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Friday, 9 November, 2012
SBP eyes outward FDI Wants it to be economy’s focus KARACHI
G
STAFF REPORT
oVERNoR State Bank of Pakistan Yaseen Anwar Thursday said Pakistan’s economy should now move away from a persisting fascination with inward Foreign Direct Investment (FDI) as a metric of the country’s economic health. The economy, the governor said, should now, at least, give attention to the outward Foreign Direct Investment (oFDI). This he said at the 4th CEo Summit and book launching of “100 Business Leaders of Pakistan” held here at a local hotel. Anwar pointed out that FDI was investment in tangible assets in the real sector. “That means that money and capital flows through FDI are not very volatile. And it is the volatility in such flows that keeps any central banker awake at night,” said he. The governor also stressed the need for developing and implementing good governance practices to stimulate economic growth in the country. He said good corporate governance regimes cannot be underscored
more as they create an attractive investment climate necessary to maintain investors’ confidence, resulting in positive impact on the share price and creating possibilities for raising low cost capital. Leaders must be visionary to see the future trends, anticipate institutional bottlenecks, remain competitive and be able to adapt rapidly to changes, he said and added that leaders need also to take into account their corporate social responsibility so that profit seeking is balanced against the objective of social service and well being of society. Anwar observed that Pakistan’s corporate sector has survived in perhaps one of the most challenging environments and yet it has flourished. “There are challenges to expanding abroad – challenges that our companies may not have encountered previously. But I, for one, would like to see more of our corporate sector aggres-
sively targeting the regional and global market. I challenge you to dream larger than ever before,” he added. Anwar noted that the millions of Pakistanis abroad will give you an edge as you venture abroad. “They will be familiar with your brands, and with the quality of your products. They may just hold the key to giving you a foothold in international markets,” he added. He observed that the world today is passing through a turbulent phase that requires a realignment of our leadership approach to managing businesses. “Today’s business leader is faced with a multitude of challenges, both on external and internal fronts. The complexities arising in the eco-system of any business may arise in the shape of macro economic imbalances that include sagging demand, inflation, volatility in financial
markets, etc.,” he said. The Governor said: “The most significant lesson that we have learnt from recent events is the importance of fundamentals in risk management. For instance, there is a basic rule since inception of banks which says “do not put all your eggs in one basket. Had this simple rule been followed, many institutions could have avoided huge losses”. Anwar cautioned that elevating corporate governance should not be confined to banks, but commercial concerns must also do the same. “We all know the pace of globalization has accelerated, resulting in increased domestic and global economic integration,” he added. “The current breed of Pakistani CEos is the street-smart entrepreneur, who will learn to adapt to any environment. That is going to be our competitive advantage in the global market,” he noted. “Twenty years from now, I would like to hear the story of how a Pakistani corporation entered the global market, the challenges it faced and overcame, and became the first Pakistani company to be consistently featured in the Fortune Global 500 list of companies,” Anwar concluded.
Pakistan’s Liquid Foreign Reserves stand at over $14b ISLAMABAD APP
The total liquid foreign reserves held by the country stood at $ 14,100.5 million on November 2, 2012. Giving the breakup of the foreign reserves position a statement of the Central Bank said that Foreign reserves held by the State Bank of Pakistan stood at $ 9,547.4 million while the net foreign reserves held by banks (other than SBP) stood at $ 4,553.1 million as on November 2,2012.
Pakistan, China ink MoU for joint marketing KARACHI APP
Heavy Industries,Taxila and Norinco -China on Thursday inked a Memorandum of Understanding (MoU) paving way for joint marketing and sale, on private-public partnership basis, of jointly manufactured defence and commercial products. The MoU signed by Lt. Gen Ayaz Saleem Rana, Chairman, Heavy Industries Taxila (HIT) and Wang Li, Vice President of Norinco, the Chinese defence firm, will enable HIT to open itself to international markets in consent with Government of Pakistan and Government of China. Secretary, Ministry of Defence Production, Lt. Gen (retd) Shahid Iqbal and Additional Secretary, Tariq Rashid Khan were also present during the signing ceremony. This MoU signed, on the sidelines of the ongoing defence exhibition,IDEAS 2012, also encompasses further strengthening of joint commercial ventures undertaken by the two. HIT established in 1974, in collaboration with Norinco China, was initially a rebuilt factory and is presently manufacturing different defence and commercial products including tanks, prime movers, trucks and so-forth. These are besides essential components of varied heavy load gadgets.
INTERNATIONAL CEO SUMMIT
‘Pakistan has its own Bill Gates, Steve Jobs and Laxmi Mittal’ KARACHI STAFF REPORT
The speakers at the 4th International CEo Summit Thursday emphasized that there is immense potential and resources in Pakistan and if the resilient people are properly guided they can push the country into a developed nation as they overcame devastated floods and earthquakes within the shortest possible time. However, they said, the people could not harness the national resources because of various reasons including lack of professional approach and the ever-worsening law and order situation across the country that is inter-related with structural problems. This mess has created fear of uncertainty in all spheres of life, the speakers added. Themed as “Growth in Testing Times: Challenges & opportunities”, the summit also witnessed the launching of a book titled “100 Business Leaders of Pakistan”. The event took place under the aegis of Manager Today magazine and CEo CLUB. Those who spoke on the occasion included chief guest Yaseen Anwar Governor State Bank of Pakistan; Ijaz Nisar Founder and President The Manager Today’s & CEo CLUB; Hussain Dawood Chairman Engro Corp; Asad Umar ExPresident Engro Corp; Kamran Rizvi - Executive Director, Navitus; Atif Bajwa – President & CEo, Bank Alfalah; Sohail
Wajahat Siddiqui Chairman, Pakistan State oil; Sirajuddin Aziz – President, Habib Metropolitan Bank; Kashmala Tariq, MNA; Muhammad Zubair Motiwala, Chairman SBI; M Rafiq Uddin Mehkari – President, Askari Bank; Irfan Siddiqui - President & CEo, Meezan Bank Limited; Shireen Naqvi – Lead Trainer, Navitus; Adnan Siddiqui – Country General Manager, IBM Pakistan; Sikandar Sultan – CEo, Shan Foods (Pvt.) Ltd; Hasan A Bilgrami – CEo, Bank Islami Pakistan Ltd; Duraid Qureshi, CEo HUM Network; Shehryar Ali Taseer – CEo, Media Times Ltd; Jamshid Iqbal Cheema – Chairman, Auriga Group of Companies;
Asad Said Jaffar – Chairman & CEo, Philips Electrical Industries of Pakistan Ltd; Syed Saquib Mohyuddin – CEo, SME BSF; Usman A. Ghani – International Consultant CoNFLUENTC; Tariq M. Rangoon Wala Chairman, ICC Pakistan Chapter & Dr. Kamran Shams Executive Director Akhuwat and others. Speaking on the subject of role played by the visionary leadership in overall economic growth, Governor SBP Yaseen Anwar said the business leaders were facing challenges both internally and externally. But, he said, they cannot take good decisions internally without considering the external issues and problems.
Asad Umar, former President of Engro Corporation, said a clear vision and sense of ownership not only brings up good leaders but helps build great institutions as well. He said that institutions were beyond individuals leading the institutions and true leadership was vital to the entire socioeconomic growth of the country. Ijaz Nisar said: “We always quote success stories of western CEos but do not highlight achievements of local entrepreneurs like Sohail Wajahat Siddiqui, Kamran Rizvi, Asad Umar, Muhammad Zubair Motiwala and Yaseen Anwar.” He said Pakistan had its own local Bill
Gates, Steve Jobs and Laxmi Mittal who could turn the fate and face of the country if they were provided conducive and friendly environment for doing business. Topic of the summit were: The path to prosperity: opportunities of Business Growth in Pakistan (CEo’s Panel Discussion); Entrepreneurship: Future of Pakistan; Role of visionary Leadership in Economic Growth; Developing Human Capital as Strategic Investment; Corporate Governance for Growth – New Economic Agenda & Business Success; Developing Public–Private Partnership to Boost Economic Development; What does ‘Growth’ mean for: A new enterprise, A family business & A multinational; The tough questions: Growing where? Growing how?; Growing through people: Engagement First! And Growing with money; Getting the best bang from your buck!. The summit was termed as an ideal opportunity for building relationships with peers and colleagues who can share information, insights and inspiration that can be of vital help for the local organizations. The event also provided multiple opportunities to gather with other summit attendees in order to extend once reach and influence into the community of his/her fellow senior CEo leaders. The conference was well attended and more then 500 professionals from different cities of the country showed up in it.
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Asian markets hit by US ‘fiscal cliff’ fears HONG KONG
F
AFP
EARS the US economy is facing another huge economic crisis spurred a sell-off in Asian markets Thursday as Barack obama’s re-election raised the spectre of another dangerous stand-off in Washington. Investors fear a deeply divided Congress will not be able to reach an agreement to avoid a so-called fiscal cliff at the end of the year that many say will send the United States back into recession. Eyes are also on Beijing, where the Communist Party has kicked off its 18th congress, which will see the beginning of a once-in-adecade leadership change. Tokyo stumbled 1.27 percent by the break, Hong Kong skidded 1.24 percent, Sydney lost 0.85 percent, Seoul was 0.89 percent lower and Shanghai fell 0.87 percent. The initial upbeat reaction Wednesday to obama’s victory over Republican Mitt Romney was replaced Thursday with trepidation as the focus turned to the fiscal cliff, a combination of deep spending cuts and huge tax hikes to take effect on January 1. The package is a major threat to the economy after a protracted but possibly reckless compromise was agreed last year between De-
mocrats and Republicans in order to raise the country’s borrowing cap. If it kicks in, the United States’ slow recovery from the financial crisis could be reversed and the economy tip back into recession, which would in turn deal a major blow to the global economy. And with Democrats holding the Senate while the Republicans hold the House of Representatives analysts say a compromise could be as tough to find as last August, when the row over the spending limit saw the country lose its AAA sovereign debt rating. “Immediately after the re-election parties ended, markets returned to the daunting issue of the US ‘fiscal cliff’,” Nicholas Smith, Japan strategist for CLSA in Tokyo, told Dow Jones Newswires. Wall Street, which had
ADB, OFID sign risk-sharing agreement ISLAMABAD
favoured a pro-business Romney win, tumbled on obama’s victory. The Dow dived 2.36 percent, the Nasdaq shed 2.48 percent and the S&P 500 lost 2.37 percent. Currency markets also reacted negatively. The dollar fell to 79.87 yen in early Asian trade, from 79.96 yen in New York late Wednesday, as investors seek out the safe Japanese unit amid times of economic uncertainty. And the euro was also hit by traders becoming more riskaverse. The single currency, which rose against the dollar Wednesday on expectations of continued loose US monetary policy under obama, fetched $1.2757 in Tokyo, compared with $1.2767 in New York. It had reached $1.2860 on Wednesday in Asia. The European currency also
Crude up in Asia on bargain-hunting
APP
Asian Development Bank (ADB) and the oPEC Fund for International Development (oFID) signed a risk distribution agreement to support trade in emerging Asian countries, including Pakistan under ADB’s Trade Finance Program (TFP). The agreement will support an estimated incremental trade flow between $800 million and $1.2 billion in countries such as Bangladesh, Mongolia, Pakistan, Sri Lanka and Uzbekistan, and other markets where financing from private financial institutions is limited. “By supporting trade transactions in emerging Asia, oFID and ADB will help create economic growth and jobs,” said Philip Erquiaga, ADB’s Director General for Private Sector operations Department. According to ADB press statement received here Thursday, ADB’s TFP fills private sector market gaps in trade finance by providing guarantees and loans through over 200 partner banks to support trade.
fell to 101.87 yen, compared with and 102.09 yen. Market sentiment was also pressured after the European Union slashed its eurozone economic forecast and European Central Bank chief Mario Draghi warned that the eurozone’s woes were beginning to hurt Germany, the bloc’s powerhouse. However, Greek lawmakers did manage to pass a crucial austerity package that opens the way for it to qualify for a fresh batch of bailout cash. In China the week-long congress is expected to see the anointment of the country’s next leaders, with the focus on the composition of the Communist Party’s top governing body for signs of future policy direction. In a speech to open the event President Hu Jintao called for the country’s future leadership to “speed up the creation of a new growth model and ensure that development is based on improved quality and performance”. oil prices rose, with New York’s main contract, light sweet crude for delivery in December, adding 42 cents to $84.86 a barrel and Brent North Sea crude for December delivery gaining 41 cents to $107.23. Gold was at $1,716.60 by 0300 GMT compared with $1,729.40 Wednesday.
SINGAPORE AFP
Crude prices bounced on bargain-hunting in Asia Thursday after suffering big losses in New York where dealers were spooked by concerns over the US “fiscal cliff” and European debt, analysts said. New York’s main contract, light sweet crude for delivery in December, added 55 cents to $84.99 a barrel in the afternoon and Brent North Sea crude for December gained 68 cents to $107.50. “We had quite a large move down (Wednes-
day) as the worries over the fiscal cliff and European woes started to more than usurp the euphoria” over the re-election of President Barack obama, Jason Hughes, head of premium client management for IG Markets Singapore told AFP. “In Asian trade prices have pushed back up... it’s probably people covering positions after a big move.” After obama’s victory over Republican Mitt Romney the focus turned to the US fiscal cliff, a combination of deep spending cuts and huge tax hikes to take effect on January 1. The package is a major threat to the economy that investors warn could tip the world’s number one economy back into recession if lawmakers do not agree a less deal to slash the country’s debt. Sentiment has also been pressured after the European Union cut its eurozone economic forecast and European Central Bank chief Mario Draghi issued a warning over the currency bloc’s woes. “Unemployment is deplorably high, overall economic activity is weak and it is expected to remain weak in the near term,” Draghi told a banking conference in Frankfurt on Wednesday.
Euro weak in Asia ahead of ECB meeting TOKYO AGENCIES
The euro weakened in Asia Thursday as markets looked to a European Central Bank meeting as the next key trading peg after the US presidential election and approval of a Greek austerity package. The single currency bought
$1.2760 and 101.92 yen in Tokyo trade, from $1.2767 and 102.09 yen in New York late Wednesday after the European Union cut its economic growth forecast and the ECB chief stoked worries about how slowing growth is hurting the continent’s top economy, Germany. The dollar weakened to 79.87 yen, from 79.96 yen in US trade. The greenback tumbled in Asian trade Wednesday as dealers bet that under the re-elected President Barack obama the US Federal Reserve would continue its loose monetary policy that has seen it flood markets with billions of dollars, which weighs on the greenback. Investors were focused on the ECB’s policy meeting later Thursday and a press briefing by its president, Mario Draghi, dealers said. “Although the ECB is expected to stand pat on its monetary policy, the euro may come under pressure if Mr Draghi signals a chance of further easing amid the recent worsening of the eurozone economy,” said Daisaku Ueno, senior forex and fixed income strategist at Mitsubishi UFJ
Morgan Stanley. “In Asia, a wait-and-see stance will likely dominate before the events,” he told Dow Jones Newswires. on Wednesday, the Greek parliament passed austerity measures crucial to securing loans demanded by international creditors seen as necessary to keep its economy afloat. Dollar-yen trade was little moved Thursday by new data showing a smaller-than-expected surplus in Japan’s September current account, the broadest measure of trade with the rest of the world. The new data are seen as a negative for the yen. Traders also focused on post-election developments in the United States, with fears that a divided Congress could again see deadlock on reforms, allowing a so-called “fiscal cliff” package of spending cuts and tax hikes to take effect on January 1. If Congress fails to agree how to cut spending over the medium term, there will be automatic deep spending cuts that could tip the United States back into recession, in a major blow for the slowing global economy.
Business 02 Major Gainers COMPANY Island TextileXD Exide (PAK) Attock RefineryXD Pak Services Millat Tractors Ltd.
OPEN 465.25 318.00 159.99 166.99 519.65
HIGH 488.51 331.50 167.98 174.90 526.00
LOW 488.51 330.00 161.00 174.90 519.01
CLOSE 488.51 330.00 167.60 174.90 525.55
CHANGE 23.26 12.00 7.61 7.91 5.90
TURNOVER 100 400 4,063,700 200 40,100
9501.00 3600.00 1420.00 750.00 325.00 294.00
9501.00 3600.00 1325.00 750.00 323.60 278.06
9501.00 3600.00 1325.00 750.00 324.20 279.74
-273.99 -175.00 -55.00 -19.00 -15.80 -12.95
20 40 200 50 300 92,700
83.01 6.06 15.14 7.15 53.28
78.12 5.62 14.06 6.42 52.11
79.13 5.85 15.14 7.05 52.65
-1.30 0.23 1.00 0.59 -0.03
14,856,000 12,057,500 11,429,000 9,177,500 8,507,000
Major Losers UniLever Pak Unilever Food Bata (Pak) XD Siemens Pakistan Sanofi-Aventis Pak National FoodsXD
9774.99 3775.00 1380.00 769.00 340.00 292.69
Volume Leaders Engro Foods Ltd. K.E.S.C. Jah.Sidd. Co. Azgard Nine D.G.K.CementXD
80.43 5.62 14.14 6.46 52.68
Interbank Rates US Dollar UK Pound Japanese Yen Euro
95.9451 153.6369 1.1942 123.1935
Dollar East BUY US Dollar Euro Great Britain Pound Japanese Yen Canadian Dollar Hong Kong Dollar UAE Dirham Saudi Riyal Australian Dollar
SELL
95.90 120.84 151.37 1.1819 94.62 12.14 25.85 25.25 98.18
96.40 123.19 154.28 1.2045 96.95 12.40 26.32 25.68 101.52
OGRA hires auditing firm to recommend profit margin of CNG stations ISLAMABAD: oil and Gas Regulatory Authority (oGRA) on Thursday issued a contract for emergency audit of the CNG stations. The contract of audit has been issued to owais Haider and Noman Liaquat auditing firm.The firm would recommend the production cost and the profit of the CNG stations. The audit company is expected to present its recommendations by Nov 12. Profit margin of the CNG stations would be decided on the recommendations of the audit report, the sources said. owais Haider and Noman Liaquat Company is among the 14 best auditing firms as ranked by the State Bank of Pakistan. ONLINE
CORPORATE CORNER GIDS to participate in IDEAS-2012 in a big way KARACHI: Global Industrial & Defence Solutions (GIDS) is participating in IDEAS-2012 in a big way. This international exhibition of arsenal is organised on alternate years at Karachi Expo Centre. organizing IDEAS has helped in projecting Pakistan as a country capable of meeting the defence requirements of geopolitically important states of the region. At IDEAS-2012, Global Industrial & Defence Solutions (GIDS) is displaying a comprehensive range of products being produced by its constituent companies. These companies are involved in production of research based products and services. These products and services are extensively used by the three stakeholders responsible for guarding the air, land and sea frontiers of Pakistan. Excellence in technology, innovation and competitiveness give these companies an edge over other manufacturers in the region. These companies invest heavily in R&D and give top priority to the development of human resource. The seven constituent companies are: Advance Engineering Research organization; Integrated Defence Systems; Marine Systems, Xpert Engineering Services; Institute of Industrial Control Systems; Al-Technique Corporation of Pakistan, and Scientific Engineering & Technology Services.
Burj signs MoU with Honda LAHORE: Burj Bank Limited, Pakistan’s fastest growing Islamic Bank, signed a Memorandum of Understanding (MoU) with one of the country’s top automotive brands, Honda Atlas Cars (Pakistan) Limited. The MoU was signed by Mr Ahmed Khizer Khan, President & CEo – Burj Bank Limited & Mr Takeharu Aoki, President & CEo – Honda Atlas Cars (Pakistan) Limited in the presence of Mr Khwaja Asif, Group Head Consumer Banking & SME – Burj Bank Limited and Mr Ayaz Hafeez, GM Sales & Marketing – Honda Atlas Cars (Pakistan) Limited.
Friday, 9 November, 2012