Pakistan Daily Economy Update - 4 November

Transcription

1. Nov 4 , 2020 KCCI - eBulletin PM takes power relief step to help boost exports PM Imran Khan has announced Industrial Support Package (ISP) that offers additional consumption of electricity to small and medium industries at 50% less rates. The package became effective from 1st Nov’20 and would continue till 30th June 30. Minister for Industries Hammad Azhar said under the package, the industries would be provided electricity at off-peak hours' rate for 24 hours for next three years. The SMEs, he said, would be getting 50% tariff relief on the use of additional electricity, considering their bills of Nov’19, during next 6 months, while all the industries would be provided with additional electricity on 25% reduced rates for next 3 years. BR. Date / Period Unit Value Change Daily USD-Interbank USD-Open MKT 3-Nov 3-Nov PKR PKR 159.97 160.50 -0.18% 0.00% KSE-100 index FIPI Industrial power incentives expected to augur well for troubled economy Lockdown-hurt business community sees positive impact of electricity tariff discounts announced by the govt. for trade and industry on revving up the economy. Shariq Vohra, President of KCCI said that overall the industry is very happy with this decision of the govt. He said that electricity rates are high in Pakistan and it is for the first time that power rates are being reduced and the discounted power rates would provide a breather to the export sectors. Industrialist Zubair Motiwala said the move is good but it will not have a very significant impact as industrialists will only be able to consume additional electricity as if they expand, it would take time. He added that the govt. needs to reduce the tariff for existing use of electricity, which would really benefit the exports. The News. 3-Nov 3-Nov Pts. $ Mn 40,481 -3.75 3.50% NM** Crude (AP'19) 3-Nov $/bbl 37.66 2.31% Gold (MA'19) 3-Nov $/oz 1,910.4 0.95% Gold (10g) Local 3-Nov PKR 98,850 0.00% Silver (MA'19) 3-Nov $/oz 23.33 -2.91% Cotton(KHI)-40 kg 3-Nov PKR 10,395 -2.03% Kibor-6M 3-Nov % 7.35 0.00% Huge potential for export of value-added products to China: CG Speaking at a webinar organized by KCCI in collaboration with Pakistan's Consulate in Shanghai, the Pakistan's CG in Shanghai Hussain Haider has emphasized that in order to increase Pakistan's exports to China, the business and industrial community will have to focus on value addition as it has been observed that raw materials and less value-added products were typically being exported to China, the Karachi Chamber and Shanghai Chamber should sign the much-awaited MoU through an online forum as the said MoU, which was initiated in Apr’20 and concurred by the two Chambers in Aug’20, suffered delay due to the outbreak of COVID-19 pandemic. President KCCI Shariq Vohra said that YRD region in China was one of the richest regions which contributes 20% to the Chinese GDP. Hence, we will also have to look for trade and investment opportunities in this particular region. Referring to enhanced usage of e-commerce in China where 749Mn consumers are available online, Shariq Vohra particularly mentioned that although alibaba.com is the biggest buying and selling portal of China but this portal offers very limited services through an agent to Pakistani businessmen and industrialists who are intending to use this huge platform for their buying and selling needs but they are unable to do so mainly due to lack of adequate payment solution. BR. Forex Reserves 23-Oct $ Bn 19.30 WoW -0.03% Remittances Jul-Sep 20 $ Bn 7.15 31.08% Exports* Jul-Sep 20 $ Bn 5.46 -0.94% Imports* Jul-Sep 20 $ Bn 11.26 0.56% Trade Balance* Jul-Sep 20 $ Bn -5.80 -2.02% Current Account Foreign Direct Inv. Jul-Sep 20 Jul-Sep 20 $ Bn $ Bn 0.79 0.42 153.08% -23.79% Cheap power to industries, KE: Govt. to give PKR 21Bn subsidy from Covid Package The govt. has reportedly decided to allocate PKR 21Bn subsidy from Covid-specific stimulus package to supply cheap electricity to industrial consumers of Discos and Karachi Electric. However, the impact of the Fuel Price Adjustment (FPA) shall be passed on to the industrial consumers on incremental consumption basis and Nepra will issue necessary notification in this regard. BR. YoY Jul-Aug 20 LSM Growth* % 3.66 % 8.86 Jul-Oct 20 Avg. CPI Discount Rate % 7.00 Jul-20 Sources: KCCI Research, PMEX , NCCPL, KSE, SBP, PBS* ** Not Meaningful, WoW= week on week; YoY=Year on Year Major Currencies 235 225 4 months of FY21: exports show 0.1% negative growth YoY The country's exports have shown negative growth of 0.1% during 4MFY21 as compared to 4MFY20. The exports during 4MFY21 stood at $ 7.540Bn as compared to $ 7.547Bn and the balance of trade has witnessed a decline of -4.5% to $ 7.424Bn as compared to $ 7.776Bn. BR. 215 Cotton stockpiles fall record 43%; imports likely to surge Cotton stockpiling fell a massive 43% to 3.45Mn bales till 31st Oct’20 against 6.09Mn bales till Oct’19, raising concerns that the country would have to import at least 7Mn bales worth $ 3Bn to fulfil domestic demand. Heavy monsoon along with sowing substandard seeds have taken a toll on total yields. The News. 175 SBCA told to file approval procedure of building plans Sindh High Court has directed the Sindh Building Control Authority to inform it whether the Building Code of Pakistan and fire safety provisions were followed while granting approval of proposed building plans. A two-judge bench headed by Justice Ali Mazhar further directed an assistant commissioner to come up with a viable solution on the next hearing to establish more helpline numbers for assistance of public in order to ensure timely reporting of fire incidents. Dawn. \ Economic Indicators List of Indicators New draft of APTTA, PTA: Dawood to visit Afghanistan from 16th Advisor on Commerce, Abdul Razak Dawood is to visit Afghanistan from 16-18th Nov’20 to discuss prospects of Preferential Trade Agreement (PTA) and a new draft of Afghanistan Pakistan Transit Trade Agreement (APTTA) which will expire in Feb’21. BR. GBP, 3-Nov-20, 207.9 205 195 185 EUR, 3-Nov-20, 187.1 165 155 USD, 3-Nov-20, 160.0 145 Nov-19 Feb-20 USD May-20 GBP Aug-20 Source: KCCI Research ; Oanda.com EUR Quote of the Day “Innovation distinguishes between a leader and a follower.” Steve Jobs FBR says there will be no extension in return filing deadline FBR has made it clear to all taxpayers that the date for filing annual income tax returns will not be extended further; therefore the taxpayers are directed to submit returns before 8th Dec’20. BR. Tax returns set to hit 3Mn mark FBR has received 380,000 returns for the TY19 from the taxpayers during the last 8 months mostly pronounced by economic shutdown related to coronavirus outbreak, and the number is set to touch the 3Mn mark. The number of return filers by 29th Feb’20 for TY19 was 2.53Mn as per active taxpayers list issued on 1st Mar’20. The News. CPEC Ordinance indemnifies CPEC authority CPEC Authority and its executives, employees and staff have been given indemnity from any suit, prosecution or other legal proceedings by any agency under the Section 23 of the CPEC Authority Ordinance tabled in the National Assembly. The News. New SOPs for passengers travelling to Pakistan The CAA has made an amendment to the SOPs for international passengers travelling to Pakistan. The authority issued a list of tests, which may be considered as equivalent to PCR-based tests for Covid-19. The CAA said passengers holding negative certificates/reports for any of the mentioned tests would be considered as fulfilling the requirement of mandatory RT-PCR testing as mentioned in the SOPs related to international passengers, chartered and private aircraft flights to Pakistan issued on 29th Sep’20. Dawn. Sales tax collection on imports up 4.5% in July-Oct The collection of sales tax at import stage increased 4.5% to PKR 279Bn during 4MFY21 from PKR 267Bn in 4MFY20. Local importers were cautious about placing new orders for importing raw materials for manufacturing of export-based products, given the pandemic situation around the world. The News. $ 2Mn ADB grant to strengthen fight against Covid-19 The govt. has signed a $ 2Mn grant agreement with ADB to strengthen efforts to combat the coronavirus pandemic. The grant supplements an initial $ 500,000 provided by the ADB through Unicef to support Pakistan’s procurement of emergency supplies and personal protective equipment. Dawn. Bosnian leader arrives on two-day visit today Chairman of the Presidency of Bosnia & Herzegovina Sefik Dzaferovic, accompanied by a high-level delegation including the minister for security and presidential advisers, will arrive on their first two-day official visit to Pakistan today (4th Nov’20). Dawn. Comparative View of CPI Inflation (%) 12 10 8 6 10.97 10.14 10.45 10.32 8.86 6.39 6.19 7.49 5.88 4 2 0 CPI (National) CPI (Urban) 4MFY19 4MFY20 CPI (Rural) 4MFY21 Source: KCCI Research, PBS Trade Inquiries Manufacturers/Traders interested in exporting Cattle Feed to the Kingdom of Bahrain are requested to send their company details with KCCI membership number at res@kcci.com.pk.