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  • IMF board approves $452.4 million as second tranche for Pakistan

    IMF board approves $452.4 million as second tranche for Pakistan

    KARACHI: International Monetary Fund (IMF) in its board meeting held on December 19, 2019 approved second tranche of about $452.4 million under its total $6 billion loan program for Pakistan.

    The Executive Board of the IMF on December 19, 2019 completed the first review of Pakistan’s economic performance under the Extended Fund Facility (EFF).

    The completion of the review will allow the authorities to draw SDR 328 million (about US$ 452.4 million), bringing total disbursements to SDR 1,044 million (about US$ 1,440 million), said a press release issued by the IMF.

    The Fund observed that Pakistan’s economic reform program is on track. Decisive policy implementation by the Pakistani authorities is helping to preserve economic stability aiming to put the economy on the path of sustainable growth.

    Transition to a market-determined exchange rate has been orderly; inflation has started to stabilize, mitigating the impact on the most vulnerable groups of the population.

    The Pakistani authorities remain committed to expanding the social safety nets, reducing poverty, and narrowing the gender gap, the IMF said.

    The Executive Board approved the 39-month, SDR 4,268 million (about $6 billion at the time of approval of the arrangement, or 210 percent of quota) EFF for Pakistan on July 3, 2019.

    Following the Executive Board’s decision, David Lipton, First Deputy Managing Director and Acting Chair, issued the following statement:

    “Pakistan’s program is on track and has started to bear fruit. However, risks remain elevated. Strong ownership and steadfast reform implementation are critical to entrench macroeconomic stability and support robust and balanced growth.

    “The authorities are committed to sustaining the progress on fiscal adjustment to place debt on a downward path. The planned reforms include strengthening tax revenue mobilization, including the elimination of tax exemptions and loopholes, and prudent expenditure policies. Preparations for a comprehensive tax policy reform should start early to ensure timely implementation. Enhanced social safety nets will help alleviate social costs and build support for reforms.

    “The flexible, market-determined exchange rate remains essential to cushion the economy against external shocks and rebuild reserve buffers. The current monetary stance is appropriately tight and should only be eased once disinflation is firmly entrenched. Strengthening the State Bank of Pakistan’s autonomy and governance will support these efforts.

    “Faster progress is needed to improve the AML/CFT framework, supported by technical assistance from the IMF and other capacity development providers. Swift adoption of all the necessary measures is needed to exit the FATF’s list of jurisdictions with AML/CFT deficiencies.

    “The authorities have adopted a comprehensive plan to address the accumulation of arrears in the power sector. Its full implementation is key to improve collection, reduce losses, and enhance governance. Timely and regular adjustment of energy tariffs will bring the sector in line with cost recovery.

    “Efforts are ongoing to further improve the business environment, strengthen governance, and foster private sector investment. Reform of the state-owned enterprise sector will help put Pakistan’s public finances on a sustainable path and have positive spillovers by leveling the playing field and improving the provision of services.”

  • Pakistan’s forex reserves increase to $17.655 billion

    Pakistan’s forex reserves increase to $17.655 billion

    KARACHI: The liquid foreign exchange reserves of the country have increased by $1.607 billion, State Bank of Pakistan (SBP) said on Thursday.

    The foreign exchange reserves increased to $17.655 billion by week ended on December 13, 2019 as compared with $16.048 billion a week ago.

    The foreign exchange reserves of the central bank increased $1.659 billion to $10.892 billion by week ended December 13, 2019 as compared with $9.233 billion a week ago.

    The reserves held by the commercial banks declined nominally to $6.762 billion by December 13, 2019 as compared with $6.814 billion a week ago.

  • SECP, universities sign MoU to promote financial literacy

    SECP, universities sign MoU to promote financial literacy

    ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has signed Memorandums of Understanding (MOU) with five leading universities to promote financial literacy among youths.

    SECP’s Commissioner Investor Education Department, Shaukat Hussain inked the MoUs, said a statement on Tuesday.

    While universities were represented by their respective Vice Chancellors, Registrars and Directors.

    These HEC recognized universities included University of Balochistan, Mehran University of Engineering and Technology Jamshoro, University of Wah, Forman Christian University Lahore and University of Malakand. Including these five MOUs, SECP’s total number of active MOUs with various institutions under its investor education program ‘Jamapunji’ reached 51, giving it leverage of an ever increasing network of partners for spreading investor awareness.

    Talking at the occasion, Shaukat Hussain emphasized on the importance of collaborative efforts between the regulator and the educational sector to enable a more aware and responsible financial ecosystem in Pakistan.

    He mentioned SECP’s efforts leading to 28 places jump in the World Bank’s Ease of Doing Business Index, making Pakistan among the top 10 countries with the most improved business climate.

    He lauded each of these universities for their established Offices of Research, Innovation and Commercialization (ORICs), which encourage and facilitate aspiring student entrepreneurs.

    The Commissioner apprised participants of SECP’s dedicated Startup Portal and ongoing collaboration with various National Incubation Centers across Pakistan.

    He informed participants that SECP is member of HEC’s National Curriculum Revision Committees (NCRC) and providing due input in improving ‘ Economics’ and ‘ Business Administration’ tertiary level curricula.

    He was of the view that a curricula with components of capital markets, insurance sector and basics of financial literacy would help in producing astute entrepreneurs.

    The representatives appreciated SECP’s efforts for cultivating financial literacy.

    Under the MoU, SECP will be holding regular seminars at universities on a continuing basis to impart knowledge to students on the basics of savings, financial planning, investing and capital markets.

    Visiting university delegates committed to extending their full support through their vast network of colleges and campuses, radio channels, faculty resources, infrastructure and premises, information exchange etc., to make meaningful impact hand in hand with SECP.

  • Foreign investment witnesses massive growth to $2bn in five months

    Foreign investment witnesses massive growth to $2bn in five months

    KARACHI: The inflows of foreign investment registered unprecedented growth to $2 billion during first five months (July – November) of 2019/2020 owing to significant investment in debt securities.

    According to data of foreign investment in Pakistan by State Bank of Pakistan (SBP) on Tuesday, the total investment increased to $2 billion during first five months of current fiscal year as compared with $146.7 million in the same period of the last fiscal year.

    The total foreign private investment registered 493 percent growth to $869.7 million during the period under review as compared with $146.7 million in the same period of the last fiscal year.

    The major component under this head i.e. foreign direct investment grew by 78.1 percent to $850 million during July – November 2019/2020 as compared with $477.3 million in the same period of the last fiscal year.

    The portfolio investment in the equity market registered 106 percent growth to $19.5 million during first five months of current fiscal year as compared with outflow of $330.6 million in the corresponding months of the last fiscal year.

    The debt securities witnessed substantial investment of $1.136 billion during first five months of current fiscal year as compared with nominal amount in the corresponding period of the last fiscal year.

  • CDNS decides screening all customers of national saving schemes

    CDNS decides screening all customers of national saving schemes

    The Central Directorate of National Savings (CDNS) has decided to screen all customers of national savings schemes.

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  • IMF board to meet on December 19 to review Pakistan program

    IMF board to meet on December 19 to review Pakistan program

    KARACHI: The board of International Monetary Fund (IMF) will meet on December 19, 2019 to review Pakistan’s loan program and consider releasing next tranche.

    Gerry Rice, Director Communication, IMF in a press briefing on Thursday said that the IMF had a $6 billion program to support IMF’s economic reforms.

    “We had a mission there in November and the communication around that with a preliminary assessment of where we think Pakistan stands.”

    Which is that the program is on track and we reached a staff-level agreement on what we call the first review. You can read about that in more detail on our website.

    We had the preliminary assessment from staff after that mission to Pakistan and the board will meet to discuss that first review on Thursday, December 19th.

    What that indicates is that all prior actions and performance criteria under the program with Pakistan have been met. And that the financing assurances needed for the program to go forward are in place.

  • Pakistan’s foreign exchange reserves increase despite $1bn Sukuk repayment

    Pakistan’s foreign exchange reserves increase despite $1bn Sukuk repayment

    KARACHI: The foreign exchange reserves of the country have increased by $55 million by the week ended December 06, 2019 despite repayment of $1 billion against International Sukuk.

    The foreign exchange reserves of the country increased by $55 million to $16.048 billion by week ended December 06, 2019 as compared with $15.993 billion a week ago, State Bank of Pakistan (SBP) said on Thursday.

    During the week ending December 06, 2019, SBP made a repayment of Pakistan International Sukuk of $1,000 million.

    After accounting for multilateral and other official inflows during the week, SBP reserves increased by US$121 million to US$9.233 billion. The SBP’s foreign exchange reserves were $9.113 billion a week ago.

    The SBP said that on 09-December-2019 it received US$1.3 billion from Asian Development Bank. These funds will be part of the SBP weekly reserves data as of 13-December-2019, to be released on 19-December-2019.

    The reserves held by commercial bank decline by $65.8 million to $6.814 billion by week ended December 06, 2019 as compared with $6.88 billion a week ago.

  • Overseas Pakistanis send $9.298 billion in five months

    Overseas Pakistanis send $9.298 billion in five months

    The State Bank of Pakistan (SBP) reported on Tuesday that overseas Pakistani sent $9.298 billion during the first five months of the current fiscal year, spanning from July to November. This figure compares closely with the $9.282 billion received during the same period in the preceding year.

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  • SBP receives $1.3 billion from Asian Bank for economic reforms

    SBP receives $1.3 billion from Asian Bank for economic reforms

    KARACHI: State Bank of Pakistan (SBP) has said that it received $1.3 billion from Asian Development Bank (ADB) on Monday night.

    In a tweet message, the central bank confirmed the transfer of $1.3 billion from the ADB.

    Earlier in the day Minister for Economic Affairs, Muhammad Hammad Azhar witnessed the signing of two loans programme amounting to US $1.3 billion between the government of Pakistan and the ADB for economic reforms.

    The loan agreements were signed by Secretary, Economic Affairs Division, Dr Syed Pervaiz Abbas and Ms Xiaohong Yang, Country Director, Asian Development Bank (ADB).

    Under Special Policy-Based Loan (SPBL) Facility, Asian Development Bank has committed to providing US $1 billion for Economic Stabilization Programme.

    This programme aims at improving exchange rate management, strengthen public financial management to mobilize more revenues, restore allocated efficiency of scarce public resource, address the power sector pricing issues and reduce the social impacts of macroeconomic stability measures by improved targeting and transparency of existing social protection programmes.

    Out of total US $1.3 billion loan, US $ 300 million is allocated to Energy Sector Reforms and Financial Sustainability Program (Subprogram 1).

    It will address issues regarding energy shortfalls, technical lacuna’s and policy related shortcomings in Pakistan’s energy sector.

    The programme will help to secure financial sustainability by controlling new accumulation of circular debt; strengthen governance by rationalizing competitive market road-map, separation of policy and regulatory functions in hydrocarbons sector, appointment of appellate tribunals, implementation of multi-year tariffs and un-bundling of gas sector and reinforce infrastructure improvements through integrated planning to facilitate public and private sector investment across the energy supply chain.