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18-Business Pages- 5th October_Layout 1 10/5/2012 4:44 AM Page 1

Friday, 5 October, 2012

IMF sees Pakistan GDP growth at 3-3½ WASHINGTON spEcIaL cOrrEspONdENt


AKISTAN is expected to achieve an economic growth in the range of 3-3½ in the current fiscal year but the GDP growth needs to step up to meet demands of the growing labor force, the International Monetary Fund said Thursday. “Pakistan faces a challenging economic outlook. GDP growth in 2012/13 is projected to be in the 3-3½ percent range, which needs to accelerate in order to absorb the growing labor force,” the Fund said. The statement follows Post-Program Monitoring (PPM) discussions between the Fund team and the Pakistani authorities in Dubai and Islamabad during September 26- October 3, 2012. The fund noted that inflation has fallen recently but is expected to be back in double digits by the middle of next year if corrective measures are not taken to reverse monetary financing of the fiscal deficit. Pakistan’s external position is weakening. While the current account deficit is not large by international standards, financial flows have weakened and central bank reserves have fallen. “Decisive and far-sighted action is needed to address this challenging outlook. Discussions on economic policy fo-

cused on diligent management of the budget deficit, reducing inflation, and structural reforms. The government and the IMF team agree on the need to contain the budget deficit to help lower inflation, reduce crowding out of private sector credit, and ensure debt sustainability. “In our view, this requires significant corrective measures; the fiscal deficit is otherwise likely to exceed the budget target by a significant margin. To rein in the fiscal deficit, both revenue and expendi-

ture measures will be required.” On the revenue side, the Fund said while there has been some improvement in collections, tax revenue should be raised further through sustained policy measures and strengthened administration both at the federal and provincial level, including a significant step-up in the Federal Board of Revenue’s enforcement activities. On the expenditure side, untargeted subsidies should be reduced, while fully protecting the most vulnerable members

of society through targeted assistance schemes. “The mission welcomed the authorities’ intention to prudently manage public spending, despite pressures associated with the electoral cycle, and noted that it is crucial that expendit u r e restraint

also apply to provincial governments, which now have increased spending responsibilities. The authorities also signaled their continued commitment to trying to meet their fiscal target.”

Another 10 years it is then… Crisis to last 10 years, says IMF chief economist BUDAPEST: The world economic crisis could take 10 years to run its course, the IMF’s chief economist Olivier Blanchard told Hungarian business news site in an interview published on Wednesday. “It’s not yet a lost decade,” Blanchard said, “but it will surely take at least a decade from the beginning of the crisis for the world economy to get back to decent shape.” Urging greater solidarity between member countries of the eurozone and more integration in fiscal and economic policy, he said Europe “has to go forward” with integration to make the common currency zone a success. “It cannot stay where it is. I think nobody really wants to go back,” he said. “When a country is doing poorly the others have to be willing to help in various ways, not only out of solidarity, but because trouble in one country may well spill over to theirs. “This is why the fiscal union and the banking union proposals being worked on as we speak are so important,” he explained. Blanchard also said the United States has a fiscal problem which it hasn’t dealt with yet. “Most analysts are confident that when it needs to be done it will be done. I hope they are right,” he said. Elsewhere, Blanchard said Japan faced a difficult fiscal adjustment and could take decades to solve its debt problems, but that the IMF did not forecast any hard landing for China. “China has probably taken care of its asset boom although it has slower growth than before,” he said.

Down to one

SeCP drafts Sukuk Regulations

Govt claims to curtail inflation to single digit

ISLAMABAD: In order to develop the sukuk (Islamic bond) market on a stronger footing, the Securities and Exchange Commission of Pakistan (SECP) has drafted the Issuance of Sukuk Regulations, 2012, to elicit public comments. The public can submit their comments by October 15. The regulations are aimed at facilitating the issuers and to provide comfort to the sukuk investors. The regulations broadly cover (i) eligibility and conditions for issuance of sukuk, (ii) disclosure and reporting requirements, and (iii) appointment of trustee and Sharia advisor. Under the regulations, any company or corporate body can issue sukuk. However, such company or corporate body shall have no over-due loan, the issuer’s as well as the instrument rating shall not be lower than triple B minus (BBB-), it has appointed a trustee through a trust deed to safeguard the interests of the sukuk holders, it has arranged appropriate security, where required, in the form acceptable to the trustee, it has obtained consent of a depository company to declare the sukuk as an eligible security for the purposes of depository system. Every company or corporate body shall before the issuance of sukuk, appoint a Shariah advisor who shall ascertain and shall give a fatwa that the concept on the basis of which the sukuk is structured and the business in which proceeds of the sukuk issue are to be utilized are not against the principles of Shariah. Where the sukuk are issued to the general public, the issuer shall prepare a prospectus containing all the information and disclosures as required under the ordinance. However, where the sukuk are issued through private placement, the issuer shall prepare an information memorandum and disclose therein all the material information including those as mentioned in the sukuk regulations. The issue of sukuk along with its salient features shall be reported by the issuer to the SECP within 10 days of the close of the issue. ONLINE


The National Price Monitoring Committee expresses satisfaction over containing the inflation to single digit for consecutive three months. Food and Non-Food inflation is recorded at 7.6 percent and 9.7 percent respectively. Similarly SPI and WPI also registered at 7.5 percent and 7.8 percent respectively. The first quarter of the current fiscal year CFY13 posted a single digit inflation at 9.1 percent as compared to 11.5 percent in the corresponding period of last year. All indicators of the inflation reported single digit during July-Sept. CFY13. The meeting reviewed the Consumer Price Index (CPI), Food, Non-Food, Core, Wholesale Price index (WPI) and Sensitive Price Index (SPI). It was noted that as a result of continuous efforts of the government the CPI reduced to 8.8 percent during September 2012 and government has succeeded in containing inflation to single digit, which shows government commitment in controlling the headline inflation. The SPI trend suggest that week ended on 27th September 2012 recorded a decrease of 0.37 percent due to decline in the prices of Onion, Potatoes, Tomatoes, Sugar and pulses etc. However, out of 53 items, prices of 09 items registered increase while prices of 16 items decreased and prices of 28 items remain unchanged as compared to last week ended on 20-09-2012, where prices of 20 items increased, prices of 09 items decreased and prices of 24 items remained unchanged. The Food and Non food items which registered nominal increase in their prices were Rice Basmati 0.43%, Red Chilies 0.31%, Beef 0.17%, Wheat 0.09% while Petrol and Eggs increased by 1.72% and 1.28%. However, with better weather condition the arrival has started resultantly easing out the prices of essential commodities. The other items which registered decrease in their prices are Garlic 1.75%, Sugar 1.31%, Kerosene Oil 1.24% , Chicken 1.05%, Vegetable ghee 1.04%, Gram Pulse 0.46%, Diesel 0.37%, LPG 0.37%, Masoor Pulse 0.15%, Mash Pulse 0.13% and Moong Pulse 0.08%. It was also observed that in comparison with the regional countries, Pakistan is the lowest in prices of Wheat, Wheat Flour, Rice, Sugar, Red Chillies, Chicken Farm and 2nd lowest in Moong Pulse, Masoor Pulse and Beef while prices of Mash Pulses,

Onion, Tomato, Potato, Diesel, Tea, Edible Oil, DAP and Urea are higher in Pakistan. The committee reviewed the price trend of selected items among the Provinces. Some variations in the prices of Wheat Flour, Rice Basmati Broken, Pulses, Beef, Mutton, Milk Fresh, Milk Powdered, Ghee, and Garlic were observed. It was noted that in most items prices in Balochistan are higher as compared to other Provinces. It was also noted that prices of Beef and mutton are much higher in Islamabad as compare to Rawalpindi. The concerned representative was advised to look into this and take necessary steps to ensure that supply of mutton and beef be available at reasonable prices. The chair also emphasized for market intelligence among the provinces and ICT. It was informed in the meeting that Food Security Division is consulting the provincial governments to overcome the shortcoming of market intelligence and the demand supply gap. The chair also took note of increase in prices of beef and mutton and to this aspect emphasized the control of livestock smuggling to neighboring countries. It was informed to the meeting that our population growth rate is 2.03 percent whereas animal growth rate is 3.7 percent, so we have surplus animals for export. A subcommittee was proposed in Food Security and Research Division to analyze the situation of demand and supply position of livestock and come up with findings and measures to control the prices of livestock and its products. The meeting also discussed disease surveillance system to take care of livestock. The chair appreciated the initiated programs of PARC for poultry and animal disease surveillance and instructed that all efforts

should be geared up to keep the system in place by taking all provinces on board. The meeting was informed that Khyber Pakhthunkhwa government has assigned the first class magistrate power to all district food controllers to maintain price stability in the province. Punjab Government has appointed 352 magistrates in the province to control the price situation and they have collected approximately Rs. 6 lakh fine from the shopkeepers who were violating the price list. Balochistan Government is also making efforts on multi directions for consumer protection and consumer courts are working in the province and in Sindh special magistrates are appointed to check the price and supply position of the consumer items. In order to further streamline the system the meeting emphasized for necessary measures with regard to revival of Executive Magistracy System and advised the concerned quarters to expedite the process. It was also noted that prices of the Palm Oil are decreasing in international market but its impact is not being transferred to consumer. M/o Industries was advised to check the price movement and ensure that relief be transferred to consumer. The rising trend in prices of tea was also noted and concerned quarter was advised to take necessary measure to control the prices.

Japan conjures up power ISLAMABAD: The Government of Japan has decided to extend financial support of US$ 108,731 (approx. Rs 9.8 million) to the Agency for Technical Cooperation and Development (ACTED), for the construction of a micro hydro power station in Village Usherai Twagh, Upper Dir, Khyber Pakhtunkhwa. The agreement for the project was signed between Mr. Akira KONO, Chargé d’Affaires ad interim of Japan to Pakistan and Mr. Robin Nataf, Deputy Country Director for ACTED Pakistan, on 4th October, 2012 at the Japanese Ambassador’s residence in Islamabad. The grant will be utilized for the construction of a micro hydro power station in Village Usherai Twagh, Upper Dir with a total installed capacity of 50 Kilowatts. In addition to meeting the essential energy requirements of all the 130 households in the village, this would also contribute to improve living conditions of local community and develop local economy. The project will benefit particularly women as it could alleviate their work load by helping mechanizing some of their manual household labour. “I believe, by providing stable and sustainable energy for the community in remote area, this project will contribute not only to the improvement of quality of life of the people of the village, but also to their human security, which would lead to further development of their human potential. I also hope it would certainly further enrich the cherished relationship between the people of Japan and Pakistan.” said Kono at the signing ceremony. ONLINE

18-Business Pages- 5th October_Layout 1 10/5/2012 4:44 AM Page 2

02 Business PMN launches Pakistan Microfinance Review

Major Gainers ComPAnY oPen Nestle Pakistan Ltd. 4646.26 Bata (Pak) Limited 1055.55 Shezan Inter. 330.75 National Foods 279.32 Murree Brewery 162.63


Low 4800.00 1051.00 347.00 282.00 167.00

CLoSe CHAnGe 4800.00 153.74 1100.00 44.45 347.28 16.53 293.28 13.96 170.76 8.13

tuRnoveR 100 400 5,100 7,700 36,300

10400.00 87.12 215.00 60.88 57.75

10000.00 87.12 211.00 60.88 54.50

10000.00 87.12 211.32 60.88 54.50

-500.00 -4.58 -3.50 -3.20 -2.75

140 1,000 18,500 500 2,000

7.55 61.48 5.00 23.06 51.57

7.15 58.10 4.90 21.84 50.77

7.40 60.52 4.99 22.87 50.98

0.28 1.67 0.01 0.88 0.36

13,130,500 9,494,000 8,416,500 6,346,000 5,333,500

Major Losers


Pakistan Microfinance Network (PMN) has launched the “Pakistan Microfinance Review 2011” for the microfinance industry. The initiative is supported by the Pakistan Poverty Alleviation Fund (PPAF), UKAID and the Citi Group, says a statement issued here Thursday. The event was well attended by representatives from the State Bank of Pakistan (SBP), UKAID, PPAF, Commercial Banks, PMN members (Microfinance Banks, Microfinance Institutions, Rural Support Programmes) and other stakeholders. PMN CEO, Syed Mohsin Ahmed highlighted the achievements, challenges and opportunities of the microfinance industry. Chairperson PMR Editorial board, Ghalib Nishtar along with other editorial board speakers including representatives of SBP, PPAF, UKAID and Urban Poverty Alleviation Program (UPAP) of NRSP held a discussion session. The year 2011 was declared as a watershed period for the microfinance sector in Pakistan as the industry achieved sustainability despite a challenging macroeconomic environment, rains and floods in Sindh, security situation and persistent energy crises in the country. The sector is proving successful in making the transition to commercial finance and witnessed the launch of first money market financing instrument with a number of new products & services for credit as well as remittances. The portfolio at risk remains within acceptable thresholds reflecting positively on the quality of portfolio. The industry continued growth in branchless banking transactions despite the deployment of only two models and saw MFBs and MFIs linking up to provide financial services to the microfinance clientage. With nationwide launch of MicrofinanceCIB(Credit Information Bureau), the industry will have the option to better manage credit risk and reward clients with good credit history. Given these positive developments and the upgraded business environment ranking by Economist Intelligence Unit a number of deep pocket investors expressed interest in exploring the market for potential investment and a number of transactions were successfully concluded. In presence of an enabling environment and the industry attaining sustainability, the sector is poised for growth. With the entry of new players and consolidation taking place, the industry is ideally positioned for expansion and provision of a wide array of services covering the entire spectrum of microfinance.

HIGH 4800.00 1100.00 347.28 293.28 170.76

UniLever Pak ZIL Limited Clariant Pak Gillette Pak Biafo IndustriesXD

10500.00 91.70 214.82 64.08 57.25

Volume Leaders SINGAPORE aFp


rude was down in Asian trade Thursday as worries over Spain and a slowing Chinese economy highlighted a weak global economic outlook, analysts said. New York’s main contract, light sweet crude for delivery in November, shed 20 cents to $87.94 a barrel and Brent North Sea crude slipped three cents to $108.14. “Crude oil prices dipped slightly on the weak outlook for economic growth,” said Sanjeev Gupta, who heads the Asia-Pacific oil and gas practice at Ernst and Young. “This past week, European attention has been focused on Spain’s problems,” he told AFP, adding that in Asia markets were worried about signs of an economic slowdown in China, the world’s biggest energy consumer. Traders were watching Spain for hints on whether it would ask for a eurozone bailout soon, after Catalonia president Artur Mas said

Wednesday the move was unavoidable and Madrid should ask for it without a long delay. His words flew in the face of Spanish Prime Minister Mariano Rajoy’s studious refusal to say whether the eurozone’s fourth largest economy needs rescuing, insisting instead on the need to study the matter. On Wednesday, the Asian Development Bank slashed its growth estimates for Asia’s emerging economies to the lowest level since 2009, citing a slowdown in powerhouses China and India. It forecast China’s gross domestic product (GDP) would expand 7.7 percent this year before bouncing back to 8.1 percent in 2013 but still well below the 9.3 percent achieved last year. India would see GDP growth slow to 5.6 percent in 2012 before picking up to 6.7 percent next year. The bank also warned of significant risks caused by the effects of the European debt crisis and continued weakness in the United States, both of which are major export markets.

Lotte PakPTA 7.12 Nishat Mills Limited 58.85 Golden ArrowXD 4.98 Sui South Gas 21.99 D.G.K.Cement 50.62

Interbank Rates US Dollar UK Pound Japanese Yen Euro

Dollar East US Dollar Euro Great Britain Pound Japanese Yen Canadian Dollar Hong Kong Dollar UAE Dirham Saudi Riyal Australian Dollar

Asian markets mostly up on US data HONG KONG aFp

Asian markets mostly rose on Thursday as investors cheered upbeat US economic data, but nagging concerns over Europe kept advances in check. Tokyo gained 0.62 percent by the break, Hong Kong was 0.10 percent higher and Sydney gained 0.10 percent while Seoul eased 0.54 percent. Shanghai is closed for a week-long public holiday. Regional shares took their cue from Wall Street, which ended in positive territory after jobs and services figures provided some hope for the economy. The Institute for Supply Management released its services industry index Wednesday, which showed the crucial sector picking up pace, though hiring remained flat. Separately, payrolls company ADP released a report showing pri-

vate sector hiring was better than expected in September, with 162,000 jobs added. Despite being down 14 percent from August the slowdown is less than expected. US dealers welcomed the announcements. The Dow finished up 0.09 percent, the S&P 500 was 0.36 percent higher and the Nasdaq climbed 0.49 percent. Eyes are now firmly on policy meetings over the next two days for the European Central Bank, the Bank of Japan and Bank of England, while closely watched non-farm payrolls are due out of Washington on Friday. “There is a little bit of a wait-andsee attitude in Asia this week,” said Wee Khoon Chong, Asia rates strategist at Societe Generale in Hong Kong. On currency markets the euro rose to $1.2923 and 101.61 yen in early trade, compared with $1.2903

95.3431 153.6169 1.2138 123.3931

and 101.31 yen in New York late Wednesday. The dollar was at 78.63 yen against 78.51 yen. However, Europe’s debt woes continue to weigh after Spanish Prime Minister Mariano Rajoy said Tuesday he would not request a bailout any time soon despite the parlous state of the country’s finances and its dangerously high borrowing costs. Spain, the eurozone’s fourthbiggest economy, is required to make a formal demand for help to trigger the release of eurozone rescue funds and supportive bond-buying action from the European Central Bank. Oil prices eased with New York’s main contract, light sweet crude for delivery in November, shedding 10 cents to $88.04 a barrel and Brent North Sea crude slipping a cent to $108.16. Gold was at $1,780.35 at 0300 GMT compared with $1,778.50 on Wednesday.



94.70 122.87 152.77 1.2007 95.90 12.06 25.75 25.24 96.41

95.20 123.83 153.93 1.2098 97.13 12.22 25.92 25.37 98.60

Dollar stable on hopes for easing in Japan TOKYO: The dollar stayed within a narrow range in Asian trade Thursday as lingering hopes for further monetary easing were offset by worries about economic fundamentals, analysts said. The dollar bought 78.47 yen in morning trade, little changed from late Wednesday in New York, where it stood at 78.51 yen. The euro bought $1.2913 and 101.33 yen in Asian trade, compared with $1.2903 and 101.31 yen in New York. The dollar was well supported in the short term, because of increased risk appetite, said Osamu Takashima, Citibank Japan chief currency strategist. The greenback has risen against the yen over the past few days, but there is little in the way of economic fundamentals to back that up, he said. “The dollar likely won’t rise above a mid-term important technical point,” he said, noting 78.90 as the resistance. aFp

CORPORATE CORNER Qatar Airways expands further new nippon odourless Aircare into South east Asia improves indoor air quality

(VOC). VOC is an air pollutant that is harmful to both the environment and our health. Since then, we have moved towards the direction of providing ultra-low VOC. Today, I am happy to say that Nippon Paint Pakistan offers eco-friendly and low VOC coatings to its customers. Our Green Choice Range is both eco- and health-friendly.”

oGDCL achieved significant success in FY 11-12

YANGON/MYANMAR: Qatar Airways today marked the resumption of flights to Yangon after a four-year absence with the launch of scheduled services to Myanmar’s largest city. Yangon becomes Qatar Airways’ 10th gateway in the Association of South East Asian Nations (ASEAN) following on from successful operations to Kuala Lumpur, Bangkok, Bali, Ho Chi Minh City, Jakarta, Hanoi, Singapore, Manila and Phuket – and the carrier’s 119th destination worldwide. It is also the latest of several route launches so far this year by the rapidly-growing global carrier. Qatar Airways suspended flights to Yangon in January 2008, and is now restoring services, providing greater economic and travel opportunities for the people of Myanmar.

LAHORE: Nippon Paint, the leading paint brand in Pakistan, has launched its next generation of paint, NIPPON ODOUR-LESS AIRCARE. It is the first paint innovation in the country using active carbon technology, which refreshes the air by absorbing the indoor air pollutant, formaldehyde. Speaking at the launch event today, Nippon Paint (Pakistan) (Private) Limited’s general manager, Mr. Samad Zaheer said “Nippon Paint Pakistan has been supporting initiatives to encourage environmental sustainability and to protect the world we live in. In 2009, we have pro-actively started the ball rolling in the paint industry by being the first to launch almost odourless paint – our Nippon Spot~less, which has almost no paint odour, and is near zero volatile organic compounds

tors. He said that appointment of Mr. Masood Siddiqui as MD/CEO would bring a positive change in the Company due to his professional background experience and good performance in the past. The OGDCL officers / employees would touch high professional performance under the guidance of the present management. He acknowledged and lauded the performance of the ex-Chairman of the Board and other directors and former MD/CEO. He welcomed the new members of the BOD and congratulated OGDCL employees on completion of 50 years of continued service to the nation by achieving significant hydrocarbons discoveries.

etihad Airways to increase flights to Istanbul

ISLAMABAD: The 15TH Annual General Meeting (AGM) of OGDCL held here at OGDCL House Islamabad which was presided by Ch. Muhammad Shafi Arshad Chairman of the Board of Directors. Mr. Masood Siddiqui MD/CEO OGDCL alongwith other directors of the BOD were also present. Ch. Muhammad Shafi Arshad Chairman welcomed the shareholders and thanked Government of Pakistan to repose confidence of the GOP to the present management and Board of Direc-

LAHORE: Etihad Airways, the national airline of the United Arab Emirates, has announced it will fly daily between Abu Dhabi and Istanbul from January 1, 2013. The Abu Dhabi-based airline launched services to Istanbul, the largest city in Turkey, with four non-stop flights a week in June 2009, increasing to five services per week later that same year. The daily flights to Istanbul will be operated by a two-class Airbus A320 aircraft, configured with 16 Pearl Business class and 120 Coral Economy class seats and passengers from Pakistan can enjoy two way smooth connections from Karachi, Lahore and Islamabad every day.

Friday, 5 October, 2012

Profit E-paper 5th October, 2012  

Profit E-paper 5th October, 2012