chinese power plants) and annual LNG purchases to Qatar. Question is who is going to use all this power? Even if pakistan grows at 5% annually its power usage will be maximum 25,000 MW in 2022. what will happen to the extra and minimum 10,000 MW power capacity which will run idle? There are going to be ghost power plants in pakistan and you will see a situation where different lobbies representing the LNG and coal based power plants will be forcing pakistan to give them preference in buying power from.

Pakistan will have no option but to increase cost of power to the end consumer and to its industry. It is sinking deeper and deeper :rotfl:


This free of Load shedding is is BS. Offcourse in winter Paki aam janta electricity requirement will be very low, it is mainly in Peak summer.

Electricity along with water is driver of economic growth and Pakis are prone to lie about it. Just like Chinese Railway engines, the chinese plants probably dont operate. The Chinese have a neat trick by breaking down thier old power plants, refurbishing them and assembling them in Pakistan and pricing it at the cost of new one. That way even an 80% default, thee Chinese still get a return.

Regarding Load shedding , Pakistan domestic and agricultural demand will be very low any ways during winter season, with or without CPEC. Absence of Load shedding in domestic sector could also mean there is no electricity demand from Pakistani Industrial sectors.

Thats why unless there is mega desalination plant coming up in Gwadar, till date Google earth shows none, there cannot be 500,000 Chinese settled there.

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Re: Pakistani Economic Stress Watch

Postby tandav » 26 Oct 2017 21:06

Electrical load demand will from Chinese SEZs in Pakistan... Islands of Sinic Pork Eater communities inside a sea of Halal Eaters connected by CPEC, protected by PLA, governed by CPC. Fenced off for the commoners... a truly exclusive club. I think China will succeed where America failed since they will put their people there

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Re: Pakistani Economic Stress Watch

Postby Aditya_V » 27 Oct 2017 10:38

China Pakistan Friendship is based on India Hatred and keeping their populations away from each other, already there a few Chinese body bags thanks to a few thousand Chinese workers in Pak. Americans also had such a number during 1950-70's with people like Chuck Yaeger in Paksitan.

If Chinese start increasing numbers there will be automatic clash as the 2 cultures cannot coexist, it is not for nothing the Chinese have literally Banned Islam in their country and far more restrictive of Islamic practice rather than so called enemy nations of Pakistan- America, India or Israel.

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Re: Pakistani Economic Stress Watch

Postby Vips » 27 Oct 2017 17:24

Pakistani author shatters delusions of paki dreams of earning toll income form CPEC which is three times pakistani budget size by 2030!!!

The author did some research regarding the freight market size, the tolls that can be levied etc. Not knowing that the whole effort is wasted as Chinese have a written agreement with Pakistani government and no toll can be charged on Chinese trucks/good movement. :rotfl:

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Pakistani Economic Stress Watch

Postby Peregrine » 27 Oct 2017 22:33

X Posted on the Terroristan Thread

Uncertainty has wiped $18.5b off Pakistan’s stock market

KARACHI: Not too long ago, the government sold a 40% stake in the Pakistan Stock Exchange (PSX) to the Chinese at Rs28 per share.

Since then, as of Thursday, the Chinese consortium had seen its investment shed close to 30% of the total value of $86 million.

Additionally, close to $18.5 billion have been wiped off Pakistan’s stock market since the KSE-100 Index – a benchmark for market performance – closed at 52,876.46 – its personal best achieved on May 24 this year. Share prices have plummeted and not a single equity-based fund has posted a positive return in the last nine months.

Come October, there is no recovery in sight.

Weekly review: KSE-100 succumbs to political apprehensions, 1,097 points wiped off

The index settled below 41,500 on Thursday, an overall retreat of close to 22%, as the stock market’s worst year since 2008 continued.

Volumes have dried up and volatility has risen. Investors are sitting on the bench and awaiting clarity. Some have made the exit while a few are patiently waiting for a positive trigger.

The gloomy situation at the PSX is a far cry from what it was in 2016 when the KSE-100 posted the best return in Asia that was also among the top five in the world.

Now, it has become one of the cheapest emerging markets, but buyers are still missing in action.

What went wrong for the PSX which, at one point, was the government’s strongest pitch to the world?

“Stock markets everywhere abhor uncertainty,” said Maheen Rahman, CEO at Alfalah GHP that manages over Rs28 billion in assets, according to the latest data available with the Mutual Funds Association of Pakistan.

The uncertainty arose when Nawaz Sharif was disqualified from the seat of prime minister, a fate that would subsequently result in a reshuffled cabinet, a new premier and reports of infighting within the ruling party. During the time, the Pakistani rupee lost 3.5% against the US dollar for literally 24 hours, and noise over falling foreign exchange reserves, piling debt and widening current account/trade deficits increased further.

As if that wasn’t enough, the country’s finance minister, a staunch believer of keeping the rupee strong, inched closer to an ungraceful exit as well over corruption charges. With him gone, there is no telling when the rupee would fall.

Rahman feels that rupee depreciation is playing on the minds of investors, but some of it has been factored in already.

“At this stage, the stock market has priced in the ex-prime-minister’s departure, at least a 5% depreciation in the rupee and the expectation of greater political noise along with foreign policy shifts leading into 2018.”

While the government has categorically ruled out rupee depreciation, Rahman said some sectors stand to benefit if it does eventually happen.

“Banking sector is likely to be a major beneficiary of the devaluation, as higher inflation could push interest rates higher. Oil and gas exploration, power companies and export-oriented sectors such as textiles and technology companies are also likely to benefit.”

Samiullah Tariq, director research and business development at Arif Habib Limited, echoed the same view.

“It (rupee depreciation) appears to be a potential trigger,” said Tariq. “45-50% of KSE-100 companies provide a hedge against the rupee/dollar parity, whereas the remaining major sectors have enough pricing power to pass on the cost.

“Such an event might also attract foreign flows as it would be an end to the uncertainty regarding rupee parity.”

While local money managers are wary of the looming risk, potential rupee depreciation is also playing on the minds of foreign investors who want to avoid an immediate hit if the dollar gains in value.

“The looming risk of devaluation is restricting an entry point for foreign active managers who want to avoid an immediate 10-15% hit in dollar terms if rupee depreciates in the coming months,” said Shamoon Tariq, partner and portfolio manager at Sweden-based Tundra Fonder that has an exposure of roughly $100 million in the PSX.

Distressing indicators

While the stubborn rupee may be playing on the minds of investors, it is Pakistan’s worrying economic indicators that are at the core of the problem.

PM likely to announce bailout package for stock market

A widening trade deficit has forced the government to increase regulatory duty on 356-plus items as it bids to restrict imports while also taking a shot at increasing tax collection.

It may be a quick fix, but many believe that underlying structural changes – including reducing losses of state-owned enterprises, reforming the tax system that includes broadening the base, and creating a conducive environment for businesses – are key to higher economic growth.

Stakeholders say the domestic demand story is resilient, and just some amendments are needed.

“Those of us with clear memories of 2008 understand the benefits of value-investing,” said Rahman. “Pakistan’s domestic demand story is resilient, earnings of companies have continued to grow and valuations are at 2-year lows. Structural adjustments are needed and overall, the political process should be respected and not hampered to restore investor confidence.

Samiullah Tariq also said the PSX is equipped enough to deal with mishaps, ruling out the possibility of a repeat of 2008 when the stock market crashed and was shut down. “The market is more equipped today than ever to deal with mishaps. With the market already reclining from its all-time high of near 53k, chances of an upside are likely to overshadow bearish notions.”

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Re: Pakistani Economic Stress Watch

Postby Peregrine » 27 Oct 2017 22:48

Vips wrote:Pakistani author shatters delusions of paki dreams of earning toll income form CPEC which is three times pakistani budget size by 2030!!!
The author did some research regarding the freight market size, the tolls that can be levied etc. Not knowing that the whole effort is wasted as Chinese have a written agreement with Pakistani government and no toll can be charged on Chinese trucks/good movement. :rotfl:
Vips Ji :
1. A Readers Comment : Majnu - Oct 26, 2017 - 8:26PM - Reply :
I have full faith in this country and government which can turn every profit into a loss.

2. The Toll on Trucks will be minimal as there will not be much movement of of Goods other than by the Chinese. After all thre is nothing tat Xinmjiang will Import from Terroristan.

3. Oil and Natural Gas : From all over the World through Gwadar : Xinjiang Exports its own Oodles of Oil and Goodles of Gas by Pipeline to China.

As the wag said : Front, Front Watching Happening Happening What!

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Re: Pakistani Economic Stress Watch

Postby anupmisra » 27 Oct 2017 23:24

Vips wrote:...the whole effort is wasted as Chinese have a written agreement with Pakistani government and no toll can be charged on Chinese trucks/good movement...


Details...details...details...not a strong virtue of an average paki-sialkoti-economist. And the paki mard-e-momeens used to laugh at the Yindoo-Baniya mentality.

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Re: Pakistani Economic Stress Watch

Postby tushar_m » 28 Oct 2017 09:15

Pakistani newspaper blames anti-India hysteria for sky-high tomato prices


At the time when tomatoes were selling for Rs300 a kilo in Lahore they were available at Indian Rs40 a kilo in Amritsar a mere 30 miles away.


Is it Economic Stress ??? don't know but 300/Kg is certainly a lot.

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Re: Pakistani Economic Stress Watch

Postby kancha » 28 Oct 2017 10:13

tushar_m wrote:Pakistani newspaper blames anti-India hysteria for sky-high tomato prices


At the time when tomatoes were selling for Rs300 a kilo in Lahore they were available at Indian Rs40 a kilo in Amritsar a mere 30 miles away.


Is it Economic Stress ??? don't know but 300/Kg is certainly a lot.


Adjusting for conversion rate of PKR with INR, the value in Lahore comes to about Rs 185/kg. But that is still nearly 4.75 times costlier than in Amritsar!

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Re: Pakistani Economic Stress Watch

Postby arun » 28 Oct 2017 10:26

Vips wrote:Pakistani author shatters delusions of paki dreams of earning toll income form CPEC which is three times pakistani budget size by 2030!!!

The author did some research regarding the freight market size, the tolls that can be levied etc. Not knowing that the whole effort is wasted as Chinese have a written agreement with Pakistani government and no toll can be charged on Chinese trucks/good movement. :rotfl:


Excerpt from the above:

Earlier this month, the Board of Investment claimed that the CPEC toll income would be three times the budget of Pakistan after completion by 2030. It is the first time an official figure on CPEC toll estimates has come out and needs some objective appraisal.

Pakistan’s budget this year stood at Rs4.75 trillion. Thrice this amount would mean Rs14+ trillion ($135+ billion).


Talk of CPEC generating toll income of USD 135 Billion is typical braggart claim from the Mohammadden Terrorism Fomenting Islamic Republic of Pakistan that has no basis in reality.

Consider the Suez Canal revenue for the 10 months January to October 2017 amounted to USD 4.3 Billion for an annualised USD 5.16 Billion.

Suez Canal revenues up to USD 4.3 billion in 2017: SCZone Chairman

Al-Masry Al-Youm
October 19, 2017 3:29 pm

The chairman of Suez Canal Authority (SCA) and SCZone — the Suez Canal Economic Zone, Mohab Mamish, announced on Wednesday that the SCA’s revenues raised by 3.4 per cent within the period from January-October 2017, increasing to $US4.3 billion up from $US4.2 billion in 2016. ……………..

Suez Canal revenues up to USD 4.3 billion in 2017: SCZone Chairman


Then consider that the Panama Canal revenue for the 6 months January to June 2017 amounted to USD 1.1 Billion for an annualised USD 2,2 Billion revenue:

Panama Canal toll revenues up 19.7% in first half 2017

Panama Canal revenues totaled US $ 1,119.5 million in the first half of this year, up 19.7% from US $ 935.3 million in the same period of National Institute of Statistics and Census (INEC) released today.

08/08/2017 - 15:59 ·Panama, Aug 8 (EFE) .- Panama Canal revenues totaled $ 1,119.5 million in the first half of this year, 19.7% more than the 935.3 million in the same period of 2016 According to data from the National Institute of Statistics and Census (INEC) released today. ………………..

Panama Canal toll revenues up 19.7% in first half 2017

anupmisra
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Re: Pakistani Economic Stress Watch

Postby anupmisra » 28 Oct 2017 18:01

Pakistani banks ignored as Chinese financing dominates CPEC
:((

Pakistani banks are missing out on the China-Pakistan Economic Corridor (CPEC) boom as Chinese financial institutions fill in the gap of providing majority financing for these projects.
Hashemy added that out of current $6-$7 projects ongoing under CPEC, only 10pc or around Rs50b constitutes local financing.
There is a danger that Chinese domination in CPEC will leave Pakistan vulnerable to paying interest on loans procured from their banks in the future and benefits expected to be accrued later on may not be fully realized.(No $hit, abdul?)
Norman Sze, national leader at government affair unit Deloitte China said, “The finance sector in Pakistan is not very advanced and mature,” Sze said. “They could participate into the projects, but it would be difficult for them to meet such a huge financing demand.(and the chinis did not know about this, er...shortcoming?)


So, in a nutshell, chini banks lend to chini companies at subsidized rates to buy over-produced and out-of-warranty chini products and use out-of-work chini labor to finance pakiland-based projects that are backed by paki sovereign guarantees which largely benefit the chini economic growth . And the paki awaam are required to pay the debt service at exorbitant rates or else lose their only shirts. Who, I said, who could have foretold this scenario?

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https://profit.pakistantoday.com.pk/201 ... ates-cpec/

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Re: Pakistani Economic Stress Watch

Postby Peregrine » 28 Oct 2017 22:47

anupmisra wrote:Pakistani banks ignored as Chinese financing dominates CPEC
:((
https://profit.pakistantoday.com.pk/201 ... ates-cpec/

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anupmisra Ji :

Thanks for Alfred E. Neuman - "What? Me worry?"

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Re: Pakistani Economic Stress Watch

Postby disha » 28 Oct 2017 23:36

tushar_m wrote:
At the time when tomatoes were selling for Rs300 a kilo in Lahore they were available at Indian Rs40 a kilo in Amritsar a mere 30 miles away.


Is it Economic Stress ??? don't know but 300/Kg is certainly a lot.


It is environmental stress. Expect more of donkeys and dogs and crows being eaten around in Bakistan. That entire nation is going to be a desert wasteland in a generation unless bakis are exported out to the real deserts of Barbaria.

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Re: Pakistani Economic Stress Watch

Postby anupmisra » 29 Oct 2017 18:36

Imports of new, used motorcycles surge five times

Bike imports in July-September amounted to $2.48 million, up almost five times from the same quarter a year ago when their import bill was just $500,000.
Importing used and new bikes cost $2.99m in 2016-17, $2.94m in 2015-16 and $1.74m in 2014-15, according to the Pakistan Bureau of Statistics.


Importing used motor cycles (or, "discarded motorcycles")? How desperately low can one get?

https://www.dawn.com/news/1366927/impor ... five-times

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Pakistani Economic Stress Watch

Postby Peregrine » 30 Oct 2017 23:39

X Posted on the Terroristani Thread

A ticking economic bomb

ISLAMABAD: With political uncertainty growing, a ticking economic bomb is refusing to get defused amid the widening twin deficits that have started causing new financial problems for the PML-N government.

The situation is turning serious as Finance Minister Ishaq Dar has been occupied with allegations of corruption for the past many weeks, ostensibly prompting Sindh Governor Mohammad Zubair to say few days ago that the ousted prime minister had been misled to an extent about the economy.

The simultaneous publication of two frightening reports each by the Asian Development Bank (ADB) and World Economic Forum (WEF) recently further cast doubts about the economy, which according to them, required major effort to avoid more problems in near future.

Part of the problem is said to be the government’s inaction and the poor performance of the economic ministries whose bosses are busy in political firefighting rather than concentrating on their jobs.

The most challenging issue confronting the government, however, is the budget deficit – the mother of all economic ills, also known as fiscal deficit – has already risen to 5.8% of Gross Domestic Product (GDP) and is feared to go back to the same position of 2013 by the time the year 2017-18 ends. This means 8% (Rs2 trillion-plus). It has already reached Rs1,864 billion.

All the related consolidated federal and provincial budgetary figures of the last financial year reveal that there was 6.1% fiscal deficit, the highest in last four years of the PML-N government. How would the government avoid over 8% budget deficit during the current financial year is anybody’s guess but the situation seems to be heading towards 1999 when the gap between income and expenditure turned incredibly high.

Finance Minister Ishaq Dar is often accused of manipulating figures to show reduced fiscal deficit as well as the total debt that according to the central bank rose to Rs22.2 trillion in 2016-17 compared to Rs14.8 trillion of 2013. The latest figure of the total debt stands at Rs25 trillion.

Interestingly, the budget deficit grew 5.8% of the GDP just in two months (July- August) this year against the prescribed limit of 4% kept by the hurriedly amended Fiscal Responsibility and Debt Limitation (FRDL) Act of 2005 through the money bill in the National Assembly. Intriguingly, it was not allowed to be debated in the house. But then MNAs also did not raise any objection which speaks volumes about their interest in the business of the house.

There is a clear violation of the FRDL Act and questions are being asked as to why the mandatory fiscal policy and debt policy statements were not announced by June 30 this year.

The budget deficit, which ended at 5.8% of GDP in 2016-17 in spite of the fact the government did not include Rs400 billion circular debt in it. Also, Rs250 billion sales tax refunds of the exporters continue to be withheld. If both were included in the final numbers, fiscal deficit would have further risen.

“I am indeed concerned over the rising budget deficit and this all is happening due to increasing financial indiscipline,” said renowned economist and former finance minister Dr Hafiz Pasha.

He regretted that the National Assembly was told that budget deficit was 4.3 % in 2016-17 which was later shown as 5.8% in the revised estimates. “I do not know why do they lie so blatantly,” he said, adding that growing budget deficit was fast turning unmanageable as the government continues to borrow recklessly and increasing its expenditures without realising its consequences.

He said the way FRDL act was flouted and then amended should be an eye-opener for everybody and must not go unnoticed.

The rising fiscal deficit coupled with huge debt burden, he pointed out, was widening the investment and savings gap, and causing new problems to the current account deficit.

“All is not well if the budget deficit touches 8% of GDP in 2017-18 and I do not know who would fix this problem that is fast tearing apart the entire current budget,” Dr Pasha said.

Another former finance minister Dr Salman Shah was equally critical of the burgeoning fiscal deficit and blamed the Dar-led finance ministry which, he said, destroyed the whole financial discipline by grossly manipulating budget deficit numbers.

He expressed his indignation over large-scale manipulation of statistics and the altering definition of revenue and expenditure. “But still by doing that accounting gimmickry fiscal deficit remained over 6% last year and it is likely to end up close to 8% during 2017-18,” Dr Shah said.

“When you remove the amount of circular debt from the budget and change the definition of other economic indicators, how could there be any hope for any correct assessment of the economy that has thoroughly been destroyed by the government and its finance minister,” he alleged.

Many people believe that parliament should have held the government responsible for overspending and thus, increasing budget deficit to a current dangerous level. Revenue growth remained a major issue due to which budget deficit has become highly controversial.

The issue compounded when the government kept changing the definition of revenue, expenditure and fiscal deficit. The government did not disburse funds to the provinces under the NFC on time and asked them not to spend money with a view to show a lower fiscal deficit. Likewise, privatisation proceeds and foreign grants were treated as non-tax revenue instead of financing items only to show a lower budget deficit.

Going forward, the prime minister has to spend more time in finding out the solution of serious economic problems in the next few months, failing which collapsing of the economy cannot be stopped.

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Re: Pakistani Economic Stress Watch

Postby anupmisra » 31 Oct 2017 00:24

Spinning it (this one's a top spin)!

Pakistan has received $16b foreign investment: Interior Minister

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Interior Minister gesticulating to the assembled reporters on his preferences for feminine...er... attributes.


Pakistan has attracted over $16 billion in foreign investment despite a downturn in the world economy, said Federal Interior Minister Ahsan Iqbal, without divulging details of the breakup of the inflow.
Iqbal said Pakistan is seeing a return of foreign investment, structural reforms implementation, and improvement in the overall fiscal and monetary situation.
While the country only attracted $2.4 billion as foreign direct investment in 2016-17, an amount that was 5% higher year-on-year, Iqbal’s statement seemed without context as he did not mention a timeframe for the $16-billion inflow.
Estimates, however, suggest the minister’s number includes the inflow related to the China-Pakistan Economic Corridor that is mostly not included in the official FDI figures released every month by the State Bank of Pakistan.(loans are now counted as FDI?)


What happened to the finance minister? Should he not be the one making such wild claims? What?! He is missing in action? Has a warrant against him? Noooo....!!

https://tribune.com.pk/story/1544156/2- ... -minister/

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Re: Pakistani Economic Stress Watch

Postby yensoy » 31 Oct 2017 10:00

^^^^ Welcome to Democracy with Paki characteristics... Army chief talks about Finances. Interior minister talks about Finances. Finance minister doesn't.

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Pakistani Economic Stress Watch

Postby Peregrine » 31 Oct 2017 23:29

X Posted on the Terroristan Thread

World Bank Group Flagship Report – Doing Business 2017

INDIA : Population : 1,311,050,527 - GNI per Capita : US$ 1,590 - Thus GNI US$ 2,084.57 Billion

TERRORISTAN : Population : 188,924,874 – GNI Per Capita : US$ 1,440 – Thus GNI US$ 272.05 Billion

However, Terroristan maintains that its Population is 207 Million therefor its GNI Per Capita is US$ 1,314!

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Re: Pakistani Economic Stress Watch

Postby Gagan » 01 Nov 2017 00:47

I worry about what will happen to the Uber Expensive Orange Line Metro project
Nawaz is gone, Isaq Dar is reading namaz in KSA.

Who will pay the billions for completion of the sunk costs?
This metro line which has already gobbled up a lot of money, and land grabbing by the netas, may end up being left unfinished - the billions down the drain.

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Pakistani Economic Stress Watch

Postby Peregrine » 01 Nov 2017 01:46

Gagan wrote:I worry about what will happen to the Uber Expensive Orange Line Metro project
Nawaz is gone, Isaq Dar is reading namaz in KSA.
Who will pay the billions for completion of the sunk costs?
This metro line which has already gobbled up a lot of money, and land grabbing by the netas, may end up being left unfinished - the billions down the drain.
Gagan Ji :

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Pakistani Economic Stress Watch

Postby Peregrine » 01 Nov 2017 02:10

Five things that ail the Pakistan stock market
The celebrations of the best performing market in Asia are long since over for the Pakistan equity market which has been down in the dumps since May this year.
After providing mouth-watering returns of 46 per cent in 2016, the market continued to rally until the KSE-100 index hit an intra-day high of 53,124 points on May 25.
Stock brokers and analysts who were projecting the Index would hit 56,000 points by the end of 2017 gasped for breath as it took a sudden turn for the worse. In the five months since then, the index has plunged by an agonising 11,715 points, or 22pc, pushing investors into heavy losses.
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Pakistani Economic Stress Watch

Postby Peregrine » 01 Nov 2017 02:57

Market watch: Stocks bleed as KSE-100 Index falls another 707 points
KARACHI: The stock market witnessed on Tuesday another turbulent session as the index dropped below 40,000 points amid a proportionate rise in the political temperature in the country.
Absence of positive triggers also contributed to the overall bearish trend in the market as heavyweight sectors were deprived of investor interest and, resultantly, dragged the index down.
At close, the benchmark KSE 100-share Index registered a plunge of 707.13 points or 1.75% to finish at 39,617.19.
According to Elixir Securities, Pakistan equities continued to bleed amid turbulence on political front as heavyweight sectors dragged KSE-100 Index to 13-month low near 39,600 level.
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Pakistani Economic Stress Watch

Postby Peregrine » 01 Nov 2017 17:10

X Posted on the Terroristan Thread

Pakistan now ranked 147th in World Bank’s Ease of Doing Business Index
ISLAMABAD: Pakistan has slipped three places on the Word Bank’s Ease of Doing Business Index and is now ranked a lowly 147th among 190 economies, denting the government’s pro-business image ahead of next general elections.
The findings of the report serve as a reminder to the PML-N government that has claimed making Pakistan an easier place to do business in, while also helping it become one of the fastest 25 growing economies of the world. Instead, the country was ranked at 43 from the bottom on the influential global index.
The World Bank released the Doing Business 2018 report on Tuesday that covers 190 economies and measures how close each economy is to global best practices in business regulations.
In South Asia, Bhutan, at the 75th place in the Doing Business rankings, is the highest-ranked economy followed by India (100)) and Nepal (105). Pakistan, at the 147th position, was at number 6 in South Asia followed by Bangladesh (177) and Afghanistan 183.
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Pakistani Economic Stress Watch

Postby Peregrine » 02 Nov 2017 22:33

X Posted on the Terroristan Thread

No progress on any bailout package for stock market
KARACHI: The government has not worked out any modalities for a bailout package meant to rescue the ailing stock market, confirmed an official on Wednesday.
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Re: Pakistani Economic Stress Watch

Postby Aditya_V » 03 Nov 2017 13:00

Peregrine wrote:X Posted on the Terroristan Thread

World Bank Group Flagship Report – Doing Business 2017

INDIA : Population : 1,311,050,527 - GNI per Capita : US$ 1,590 - Thus GNI US$ 2,084.57 Billion

TERRORISTAN : Population : 188,924,874 – GNI Per Capita : US$ 1,440 – Thus GNI US$ 272.05 Billion

However, Terroristan maintains that its Population is 207 Million therefor its GNI Per Capita is US$ 1,314!

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We must work to get the Paki GDP to 4% of our economy.

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Re: Pakistani Economic Stress Watch

Postby Deans » 03 Nov 2017 15:27

Aditya_V wrote:Cheers Image

We must work to get the Paki GDP to 4% of our economy.[/quote]

When Pak is 7-8% of our economy, which will be soon, we will be adding a Pakistan to our economy every year.

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Re: Pakistani Economic Stress Watch

Postby Prem » 06 Nov 2017 11:19

https://tribune.com.pk/story/1550788/2/
Export emergency: who is in charge?

The Engineering Development Board (EDB) website reveals that over the past five years the export of engineering goods fell from 5% to 15%.
The mining industry has lost all foreign investment for the first time in the past three decades. This is despite the massive high and intermediate-value mineral reserves in the country.Value-addition in exportable industrial and agricultural goods appears to be a distant dream. That is what all indicators reflect if you carefully examine the data splashed on the economic and finance-related official websites.Take a look outside Pakistan now. The engineering and mining sectors have significantly become engines of growth in many countries of Europe and Asia. Talk to any investor in these two areas in Pakistan and you would hear of doom and no word of hope.What makes investors think like that? Is it lack of technical labour or bank financing? To find out I spoke to a number of investors who attended last week’s meeting of the NA Finance Committee. They told me that even poor marketing is not to blame for failure in increasing exports. It is the bureaucracy, especially the finance and economics-related offices in Islamabad and the four provincial capitals which act as the real roadblocks to realising the actual potential of Pakistani resources.They claimed that this bureaucracy is doing everything to discourage Pakistani growth and to encourage imports. This brings down the prospects of posing a resilient competition to imports that flood Pakistan at will.Trade has picked in Pakistan in non-grocery goods. But foreign goods’ unprecedented import depletes the foreign exchange reserves and chances of employment.This was the argument presented by Arif Habib and other major business leaders and chambers’ representatives at the NA Finance Committee meeting last week. Slowing down or ending the foreign goods’ influx is what the local investors need from the policymakers as well as the trade-related bureaucrats.Refunds of exporters are stopped at the FBR while external trade management is poor to the extent of criminality, most chambers’ representatives complained. And there was a consensus that an export emergency needs to be launched without delay.
Not many took this proposal seriously but there was a consensus on one point: industrialisation process in Pakistan has come to a halt. And the government’s policy of neglect was the sole reason for that.How did the cost of doing business rise in Pakistan so dramatically that it discouraged exportable surplus? This was the most important question asked. The business representatives had three major reasons to define this tragedy: energy prices; non-payment of over Rs500 billion refunds over the past five years; and, neglect of the SME sector.The cost of doing business was also inflated by the ‘speed money’ that exporters have to pay Customs for importing raw materials and intermediate goods. One chamber representative said more than Rs3 billion a year had to be paid to the Customs staff in Karachi alone.Arif Habib said industry, IT, and construction are the areas that the government needs to focus on in a revival strategy. Or else, India, Bangladesh and Sri Lanka would grab all the orders so far available to Pakistani exporters. But who would bell the cat? None in the committee hall knew a thing about that.

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Pakistani Economic Stress Watch

Postby Peregrine » 16 Nov 2017 03:19

X Posted on the Terroristan Thread

Market watch: Bourse falls as political uncertainty, MSCI review take their toll

KARACHI: The stock market got no respite from the bear-run for the fourth straight session on Wednesday as investors continued to stand on the sidelines.

Apart from political and economic uncertainty, the downgrade of Engro Corporation by the MSCI in its biannual review also dented sentiments. The KSE-100 index started falling from the word go and dropped over 338 points before recovering slightly.

At close, the benchmark KSE 100-share Index registered a decrease of 280.99 points or 0.69% to settle at 40,662.79.

Elixir Securities, in its report, stated Pakistan equities closed fourth consecutive session lower with the benchmark index settling above 40,600 points.

The market opened lower as Engro Corp (-2.7%) dented the index in early trade. The stock recorded volumes of around nine million shares and traded at levels last seen 13 months ago.

Apart from Engro, the KSE-100 index was hit mainly by stocks across oil and financial sectors. These included Habib Bank (HBL, -2.3%), Oil and Gas Development Company (OGDC, -2.4%), MCB Bank (-2.4%), Pakistan Petroleum (PPL, -1.6%) and Pakistan Oilfields (POL, -1.4%).

Investor participation in the wider market was dismal and only about 90 million shares changed hands on the KSE All-share Index, down 28%.

While oil stocks tracked overnight fall in international crude prices, Mari Petroleum (+3.1%) stood out following news of a hydrocarbon discovery, which was announced on Tuesday.

“(We) expect a range-bound market with the KSE-100 index likely finding support near current levels. Participants, on the other hand, will continue to look towards institutional flows to gauge market direction in the absence of near-term triggers,” the report added.

JS Global analyst Maaz Mulla said bears dominated the bourse for most of the day largely because of political uncertainty as the KSE-100 index shed 281 points to close at 40,663.

The exploration and production sector continued to march on the downward path as international crude prices edged lower after the International Energy Agency cast doubt about talk over the past few months of tightening fuel markets.

POL (-1.43%), PPL (-1.62%) and OGDC (-2.42%) lost value to close in the red zone. Pakistan State Oil fell 0.70% in the wake of news that the company’s receivables swelled to Rs307 billion.

Some positivity was seen in the textile sector as restrictions may be withdrawn on the import of cotton from December 1. Nishat Mills in the sector rose 0.16%.

“Moving forward, we recommend investors to remain cautious,” Mulla said.

Overall, trading volumes fell to 90 million shares compared with Tuesday’s tally of 140 million.

Shares of 367 companies were traded. At the end of the day, 145 stocks closed higher, 201 declined while 21 remained unchanged. The value of shares traded during the day was Rs6.8 billion.

Engro Corporation was the volume leader with 8.98 million shares, losing Rs7.40 to close at Rs265.77. It was followed by Azgard Nine with 7.01 million shares, losing Rs0.24 to close at Rs14.82 and Unity Foods (R) with 3.86 million shares, losing Rs0.13 to close at Rs4.80.

Foreign institutional investors were net sellers of Rs530.8 million during the trading session, according to data compiled by the National Clearing Company of Pakistan.

Note : KSE-100 Index : 13-11-2017 - 41,239.89, 15-11-2017 - 40,662.79.

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Re: Pakistani Economic Stress Watch

Postby A_Gupta » 16 Nov 2017 03:37

http://www.atimes.com/article/pakistans ... ues-apace/
Pakistan’s political and economic deterioration continues apace

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Re: Pakistani Economic Stress Watch

Postby anupmisra » 16 Nov 2017 19:01

Enjoy this overview. You can almost draw a boundary map separating the three nations.

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https://openknowledge.worldbank.org/bit ... 812132.pdf

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Pakistani Economic Stress Watch

Postby Peregrine » 19 Nov 2017 02:25

X Posted on the Terroristan Thread

Imports continue to surge, deficit widens to $12.1b in Jul-Oct

ISLAMABAD: Pakistan’s trade deficit widened to $12.1 billion in first four months of the current fiscal year, which is nearly half of the annual target set by the government and is the result of unstoppable growth in imports that were almost triple the value of exports.

The value of imported goods exceeded the value of exports by $12.13 billion in the July-October period of FY18,
reported the Pakistan Bureau of Statistics (PBS) on Monday.

The trade deficit in the first four months was $2.9 billion or 31.24% higher than the same period of previous year. This deficit came on a higher base as Pakistan had closed the last fiscal year at a record $32.4-billion deficit.

The trade gap in the first four months was equal to 48% of the annual target of $25.7 billion, indicating that this year again the current account deficit would remain far higher than official projections.

Exports in July-October increased one-tenth to $7.1 billion but were only equal to 30% of the annual target of $23.1 billion. In absolute terms, export receipts went up $644 million. The value of imports stood at $19.1 billon, which was 22.6% or $3.53 billion higher than the import bill in the first four months of last fiscal year. Imports reached 39% of the annual target.

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However, the worrisome aspect was that export receipts were 276% less than the import bill.

Last month, the government introduced heavy regulatory duties on scores of goods in order to curb imports. Lately, it was revealed that the duties were primarily aimed at enhancing revenues rather than cutting the import bill. Total impact of these regulatory duties is estimated at below $400 million, which is insignificant when compared with $53 billion worth of imports in the last fiscal year.

For the new fiscal year 2017-18, the government has set the export target at $23.1 billion, which requires 13.2% growth over last year’s exports of $20.5 billion. It aims to restrict imports to $48.8 billion, which seems impossible, given the trend recorded in the first four months.

The first four-month results have made the $8.9-billion current account deficit target irrelevant. The World Bank and the Asian Development Bank have projected roughly $14 billion to $14.5 billion in current account deficit.

A higher-than-projected current account deficit will have a direct bearing on the central bank’s foreign currency reserves, which are again on a sliding path, standing at only $13.8 billion.

Independent economists say Pakistan will require about $20 billion to $25 billion in the current fiscal year to meet its external financing needs, although the finance ministry puts the figure at $18 billion including debt repayments.

October data

The growth in exports on an annualised basis slowed down for the third consecutive month, standing at 7.9% in October over the same month of last year. PBS data showed that exports grew to $1.9 billion in October.

In absolute terms, export receipts increased only $138 million. Imports grew at a pace of 23.6% and the country paid $4.93 billion worth of import bill in October. Imports were $941 million more than October 2016. Consequently, the trade deficit widened 35.9% or $3.1 billion in October over the same month of previous year. In absolute terms, the deficit widened $802 million.

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Re: Pakistani Economic Stress Watch

Postby Guddu » 19 Nov 2017 08:42

Winning!...Pakis make the list.

Who's Next? Venezuela's Collapse Puts These Nations At Risk

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by Tyler Durden
Nov 18, 2017 8:00 PM
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"It's a wake-up call for a lot of people who will say ‘Look, the stuff I own is actually very risky'..." warns Ray Jian, who oversees about $6 billion at Pioneer Investment Management Ltd. in London. "People have been ignoring risks in places like Lebanon for a long time," and the official default of Venezuela this week has emerging-market money managers are looking to identify countries that might run into trouble down the road.



While Bloomberg reports that while none are nearly as badly off as Venezuela - where a combination of low oil prices, economic mismanagement and U.S. sanctions did the country in - traders are scouting for credit risk, from Lebanon, where Prime Minister Saad Hariri’s sudden resignation has once again thrust the nation into a Saudi-Iran proxy war, to Ecuador, where recently elected President Lenin Moreno continues to expand the debt load in a country with a history as a serial defaulter.
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1. Lebanon:
One of the world’s most indebted countries, Lebanon may hit a debt-to-gross domestic product ratio of 152 percent this year, according to International Monetary Fund forecasts. That’s coming at a time when political tension is rising. Hariri’s abrupt resignation, announced from Riyadh on Nov. 4, triggered about $800 million of withdrawals from the country as investors speculated that the nation would be in the crosshairs of a regional feud between the Saudis and Iranians. While the central bank says the worst may be over, credit-default swaps have hit a nine-year high.

2. Ecuador:
After a borrowing spree, the Andean nation’s external debt obligations over the next 12 months ballooned to a nine-year high relative to the size of its GDP. Ecuador probably has the highest default risk after Venezuela, according to Robert Koenigsberger, the chief investment officer of Gramercy Funds Management. The country will be vulnerable “when the liquidity environment changes and they can no longer go to the market to get $2.5 billion to plug the hole," he said. Finance Minister Carlos de la Torre told Bloomberg in an email on Thursday that there is "no default risk" for any of Ecuador’s debt commitments and the nation’s indebtedness is nowhere near "critical" levels.

3. Ukraine:
While the Eastern European nation’s credit-default swaps have declined from their 2015 highs, persistent economic struggles are giving traders reason for caution. GDP expansion has slowed for three consecutive quarters and the World Bank warns that the economy is at risk of falling into a low-growth trap. Ukraine’s parliament approved next year’s budget on Tuesday as it eyes a $17.5 billion international bailout.

4. Egypt:
Egypt’s credit-default swaps are hovering near the highest since September. The cost for protection surged in June as regional tensions heated up amid a push by the Saudis to isolate Qatar. While Egypt has been able to boost foreign-currency reserves and is on course to repay $14 billion in principal and interest in 2018, its foreign debt has climbed to $79 billion from $55.8 billion a year earlier.

5. Pakistan:
Pakistan’s credit-default swaps surged in late October and linger near their highest level since June. South Asia’s second-largest economy faces challenges as it struggles with dwindling foreign reserves, rising debt payments and a ballooning current account deficit. Pakistan is mulling a potential $2 billion debt sale later this year. Speaking at the Bloomberg Pakistan Economic Forum last week, central bank Deputy Governor Jameel Ahmad played down concerns over the country’s widening twin deficits.


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