Thursday, 22 November, 2012

KARACHI

ISMAIL DILAWAR

In a fresh setback to the country’s deplet-ing dollar reserves Pakistan Wednesday“successfully” repaid a seventh tranche ofover $394 million to the InternationalMonetary Fund (IMF). A central bankspokesman said Wednesday witnessedthe repayment of SDr 258.4 million,which is equivalent to $394.3million, tothe Fund under the 2008’s $ 11.3 billionStand-By Arrangement (SBA) of whichPakistan has received only $ 8.3 billion.In 2008, Islamabad had sought a bailoutpackage from the IMF to avoid a possibledefault on the Balance of Payment front.

“Seventh installment under IMF/SBAfacility amounting to SDr 258.4 million,equivalent of US$394.3 million, has beensuccessfully made today,” said SyedWasimuddin, chief spokesman of theState Bank of Pakistan.

With this transfer Pakistan’s repay-ments to the IMF since February 2012total at $ 2.522 billion. “With payment of7th installment on 21 november 2012,Pakistan to-date has paid SDrs 1,644 mil-lion equivalent US$ 2,522 million to IMFsince Feb-2012,” said the spokesman.

The dollar-hungry Pakistan would berepaying the next, 8th, installment to itslenders in the IMF after some threemonths at the end of February next year.

Such huge repayments have been apermanent drain on the foreign exchangereserves of the funds-starved Pakistanwhich is already breathing hard underheavy foreign debts which, according toofficial data, have swelled beyond $ 62billion.

What is alarming is the fact that thecountry’s dollar reserves have contractedto single digit, below $ 9 billion.

The State Bank last Thursday re-ported that on november 9 the country’sholding of the greenback stood at $ 13.84billion. Of this total, the central bank’s re-serves amount to $ 9.24 billion while thatof the commercial banks stand at $ 4.60billion.

except worker remittances that arebeing received on average to the tune of $1 billion every month, all other indicatorson Pakistan’s Balance of Payment list restin the red zone.

The analysts believe that negativeslike poor inflows of foreign investmentseem to be offsetting the positive impactof positives like a $258 million surplus inthe country’s current account balance.

This surplus, however, could only beachieved after the United States, Pak-istan’s non-nato ally in the War on Ter-ror, reimbursed $ 1.118 billion toIslamabad under the long-withheld Coali-tion Support Fund in early August thisyear. The economic observers believe that

such short-term gains were far from beingenough to put Pakistan’s troubled exter-nal sector back on track.

The received CSF money, the analystsview, was Pakistan’s own money and washardly enough to repay the IMF tranchesdue in the months ahead.

PAKISTAN’S IMF DEBT BURDEN SHRINKS BY $2.522B WITH 7TH REPAYMENT

ISLAMABAD

STAFF REPORT

CenTrAl banks of the De-veloping-8 countriesWednesday agreed on a“sustainable growth strat-egy” under which the mem-

ber countries would lessen dependenceon their traditional trade partners andfocus on the regional blocs like the D-8.

In a joint communiqué, the D-8 cen-tral banks decided that the membercountries would confront mutual eco-nomic challenges through concertedmeasures ranging from the establishmentof correspondent banking relationshipand currency swap arrangements to pro-motion of Islamic finance models to dealwith the emerging global economic chal-lenges.

The governors of central banks of D-8 countries held their second meetinghere with Governor State Bank of Pak-istan Yaseen Anwar in the chair toachieve the objectives of increasing theblock’s mutual understanding of variouseconomic and financial sector relatedchallenges facing them, and enhancingmutual co-operation to confront thesechallenges.

The D-8 central banks’ governors areexpected to again gather in 2014 inTurkey. Agenda of the meeting, the gov-ernors agreed Wednesday, would be thediscussion on shadow banking and its re-lated risks amongst other financial sectorissues.

The communiqué issued by the SBPreads as follows:

Since we last met in Abuja, nigeria inJuly 2010, the global economy continuesto face a number of challenges. external,fiscal and financial imbalances still per-sist, creating challenges on economicgrowth and employment. Global growthis projected to drop in 2012 because ofweak economic activity in the US and de-teriorating sovereign and banking sectordevelopments in the euro area. As a re-sult, real GDP growth in the emergingand developing economies is going to fur-ther slowdown.

Although the impacts and relatedchallenges may be different from countryto country, and region to region, we areall united in our resolve to achieve sus-tainable and inclusive growth in a collab-orative way.SpeCifiCally, we will:

a. Formulate monetary and financialpolicies to support sustainable growth

strategy in D-8 countries in the backdropof an uncertain outlook for the globaleconomy.

b. Promote Innovative Financial In-clusion Policies.

c. explore opportunities in IslamicFinance.

d. establish information exchangeand promote peer learning amongst D-8central banks.SuStainable Growth StrateGy

We must work together to formulatemonetary and financial policies to sup-port sustainable growth strategy for D-8countries in the backdrop of an uncertainoutlook for the global economy. The D-8economies face a diverse set of economicchallenges. Some of these are structural;others may be cyclical in nature, whileothers a direct consequence of the globalcredit crunch of 2007-08 and the recenteuro area crises.

However, in formulating a growthstrategy to deal with these issues – and toidentify areas of potential cooperationbetween members – it is necessary to un-derstand these challenges better. In orderto achieve this, we have agreed to collab-orate and focus on:

a. Developing and using monetaryand financial policy tools that can bufferthe domestic economy against the globalslowdown by striking a balance betweennurturing sustainable domestic demandand an export-led growth model.

b. reduce dependency on demandfrom traditional trade partners by rebal-

ancing and diversifying the sources ofeconomic growth in the domesticeconomies by focusing on opportunitiesfor greater cooperation amongst regionalblocs, such as the D-8.

c. establish correspondent bankingrelationship and currency swap arrange-ments amongst D-8 countries to promotetrade and capital flows.

d. The need to bring the informal sec-tor into the mainstream economy, andhence into the tax net, by improving theefficiency of public institutions, in orderto increase fiscal space and the effective-ness of monetary management processes.

e. Developing the means (such asjoint research projects and professionalexchanges between the member countriesfor capacity-building) to better under-stand, and learn from member countries’experiences, on the efforts undertaken totackle challenges that are common to theD-8 e.g. enforcing better fiscal discipline;promoting investment in infrastructure;implementation of capital standards; in-centivizing banks to lend to the real sec-tor and sustaining low and moderatelevels of inflation and contributing to fi-nancial stability.finanCial inCluSion

Financial inclusion will remain a toppriority as it alleviates financial con-straints on poor and low income house-holds, helps them to benefit from bettereconomic opportunities, and creates em-ployment.

We also note the effectiveness of ex-

isting policy frameworks and institutionsand progress made on various innovativenew approaches to financial inclusion.

We reaffirm our support to promotefinancial inclusion in D-8 countries. Inthis regard, we will take important meas-ures to advance the financial inclusionagenda. Specifically we will:

a. reaffirm or formulate national fi-nancial inclusion strategies in our coun-tries and gather support from across ourgovernments, financial sector and otherkey stakeholders to build broad-basedownership of the financial inclusionagenda.

b. Study policy approaches for build-ing delivery channels and payments sys-tems such as agent-based banking,mobile phone banking, and post officenetworks.

c. Form a D-8 Consultative Group onFinancial Inclusion (CGFI) with repre-sentation from each central bank. TheCGFI will have a series of knowledge ex-change exercises, consultations and pro-duce a comprehensive document by thenext D-8 Summit.iSlamiC finanCe

We reviewed the progress of IslamicFinance industry in D-8 countries thathas enjoyed rapid growth over the pastdecade primarily due to global trends andlocal demand for Shariah-complaint fi-nancial services. Going forward, the cen-tral banks may discuss sustainablemodels to promote Islamic finance in D-8 countries especially in the wake of chal-

lenging global economic landscape. Thereis need for exploring sustainable modelsto promote Islamic finance in D-8 coun-tries especially in the wake of challengingglobal economic landscape.

The cooperation will highlight strate-gies for ensuring growth trajectories forIslamic finance in D-8 countries, withemphasis on home grown demand andstrategies in D-8 countries, primarilypromoting Islamic finance to meet latentdemand for financial services due to lowlevel of financial inclusion and lack ofShariah compliant financial solutions. Inthis regard, the expert group identifiedthree major areas of cooperation i.e. de-velopment of financial instruments &markets, improving perception and en-hancing awareness, and training & capac-ity building.

establish Information exchange andPeer learning

Finally, we have agreed that each ofthe D-8 members has their strengths infinancial and monetary sector issues. Inorder for D-8 members to benefit fromthese strengths we will formalize our co-operation though the regular informa-tion exchange and work through peerlearning model amongst D-8 centralbanks in such areas including monetarypolicy, banking regulations and supervi-sion, financial inclusion and Islamic fi-nance. We hope that the D-8 countrieswill join the proposed peer learningworking groups and share their uniqueexperiences.

D-8 countries agree to focus on regional blocs

ISLAMABAD

STAFF REPORT

Stressing the need for continued collabo-ration amongst the D-8 central banks,Governor State Bank of Pakistan (SBP)Yaseen Anwar Wednesday said the mem-ber countries need to explore ways to pro-mote Islamic financing in the wake ofchallenging global economic landscape.

While opening and chairing the 2ndmeeting of central bank governors of theD-8 countries in Islamabad, Anwar saidthere was aneed for exploring sustainablemodels to promote Islamic finance in theDeveloping-8 (D-8) economies.

He said macroeconomic policies of D-8 countries must be balanced to checkoverheating pressures from strong recov-ery, high credit growth, volatile capitalflows, elevated commodity prices, and re-newed risk of inflation.

“We must continue to rebalance oureconomies to sustain growth through mod-ulating domestic consumption, increase intrade and allow capital to flow freely be-tween emerging and developing economiesin search of better returns as against in-vestment in debt ridden advancedeconomies”.

He noted that a sudden drop in thegrowth rate in 2009 immediately after the

2008 crises was perhaps the principal rea-son why the D-8 central bank governors intheir first meeting agreed to set this meet-ing agenda on strengthening monetary andfinancial cooperation.

“The global growth is projected to fur-ther drop from 3.8 percent in 2011 to about3.3 percent in 2012. As a result, the realGDP growth in the emerging and develop-ing economies is projected to be furtherslower from 6.3 percent in 2011 to 5.2 per-cent in 2012. Therefore, we need continuedcollaboration to further strengthen oureconomies,” he added.

There was only one central bank ineach country/monetary area, and there-fore, it was very logical for central banks tolook beyond their national borders for ad-vice and collaboration, he said adding thatin recent years, increasing globalizationhas further enhanced the need for centralbanks’ cooperation to tackle risks due tothe cross border interdependencies and tomake the most of emerging opportunities.

The central banks’ cooperation hadbeen facilitated through collaborative mul-tilateral forums such as the G20, the FSBand the meetings of the IMF, BIS and a

number of bilateral and regional initiativesfor cooperation. “The enhanced role ofthese forums also reflects the increasinglyimportant role that the central banks ofemerging and developing economies areplaying at these international forums,” saidthe SBP governor. Stressing the need forstrengthening cooperation amongst D-8countries, Anwar said the D-8’s secretariatmust be strengthened to collect and main-tain information on our economies andtheir interconnectedness.

“This would serve the dual purpose asit would provide regular updates on thestate of D-8 economies and would help usin reviewing and measuring progress ofour economies on economic and financialcooperation,” he said. Anwar suggestedthat D-8 countries must collaborate andfocus on the optimal use of monetary pol-icy tools which are at best the first line ofdefence against the global crisis. The D-8countries must collaborate on how to re-balance its growth model from export-ledgrowth to diversifying demand throughstructural changes in their economies thatwould enable sustainable future growthand make their economies less susceptibleto volatility in other financial markets, par-ticularly by raising domestic demand andrecycling more of the D-8 countries sav-ings into investments at home.

Let’s explore Islamic finance modelsSBP urges D-8 central banks to explore Islamic finance models amid global economic challenges

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Thursday, 22 November, 2012

Major Gainers

COMPANY OPEN HIGH LOW CLOSE CHANGE TURNOVERIsland Textile 687.34 721.70 720.00 721.70 34.36 500Bhanero Tex.XD 226.00 237.30 237.30 237.30 11.30 1,600Millat Tractors Ltd. 558.84 578.00 559.00 569.80 10.96 38,000Siemens Pakistan 740.00 750.00 747.00 750.00 10.00 1,700Colgate Palmolive 1290.00 1301.00 1300.00 1300.00 10.00 400

Major LosersBata (Pak) XD 1380.00 1400.00 1311.50 1352.50 -27.50 900Indus DyeingXD 549.98 550.00 522.50 538.91 -11.07 1,200Sanofi-Aventis Pak 325.00 315.00 315.00 315.00 -10.00 100Murree BreweryXDXB 155.00 152.00 147.25 147.38 -7.62 1,200IGI Insurance 126.91 123.00 120.57 120.57 -6.34 83,500

Volume Leaders

K.E.S.C. 5.65 6.44 5.70 6.16 0.51 36,529,000Fauji Cement 6.77 6.88 6.63 6.70 -0.07 23,695,000Jah.Sidd. Co. 15.87 16.35 15.40 16.10 0.23 12,298,500Maple Leaf Cement 13.95 14.70 13.75 14.25 0.30 9,255,000Azgard Nine 8.26 8.49 8.01 8.28 0.02 9,093,500

Interbank RatesUS Dollar 95.9684UK Pound 152.7433Japanese Yen 1.1679Euro 122.6572

Dollar EastBUY SELL

US Dollar 96.40 96.90Euro 122.64 124.11Great Britain Pound 152.45 154.24Japanese Yen 1.1569 1.1704Canadian Dollar 95.64 97.26Hong Kong Dollar 12.21 12.43UAE Dirham 26.10 26.38Saudi Riyal 25.58 25.83Australian Dollar 98.61 101.22

Business

ISLAMABAD

ONLINE

Dr Asim Hussain Advisor to thePrime Minister on Petroleumand natural resources has saidthat lnG import is most essen-tial to overcome the energy

shortfall and it will also help in improving theeconomy ultimately. He said this while chairinga meeting on lnG import.

The meeting was also attended by SenatorSaleem H.Mandviwalla, Minister of State forFinance, Dr. Waqar Masood Khan SecretaryPetroleum, Mr. Zuhair Siddiqui Managing Di-rector Sui Southern Gas Company ltd, (SSGC)Mr. Shahid Sattar Member Planning Commis-sion of Pakistan, Dr. riaz Mahmood SeniorJoint Secretary Ministry of law, Mr. MansoorSiddiqui Director State Bank of Pakistan, rep-resentative of the Ministry of Finance, seniorofficers of SSGC and Ministry of Petroleum.

A briefing was given by SSGC regardinglnG Integrated Project’s request For Proposal(rFP). It was informed by SSGC that the lnGbidding process would be through two enve-lope system i.e. technical and Financial propos-als would be sought.

Detailed discussions were held on variousaspects of lnG import including quantity, bid-ding process, timelines, bid security and per-formance bond, credit structure, sovereignguarantees, evaluation of bids and Gas SalePurchase Agreement (GSPA) terms.

It may be re-called that eCC in its meetingon 7th August 2012 approved the short andlong term liquefied natural Gas (lnG) Import

Framework proposed by Ministry of Petroleum& natural resources. However, eCC formed atechnical group comprising Secretary Petro-leum, Secretary Finance, Secretary Water &Power, Deputy Chairman Planning Commis-sion, Chairman Board of Investment andChairman State Bank of Pakistan to work fur-ther on mechanism, bidding details, guaranteematters and legal issues.

KArAChi: November 2012 Karachi Kings Lions Club

District-305 -S3 Pakistan is a part of Lions Club

international participating with PiD Lions Malik Khuda

Baksh on the occasion of Jurisdiction of houses Keys

along with the Wall clocks from Karachi Kings Lions Club

to the flood victims on the event of “handing Over

Ceremony of 24 houses” at Thatha, Sindh. Governor Lion

Tasneem Ahmed (District 305-S3)Lion ishrat Bano

President of Karachi Kings Lions Club and the team

members distributed clocks to the flood disasters.

Samsung wins 27 honours at the

‘CES 2013 innovations Awards’

lahore: Samsung electronics Co. ltd., a mar-ket leader and award-winning innovator, has won27 prestigious International Consumer electronicsShow (CeS) 2013 Innovations Awards. Samsungwas recognized with two “Best of Innovations”awards and four “eco-Design” honors, by CeS, theworld’s largest annual consumer-technologytradeshow. Over the past four years, Samsung hasbeen honored with 117 awards, judged across 29product categories, by a preeminent panel of in-dustrial designers, engineers, and Media Mem-bers, who converge to honor outstanding designand cutting edge engineering. Samsung’s award winning products at CeS 2013

include; 85-inch UHD TV, the world’s largestcommercialized UHD leD TV, boasts life-like pic-ture quality with over 8 million pixels, four timesthe resolution of Full HD displays. SamsungSmart TV Camera supports full HD resolution andenables Smart Interaction features such as Ges-ture Control and Face recognition. The 2013Smart leD TV 7500 and 8000 Series, along withOleD TV also won Design & engineering Awards.The eX2F SMArT Compact Camera impresseseveryone, with premium images, full manual con-trol and robust wireless connectivity. The Induc-tion range with Flex Cookzone makes cookingeasier by eliminating boil-overs, automatic alertsand preset heating levels.

New Era Watches steals the

limelight at Swiss embassy

KaraChi: new era Watches, the sole distributorfor Omega watches and jewelry in Pakistan, was astar of the Swiss Watch Fair, organized by theSwiss embassy in collaboration with the authorizedSwiss watch dealers in Pakistan. Held on novem-ber 17, 2012, the Swiss Watch Fair showcased thelatest designs, innovation and technology of Swisswatches. Omega , a major attraction the event withits latest collection of exclusive and chic timepiecesand jewelry, attracted huge crowds and apprecia-tion across different walks of life. On the occasion,the visitors also enjoyed Swiss delicacies likeraclette and Movinpick ice cream.

Fatima Memorial hospital,

Jahanara Memorial Trust sign MoU

lahore: Jahanara Memorial Trust (JMT) andFatima Memorial Hospital (FMH) have signed aMemorandum of Understanding (MoU) to collabo-rate with their specific strengths and capacities todevelop state of the art emergency room (er) serv-ices at FMH. This collaboration will launch Pak-istan’s first fully equipped ‘er room of the Future’compliant international standards of technologicaladvanced high quality medical care complete withevery state-of-the-art feature and facility availablein the global market. The vision is to provide emer-gency treatment to all walk in patients, regardless oftheir citizenship, status or ability to pay.

iSLAMABAD: indonesian Delegation along with the

President of republic of indonesia, his Excellency Dr. h.

Susilo Bambang Yudhoyono, were warmly received by

Executive Assistant Manager, Salman Saeed upon their

arrival at islamabad Marriott for D-8 Summit 2012.

inauguration ceremony

of Aman Center at iBA

KaraChi: The Inauguration Ceremony of IBA-Center for entrepreneurial Development (CeD) washeld at the Institute of Business AdministrationKarachi, this evening. This Center has been estab-lished in collaboration with the Aman foundation topromote entrepreneurship by providing state of theart facilities to young entrepreneurs at IBA.The Director CeD, Mr. ZafarSiddiqui, welcomedthe esteemed guests and highlighted the impor-tance of this center. He spoke about IBA’s strate-gic vision and informed the audience in detailabout the center’s vision and functional areas. Healso highlighted the regional collaboration withother communities to promote entrepreneurship.

KArAChi: The British Deputy high Commissioner and

Director UK Trade and investment, Pakistan Mr. Francis

Campbell, at a reception hosted by him at his residence

to introduce LSBF (London School of Business and

Finance) Country head for Pakistan, Mr. Faisal Azeem.

CORPORATE CORNER

‘LNG import imperativefor country’s economy’

Euro weakens as eurozonefails to agree Greek dealhonG KonG: The euro fell in Asian trade on Wednesday andshares eased after eurozone finance chiefs said they had failed toagree on a deal to unlock the latest batch of crucial bailout cashfor Greece. Ministers said in a statement at the end of talks thatended in the small hours that they would meet again next Monday“for further technical work on some elements of the package”.

The news sent the euro diving from recent highs against the yen,while it also lost almost a US cent from its intra-day peak againstthe dollar. In afternoon trade the single currency bought $1.2747and 104.30 yen after hitting $1.2820 and 105.07 yen before the an-nouncement from Brussels. It had finished in new York Tuesday at$1.2818 and 104.70 yen. The dollar, which had touched a seven-month high of 81.97 yen in the morning, bought 81.81 yen in the af-ternoon. Traders were left disappointed as they had been buyingthe euro on expectations an agreement would be made in Brussels,while Jean-Claude Juncker, who presides over the eurogroup hassaid there were “good chances of an agreement”. AGENCIES

‘Gas supply to domestic consumers top priority’

ISLAMABAD

APP

Advisor to the Prime Minister on Petroleum and natural resources Dr Asim Hussain has saidthat the supply of natural gas to domestic consumers is the top priority of the government. He said this in a meeting with parliamentarians, including MnAs engineer Khurram DastagirKhan, Hamid Saeed Kazmi, Zahid Hamid, Mufti Ajmal Khan, Mazhar Hayat Khan, roshan-ud-Din Junejo, Senator Baz Muhammad and Senator Zahid Khan, who called on him to apprisehim of the problems in supply of natural gas to their respective constituencies. The meetingwas also attended by Managing Director and Senior Management of Sui northern GasPipelines ltd. The parliamentarians apprised the advisor regarding progress on gas supplyschemes in their respective constituencies, on which the Advisor on Petroleum issued direc-tives to SnGPl for expediting work. Dr. Asim Hussain informed the parliamentarians that asite office of the SnGPl was being established in the ministry’s premises to cater for publiccomplaints and providing up-to-date information on gas supply / connection cases.

ISLAMABAD

ONLINE

Zakaria Kamarudin, Deputy Chief executive Of-ficer of Trade and Services Promotion Divisionsaid that bilateral trade volume of Pakistan andMalaysia could be increased by finding new av-enues of opportunities and cooperation

Zakaria Kamarudin and noraslan HadiAbdul Kadir, Consulate General of Malaysia vis-ited Islamabad Chamber of Commerce and In-dustry (ICCI) for having a meeting withMr.Zafar Bakhtawari, President of ICCI.

Kamarudin said that Malaysia offers a dy-namic and vibrant business environment to in-vestors who intend to set up projects in themanufacturing and services sectors in Malaysiaas foreign investment is considered an impor-tant source of development for a country. Thus,

Pakistan should accord high importance to en-courage foreign investors by creating invest-ment-friendly environment in the country toaccelerate pace of economic progress.

He said that various multi-national compa-nies of Malaysia have established their r&Dcenters adjacent to industries for creatingstrong linkage between students and industriesso that they could have complete know-howabout demands of industries . He informed themeeting about export Bank of Malaysia whichprovides financing to Malaysian entrepreneursas well as facilities foreign exporters.

Deputy Chief executive Officer invited ICCIdelegation to visit Malaysia to meet their coun-terparts and assured of support accordingly. Hesaid that the negative perception of Pakistan canonly be eliminated through frequent exchangeof trade delegations between two countries.

Crude up in Asia onUS stockpile fallSinGapore: Oil prices rose in Asiantrade Wednesday on an unexpected fallin US crude stockpiles, analysts said.new York’s main contract, light sweetcrude for delivery in January rose 52cents to $87.27 a barrel and Brent northSea crude for January delivery added 62cents to $110.45. The black gold re-ceived support from “the American Pe-troleum Institute (API) report showing astock drawdown”, said Victor Shum,senior principal of Purvin and Gertz en-ergy consultants in Singapore. “What’sdriving it is primarily the report fromthe API showing a crude oil inventorydraw,” he told AFP. The API data Tues-day showed US inventories falling bymore than 1.9 million barrels last week,compared with analyst projections of a900,000 barrel gain. AGENCIES

ICCI president stresses creation ofdirect Pakistan, Malaysia air link

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