PDF Profit_Layout 1 12/23/2011 11:38 PM Page 1
TCP gets lowest sugar procurement bid Page 7 Putting people before profit Page 2 Dollar enters the nervous nineties Page 3 Pages: 7
profit.com.pk
Saturday, 24 December, 2011
World Bank to provide up to $5.5 billion to Pakistan g
Bank to support Pakistan’s poverty reduction and development agenda g Aim to push Pakistan on a path to sustained economic growth Islamabad
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Online
he World Bank Group (WBG) will continue to support Pakistan’s poverty reduction and development agenda with an expected assistance of up to $5.5 billion over the FY 12-14, according to the World Bank’s Country Partnership Strategy Progress Report (CPSPR) released on Friday. The progress report is a mid-term review and implementation assessment of the Pakistan CPS, which was discussed by the World Bank’s Board of executive Directors on July 8, 2010. The report assesses changes in the programme since the CPS Board discussion and proposes adjustments for the remaining implementation period. In consultation with the Government of Pakistan, the original CPS period has been extended by one year to include FY14, the WB website said. “The Bank has responded flexibly in the face of the tremendous challenges Pakistan has gone through over the past year or so. I am pleased that we have been able to support the emergency response to floods, launch a MultiDonor Trust Fund (MDTF) for the crises-hit areas of Khyber Pakhtunkhwa, Federally Administered Tribal Areas and Balochistan, and deepen engagement with the provinces,” said Rachid Benmessaoud, World Bank Country Director for Pakistan. “Going forward, we will continue our strong support to Pakistan, while keeping
a keen eye on implementation to ensure that these efforts translate into real results on the ground,” he added. The progress report says the overall focus of the Bank’s strategy - to help Pakistan’s economy get back onto a path of high, sustained growth - remains valid and consistent with the overall priorities of the Government of Pakistan as articulated in its New Framework for Growth Strategy. Also, the Bank support will remain centred on the original pillars of the CPS - economic governance; human development and social protection; infrastructure; and security and conflict risk reduction. The Bank Group engagement over FY12-14 is projected at up to $4.0 billion in new International Development Association (IDA) credits and International Bank for Reconstruction and Development (IBRD) loans. This will be supplemented by a robust program under the MDTF with initial commitments of $140 million and International Finance Corporation (IFC) support projected at $1.5 billion. The Bank programme will ensure continued attention to critical social services like education and health and safety nets for vulnerable populations to address any negative implications during weak economic growth period. In addition, the Bank will support transformational infrastructure programmes, particularly energy (e.g. hydropower), which will help create jobs and
Child beggars collect garbage to earn a source of livelihood. restore long term growth. The progress report notes that while the Bank may not be able to provide budget support given weak conditions for macro-economic reform, it will remain engaged in supporting the Government in the critical issues of revenue mobilisation and power reform through analytical work, ongoing projects, and exploring operations where disbursements are based on the achievement of results. Given increased frequency of natural disasters, the Bank will bring additional focus and assistance on the Disaster Risk Management agenda. The regional cooperation opportunities will also receive increased attention. The Multi-Donor Trust Fund (MDTF) for Khyber Pakhtunkhwa, FATA and Balochistan is the Bank’s newest instrument for strategic engage-
ment in the crises-hit regions. The MDTF became effective on August 5, 2010 with grant support of 10 countries pledging $140 million. The focus of the first round of MDTF projects is on creating employment and livelihood opportunities, emergency roads construction, strengthening governance, and revitalising health services. IFC has ramped up its programme in Pakistan and has already made investments of over $1.2 billion during the last two years. IFC aims to invest about $500 million per annum in the private sector, 50 per cent of which are expected to be in trade finance and the remaining focusing on renewable energy, infrastructure, financial sector, agribusiness, manufacturing and services. The Multilateral Investment Guarantee Agency (MIGA) will continue to support invest-
Govt forms Pakistan Bureau of Statistics Islamabad
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JAlAlUDDin RUMi
o give more reliability and authenticity to the official data relating to economy, population, agriculture, trade and other areas, the government announced formation of Pakistan Bureau of Statistics by merging three previous entities which would be managed by professionals. Addressing a press conference on Friday, Finance Minister Dr Abdul hafeez Sheikh said government has formed a professional’s lead Governing Council for the Pakistan Bureau of Statistics to produce independent and credible economic data that would be trusted worldwide. he announced the merger of Federal Bureau of Statistics, the Population Census organisation and the Agriculture Census organisation to create Pakistan Bureau of Statistics organisation after the passage of Law by the parliament to establish an autonomous body of statistics. The independent organisation will be run by an autonomous governing council consist of professional economists and statisticians, said hafeez Sheikh. Statistics body had been due for the last several
years, but pressure from International Monetary Fund (IMF) forced government to step up efforts in that regard. Statistics body and governing council will function autonomously not be answerable to any ministry and will be autonomous in its decisions. Sheikh while answering the questions said legal protection has been given to new organization to secure it from any type of influence. Finance Minister hafeez Sheikh would be the first Chairman of the Governing Council of Pakistan Bureau of Statistics. however, the organisation PBS will be headed by a Chief Statistician who will be hired from the private sector. The advertisements in this regard will be published in important national and international dailies; hafeez said and added that the Chief Statistician will be hired through proper channel from the private sector. A three member hR Committee formed to interview and appoint the Chief Statistician. Members of the first governing council of PBS are Federal Finance Minister, Secretary Statistics Division, Professor Muhammad Nizamuddin, Vice Chancellor, Gujrat University, Dr Shamshad Akhtar, former Governor SBP, Dr Zeba Sathar Country Director population Council (Pakistan), Dr Naveed
hamid Professor of economics, Lahore School of economics, Dr Mehtab Karim, Dr eshya Mujahid, Mehmood Khan, Mohsin hassan Khan. The law provides formation of ‘Data Users Council’ to guide and given input in the policies of Pakistan Bureau of Statistics. The Users council will include representatives from provincial governments, State Bank, private sector and media. Provision has been made for release and dissemination of data by statistics authority while protecting secrecy of individuals, firms and institutions. Law also provides for establishment of a statistics fund to ensure financial autonomy to the bureau. Protection has been provided in the draft law to existing employees of the bureau in terms of service and they will be governed by the Civil Servants Act 1973 and its rules and will continue service on same terms and conditions. Moreover, a new Statistics Research and Training Institute (SRTI) would be established in Lahore to train officials of statistical organisations. By establishing independent Statistics organization, authorities hoped to qualify for IMF Special Data Dissemination Standards (SDDS) during current calendar year.
ments, complex infrastructure projects and crisis-affected areas. “The significant increase in IFC’s investments over the last few years demonstrates the great potential for a vivid private sector, which can create much needed jobs and help spur economic growth in the country,” said Mouayed Mahlouf, IFC Director for the Middle east and North Africa. “We are committed to helping Pakistan realise its potential especially in key sectors such as infrastructure, renewable energy and agribusiness.” The progress report notes that in addition to new lending and grant support, it will be equally important to ensure that the existing portfolio of 24 IDA/IBRD projects amounting to $3.7 billion and 38 IFC operations amounting to $927 million, as well as the MDTF and MIGA programs are implemented effectively to achieve their development objectives. The Bank’s analytical and advisory program will remain central to our policy and sector dialogue. The Trust Funds programme supported by various development partners will continue to be an important source of financing for exploiting synergies in important advisory and analytical activities. The progress report cautions that macroeconomic, political and implementation risks in Pakistan have all increased, and in the event of a significant economic deterioration, the proposed strategy would need to be revisited.
Kunnar Pasakhi pipeline project to be completed by year’s end KaRaCHI STAFF RePORT
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oRK on Kunnar Pasakhi gas pipeline is progressing around the clock and the project will be completed by the end of December 2011. According to official sources in Sui Southern Gas Company, built at a total cost of Rs1,491 million, the 24” dia, 35-km long Kunnar Pasakhi pipeline will transmit 100 mmcfd gas to SSGC system in the first phase. The project started in June 2009 and got a major boost on the intervention of Dr Asim hussain, federal minister for petroleum and natural resources, who took personal interest in expediting the project for bridging the mounting gap in demand and supply of natural gas. had it not been for the minister’s support, the project would have been completed by June 2012. The oGDC-operated Kunnar Pasakhi gas field is located in Tando Jam, some 30 kms from hyderabad city. Currently SSGC is receiving 1,100 million cubic feet per day (mmcfd) gas against the demand of 1,400 mmcfd. Besides 100 mmcfd gas from Kunnar Pasakhi, another 30 mmcfd would soon arrive from Sinjhoro gas field, followed by 15 mmcfd from haseeb field, 20 mmcfd from Rehman field and 15 mmcfd each from Meher and Jhal Magsi fields. Commissioning of these crucial projects would further improve gas supply situation for SSGC and facilitate the company in grappling with increased gas loads in winters.
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Saturday, 24 December, 2011
02
debate
OccuPy WAll STreeT MOveMenT
Putting people
before Profit The health check of the movement shows that it is still alive and kicking with significant tendencies to keep growing FaRaKH sHaHzad heN occupy Wall Street (oSW) movement literally ‘erupted overnight’ at the tail-end of the 3rd quarter of 2011, nobody had ever imagined that a relatively smaller group of disorganised people without clear-cut objectives will be able to maintain the pressure build-up for more than a week. But the forecasts were overturned when the movement also known as ‘99 per cent’ fighting to end the corporate greed, corruption and inequality completed its three months without losing its target and stamina. The health check of the movement shows that it is still alive and kicking with significant tendencies to keep growing. The demonstrators firmly believe that it is not going away because it is raising awareness of some of the gross inequality that is inherent in our current society. It has rapidly grown from a grassroots band of several hundred protesters marching in New York City on September 17, 2011 to robust and energised protest demonstrations in ten major US cities, as well as a powerful presence in social media network. The fledgling movement has so far been directly endorsed by more than 50 organisations and labour unions, and supported by democratic political leaders, , and local officials across the American nation.
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DeclArATiOn AnD MAnifeSTO It is important to have a brief overview of the Declaration and Manifesto of oSW movement as mentioned below: “As we gather together in solidarity to express a feeling of mass injustice, we must not lose sight of what brought us together. We write so that all people who feel wronged by the corporate forces of the world can know that we are your allies. “As one people, united, we acknowledge the reality: that the future of the human race requires the cooperation of its members; that our system must protect our rights, and upon corruption of that system, it is up to the individuals to protect their own rights, and those of their neighbors; that a democratic government derives its just power from the people, but corporations do not seek consent to extract wealth from the people and the earth; and that no true democracy is attainable when the process is determined by economic power. “We come to you at a time when corporations, which place profit over people, self-interest over justice and oppression over equality, run our governments.
GlOBAl APPeAl “To the people of the world, “We, the New York City General Assembly occupying Wall Street in
Liberty Square, urge you to assert your power. exercise your right to peaceably assemble; occupy public space; create a process to address the problems we face, and generate solutions accessible to everyone. To all communities that take action and form groups in the spirit of direct democracy, we offer support, documentation, and all of the resources at our disposal. Join us and make your voices heard!”
GAininG neW MOMenTuM People from all ethnicities and age groups even income levels are becoming involved in oWS. It is no longer a “bunch of out of work college kids” as we see more pictures of retirees, blue collar workers, blacks, whites, Asians and Latinos. Analysts say that each new police initiative gives them more pictures of people being peppersprayed, clubbed and dragged away that leads readers to say “at least they must be heard before being taken behind bars”. Moreover, the number of participating cities keeps growing, even becoming international. occupy Wall Street looks like a trend, even if we don’t know exactly what that trend represents. The events keep growing in number and attendance. It is said that it is remarkably drug and crime free as the participants are genuinely homeless, unemployed and impoverished. They are not the rebels without a cause, a phrase often used to signify an unjustified uprising.
beings (they are in-humane by nature)”.
yeAr Of fAileD PrOTeSTS cOnTrADicTiOnS occupy Wall Street is so disorganised it doesn’t even appear to have specific leadership, or hierarchy. It’s even hard to label. oWS participants that are demonstrating a lot of anger at the status quo, but show no clear agenda about what they would like to be done differently. oWS appears to have some ability to raise money for its encampments, demonstrations and legal work, but it does not appear to support any particular candidates, or even any particular regulatory platforms or Congressional issues. A critic blogged on internet: “easily enough, one could say it is not significant and deserves little attention”. A big con that can easily be noticed is that many of the protesters aren’t educated enough about the government’s large role in the things they’re protesting. They often seem to put all or most of the blame on banks and business, and ask the government to fix it. The government is an integral part of the problem, and the reason banks and businesses can do much of what they’ve been doing. Despite incredibly weak traditional “management” oWS is growing in terms of participants, which are remarkably diverse. They are firebrand activists apparently willing to accept criminal prosecution for supporting a cause. There are more events, in more cities with each one seeming to bring in larger audiences.
fury Of The vOiceleSS The champions of the leaderless crusade believe that corporations are organisations without a conscience that have the sole purpose of increasing profit. An oWS blog wrote: “They (corporations) cannot and should not compromise that goal (profit) for any reason whatsoever. They need to focus on next quarter’s profit or perish; forget the social consequences, future generations, or the environment. They need to stay true to their shareholders without breaking the law. Manipulation of the rules that govern corporation is one of the best ways to increase profit. Corporate laws are weak or not enforced. It’s no longer a government “by the people for the people”, but moving ever closer to the golden rule “he who has the gold, makes the rules”. We need to stop the corporations from manipulating the governmentt laws - that is the root of all the issues that have come to pass. So what all 99’rs need to agree on is something like this: A) Laws to stop Corporate Donations to Politicians. B) Laws to stop Corporate Lobbying (occupy “K” street where the Lobbyists live). C) Reverse legislation that gave Corporations the same rights as human
f the o s n mpio ade a h c Th e e s s c r u s ns o i t a l r r l e a d e t h at c o r p o e b e l i e v a n i s at i o n s c e t h at g n a re o r t a c o n s c i e s e o f u po witho e sole pur th h ave i n g p r o f i t s i n c re a
Yoni Goldstein has termed 2011 as the year of failed protests after Time magazine illustrated on its title “The Protester” as its person of the year. The opening sentences of the cover story admit just as much: “history often emerges only in retrospect. events become significant only when looked back on,” writes Rick Stengel. “An honest cataloguing of the events of this year would reveal that for all the media coverage and online blogs, protesters around the world weren’t really that successful in achieving their goals. And on some of those rare occasions when they did manage to effect change, the new reality was worse than what preceded it”, wrote Goldstein. There is yet another reason favouring oWS. We have a tendency to romanticise protesters, those who nobly publicise injustice, and bravely fight against government and all-powerful institutions.
AMericA AT crOSSrOADS “This movement has uncovered a scar on American society, an iceberg of accumulated social conflicts has risen to the surface,” said the commentary in the tabloid, which is owned by the Communist Party mouthpiece, the People’s Daily.
PuBlic SuPPOrT Many consider the occupy Wall Street protestors to have several valid points. A number of middle-class Americans are disturbed by the state of the economy, and feel that the government isn’t doing everything it can to resolve the situation. Many are frustrated because of tax loopholes that enable some corporations, millionaires and billionaires to pay a lower percentage of tax than many middle-class families. A large number of protestors and supporters are angry because of how much of a role some large corporations and their contributions play in the election process. Polls that have been conducted have indicated support for the protests by a large number of Americans.
fOrecAST Ultimately, the occupy Wall Street protestors hope to accomplish changes that will end corporate influence in government, as well as corporate corruption. It is hoped that the protests will inspire government leaders to make the legislative changes that are needed. The amount of media attention that has focused on these protests has brought a lot of support, as well as criticism. Regardless of where observers stand on the protests, they have certainly been a powerful way to bring attention to the issues that are troubling many Americans.
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Saturday, 24 December, 2011
eDitoriAL
Dollar enters the nervous nineties
Dr Sheikh and the president eeMINGLY, Dr Sheikh has become an economic convert. Not the worst of practices in times of widespread political switching. But not the best either since he heads the finance ministry. his all-well-on-the-economic-front take halfway through the fiscal, duly appreciated by the president, marks a clear departure from the policy posture he advocated at the start of the fiscal year. And though increasing exports and reduced inflation is a plus for any economy, it is a folly to compare Pakistan’s fresh numbers with last year’s, when the economy was wrongfooted by one exogenous shock after another. Dr Sheikh no doubt knows, yet chose not to place the 12 per cent year-on-year rise in exports in the context of a long term trend of decreasing exports and increasing imports bloating an already uncomfortable fiscal deficit. That too when the promise of relieving the centre’s Rs4 billion annual drain on account of PSe losses has been ruled out. And since we keep abreast of onground rigidities, we will not find fault
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with any expansion in the tax net, no matter how miniscule, as long as due attention is paid to streamlining tax collection granted to the provinces. The federal government will have to play a central role in building provincial tax collection capacity, or the exercise will not come to fruition. But the boast about government austerity needs to be taken with more than a small pinch of salt. Government claims of reining in budgetary expenditure when it blatantly borrows from the money market amount to insulting public intelligence, and cannot be expected at face value. It is little surprise the finance minister did not mention slashing the growth target. As things stand, politically correct statements regarding the economy, especially when they mask disturbing trends, suit Dr Sheikh as much as the president. But justifying excesses instead of admitting mistakes is about just as prudent as defending a faulty outlook that deepens political paralysis. This way Islamabad just embitters an already aggrieved electorate.
Rosy picture painted
Unviable government policies
This is with regards to the news report, ‘Country is safe on economic front: Dr Sheikh’ published yesterday. The worthy finance minister has, surprisingly, drawn a very rosy picture of the economy just to please his boss, but it is against the ground realities. Poverty is penetrating among the public at large, Pakistani currency is getting devalued continuously, etc. In the absence of availability of power and gas, both of which are available at almost half of the potential demand in the country; how can we expect the economy be healthy in the absence of these two commodities which are life blood of the economy?
This is with regards to the article, ‘Most eligible public transport in town’ published yesterday. I am glad someone brought up this issue in the limelight and actually wrote about it. I feel like screaming at the top of my voice when I see that the government is introducing yellow cabs and CNG buses. Are the policies of our government travelling backwards or what? It is worth a mention here that the most ‘eligible’ CNG buses are just another ruse, we don’t have enough CNG for normal traffic and now just to enjoy the enormous kickbacks, the government introduces another huge CNG guzzling monster!
m aslam CHaUdHRY
TaRIQ masOOd
lAhORe
Aahyan Mumtaz T’S good news for exporters, bad news for everyone else. Reaching record high levels, the Pakistani Rupee – US Dollar exchange rate has breached the 90 mark for the first time in history, recording 5.3 per cent depreciation during the 5MFY12. Now that’s not all that bad, proviso your income is denominated in the greenback. exporters for example, benefit from a depreciating rupee as a fall supplements their local currency reported top-line, invariably translating into fattened profitability. But what about importers, especially of the oil & gas breed? Surely, a depreciating currency would pose supply-side pressures; a real pain if demand dynamics do not allow for cost pass-through. But here is where the trouble begins. The US Dollar is all set to hit a maiden century. There is little doubt of that happening so the only question that remains is when. Will Sachin Tendulkar get his elusive 100th hundred before the Dollar reaches the century mark? Perhaps yes, but another dismal tour for the little master and the race is on. Power, or the lack of it, is a key issue of which each of us is reminded of politely by sporadic load shedding and outages. It seems now that a sequel to the horrid episode seen in the summers is about to restart again. The pertinent question to ask is as to why have there been no (or little) outages thus far, given that an estimated 3,000MW shortfall in hydro power generation capacity was expected this winter? That’s only because the gas supplies have been rerouted from industrial usage to IPPs, household and CNG consumption. Surely we cannot afford to burn stoves at the expense of cutting off the lifeline of our income generating sources. henceforth, gas supply is expected to be restored to the industry by January 2012, naturally coming at the expense of the amount supplied to power producers and used in homes.
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Good news for exporters, bad news for everyone else
This holds particular significance to the way the Rupee is expected to behave in the coming few months, as it has a direct impact on the country’s trade balance. Though load shedding is inevitable, a greater reliance on oil is likely to emerge shortly. oil as a rule swells imports and coupled with consistently rising prices of crude in the international market, considerable strain on the import bills can be expected. our currency’s relatively strong performance in FY11 was supported by a positive current account balance without too much of a drain on the financial account. This led to a Balance of Payment surplus of $2.50b last year. on the flip side, data reveals a shrinking trend in volumetric exports YTD as production dwindled (guess… no gas) as well as remittances – the hero till last year – peaking out in August owing to the eid effect. Meanwhile, imports have already surged 20 per cent on the whole, enough to cause the trade balance to plunge to $9.06b so far since July. It is hard to see this improving in the coming months simply as it would be virtually impossible to control the burgeoning import bill of oil. Greater demand for Dollar to make these payments would put strain on our currency, going forward. Then there is the financial account. To start off with, an IMF repayment of $1.40b looms around February as a first stop. The country has to repay around $9.34b by FY16, of which the bulk of the repayments are concentrated in the FY13-FY14 period, according to the repayment schedule released by the SBP. Nevertheless, Pakistan would be requiring on average $2.5b per year. The sources of such funds are unclear, but the more important concern is the exhaustive effect debt repayment will have on foreign exchange reserves. An absence of official inflows given the halt in IMF loan tranches and foreign investment is likely to keep the financial account on weak footing, if not cause further deterioration. All aspects point to more currency depreciation in the coming months on the basis of simple demand and supply dynamics in favor of the greenback. To me the measures taken by SBP on the forward cover facility against private loans and imports appear good to the point of limiting undue market exposure through speculator activity, but inherently seem to carry the air of rising dollar expectations. Will the Dollar ‘march’ on towards three figures, or will it stagger in the nervous nineties for a while? Strictly a personal opinion, my bet is on the former. The writer is a financial analyst and freelance journalist
kARAchi
Hard work and economic growth
Sajid Khan Lodhy ANY would say that working for long hours results in better output, and that it can utilise human resources in a more useful manner. To a layman this might seem right but does this hold true for the more keen-eyed? A closer look at how the mechanics of our economic system work can provide us with a suitable answer to this quiz. As far as working-efficiently-is-better-than-working-more argument is concerned, it is only partially true.
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each country in the world devises its own policies that regulate how its workforce is trained, utilised and given respite from fatigue and burnouts. Some would prefer a more relaxed environment if their economic situation is better or getting better. Still others would like to run on all cylinders if they deem their economic growth to be too slow. According to the organisation for economic Co-operation and Development (oeCD), an average worker in Germany spends 1419 hours annually on his job whereas an average worker in Greece spends 2109 hours annually on his job. With where both the economies are headed, one can clearly see that working more does not always mean working better. Greece is not going upwards in its economic growth; instead, it has taken a hit and has only been rescued by a combined effort of the european Union members. Norway and the Netherlands have even shorter work hours though their
economies have not shown a considerable dent in their wielding power despite a global recession. An interesting question in this regard could be why the world does not follow German formula of efficiency. Why can’t the world follow a pattern of work ethics much like the Germans and be more efficient, more productive? The answer, though it requires more research in this regard, lies in the world’s system of economics. You see, one can be more efficient and thrifty, saving much more than consuming and thus work less for better economic rewards. Now if you have more savings, you can work less, export much, import even lesser, and create an economy that relies on exports rather than imports. But if we continue along these lines, there is no rosy picture in sight. All countries cannot have more exports than imports and all countries cannot have more savings than borrowings. If they do so, the whole financial system would collapse on it-
ShAhAB JAfry business editor
KunWAr KhulDune ShAhiD Sub-editor
BABur SAGhir Creative Head
Ali riZvi News editor
MAheen SyeD Sub-editor
hAMMAD rAZA Layout Designer
the stereotype that certain nations are more hardworking than others has only as much credibility as the system allows them
self. Some countries have to be import-based or some consumptionbased to keep the flow of financial assets on the move. A stagnant market, where there is no competition to take over one another, where one’s requirements need not be fulfilled by the other’s produce, a collapse of the whole economy is nothing but sure. The stereotype that certain nations are more hardworking than others, has only as much credibility that the system allows them. In this regard, two examples stand out among the data compiled by oeCD: the US and Japan. They are neither most hardworking nor most efficient. Still, their economic clout is beyond any doubt. The US is a major consumption based economy though its exports have a large footprint in the international trade,
while Japan is heavily tilted towards an export-based economy. Both have almost the same number for workhours their employment force clocks each year: the US 1778 and Japan 1733. This can be true of certain nations, but not all. A poor country, howsoever we try twisting the statistics, has to work more than a rich country for the simple fact that the economic growth is an outcome of production and consumption, imports and exports taken altogether. Production or exports alone can provide only a good volume increase in economy, but it is the presence of consumption and imports as well that can bring the much needed economic growth. The writer is Sub-Editor, Op-Ed, Pakistan Today.
for comments, queries and contributions, write to: MuneeB eJAZ Layout Designer
email: profit@pakistantoday.com.pk Ph: 042-36298305-10 fax: 042-36298302 Website: www.pakistantoday.com.pk
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Saturday, 24 December, 2011
04
news
I am opposed to the idea that businessmen who are not successful blame it on the country policies
interflow Group chairman , Taher Khan
hec, uSAiD train public university staff
Govt asked to reform public sector enterprises laHORE
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STAFF RePORT
oRMeR Senior Vice President of Lahore Chamber of Commerce and Industry and former Chairman of Pakistan Poultry Association Abdul Basit has demanded of the government to constitute a high powered committee comprising of public and private sector representatives to run the huge deficit-carrying Public Sector enterprises like Pakistan International Airlines (PIA), Pakistan Railways and Pakistan Steel Mills. In a press statement issued here Friday, Abdul Basit said the National Flag carrier is following the steps of Pakistan Railways and is facing a loss of Rs144 billion with deliberate default of payment of repairs, causing grounding of planes and fabricating excuse for buying 39 planes at estimated cost of $2.5 bil-
lion in violation of PPRA rules. he said both Pakistan International Airlines (PIA) and Pakistan Railways (PR) are on the verge of collapse, with the national flag carrier having to cancel over a dozen flights because of shortage of aircraft and Railways having to halt all trains from the Lahore region because of unavailability of diesel. Abdul Basit said there are a number of high profile people attached with PIA but nobody in the airline was willing to address the issues being faced by it. he said large-scale political appointments have destroyed the record making airline. he said all over the world 100 to one planes standard is in vogue but it is very unfortunate that in case of PIA it is 400 to one plane that has jacked up the salary level of the national flag carrier to the level that it always in need of funding and today the situation has reached an alarming level. Abdul Basit said political appoint-
Political appointments are not only causing a huge loss but the standard of services provided by Pakistan international Airlines is going down every passing day ments are not only causing a huge loss but the standard of services provided by Pakistan International Airline (PIA) is going down every passing day. The situation is worse for international destination and people tend to opt for other foreign airlines. The airline is in shambles due to political hiring by every government in power which is a huge burden on the Airline’s kitty. he said that the PIA’s inefficiency was more evident than it has been for years. And it isn’t only these delayed flights and the stranded
passengers that have plagued PIA and its passengers but a number of things which include the poor condition of the airplanes, the shortage of the planes themselves, crash landings and an administration that In 1962, PIA created a world record flying from London to Karachi nonstop in the shortest amount of time which was 6 hours 43 minutes and 51 seconds. The record remains unbeaten to this day. It’s high time we end politics in our national carrier and save it from going bankrupt.
Jittery KSE posts minor loss KaRaCHI STAFF RePORT
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T was another lethargic day at the local bourse as market volumes remained below the 30 million mark. While the index was able to post a marginal gain, the gain emanated from index weight heavy Nestle rather than a spurt from the broader equity base. KSe 100 index closed at 11301.09 levels with a loss of 5.01 points, while total volume stood at 30,624,413. KSe 30 index closed at 10318.41 levels to lose 42.28 points, and All Share index closed at 7817.77 levels after losing 5.65 points. Total 140 scrips advanced 143 declined and
15 remain unchanged out of total 298 scrips traded. In terms of the fertiliser sector, investors appear more concerned of the impact of GIDC than engro’s recent price reversal which was not enough to mitigate the earnings at-
trition that GIDC is expected to bring about. The oil and gas sector was in negative territory as well while the banking sector was a mixed bag as NBP and ABL ended up higher. overall market sentiment remains gloomy as the
daily news flow regarding the overall economy remains negative and investors are merely incorporating the sentiment in their trading activities or shall we say lack thereof, said Ali hussain at hMFS.
Islamabad: higher education Commission (heC), in collaboration with the US Agency for International Development (USAID), organised a workshop on fundraising and resource mobilization for the staff of 11 public universities. The closing ceremony of the three-day workshop, attended by 28 participants, was held at heC Secretariat on Friday. The workshop was designed to help universities strengthen their ability to sustain their operations and diversify income. The resource persons addressed the issues like optimisation of human resources and economic difficulties and resource constraints for education. one-third of the total revenues of Pakistan’s public sector higher education institutions come from non-government funds, such as tuition fees, college affiliation fees, exam fees or hostel charges. only a small share of public university revenues is generated through contract research, commercial ventures, fundraising, endowments or other philanthropic sources. Online
iPO-Pakistan establishes facilitation desk at SMeDA laHORE: Small and Medium enterprises Development Authority (SMeDA) and Intellectual Property organisation (IPo), Pakistan have entered into an agreement to facilitate SMes in respective ambit of their service. Mr hameed Ullah Jan Afridi, while expressing his views on this occasion said IPo facilitation desk at SMeDA was set up to strengthen relationship between SMeDA and IPo-Pakistan for extending IP awareness and support to SMes. IP help desk has been established as a pilot project, he said, adding that desk will be receiving IP related applications and extending legal advice to SMes. on the success of this pilot project, such desks would also be opened at other offices of SMeDA in future, he added. Chairman IPo-Pakistan said areas of further collaboration will be found-out after the mutual consultation of experts of both organisations. he said IPo is looking forward to develop relations with different organisation for creating awareness about IP rights. STAFF RePORT
icci strongly resents gas shortage and hike in tariff Islamabad: Gas shortage in conjunction with electricity load shedding and tariff hike is causing immense problems for industries. Thus, government should take necessary measures to ensure constant and uninterrupted supply of gas and electricity to run the wheel of economy. President, Islamabad Chamber of Commerce and Industry (ICCI) Yassar Sakhi Butt, while criticising decision of government for increasing gas tariff by 14 per cent from 1st January 2012, said it would increase cost of production and load shedding for industry shall badly affect industrial production and commercial activities. STAFF RePORT
fBr implements WeBOc at PicT Islamabad: Federal Board of Revenue (FBR) after successful implementation of Web-Based one Customs (WeBoC) system at Port Qasim Terminal, announced to implement WeBoC at Pakistan International Container Terminal (PICT), to handle imports and exports Goods Declarations (GDs) with effect from December 17, 2011. The implementation of Web-Based one Customs (WeBoC) system at Port Qasim Terminal is done under the World Bank supported Pakistan Tax Administration Reforms Project (TARP). The Web-Based one Customs (WeBoC) has been designed to handle these GDs, earlier being handled through MCC PaCCS. As part of the transition process, different steps were taken to facilitate smooth transition. It includes that all new VIRs at PICT were to be electronically filed in WeBoC while all import GDs pertaining to VIRs filed on the date or afterwards at PICT to be processed in WeBoC. however, existing exclusions in PaCCS continue to be processed under one Customs. STAFF RePORT
customs offices to remain open Islamabad: Federal Board of Revenue (FBR) directed all the Model Customs Collectorates to remain open today on December 24 and 31, 2011 as a normal working day in order to facilitate the trade and industry in getting their cargo cleared for imports and exports. FBR has requested SBP and NBP to provide banking facility by designated branches today, to ensure the payment of duty and taxes. STAFF RePORT
PDF Profit_Layout 1 12/23/2011 11:39 PM Page 5
Saturday, 24 December, 2011
Looking at Indonesia, based on its size and current GDP development, I think it is the perfect time for us to come
news
Metro cash & carry ceO, frans W h Muller
China plays hard ball over iranian oil rates KUnwaR KHUldUnE sHaHId
A
S the world collectively contemplates over the ramifications of Washington’s sanctions on Iran, China has made its line of action pretty clear. US sanctions over Iran connote that there would be a void in the oil market and hence the oil price around the globe would increase – especially for those countries who are complying with the US Congress’ decision. Meanwhile, with a lack of purchasers for its oil Tehran is in a veritable quagmire, and hence its negotiating powers are significantly minimised. Now, what China is vying to do is get Iranian oil at a significantly cheaper rate, since the buyers have been reduced after the sanctions. China has expounded its intention of playing hard ball with Iran over oil rates by cutting its January imports in half and in turn cutting the flow of 10 per cent of Iranian oil. With China being the world’s second largest crude oil importer and Iran the fifth ranked exporter, such a
prodigious drop in oil volumes would result in a major political convulsion – especially since fresh sanctions over Iran are also on the horizon. Now with the numbers of buyers plummeting down, Iran has a choice to make: either it could sell more oil to its topmost buyer China or it would have to slash the volume of exports. ‘Choice’ is probably a misnomer for the blatantly obvious course of action that Iran would have to undertake. When Chinese negotiations with Iran over oil sales for 2012 began, the former was aware of the fact that it was the latter’s last resort and hence the Iranians stance of warding off price changes was considerably weak. And hence when Iran refused to budge, China riposted by cutting its January purchases by around 285,000 barrels per day – which amounts to over fifty per cent of 550,000 bpd that China buys annually and over 10 per cent of 2.4 million bpd of Iranian exports. With Iran dependent on oil for nearly half of the government’s revenue, it cannot afford to have such a huge dip in exports and
05
As fresh sanctions over iranian oil loom, China has the upper hand on the negotiation table g
hence it is only a matter of time before Iran complies with Chinese demands. Another sting in the tale has been courtesy an upsurge in Saudi crude exports to China, which has further diminished any iota of bargaining power that Iran might have had. When juxtaposed with the same time last year, Saudi crude exports to China have jumped by nearly 32 per cent. The new exports total 4.81 million barrels per day which is nearly half of Saudi Arabia’s production of oil. If China has been opportunistic in its maneuver
over price bargaining the same could also be said of the Saudi Kingdom. Saudi Arabia has upped the ante in oil production as it endeavours to capitalise on the sanctions on Iran. With Iranian oil evaporating from the global market, the Saudi oil has been touted to emerge as one of the major players in the oil game. US and Saudi Arabia have already had talks over a potential rise the latter’s oil production by exploring its spare production potential. hence as things stand, and as China sits with Iran on the negotiation table
again, there would only be one speaker and the Iran would have to acquiesce to whatever Beijing iterates. Nevertheless, even though China has alternatives and has made its innermost intentions conspicuous, the Chinese hierarchy would not want to give up on Iranian crude imports as it is bound to damage the relationship between the two nations unnecessarily. The writer is Sub-Editor, Profit. He can be reached at khulduneshahid@gmail.com
CORPORATE CORNER nokia and uneScO join hands to deliver quality education to teachers
Islamabad: Nokia and UNeSCo Islamabad launched the “Mobile Learning Project for Teacher’s Professional Development”, as formal collaboration took place in the presence of senior government officials, Nokia representatives and UNeSCo representatives. In Pakistan, through the project “Mobile Learning for Teachers”, Nokia will help UNeSCo to enable the delivery of high- quality educational materials to teachers who lack training and resources. Through mobile phones, teachers will be given an opportunity to train themselves. In order to support such mobile learning innovations, this project will be implemented by AGAhI, a UNeSCo partner and a non-profit foundation working in the area of communication and media policy design. PReSS ReleASe
ericsson and PTA announce winners of Mobile excellence Award laHORE: ericsson and Pakistan Telecommunications Authority (PTA) announced Muhammad Bilal Zafar and Muhammad Ahmad Bashir, senior year undergraduate students from LUMS as the winners of ericsson-PTA Mobile excellence Award 2011 at a ceremony held at ericsson Pakistan headquarter in Islamabad. The ceremony was graced by Dr Mohammed Yaseen, Chairman of PTA and senior management of ericsson Pakistan as well as PTA. A runner up award was conferred upon FSc students from the University of Karachi, Mr Sameer Ahmed Khan, Mr Zohaib Ahmed Shakir and Mr Noman Bin Rizwan. The panel of judges also conferred two special recognition awards upon Mr Irfan Ullah Khan, from Comsats University of Technology,
Abottabad and Mr hammad Masood and Mr Yawar Abbas from FAST, Karachi. PReSS ReleASe
and has been published without investigating proper facts. PReSS ReleASe
PTcl customer care camp attracts celebrities and general public
Bank of Punjab strongly rebuts media reports regarding nAB
HYdERabad: Former Pakistani test cricketer, Touseef Ahmed, viewed latest eVo 3G products during his visit to the Pakistan Telecommunication Company Ltd (PTCL) customer facilitation camp held at Central one-Stop Shop, hyderabad. The camp was organized by PTCL Regional General Manager hyderabad, Abdul Rahim Shaikh and his team. The 3-day camp created public awareness and offered personalised briefings about PTCL’s new products and services that match customers’ everyday data and voice communication needs. PReSS ReleASe
PTcl clarification on Pakistan railways phone connections Islamabad: Pakistan Telecommunication Company Limited (PTCL) has strongly refuted a news item published in a section of the press on December 23 with regards to suspension of outgoing telephone facilities to Pakistan Railways headquarters and Punjab division offices owing to non-payment of dues. In a statement issued, PTCL authorities have clarified that Pakistan Railways’ disconnected numbers are not PTCL numbers. In fact, these numbers belong to and are charged by a different telecom corporation, which only uses PTCL infrastructure to provide its services. The report is, therefore, inaccurate
laHORE: The Bank of Punjab vehemently denies the contents of press releases published with reference to the National Accountability Bureau in the newspapers especially, Business Recorder and The News dated 21/12/2011. Contrary to the press clippings, BoP has taken every possible measure permissible under the law for recovery of its nonperforming loans. Apart from initiation of litigation, referral of willful default cases under National Accountability ordinance, 1999 BoP has already forwarded 15 direct complaints to chairman NAB under section 9 for recovery of around Rs12 billion during the year, 2010. PReSS ReleASe
hTc joins Brightex in launching two hTc concept Stores
Dam will significantly contribute towards socioeconomic development of the country, Federally Administered Tribal Areas (FATA) and Khyber Pakhtunkhwa in particular, as the project will ensure availability of water for irrigated agriculture, control floods and provide low-cost hydel electricity.’ PReSS ReleASe
uK Border Agency extends premium vAc services for customers
KaRaCHI: UK Border Agency, in partnership with its commercial partner Gerrys, launched a premium lounge service at its Visa Application Centre (VAC) in Karachi. The Gerry’s premium lounge in Karachi is the luxurious, dedicated and convenient lounge for UK visa applicants, which provides a personalised service for the submission of their applications and passports for visa processing. Mandy Ivemy, UK Border Agency Regional Manager for Pakistan said, “UK Border Agency is committed to providing a first class visa service to Pakistan. PReSS ReleASe
laHORE: hTC announced its partnership with Brightex Distributions (Pvt) Ltd in launching two hTC Concept Stores, simultaneously in Karachi. These will be the first stores in Karachi to offer hTC products exclusively, and have the ability to showcase hTC’s latest innovation. In addition, the stores will also provide user trainings, after-sales support and services. PReSS ReleASe
WAPDA chairman visits a project in South Waziristan laHORE: Water and Power Development Authority (WAPDA) Chairman Shakil Durrani, during his visit to the project located in South Waziristan Agency of FATA stated, ‘Gomal Zam
kARAchi: Arif Suleman, hon Trade Advisor of Thai government in Pakistan and President/chairman PTFA & Bc (FPcci), presents, on behalf of PTFA & Bc, a cheque of donation for flood victims in Thailand to Mr Marut Jitpatima, Ambassador of Thailand in Pakistan. Also present on the occasion are Mr Sohail Mehmood, Pakistan Ambassador to Thailand, and Thai acting consul General in karachi Dr krij comson and Mr Anirut Smuthkochorn, Advisor to Thailand TTR. PRESS RELEASE
PDF Profit_Layout 1 12/23/2011 11:39 PM Page 6
Saturday, 24 December, 2011
06 Markets top 10 sectors
49% 09% 10% 04% 04%
Chemicals
01% 03% 01% 02% 17%
real estate investment
Construction & Materials electricity banks
fixed Line telecommunication
oil & Gas
financial Services
Personal Goods
equity investment instruments
STOCK MARKET HIGHLIGHTS index 11301.09 2849.27 2587.93
KSe-100 LSe-25 iSe-10
Change -5.01 +9.48 +0.52
Volume 25,613,829 681,920 3,000
Market Value 1,066,082,768 10,873,834 124,800
top 5 perForMers sector wise
Major Gainers Company Nestle PakistanXD Siemens Pak Sanofi-Aventis efU Life Assur tri-Pack films
open 2696.43 848.60 138.00 70.03 165.00
High 2831.25 890.00 144.90 73.00 167.80
Low 2818.00 813.05 140.10 67.11 162.05
Close 2831.25 1 888.89 144.81 72.87 167.65
Change 34.82 40.29 6.81 2.84 2.65
turnover 61 83 695 1,325 297
5547.50 118.68 173.44 785.05 364.74
5790.00 119.99 182.11 823.00 364.00
5500.00 113.00 165.00 745.80 360.10
5524.17 114.68 169.73 781.90 362.09
-23.33 -4.00 -3.71 -3.15 -2.65
231 133,554 6,245 1,172 5,043
Volume Leaders fatima fert.Co. Jah.Sidd. Co. engro Corp Nib bank Ltd National bank
23.17 4.19 98.54 1.30 41.19
23.36 4.15 99.49 1.51 41.90
22.99 3.95 97.00 1.29 40.85
23.16 4.08 98.41 1.49 41.22
-0.01 -0.11 -0.13 0.19 0.03
4,793,037 2,573,257 2,045,831 1,983,741 1,946,184
Bullion Market Gold 24K Gold 22K Silver (tezabi) Silver (thobi)
Per tola (PKr) 53,704.00 51,608.00 977.00 1025.00
Per 10 Gm (PKr) 46,092.00 44,245.00 839.00 880.00
Per ounce US$ 1,608.00 – 35.05 –
hiGh
lOW currenT
chAnGe
vOluMe
424.00 110.69 24.20 6.85 85.00
417.50 109.01 21.90 6.70 83.00
420.03 109.20 22.52 6.75 83.67
1.27 -0.88 -0.53 -0.05 -0.84
14,421 413,994 1,418 108,427 43,221
15.55 1.00 28.15 156.50 36.07
15.55 0.01 27.70 150.80 34.40
15.55 0.01 27.82 152.13 36.07
0.00 0.00 -0.25 2.51 1.71
1 1 156,319 17,944 204,450
Oil and Gas Attock Petroleum Attock refinery burshane LPG byco Petroleum Mari Gas Co.
418.76 110.08 23.05 6.80 84.51
Agritech Limited Agritech(Pref)(r) Arif Habib Co SD Clariant Pakistan Dawood Hercules
15.55 0.01 28.07 149.62 34.36
18.97 1.20 9.00 31.09 9.90
18.88 1.25 9.00 32.00 10.24
18.50 1.12 8.10 30.25 9.86
18.78 1.25 8.24 32.00 10.24
-0.19 0.05 -0.76 0.91 0.34
2.25 51.97 6.97 19.00 1.41
27.83 4.04 40.00 19.35 79.00
Ados Pakistan AL-Ghazi tractSPot Hinopak Motor K.S.b.Pumps Millat tractors Ltd.
89.6626 140.8869 1.1482 117.4849
4.56 189.77 70.05 25.25 378.21
2.29 52.69 7.15 19.24 1.89
2.25 51.50 6.72 18.40 1.41
2.25 52.01 6.80 18.78 1.41
0.00 0.04 -0.17 -0.22 0.00
25,600 42,526 1,017 1,405,226 2
US Dollar euro Great britain Pound Japanese Yen Canadian Dollar Hong Kong Dollar UAe Dirham Saudi riyal Australian Dollar
International Oil Price WTI Crude Oil
$99.79
Sell 89.80 117.65 141.08 1.1467 89.29 11.58 24.47 23.95 92.57
Brent Crude Oil
$107.89
Atlas battery Ltd. Atlas engineering Atlas Honda Ltd. Dewan Motors exide (PAK)
166.15 58.00 121.50 1.91 159.96
27.83 3.89 41.49 19.35 80.90
27.00 3.82 40.00 18.35 79.00
27.00 3.86 40.05 19.35 79.00
-0.83 -0.18 0.05 0.00 0.00
8,000 13,500 835 35 257
Abdullah Shah Adam Sugar AL-Noor Suger Mills bawany Sugar Colony Sugar Mills
5.60 16.70 55.20 11.10 1.75
5.00 16.95 57.95 11.10 1.70
5.00 196.00 70.05 23.99 379.50
4.56 189.77 67.00 23.99 373.01
164.10 58.00 126.00 2.25 159.90
0.00 2.70 0.00 -1.26 -4.43
103 3,220 67 24,995 5,431
161.78 58.00 125.98 1.89 158.03
-4.37 0.00 4.48 -0.02 -1.93
2,981 5,017 300 1,008 1,130
109.00 111.18 145.05 145.58
0.69 -4.44
1,170 203
160.00 58.00 125.51 1.89 158.00
110.49 111.43 150.02 150.00
Diamond ind. Hala enterprise Pak elektron Ltd. Singer Pakistan tariq Glass ind.
8.20 6.01 4.06 14.07 8.30
9.18 6.90 4.38 15.06 8.50
(Colony) thal AL-Qadir textile Amtex Limited Artistic Denim Mills Azam textile
1.40 12.50 1.18 21.50 1.11
1.10 13.00 1.25 21.50 1.60
AHCL-DeC ANL-DeC AtrL-DeC DGKC-DeC eNGro-DeC
27.96 3.40 111.88 19.09 97.03
28.25 3.46 112.00 19.25 96.40
4.56 192.47 70.05 23.99 373.78
Abbott Laboratories ferozsons (Lab) Ltd. GlaxoSmithKline Pak. Highnoon (Lab) ibL HealthCare
99.00 74.62 65.27 29.23 13.61
100.00 75.00 65.99 30.00 13.50
P.t.C.L.A Pak Datacom Ltd telecard Limited Wateen telecom Ltd WorldCall telecom
10.28 34.38 0.75 1.84 0.81
5.00 16.77 55.99 11.10 1.70
-0.60 0.07 0.79 0.00 -0.05
500 2,642 2,014 50 9,042
9.18 6.90 3.94 13.07 8.31
9.18 6.90 3.94 15.06 8.39
0.98 0.89 -0.12 0.99 0.09
1 50 389,302 501 11,224
1.00 13.00 1.17 21.50 1.11
1.00 13.00 1.20 21.50 1.11
-0.40 0.50 0.02 0.00 0.00
2,000 500 11,407 40 1
27.75 3.26 109.61 18.50 92.21
27.83 3.32 110.19 18.81 94.54
-0.13 -0.08 -1.69 -0.28 -2.49
97,000 140,500 298,000 208,000 1,558,000
99.54 74.62 65.20 29.74 13.44
0.54 0.00 -0.07 0.51 -0.17
426 10 4,216 3,276 1,962
98.50 74.62 64.10 28.51 13.15
10.32 34.50 0.83 1.88 0.94
10.13 34.45 0.75 1.75 0.83
10.17 34.50 0.79 1.75 0.90
-0.11 0.12 0.04 -0.09 0.09
325,684 900 7,497 27,179 1,537,164
0.35 35.52 0.63 1.51 1.60
0.35 35.50 0.65 1.55 1.70
0.34 34.01 0.60 1.50 1.65
0.34 34.50 0.65 1.51 1.65
-0.01 -1.02 0.02 0.00 0.05
10,002 3,884,023 55,204 299,633 501
56.83 10.29 4.81 11.51 28.30
57.99 10.29 4.89 11.55 28.52
56.00 10.00 4.72 11.00 28.18
56.46 10.01 4.78 11.35 28.27
-0.37 -0.28 -0.03 -0.16 -0.03
8,086 156,080 419,199 1,772,293 87,101
Electricity Genertech Hub Power Co. Japan Power K.e.S.C. Kohinoor Power
Banks Allied bank Ltd Askari bank b.o.Punjab bank Al-falah bank AL-Habib
SyMBOl
OPen
hiGh
lOW currenT
chAnGe
vOluMe
Non Life Insurance 5.00 16.31 52.44 10.30 1.60
Fixed Line Telecommunication
Beverages Murree brewery Co. Shezan int’l
vOluMe
Pharma and Bio Tech
Automobile and Parts buy 88.80 115.40 138.53 1.1292 86.37 11.25 24.10 23.62 89.27
chAnGe
Future Contracts
General Industrials Cherat Packaging eCoPACK Ltd Ghani Glass Ltd Merit Pack Packages Limited
lOW currenT
Personal Goods 5,670 10,506 3,400 8,057 6,000
Construction and Materials Al-Abbas Cement Attock Cement Cherat Cement D.G.K.Cement Dadabhoy Cement
hiGh
Household Goods
Industrial metals and Mining Crescent Steel Dost Steels Ltd. Huffaz Seamless Pipe int. ind.Ltd. inter.Steel Ltd.
OPen
SyMBOl
Food Producers
Industrial Engineering
Interbank Rates US Dollar UK Pound Japanese Yen euro
OPen
Chemicals
Major Losers UniLever Pak Ltd. iCi Pakistan AL-Ghazi tractorsXD Wyeth Pak Limited Millat tractors Ltd.
SyMBOl
Adamjee ins Atlas insurance Century insurance efU General ins iGi insurance Ltd.
42.06 36.00 6.78 35.06 41.94
43.38 36.90 7.23 35.05 43.25
41.38 36.00 6.45 35.00 42.00
42.63 36.00 7.23 35.00 42.65
0.57 0.00 0.45 -0.06 0.71
37,504 65,132 1,500 7,753 600
13.50 1.40 65.53
14.50 1.40 65.53
0.00 0.00 0.00
2 1 157
0.29 13.82 0.65 0.85 2.55
-0.06 -0.61 0.00 0.19 0.00
5,018 32,976 10 1,700 458
Life Insurance American Life east West Life Assur efU Life Assur
14.50 1.40 65.53
14.50 2.34 68.80
Financial Services AMZ Ventures A Arif Habib Ltd. Dawood Cap.Man Xb Dawood equities f. Nat.equities
0.35 14.43 0.65 0.66 2.55
0.38 14.89 1.14 0.99 2.55
0.28 13.70 0.65 0.60 2.55
Equity Investment Instruments AL-Noor Modar Allied rental Mod b.r.r.Guardian Cres. Stand.Mod elite Cap.Mod
3.50 22.45 2.01 0.48 2.55
4.50 22.45 2.10 0.55 3.00
4.20 21.70 2.01 0.50 2.55
4.50 22.45 2.01 0.54 2.55
1.00 0.00 0.00 0.06 0.00
131,240 25 100 33,349 26
12.88 31.00 35.30 32.00 13.00 62.00 1.11 63.52 5.00 7.00 3.43 14.94 8.30 55.03 27.16 7.95 1.77 138.65 15.95 18.45 67.11 23.75 1.30 8.94
12.88 31.00 35.95 32.00 13.02 62.86 1.15 63.68 5.00 7.00 3.50 15.94 8.50 55.50 28.58 8.41 1.80 138.65 16.00 19.56 72.87 25.00 1.33 9.00
-0.50 -0.15 0.75 0.00 -0.13 -1.23 0.00 -0.05 0.75 0.00 -0.10 0.00 0.23 -2.42 0.00 0.77 0.03 0.00 0.00 0.59 2.84 0.00 0.04 -0.10
2,314 500 545 103 8,500 1,232 404,969 1,135 500 100 12,504 1 7,216 2,025 347 3,783 16,515 4 97,206 214,239 1,325 42 28,054 41,720
Miscellaneous Century Paper Pak Paper Prod. Security Paper Pakistan Cables P.N.S.C. Pak.int.Con. SD trG Pakistan Ltd. Murree brewery Shakarganj food Hala enterprise Pak elektron Ltd. Singer Pakistan tariq Glass ind. Pak tobacco Co. Shifa int.Hospitals Media times Ltd P.i.A.C.(A) Pak Services Sui North Gas Sui South Gas efU Life Assur AKD Capital Ltd. Pace (Pak) Ltd. Netsol technologies
13.38 31.15 35.20 32.00 13.15 64.09 1.15 63.73 4.25 7.00 3.60 15.94 8.27 57.92 28.58 7.64 1.77 138.65 16.00 18.97 70.03 25.00 1.29 9.10
13.50 31.00 36.47 33.49 13.45 63.00 1.23 64.98 5.00 7.00 3.80 15.94 8.85 56.00 29.45 8.64 2.00 140.00 16.25 19.80 73.00 26.18 1.40 9.15
Mutual Funds fund
Offer
repurchase
Alfalah GHP Cash fund Askari islamic Asset Allocation fund Askari islamic income fund Askari Sovereign Cash fund Atlas income fund Atlas islamic income fund Atlas Money Market fund Atlas Stock Market fund Crosby Dragon fund
501.2900 114.7196 103.6501 100.6900 519.3500 519.0900 516.9700 453.1500 82.9800
501.2900 111.8516 102.6136 100.6900 514.2100 513.9500 516.9700 444.2600 81.3500
nAv 501.2900 111.8516 102.6136 100.6900 514.2100 513.9500 516.9700 444.2600 81.3500
fund
Offer
repurchase
HbL Money Market fund HbL Multi Asset fund HbL Stock fund iGi income fund iGi Stock fund JS Principal Secure fund i JS Principal Secure fund ii KASb Cash fund
100.2768 87.0103 97.6745 101.8987 112.3545 121.5000 104.1200 0.0000
100.2768 85.3042 95.2922 100.8898 109.6141 111.5200 96.5000 0.0000
nAv 100.2768 85.3042 95.2922 100.8898 109.6141 117.3900 101.5800 100.1087
PDF Profit_Layout 1 12/23/2011 11:40 PM Page 7
Saturday, 24 December, 2011
I am proud of the fact that with the use of advanced technology, research and innovation to suit today’s world, our brand is ranked in Pakistan among the very top, out of a total of 3500 brands marketed and sold
news
08
national foods ceO, Abrar hasan
Govt notifies incentives for Foreigners new auto-mobile entrants dump equities globally, KSE G no exception Islamabad
JAlAlUDDin RUMi
KaRaCHI
F
STAFF RePORT
oReIGN investors at KSe have yet again been at the forefront in determining market direction. KSe-100 index is down 10 per cent in 2h2011 in the backdrop of net foreign selling worth $157 million during the period. Recall that in 2h2009, KSe100 had gained 31 per cent on the back of net foreign buying of $291 million. According to our estimates, foreigners still hold 29.98 per cent ($2.4 billion) of the market’s free float versus its recent high of 32.5per cent ($2.8 billion) on May 21, 2011, said Atif Zafar at JS, adding that we believe the gloomy global economic outlook (in general) and the ongoing euro debt concerns (in particular) have reduced investors’ appetite for equities, while enhancing the appeal for bonds in search of safe havens. Interestingly, the appetite for commodities has also faded away lately; take cue from gold (down 16 per cent from its peak on Sept 6, 2011) and CRB Index (down 22 per cent from its peak on April 29, 2011). Despite equities being the least preferred instrument for investors, Pak equity bourse has seen a milder
foreign outflow compared to emerging economies. Is fOREIgn sEllIng spECIfIC tO paKIstan? No! Selling by foreign fund mangers has been seen in most equity markets. We believe rising risk premia on equities owing to gloomy world economic outlook has led to rebalancing of their funds towards fixed income securities, he added. overall, foreign portfolio investment has witnessed a drawdown from emerging economies during 2011 like India ($538 million), South Korea (-$8.9 billion), Taiwan ($9.8 billion) and Thailand (-$427 million). Interestingly, frontier markets like Dubai ($38.4 million), Abu Dhabi (-$85.1 million) and Qatar ($756 million) are yet to witness such large quantum of selling. We believe, foreigners have opted to drawdown from those countries which either have high fiscal deficit (India) or higher exports to GDP ratio (South Korea, Thailand, Taiwan, Japan etc), he added. VOlatIlE nEws flOws fROm paK Hasn’t HElpEd EItHER: he believes that during the past few months, foreigner’s uneasiness on Pakistan has also increased
due to strained US-Pak ties, domestic political uncertainty, question marks over macro-economic indicators, and energy shortfall. maRKEts wHICH HaVE attRaCtEd fOREIgn InVEstmEnts: Interestingly, Indonesia and Philippines have managed to attract foreign flows during the period under review. The two markets have witnessed an increase of 25 per cent YoY and eight per cent YoY in foreign buying in 2011 YTD. The higher confidence in the two countries is mainly on the back of high growth prospects, relatively lower fiscal vulnerability, and political stability. OutlOOK: RECOVERY In 2012? The important question these days is whether there is more downside risk to the market? We believe it is hard to predict the exact bottom of the market but looking back in history, since 1996 we have seen that KSe has rebounded sharply in the year following a decline, he added. however, clarity on the domestic political front and issues related to capital gain tax will be the main triggers in the days to follow. KSe trades at an FY12e Pe of 6.0x and offers an impressive earnings yield of 17 per cent.
oVeRNMeNT has notified incentives for new entrants in automobile sector under Auto Industry Development Programme (AIDP) to create a competitive environment and availability of vehicles at affordable price. An amended Statory Regulatory order (SRo) issued recently by Federal Board of Revenue (FBR) said additional customsduty leviable under earlier SRo issued in 2006 shall not be charged on sub-components, imported in any kit form by an assembler or manufacturer declared to be a new entrant by the engineering Development Board (eDB), for a period of three years from the start of assembly or manufacturing of respective vehicles, subject to certain conditions. To safeguard against non-serious players and briefcase assemblers, it has been
made imperative for the new entrants that they shall chalk out a plan for progressive manufacturing of the vehicles spreading over a maximum period of three years within which they shall catch up with the localization or indigenization level of respective vehicles, as approved by Auto Industry Development Committee (AIDC) of eDB; and continued non-levy of additional customs duty shall be contingent upon the achievement of progressive annual indigenization as determined by the committee. Automotive industry has been an active and growing field in Pakistan for a long time, however, not as much established to figure, in the prominent list of the top automotive industries. Despite significant production volumes, transfer of technology and localisation of vehicle components, remains low. Most cars in the country have dual fuel options and run on CNG, which is more afford-
able and cheaper than petrol. According to ministry of industries, Pakistan produced its first vehicle in 1953, at the National Motors Limited, established in Karachi, to assemble Bedford trucks. Subsequently, buses, light trucks and cars were assembled in the same plant. The industry was highly regulated until the early 1990s. After deregulation, major Japanese manufacturers entered Pakistan’s market thereby, creating some competition in this sector. Assemblers of hINo trucks, Suzuki cars (1984), Mazda trucks, Toyota (1993) and honda (1994) in particular, entered once deregulation was introduced. Assembly of Daihatsu, hyundai cars (1999) and various brands of LCVs and range of minitrucks commenced, recently. The journey of auto industry in Pakistan from 1953 to 2011 has been rough, tough and some-
times very smooth. Car industry saw boom in 20062007, when sales touched record peak of 180,834; thanks to rising car financing up to 70-80 per cent by banks due to low interest rates and rising rural buying. Since then, the industry has been surviving hard to reach the same sales level amid high interest rates and Yen appreciation against Rupee, but high farm income is giving much support to car sales. Good crops this year will keep car sales brisk despite, increase in prices. Car industry has invested over Rs20 billion in the last four to five years, to meet the growing demand. The direct employment in car industry hovers between 5,500-6,000 persons. Auto sector now employs 192,000 people directly and around 1.2 million indirectly; it has Rs98 billion of investments and contributes Rs63 billion as indirect tax in the national exchequer.
Petroleum Ministry agrees to gas storage facility for textiles Islamabad AMeR SiAl
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INISTRY of petroleum has proposed a novel solution to overcome the gas shortages of textile units of Faisalabad by allowing them the facility of gas shortage during gas supply days which they could utilise during the load shedding days. An informed source said that the proposal was discussed during a meeting with the textile millers, who were
assured that the gas storage facility would be provided to them but they would have to install smart meters so no gas theft could take place. The millers agreed to the proposal. Sui Northern Gas Pipelines Limited would be coming up with the details of the plan under which central gas storage would be developed in the city that would provide gas a suitable pressure to the textile units during the load management days. A similar proposal was given by the CNG associa-
tion to the ministry to fix monthly quota for every CNG stations. however, the ministry rejected the proposal saying it was not workable, the source said. Pakistan is faced with extreme shortage of gas supply which is estimated over 1.1 bcfd during the winter season. Since the power shortages are expected to remain over 5000 MW during the winter season due to canal closure and reduction in hydel output, the industrial units need for gas for their captive power plants.
Mfn, a pending obligation: TDAP KaRaCHI
T
TcP gets lowest sugar procurement bid KaRaCHI GhUlAM ABBAS
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RADING Corporation of Pakistan on Friday received a lowest bid of Rs46,250 per MT with the highest bid of Rs50,000 per MT for procurement of import of 200,000 tonnes of white sugar. At least 56 bidders from local sugar mills participated in the bidding and offered different quantities of sweetener with different prices, sources at TCP said, after opening of the bid at its Karachi head office. TCP, on Friday had received the lowest bid by almost Rs20 per kilogram against the Rs65 per kg price it received in previous bid, which was scrapped without awarding tender. The government was also likely to award the tender by Friday night as both committees formed by economic Coordination Committee (eCC) in Islamabad and tender
committee at TCP, were waiting for the award till filing the story. After being two tenders notices scrapped, TCP, on December 15 had issued another gallop tender for procurement of 0.2 million MT sugar from local millers. The tender was issued as per decision of eCC while inviting sealed offer from sugar mills for purchase of 0.2 million MT, white sugar packed in polythene bags and as per the Pakistan Standard and Quality Control Authority (PSQCA) approved standard. Sugar mills, defaulted with TCP, were not eligible to participate in the tender. To create competition and purchase the commodity at lowest rate, TCP had allowed non-members of PSMA to apply for the tender. The corporation has also fixed the upper limits of sugar procurement from a miller at 10,000 MT, against the previous limit of 20,000 MT. The upper limit was also decreased to give maximum space for the small millers.
STAFF RePORT
RADe Development Authority of Pakistan (TDAP) has clarified that the Most Favoured Nation status to be granted to India, was a pending obligation on behalf of Pakistan. Pakistan had no justification of not granting MFN status to India while giving it to all other countries in the WTo. This was said by head of WTo Cell, TDAP, Mujeeb Ahmed Khan, while explaining the details of granted MFN status to India under WTo laws and obligations, during a seminar arranged by Pakistan Pharmaceutical Manufacturers Association on 23rd December, 2011. The purpose of seminar was to create the awareness regarding impact on trade with India after granting MFN status and to address apprehensions of Pharma Sector in this regard. Members from PPMA then shared their views and apprehensions in detail. The major concern was of the impact on this sector regarding cost of products if there is an up surge
of imports from India for medicines and related items which will affect the level playing field between the two countries. They stated their concern that this open trade with India, will result closure of factories in Pharmaceutical sector, and huge unemployment would ensue. head of WTo Cell explained the detailed procedures and existing protective laws against NTB’s including a) safeguard measures b) anti-dumping duties c) anti-subsidy and countervailing duties d) tariff protection. he explained details of the regulatory framework through which drug imports could be tightly regulated. head of Advisory Services, TDAP, Mr Tippu Sultan, explained in detail as to how the laws of WTo are implemented on its member countries without any discrimination for trade. he frankly stated that Pakistan could not place an outright ban on imports of items from a specific country. Import ban could only be placed from all worldwide sources. he reiterated the need of adapting legal protective tools to save domestic industry in the long run. head of
WTo Cell encouraged PPMA members to give proposals for all plausible suggestions which they think can save this industry but at the same time, he requested to base these suggestions on the precedent of some other countries where such initiatives have been taken to save their respective domestic industry. PPMA suggested that bureaucracy should play a positive role in backing-up the credible suggestions presented by Pharma Sector for its protection. They quoted some examples of Bangladesh and India itself, where government is not only providing subsidy but is also putting the trade protections against imports of different products just to save domestic industry. TDAP assured participants of their full support and encouraged them to use the platform of TDAP and Government of Pakistan to address their issues. The meeting concluded with a decision for formulation of “MFN Monitoring Cell within PPMA” and scheduling a 2nd round of discussion with TDAP by MidJanuary 2012 to discuss future strategy in this regard.