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  • Pakistan’s weekly foreign exchange reserves increase by $1.24bn

    Pakistan’s weekly foreign exchange reserves increase by $1.24bn

    KARACHI: The foreign exchange reserves of the country increased by $1.24 billion to $17.97 billion by week ended June 26, 2020, State Bank of Pakistan (SBP) said on Thursday.

    The foreign exchange reserves of the country were at $16.73 billion by week ended June 19, 2020.

    The official foreign exchange reserves of the SBP increased by $1.27 billion to $11.231 billion by week ended June 26, 2020. The official reserves of the central bank were at $9.961 billion a week ago.

    The SBP said that during the week ended June 26, 2020, the central bank received around $2,046 million official inflows, including $737 million from World Bank, $503 million from Asian Development Bank, $500 million from Asian Infrastructure Investment Bank and $300 million as GOP loan disbursement from China.

    After incorporating government external debt payments of $ 809 million, SBP reserves increased by $ 1,270 million to $ 11,231 million.

    During the current week, SBP has received additional $1,000 million as GOP loan disbursement from China.

    These funds will be part of SBP weekly reserves data as of July 03, 2020 to be released on July 09, 2020.

  • Date extended to exchange Rs40,000 bearer prize bonds

    Date extended to exchange Rs40,000 bearer prize bonds

    ISLAMABAD: The ministry of finance on Thursday extended the last date to exchange bearer prize bonds of Rs40,000 denomination up to December 30, 2020.

    The last date to exchange the bearer prize bonds was expired on June 30, 2020.

    The government on June 24, 2019 announced to discontinue the circulation of Rs40,000 denomination national prize bonds.

    The State Bank of Pakistan (SBP) allowed the investors to exchange the unregistered prize bonds through three different modes. The SBP has barred the exchange of bearer prize bonds against cash.

    However, the bonds can be redeemed against registered or premium prize bonds or can be converted into national saving schemes or face value (direct transfer to the bank account of bond holder).

    The bearer instruments have been known as parking lot for undocumented economy. Therefore, the government launched registered prize bonds of Rs40,000 denomination in March 2017 which could be purchased against certain requirements including Computerized National Identity Card (CNIC) and valid bank account.

    According to Central Directorate of National Savings (CDNS) data made available on Friday people surrendered around Rs256 billion bearer prize bonds of Rs40,000 denomination since the ban imposed June 2019 for documentation of the economy.

    The data showed the total stock of investment made in bearer bonds of Rs40,000 denomination was Rs258 billion by May 2019. The remaining stock of bearer bonds is Rs2 billion by March 2020.

  • EOBI pension increases to Rs8,500; pensioners to get arrears

    EOBI pension increases to Rs8,500; pensioners to get arrears

    ISLAMABAD: The federal cabinet has approved increase in pension of Employees Old-Age Benefits Institution (EOBI) to Rs8,500 from Rs6,500.

    According to a tweet by EOBI on Wednesday, the federal cabinet approved an increase in EOBI pensions from Rs 6500 to Rs8500 effective from January 01, 2020.

    EOBI will restore the increase in pension + arrears for the month of April, June and July 2020. Pensioners can draw this increase along with the arrears from 1st August 2020, it added.

    The increase in pension was announced in December 2019 by Special Assistant to the Prime Minister on Overseas Pakistanis and Human Resource Development Sayed Zulfikar Abbas Bukhari.

    He said that after increase in the EOBI pensioners would receive Rs 8,500 per month from January 01, 2020.

    He said the ministry would move the summary regarding the increase at the next meeting of federal cabinet for a final approval.

    The SAPM said the PTI government, in its efforts to give more relief to the pensioners, had twice increased their annuity in just one and half year’s tenure.

    He said the government had already enhanced the minimum pension of the EOBI’s insured person from Rs 5,250 to Rs 6,500 during 2018.

    The EOBI pension has been enhanced by 62 per cent since the Pakistan Tehreek-e-Insaf government came into power.

    “We are intending to raise this amount up to Rs 15,000 by the end of our tenure (2023),” Zulfikar Bukhari said.

  • Headline inflation increases by 8.6 percent in June

    Headline inflation increases by 8.6 percent in June

    ISLAMABAD: The headline inflation based on Consumer Price Index (CPI) increased by 8.6 percent on Year on Year (YoY) basis in June 2020 as compared to an increase of 8.2 percent in the previous month and 8.0 percent in June 2019.

    Pakistan Bureau of Statistics (PBS) on Wednesday said that on month-on-month basis, it increased by 0.8 percent in June 2020 as compared to an increase of 0.3 percent in the previous month and an increase of 0.5 percent in June 2019.

    CPI inflation Urban, increased by 7.6 percent on year-on-year basis in June 2020 as compared to an increase of 7.3 percent in the previous month and 8.1 percent in June 2019.

    On month-on-month basis, it increased by 0.7 percent in June 2020 as compared to an increase of 0.3 percent in the previous month and an increase of 0.3 percent in June 2019.

    CPI inflation Rural, increased by 10.0 percent on year-on-year basis in June 2020 as compared to an increase of 9.7 percent in the previous month and 7.9 percent in June 2019.

    On month-on-month basis, it increased by 1.0 percent in June 2020 as compared to an increase of 0.3 percent in the previous month and an increase of 0.7 percent in June 2019.

    SPI inflation on YoY increased by 11.5 percent in June 2020 as compared to an increase of 11.0 percent a month earlier and an increase of 9.3 percent in June 2019.

    On MoM basis, it increased by 1.4 percent in June 2020 as compared to an increase of 2.2 percent a month earlier and an increase of 0.9 percent in June 2019.

    WPI inflation on YoY basis increased by 0.9 percent in June 2020 as compared to an increase of 1.5 percent a month earlier and an increase of 14.0 percent in June 2019.

    WPI inflation on MoM basis decreased by 0.3 percent in June 2020 as compared to a decrease of 2.1 percent a month earlier and an increase of 0.2 percent in corresponding month of last year i.e. June 2019.

    Core inflation (NFNE)

    Measured by non-food non-energy Urban CPI increased by 6.5 percent on (YoY) basis in June 2020 as compared to an increase of 6.3 percent in the previous month and 7.3 percent in June 2019. On (MoM) basis, it increased by 0.4 percent in June 2020 as compared to increase of 0.4 percent in previous month, and an increase of 0.2 percent in corresponding month of last year i.e. June 2019.

    Measured by non-food non-energy Rural CPI increased by 8.8 percent on (YoY) basis in June 2020 as compared to an increase of 8.4 percent in the previous month and 6.7 percent in June 2019. On (MoM) basis, it increased by 0.7 percent in June 2020 as compared to an increase of 0.4 percent in previous month, and an increase of 0.3 percent in corresponding month of last year i.e. June 2019.

    Core inflation (Trimmed)

    Measured by 20 percent weighted trimmed mean Urban CPI increased by 7.4 percent on (YoY) basis in June 2020 as compared to 6.7 percent in the previous month and by 7.3 percent in June 2019. On (MoM) basis, it increased by 0.4 percent in June 2020 as compared to an increase of 0.4 percent in the previous month and an increase of 0.4 percent in corresponding month of last year i.e. June 2019.

    Measured by 20 percent weighted trimmed mean Rural CPI increased by 9.9 percent on (YoY) basis in June 2020 as compared to 8.9 percent in the previous month and by 7.2 percent in June 2019.

    On (MoM) basis, it increased by 0.9 percent in June 2020 as compared to an increase of 0.5 percent in the previous month and an increase of 0.7 percent in corresponding month of last year i.e. June 2019.

  • World Bank approves $500 million to help Pakistan strengthening fiscal management

    World Bank approves $500 million to help Pakistan strengthening fiscal management

    KARACHI: The World Bank on Tuesday approved $500 million in financing for the Resilient Institutions for Sustainable Economy program (RISE) to help Pakistan strengthen fiscal management.

    A statement issued by The World Bank’s Board of Executive Directors approved today $500 million in financing for the Resilient Institutions for Sustainable Economy program (RISE) to help Pakistan strengthen fiscal management, promote transparency and private sector growth, and undertake foundational reforms in the energy sector to transition to low-carbon energy. These reforms are critical to build fiscal resilience and stimulate recovery from impacts of the COVID-19 pandemic.

    “Pakistan is suffering a significant fiscal shock from the economic fallout from the pandemic and the increased spending on crisis response, including emergency healthcare, social protection, and business support,” said Illango Patchamuthu, World Bank Country Director for Pakistan.

    “The RISE program supports the government efforts to achieve macroeconomic stability, accelerates long-delayed policy reforms, and sets the course for a strong and competitive economy.”

    The program supports reforms to broaden the tax base and reduce distortions in tax policy, strengthen debt management and transparency, and implement urgently needed reforms to achieve financial viability of the power sector.

    In tandem, reforms to lower barriers to the formalization of firms, increase the use of digital payments, and better regulate real estate developments will help create an enabling environment to attract private investment.

    “RISE supports reforms such as harmonizing sales tax and making the trade tariff structure more competitive. This could help the country attract new investments and spur economic recovery,” said Shabih Mohib, Lead Country Economist for the World Bank.

    “Taken as a whole, we hope that RISE can build a foundation for sustainable growth driven by the private sector.”

    The program supports the foundations for a move toward a low-carbon and more financially viable power sector. The program includes reforms to improve the integrity of the banking sector, promote digital finance, and create a more competitive national tariff policy to promote trade and reduce costs to consumers.

    The digital finance component of the program will help deepen electronic money transactions and digital payments will benefit populations with limited mobility, such as women and low-income populations.

    RISE is aligned with the government’s COVID-19 crisis response, which aims to scale up spending on health and social protection while pursuing macro-fiscal reforms in the face of economic contraction.

    RISE complements the Securing Human Investments to Foster Transformation (SHIFT) which focuses on human capital and an upcoming Program for Affordable and Clean Energy (PACE) which will tackle power sector reforms.

    PACE, which will include critical power sector reforms needed to put the country on sustainable fiscal path, will precede the second programs of RISE and SHIFT.

  • SBP foreign exchange reserves slip to $9.96 billion

    SBP foreign exchange reserves slip to $9.96 billion

    KARACHI: The official foreign exchange reserves of State Bank of Pakistan (SBP) fell by $146 million to $9.961 billion by week ended June 19, 2020, according to weekly data of foreign exchange reserves of the country issued by the SBP on Thursday.

    The official reserves of the central bank were at $10.107 billion by week ended June 12, 2020.

    The SBP said that during the week ended June 19, 2020, SBP reserves decreased by $146 million to $ 9,961.2 million. This decline is attributed to government external debt payments of $ 244.5 million.

    During the current week, SBP has received around $1,725 million, including $725 million from the World Bank, US$500 million from Asian Development Bank and US$500 million from Asian Infrastructure Investment Bank.

    These funds will be part of SBP weekly reserves data as of 26-June-2020 to be released on 02-July-2020.

    The total foreign exchange reserves of the country fell by $45 million to $16.73 billion by week ended June 19, 2020 as compared with $16.775 billion a week ago.

    However, the foreign exchange reserves of commercial banks increased by $101 million to $6.769 billion by week ended June 19, 2020 as compared with $6.668 billion a week ago.

  • SBP receives $1bn from ADB, World Bank

    SBP receives $1bn from ADB, World Bank

    KARACHI: State Bank of Pakistan (SBP) on Tuesday received $1 billion from two international financial institutions to mitigate adverse economic impact of COVID-19.

    The SBP said that it had received $500 million each from Asian Development Bank (ADB) and World Bank.

    Pakistan and three international financial institutions (IFIs) including World Bank, ADB and Asian Infrastructure Investment Bank (AIIB) have signed $1.5 billion loans agreement as each of the IFI has provided $500 million facility.

    This is concessional financing in the form of budgetary support that is being provided by the three IFIs that will help mitigate socio-economic impact of COVID-19 pandemic and strengthen health, education, and social safety nets systems.

    The Asian Development Bank is extending financial support of $500 million for this programme with the objective to support the government of Pakistan’s efforts to strengthen the health system and mitigate socio-economic impacts of the COVID-19 pandemic.

    The Asian Infrastructure Investment Bank is extending co-financing of $500 million for the CARES to augment the government’s efforts to mitigate the direct and indirect impacts of COVID-19 pandemic

    The scope of the CARES programme covers: (i) social protection for the poor and vulnerable, (ii) an expanded health sector response to the pandemic; and (iii) a pro-poor fiscal stimulus package to ensure recovery in growth and employment.

    Securing Human Investments to Foster Transformation (SHIFT) $500 million: It aims to strengthen the Civil Registration and Vital Statistics, health and education systems essential for human capital accumulation; recognise and support the contribution of women to economic productivity; and improve efficiency of the national safety nets.

    Noor Ahmed, Secretary Ministry of Economic Affairs, signed the three loan agreements on behalf of government of Pakistan, while Patchamuthu Illangovan, Country Director WB Ms Xiaohong Yang, Country Director, ADB and Konstantin Limitovsriy, Vice President, AIIB signed agreements on behalf of the World Bank, Asian Development Bank and AIIB respectively.

  • SBP develops regulatory framework for cross border e-commerce

    SBP develops regulatory framework for cross border e-commerce

    ISLAMABAD: State Bank of Pakistan (SBP) has developed regulatory framework for facilitation of cross border B2C e-commerce.

    However, this will be adopted after integration with the e-Commerce to be developed by Federal Board of Revenue (FBR) in WeBOC (Web Based One Customs).

    The officials of SBP shared this information at the second meeting of National e-Commerce Council, chaired by Abdul Razak Dawood, Advisor to the Prime Minister on Commerce and Investment on Thursday.

    All of the nominated members of the Council, including State Bank of Pakistan, Ministry of IT & Telecom, Federal Board of Revenue, Securities and Exchange Commission of Pakistan, National Information Technology Board, Provincial Departments of Industries and Commerce, Provincial Revenue Authorities, Pakistan Post, Federal and Provincial Consumer Rights Commission/Councils, Telecom companies, online marketplaces, Fintech sector representatives, Freelancers, Banking sector and Logistics companies attended the meeting.

    The Advisor briefed the participants about the progress achieved in the past months on the e-Commerce Policy, since its approval on October 01, 2019.

    He appreciated the coordinated efforts of public and private sector for the effective implementation of the policy.

    Talking to the participants, Razak Dawood underlined that the trend of e-commerce has increased rapidly in the recent years with the development and easy accessibility of the internet.

    He added that, due to the covid-19 pandemic, the importance of e-Commerce has increased manifolds, making it an extremely vital sector for the economy.

    He stressed the importance of directing the resources towards digital adoption and connecting the SMEs to e-platforms across the globe, while exploring new market access opportunities for them.

    Punjab and Khyber Pakhtunkhwa Revenue Authorities apprised the participants of the incentives being announced for Digital and e-Commerce sector in the provincial budgets to support these sectors during these challenging circumstances.

    Representatives from Consumer Protection Councils of Punjab and Lahore and from Consumer Rights Commission of Pakistan informed that, in line with the directions of the e-Commerce Policy, Federal and Provincial Consumer Acts are being amended to include the subject of e-Commerce and the disputes arising from this sector.

    They added that webinars are being planned to educate academia and train the judicial officers on the subject of consumer protection.

    SECP shared with the participants that several new initiatives are being planned to promote e-Commerce, including introduction of a separate sectoral classification of e-Commerce.

     So far 152 businesses have registered on their portal, which has reduced the time of a company registration to 4 hours.

    Secretary Commerce told the participants that Ministry of Commerce is continuously engaged with its foreign trade missions for promoting Pakistani trade and exploring new markets for its exporters.

    In this regard, a new development is registration of Pakistani sellers with Amazon. Initially, a list of 38 exporters has been communicated to Amazon, which is limited to Surgical & Sports Goods and Home Textiles Sectors but will be expanded to other sectors in near future, after a successful trial of these shortlisted companies.

    A video message from the Director General-WTO, appreciating Pakistan’s e-Commerce Policy being a step in the right direction, was also shared with the participants.

  • Foreign exchange reserves up by $70 million

    Foreign exchange reserves up by $70 million

    KARACHI: The foreign exchange reserves of the country have increased by $70 million to $16.775 billion by week ended June 12, 2020, State Bank of Pakistan (SBP) said on Thursday.

    The foreign exchange reserves were at $16.705 billion by week ended on June 05, 2020.

    The foreign exchange reserves held by the central bank increased by $11 million to $10.107 billion by week ended June 12, 2020 as compared with $10.096 billion a week ago.

    The foreign exchange reserves held by commercial banks were also increased by $59 million to $6.668 billion from $6.609 billion a week ago.