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Sunday, 22 July, 2012
$30 billion? Sounds realistic enough Export target realistic, linked to development initiatives: ACCI ISLAMABAD Online
The Attock Chamber of Commerce and Industry (ACCI) said business community will help government realise export targets under the new three-year Strategic Trade Policy Framework 2012-2015. Export target of $30 billion is realistic, the private sector can help government achieve the goal which will require workable development initiatives backed by enabling social, political and investment environment, it said. Business community is awaiting new trade policy and pinning high hopes on newly-appointed Secretary Commerce Munir Qureshi who is considered a business friendly official, said President ACCI Tariq Mehmood,. He said that national business leaders including CACCI VP Tariq Sayeed, VP Saarc CCI Iftikhar Ali Malik, FPCCI President Haji Ghulam Kadir Khan Sherani and others have assured all out assistance and cooperation to the government functionaries in realising the entire objectives provided enabling environment is guaranteed. Tariq Mehmood said that first three-year trade policy framework which is to end in next nine days failed to achieve goals due to energy crisis, want to business friendly taxsystem, capacity building and certification issues, export subsidies and lack of interest by finance ministry to provide funds to commerce ministry.
Guess who borrowed Rs.51b in 6 days from SBP KARACHI inP
The government has borrowed rs51 billion in six days from the State Bank of Pakistan. The central bank has issued new statistics of borrowings of the government, according to which the government has borrowed rs51 billion only in 6 days in the current fiscal year. This means that the government is borrowing rs8.5 billion per day from the State Bank. According to the statistics, the government borrowed rs44.72 billion to over come budget deficit. The provincial governments had a loan of rs3.54 billion while rs6.39 billion were borrowed for the purchase of commodities. The year ending on June 30, the government was in debt of rs1200 billion to the central bank.
SITE is low on gas KARACHI nni
SITE Association of Industry Chairman Mr. M Irfan Moton has expressed much concern on low gas pressure in SITE Area by the Sui Southern Gas Company Limited. About 2530 percent of industrial units have gone out of production in the SITE industrial area due to anomalous gas pressure, industrialists are complaining of low gas pressure for last two days. He said in a press statement that the industrial production stopped yesterday after gas pressure dropped abruptly, several captive power generating units also stopped operating because of the non sufficient supply of gas to the biggest and oldest industrial area of the country. He further said that this problem is being faced only by the industrialists of SITE Area whereas the other industrial areas of Karachi do not face this problem which means that discriminatory attitude is being made by SSGCL with SITE Area and this issue should be addressed by the authorities.
Super Comrade Putin hits a homer! Putin signs Russia into WTO MOSCOW AGenCieS
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rESIDENT Vladimir Putin on Saturday signed the bill ratifying russia's entry to the World Trade Organization after 18 years of often acrimonious negotiations, the Kremlin press office said. Economists have long argued that russia needed to join the WTO as it was the only major economy outside the body -following China's membership in 2001 - and the government hopes accession will stimulate growth. The measure making russia the 156th WTO member will become law within 30 days, after the lower house of parliament, the State Duma, approved it
on July 10 and the upper house, the Federation Council, on Wednesday. But the membership has also been controversial, with some medium-sized firms expressing concern they will be put out of business by being unable to compete against imports made cheaper by a reduction in customs tariffs. The reduction of the tariffs was a key condition for russia entering the WTO and they will fall from a current average level of 9.5 percent to 7.4 percent in 2013, 6.9 percent in 2014 and 6.0 percent in 2015. According to the World Bank, WTO entry will bring a boost worth 3.3 percent of russian GDP -- or $49 billion -in the first three years after joining. Over 10 years, the gain will be worth 11
percent of GDP, it says. But Senator Sergei Lisovsky warned this week that russia was wholly unprepared to compete without trade protection against other world economies which were more used to competition and were considerably less corrupt. russia's journey to joining the WTO started back in 1993 but was marked by frequent rows with Western partners, objections by its foes and not least a sometimes lukewarm attitude on the part of the russian leadership. But Putin is now openly championing modernisation of the economy to wean the country off dependence on oil and gas exports and officials have warned progress is not possible without WTO membership.
Global stocks, euro tumble on Spain bailout fears US and European stocks fell and the euro hit record lows after Spain's heavily indebted Valencia region asked for financial aid, increasing investor fears that the Spanish government will seek a full-blown bailout NEW YORK AGenCieS
Valencia sought help under an 18 billion euro ($22.1 billion) program passed on Thursday that aims to bolster regional finances. Spain's IBEX stock index .IBEX fell 5.8 percent, its biggest oneday drop in two years, and the risk premium on government debt hit a euro-era high as its borrowing costs rose to 7.32 percent. That is above the 7 percent threshold considered unsustainable, with little relief in sight. "There is very little to stop Spanish bond (yields) moving up at the moment, and that is a big concern," said Ed Shing, head of European equity strategy at Barclays. Martin Briggs, risk advisory consultant for global payments company AFEX Markets Plc in London, called the euro "a slow motion train crash that's happening in front of our eyes. No one seems to have the will or the ability to make the tough decisions that need to take place." The euro plumbed record lows against the Australian, Canadian and New Zealand currencies and hit multimonth lows against the Norwegian and Swedish crowns. Against the yen, it hit the lowest level in more than 11 years. The euro fell as low as $1.2143, its weakest level against the dollar since mid-June 2010. It last traded at $1.2160, down 1.0 percent, as a sell-off against sterling and the Swedish crown exacerbated the euro's slide. U.S. stocks snapped a three-day winning streak while stocks in Europe extended losses after the European Central Bank said it would stop accepting Greek bonds as collateral, adding to concerns about the euro zone debt crisis. The FTSEurofirst 300 .FTEU3 closed down 1.5 percent at 1,048.98. Banks .SX7P and insurers .SXIP, which stand to lose on their sovereign bond holdings and loan books if the euro zone crisis intensifies, were among the top decliners in Europe.
Banks fell 3.7 percent and insurers slipped 1.9 percent. Spain's plight overshadowed another round of strong U.S. corporate earnings, including betterthan-expected profits at General Electric (GE.N) and strong advertising revenue at Google (GOOG.O). "The news from Europe continues to be a smoldering mess, and it will be a long convoluted process before things are resolved there," said John Kattar, who helps oversee $1.7 billion in assets as chief investment officer at Eastern Investment Advisors in Boston. The Dow Jones industrial average .DJI ended down 120.79 points, or 0.93 percent, at 12,822.57. The S&P 500 Index .SPX closed down 13.85
points, or 1.01 percent, at 1,362.66. The Nasdaq Composite Index .IXIC finished down 40.60 points, or 1.37 percent, at 2,925.30. German bond prices and U.S. Treasuries rose as investors clamored for safe-haven assets. German 10-year bond yields fell 5 basis points to 1.168 percent, and the benchmark 10-year U.S. Treasury note was up 15/32 in price to yield 1.4584 percent. The U.S. dollar index .DXY rose 0.7 percent to 83.476. Oil fell below $106 per barrel at one point as a firmer dollar spurred a dip from an eightweek high hit in the previous session due to supply worries linked to tension in the Middle East and hopes of an economic stimulus in the United States.
BOI woos North America Pak to sign investment treaties with US, Canada this year: BOI chairman g
ISLAMABAD Online
In a major development, Pakistan would sign investment treaties with United States and Canada this year which will go a long way to bolster country’s export. In an interview with Online Board of Investment (BOI) Chairman Saleem H. Mandviwala said the signing of investment treaties with United States and Canada will be an important development for Pakistan which would be signed till end December this year. “Political leadership, Bureaucracy and Business mafia had been creating difficulties in way of promoting foreign investment as they did not want foreign investment to come into the country,” said BOI Chairman. He said we will have to put our home in order first and there is a dire need for taking efforts to bring foreign investment in the country. To a question, he said the recently passed Bill of Special Economic Zone was a milestone in the history of Pakistan which would help the country to attract foreign direct investment (FDI) and encourage local investors as it provides legal cover to their investments. Chairman BOI went on to say that the establishment of Special Economic Zone will attract both domestic as well as international investors. Some of the investor countries like Korea, China and Japan were expecting to benefit from scheme as soon as it became operational. He said provincial governments would be requested to start the process as soon as rules were framed. He further said that the SEZ bill will help create an industrial cluster with liberal incentives, infrastructure, investor facilitation services to enhance productivity and reduce cost of doing business for economic development and poverty reduction. “The SEZ bill also guarantees that the incentives once granted would not be withdrawn due to conflict of interests. BOI would now move ahead at a faster pace and through a well-planned campaign, motivating local and foreign investors to invest in the country,” he said, adding that it would not only help in bringing new technologies but also provide jobs to the people and increase our exports to reduce the trade deficit.
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Business 02 Oil falls as Europe debt woes revive economic fear Sunday, 22 July, 2012
Fitch downgrades Nokia credit rating, outlook negative
Oil prices fell, snapping a string of seven straight higher settlements, as the euro zone debt crisis brought economic concerns back in focus and strengthened the dollar NEW YORK AGenCieS
PARIS APP/AFP
International ratings agency Fitch on Friday downgraded the longterm debt of Finnish telecommunications equipment maker Nokia by two notches from "BB+" to "BB-" and said the outlook was negative. Fitch noted in a statement that it had said previously that it would take such a move if the agency "was not convinced that Nokia could stabilise the revenue declines and be capable of generating positive single digit operating margins in its Devices and Services division." On Thursday, Nokia said its second quarter net loss had more than quadrupled on a 12-month basis to 1.41 billion euros ($1.73 billion). "Fitch believes that the company does not have products in its current portfolio that can stem the recent losses," the ratings agency said. It added that "the degree of competition in the industry would suggest that it is going to be difficult to reestablish a significant presence in the smartphone market."
Come again please? SL seeks another IMF bailout after record loan g
COLOMBO APP/AFP
Sri Lanka on Saturday announced the completion of a $2.6 billion IMF bailout, but it was seeking fresh loans to support an economy emerging from decades of ethnic war. The International Monetary Fund on Friday released the final installment of the bailout agreed in July 2009; two months after Colombo defeated Tamil rebels in a major offensive to end the drawn-out conflict. The drawing down the final installment of the bailout package marked the longest engagement Sri Lanka has had with the IMF and the single largest facility from a multilateral institution, the Central Bank of Sri Lanka said. "Sri Lankan authorities now look forward to the continued close engagement with the IMF and intend to discuss the possibility of financial support for its economic development agenda..." the bank said in a statement. It did not say how much Sri Lanka hoped to secure from the IMF by way of fresh loans, but finance ministry sources said Colombo was looking at more than $500 million as a first step.
B
rENT and U.S. crude futures posted weekly gains of more than 4 percent, both contracts having touched eight-week peaks on Thursday. U.S. and European equities slid and the euro weakened broadly after Spain's heavily indebted Valencia region called for aid, increasing investor fears that the Spanish government is moving toward a full-blown bailout. "The dollar spiking higher versus the euro on Spain banks needing help pushed oil lower. Some geopolitical fatigue seemed to emerge as well, with the rumors about Assad taking a deal. Looks like if he goes we will get a selloff," said John Kilduff, partner at Again Capital LLC in New York. Syria's Information Ministry said comments by russia's ambassador to France that President Bashar al-Assad had accepted leaving power in an orderly way were "completely devoid of truth." Fighting raged as government troops battled rebels at border posts and in corpse-strewn streets in Damascus after a fourth member of Assad's inner circle died from wounds sustained in a bomb attack this week. Brent September crude fell 97 cents to settle at $106.83 a barrel, after falling as low as $105.60 intraday. Front-month Brent jumped 4.33 percent for the week, posting a fourth straight weekly gain and having risen 16.5 percent in the period. Expiring U.S. August crude fell $1.22 to settle at $91.44 a barrel, off its low of $90.66. For the week, U.S. crude rose 4.98 percent. U.S. September crude fell $1.14 to settle at $91.83 a barrel. Volumes were tepid at less than half a million lots traded each for Brent and U.S. crude, as dealings lagged 30-day averages. U.S. heating oil futures fell more than 2 cents. Gasoline managed to post a gain, less than a penny, keeping frontmonth August more than 9 cents above
the September contract. Money managers raised their net long U.S. crude futures and options positions in the week to July 17, the U.S. Commodity Futures Trading Commission said. U.S. demand for crude oil, gasoline and distillates fell in June from a year earlier, the industry group American Petroleum Institute said in a report. The API attributed the drop to a slowing U.S. economy. M.E, IRAN UNCERTAINTY: Concerns about potential supply disruptions in the Middle East have pushed up oil prices recently as violence in Syria intensified and
However, adding to the bearish sentiment on Friday was news that China will load full contracted volumes of Iranian oil in July after refiner Sinopec and the National Iranian Tanker Co resolved a freight dispute. Chinese news also weighed on copper, another dollar-denominated commodity. The industrial feedstock fell more than 2 percent on the inflamed worries about the euro zone that strengthened the U.S. currency, but also on China's warning against relaxing curbs on property speculation.
Asian economic powerhouses subdued, recovery to be muted Optimism around Asia is fading with growth in its biggest economies slowing considerably this year, compelling central banks to keep policy accommodative for longer, though the worst of the downturn may be over, a poll showed
SINGAPORE AGenCieS
PESSI Commissioner Dr Sajid Yoosufani during his visit to Health Management Company, Punjab Social Security Hospital, Manga Raiwind Road.
after a Bulgarian bus bombing killed Israeli tourists -- an act Israel blamed on Iran. New York police believe Iranian revolutionary Guards or their proxies have been involved so far this year in nine plots against Israeli or Jewish targets around the world, according to restricted police documents obtained by reuters. An Iranian lawmaker said just over half of Iran's parliament has backed a draft law to block the Strait of Hormuz shipping lane, reminding investors of the uncertainty involved in the West's dispute with Tehran over Iran's nuclear program.
As Europe's debt crisis drags on and the U.S. economy slows, weighing on Asia's exports, economists are cutting their growth forecasts for most of the economies in the region. But they remain cautiously optimistic that Asia would start to recover by the end of this year, even if some are skeptical about the pace at which it would do so. "It is going to be a long hard slog back
up," said Vishnu Varathan, economist at Mizuho Corporate Bank in Singapore, who feels that this time around Asia isn't going to see the V-shaped rebound it experienced after the 2008/09 global crisis. When compared to previous reuters quarterly surveys, analysts seem more pessimistic about Asia's ability to shield itself from the headwinds from the Europe and the United States. "The euro zone is not doing very well and one of the key things that have changed was that in Q1 there was quite a bit of optimism about the U.S.
economy. That has turned around quite abruptly this time around," said Varathan. Though the U.S. is largely expected to avoid another recession, the meager average growth on around 2 percent economists have been forecasting for 2012 will not be enough to bring the unemployment rate below 8 percent until next year. With external weakness likely to persist, policymakers in much of Asia are looking to ramp up domestic demand with fresh fiscal or monetary stimulus. CHINA BOTTOMING OUT While growth in China's economy is expected to weaken to 8.0 percent this year, a level many consider the borderline between a potentially severe slowdown and a mild one, the growth outlook for India was slashed to 6.3 percent this fiscal year, which would be the slowest pace in a decade. China's economy will likely recover modestly as Beijing intensifies its policy fine-tuning to boost growth. Analysts predict it probably bottomed out last quarter, when growth cooled to 7.6 percent from a year earlier, the slowest pace in more than three years. But the story looks much worse for India. Even as growth falters, the rupee has been hitting all-time lows against the dollar, the government is struggling with bloated fiscal and current account deficits and inflation has remained stubbornly high, giving policymakers less room to maneuver. Singapore, Taiwan and South Korea, all heavily exposed to trade with the West, will take a hit this year as the situation worsens in Europe. Singapore's tradedependent economy showed a surprise contraction of 1.1 percent in the second quarter after a strong January-March in another sign that weakness in Western countries has begun to affect Asia. The International Monetary Fund on Monday trimmed its forecast for economic growth in emerging countries and warned that the outlook could dim further if policymakers in Europe do not act with enough force.