Friday, 5 October, 2012

SeCP drafts Sukuk RegulationsISLAMABAD: In order to develop the sukuk (Islamic bond) market ona stronger footing, the Securities and Exchange Commission of Pakistan(SECP) has drafted the Issuance of Sukuk Regulations, 2012, to elicitpublic comments. The public can submit their comments by October 15.The regulations are aimed at facilitating the issuers and to providecomfort to the sukuk investors. The regulations broadly cover (i)eligibility and conditions for issuance of sukuk, (ii) disclosure andreporting requirements, and (iii) appointment of trustee and Shariaadvisor. Under the regulations, any company or corporate body can issuesukuk. However, such company or corporate body shall have no over-dueloan, the issuer’s as well as the instrument rating shall not be lower thantriple B minus (BBB-), it has appointed a trustee through a trust deed tosafeguard the interests of the sukuk holders, it has arranged appropriatesecurity, where required, in the form acceptable to the trustee, it hasobtained consent of a depository company to declare the sukuk as aneligible security for the purposes of depository system. Every company orcorporate body shall before the issuance of sukuk, appoint a Shariahadvisor who shall ascertain and shall give a fatwa that the concept on thebasis of which the sukuk is structured and the business in which proceedsof the sukuk issue are to be utilized are not against the principles ofShariah. Where the sukuk are issued to the general public, the issuershall prepare a prospectus containing all the information and disclosuresas required under the ordinance. However, where the sukuk are issuedthrough private placement, the issuer shall prepare an informationmemorandum and disclose therein all the material information includingthose as mentioned in the sukuk regulations. The issue of sukuk alongwith its salient features shall be reported by the issuer to the SECP within10 days of the close of the issue. ONLINE

Japan conjures up powerISLAMABAD: The Government of Japan has decided to extendfinancial support of US$ 108,731 (approx. Rs 9.8 million) to theAgency for Technical Cooperation and Development (ACTED), forthe construction of a micro hydro power station in Village UsheraiTwagh, Upper Dir, Khyber Pakhtunkhwa. The agreement for theproject was signed between Mr. Akira KONO, Chargé d’Affaires adinterim of Japan to Pakistan and Mr. Robin Nataf, Deputy CountryDirector for ACTED Pakistan, on 4th October, 2012 at the JapaneseAmbassador’s residence in Islamabad. The grant will be utilized forthe construction of a micro hydro power station in Village UsheraiTwagh, Upper Dir with a total installed capacity of 50 Kilowatts. Inaddition to meeting the essential energy requirements of all the 130households in the village, this would also contribute to improveliving conditions of local community and develop local economy.The project will benefit particularly women as it could alleviatetheir work load by helping mechanizing some of their manualhousehold labour. “I believe, by providing stable and sustainableenergy for the community in remote area, this project willcontribute not only to the improvement of quality of life of thepeople of the village, but also to their human security, which wouldlead to further development of their human potential. I also hope itwould certainly further enrich the cherished relationship betweenthe people of Japan and Pakistan.” said Kono at the signingceremony. ONLINE

WASHINGTON

spEcIaL cOrrEspONdENt

PAKISTAN is expected toachieve an economic growthin the range of 3-3½ in thecurrent fiscal year but theGDP growth needs to step

up to meet demands of the growing laborforce, the International Monetary Fundsaid Thursday.

“Pakistan faces a challenging eco-nomic outlook. GDP growth in 2012/13is projected to be in the 3-3½ percentrange, which needs to accelerate in orderto absorb the growing labor force,” theFund said.

The statement follows Post-ProgramMonitoring (PPM) discussions betweenthe Fund team and the Pakistani author-ities in Dubai and Islamabad during Sep-tember 26- October 3, 2012.

The fund noted that inflation hasfallen recently but is expected to be backin double digits by the middle of nextyear if corrective measures are not takento reverse monetary financing of the fis-cal deficit. Pakistan’s external position isweakening.

While the current account deficit isnot large by international standards, fi-nancial flows have weakened and centralbank reserves have fallen.

“Decisive and far-sighted action isneeded to address this challenging out-look. Discussions on economic policy fo-

cused on diligent management of thebudget deficit, reducing inflation, andstructural reforms.

The government and the IMF teamagree on the need to contain the budgetdeficit to help lower inflation, reducecrowding out of private sector credit, andensure debt sustainability.

“In our view, this requires significantcorrective measures; the fiscal deficit isotherwise likely to exceed the budget tar-get by a significant margin. To rein in thefiscal deficit, both revenue and expendi-

ture measures will be required.”On the revenue side, the Fund said

while there has been some improvementin collections, tax revenue should beraised further through sustained policymeasures and strengthened administra-tion both at the federal and provinciallevel, including a significant step-up inthe Federal Board of Revenue’s enforce-ment activities.

On the expenditure side, untargetedsubsidies should be reduced, while fullyprotecting the most vulnerable members

of society through targeted assistanceschemes.

“The mission welcomed the author-ities’ intention to prudently man-age public spending, despitepressures associated withthe electoral cycle,and noted thatit is crucialthat ex-p e n d i -t u r er e s t r a i n t

also apply to provincial govern-ments, which now have in-creased spending

responsibilities. The authorities also

signaled their continuedcommitment to trying to

meet their fiscal target.”

IMF sees Pakistan GDP growth at 3-3½

ISLAMABAD

ONLINE

The National Price Monitoring Committee ex-presses satisfaction over containing the infla-tion to single digit for consecutive three months.

Food and Non-Food inflation is recordedat 7.6 percent and 9.7 percent respectively.Similarly SPI and WPI also registered at 7.5percent and 7.8 percent respectively. Thefirst quarter of the current fiscal year CFY13posted a single digit inflation at 9.1 percentas compared to 11.5 percent in the corre-sponding period of last year. All indicatorsof the inflation reported single digit duringJuly-Sept. CFY13.

The meeting reviewed the ConsumerPrice Index (CPI), Food, Non-Food, Core,Wholesale Price index (WPI) and SensitivePrice Index (SPI). It was noted that as a re-sult of continuous efforts of the governmentthe CPI reduced to 8.8 percent during Sep-tember 2012 and government has succeededin containing inflation to single digit, whichshows government commitment in control-ling the headline inflation.

The SPI trend suggest that week ended on27th September 2012 recorded a decrease of -0.37 percent due to decline in the prices ofOnion, Potatoes, Tomatoes, Sugar and pulsesetc. However, out of 53 items, prices of 09 itemsregistered increase while prices of 16 items de-creased and prices of 28 items remain un-changed as compared to last week ended on20-09-2012, where prices of 20 items increased,prices of 09 items decreased and prices of 24items remained unchanged. The Food andNon food items which registered nominal in-crease in their prices were Rice Basmati 0.43%,Red Chilies 0.31%, Beef 0.17%, Wheat 0.09%while Petrol and Eggs increased by 1.72% and1.28%. However, with better weather conditionthe arrival has started resultantly easing out theprices of essential commodities.

The other items which registered de-crease in their prices are Garlic 1.75%, Sugar1.31%, Kerosene Oil 1.24% , Chicken 1.05%,Vegetable ghee 1.04%, Gram Pulse 0.46%,Diesel 0.37%, LPG 0.37%, Masoor Pulse0.15%, Mash Pulse 0.13% and Moong Pulse0.08%. It was also observed that in compar-ison with the regional countries, Pakistan isthe lowest in prices of Wheat, Wheat Flour,Rice, Sugar, Red Chillies, Chicken Farm and2nd lowest in Moong Pulse, Masoor Pulseand Beef while prices of Mash Pulses,

Onion, Tomato, Potato, Diesel, Tea, EdibleOil, DAP and Urea are higher in Pakistan.

The committee reviewed the price trendof selected items among the Provinces. Somevariations in the prices of Wheat Flour, RiceBasmati Broken, Pulses, Beef, Mutton, MilkFresh, Milk Powdered, Ghee, and Garlic wereobserved. It was noted that in most itemsprices in Balochistan are higher as comparedto other Provinces. It was also noted thatprices of Beef and mutton are much higher inIslamabad as compare to Rawalpindi.

The concerned representative was ad-vised to look into this and take necessarysteps to ensure that supply of mutton andbeef be available at reasonable prices. Thechair also emphasized for market intelli-gence among the provinces and ICT. It wasinformed in the meeting that Food SecurityDivision is consulting the provincial govern-ments to overcome the shortcoming of mar-ket intelligence and the demand supply gap.

The chair also took note of increase inprices of beef and mutton and to this aspectemphasized the control of livestock smug-gling to neighboring countries. It was in-formed to the meeting that our populationgrowth rate is 2.03 percent whereas animalgrowth rate is 3.7 percent, so we have sur-plus animals for export.

A subcommittee was proposed in Food Se-curity and Research Division to analyzethe situation of demand andsupply position of live-stock and come up withfindings and measures tocontrol the prices of live-stock and its products. Themeeting also discussed dis-ease surveillance system totake care of livestock. The chairappreciated the initiated pro-grams of PARC for poultryand animal disease surveil-

lance and instructed thatall efforts

should be geared up to keep the system inplace by taking all provinces on board.

The meeting was informed that KhyberPakhthunkhwa government has assigned thefirst class magistrate power to all districtfood controllers to maintain price stability inthe province. Punjab Government has ap-pointed 352 magistrates in the province tocontrol the price situation and they have col-lected approximately Rs. 6 lakh fine from theshopkeepers who were violating the price list.

Balochistan Government is also makingefforts on multi directions for consumer pro-tection and consumer courts are working inthe province and in Sindh special magis-trates are appointed to check the price andsupply position of the consumer items. Inorder to further streamline the system themeeting emphasized for necessary measureswith regard to revival of Executive Magis-tracy System and advised the concernedquarters to expedite the process.

It was also noted that prices of the PalmOil are decreasing in international marketbut its impact is not being transferred toconsumer. M/o Industries was advised tocheck the price movement and ensure thatrelief be transferred to consumer. The risingtrend in prices of tea was also noted and con-cerned quarter was advised to take necessary

measure to con-trol the prices.

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

Down to one Govt claims to curtail inflation to single digit

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Friday, 5 October, 2012

Major Gainers

ComPAnY oPen HIGH Low CLoSe CHAnGe tuRnoveRNestle Pakistan Ltd. 4646.26 4800.00 4800.00 4800.00 153.74 100Bata (Pak) Limited 1055.55 1100.00 1051.00 1100.00 44.45 400Shezan Inter. 330.75 347.28 347.00 347.28 16.53 5,100National Foods 279.32 293.28 282.00 293.28 13.96 7,700Murree Brewery 162.63 170.76 167.00 170.76 8.13 36,300

Major LosersUniLever Pak 10500.00 10400.00 10000.00 10000.00 -500.00 140ZIL Limited 91.70 87.12 87.12 87.12 -4.58 1,000Clariant Pak 214.82 215.00 211.00 211.32 -3.50 18,500Gillette Pak 64.08 60.88 60.88 60.88 -3.20 500Biafo IndustriesXD 57.25 57.75 54.50 54.50 -2.75 2,000

Volume Leaders

Lotte PakPTA 7.12 7.55 7.15 7.40 0.28 13,130,500Nishat Mills Limited 58.85 61.48 58.10 60.52 1.67 9,494,000Golden ArrowXD 4.98 5.00 4.90 4.99 0.01 8,416,500Sui South Gas 21.99 23.06 21.84 22.87 0.88 6,346,000D.G.K.Cement 50.62 51.57 50.77 50.98 0.36 5,333,500

Interbank RatesUS Dollar 95.3431UK Pound 153.6169Japanese Yen 1.2138Euro 123.3931

Dollar EastBuY SeLL

US Dollar 94.70 95.20Euro 122.87 123.83Great Britain Pound 152.77 153.93Japanese Yen 1.2007 1.2098Canadian Dollar 95.90 97.13Hong Kong Dollar 12.06 12.22UAE Dirham 25.75 25.92Saudi Riyal 25.24 25.37Australian Dollar 96.41 98.60

Business

SINGAPORE

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Crude was down in Asian tradeThursday as worries over Spainand a slowing Chinese economyhighlighted a weak global eco-nomic outlook, analysts said.

New York’s main contract, light sweet crudefor delivery in November, shed 20 cents to$87.94 a barrel and Brent North Sea crudeslipped three cents to $108.14.

“Crude oil prices dipped slightly on theweak outlook for economic growth,” said San-jeev Gupta, who heads the Asia-Pacific oil andgas practice at Ernst and Young.

“This past week, European attention hasbeen focused on Spain’s problems,” he toldAFP, adding that in Asia markets were worriedabout signs of an economic slowdown in China,the world’s biggest energy consumer.

Traders were watching Spain for hints onwhether it would ask for a eurozone bailoutsoon, after Catalonia president Artur Mas said

Wednesday the move was unavoidable andMadrid should ask for it without a long delay.

His words flew in the face of Spanish PrimeMinister Mariano Rajoy’s studious refusal tosay whether the eurozone’s fourth largest econ-omy needs rescuing, insisting instead on theneed to study the matter.

On Wednesday, the Asian DevelopmentBank slashed its growth estimates for Asia’semerging economies to the lowest level since2009, citing a slowdown in powerhouses Chinaand India.

It forecast China’s gross domestic product(GDP) would expand 7.7 percent this year be-fore bouncing back to 8.1 percent in

2013 but still well below the 9.3 percentachieved last year.

India would see GDP growth slow to 5.6percent in 2012 before picking up to 6.7 percentnext year.

The bank also warned of significant riskscaused by the effects of the European debt crisisand continued weakness in the United States,both of which are major export markets.

Qatar Airways expands furtherinto South east Asia

YANGON/MYANMAR: Qatar Airways todaymarked the resumption of flights to Yangon after afour-year absence with the launch of scheduledservices to Myanmar’s largest city. Yangon be-comes Qatar Airways’ 10th gateway in the Associa-tion of South East Asian Nations (ASEAN)following on from successful operations to KualaLumpur, Bangkok, Bali, Ho Chi Minh City,Jakarta, Hanoi, Singapore, Manila and Phuket –and the carrier’s 119th destination worldwide. It isalso the latest of several route launches so far thisyear by the rapidly-growing global carrier. QatarAirways suspended flights to Yangon in January2008, and is now restoring services, providinggreater economic and travel opportunities for thepeople of Myanmar.

new nippon odourless Aircareimproves indoor air quality

LAHORE: Nippon Paint, the leading paint brandin Pakistan, has launched its next generation ofpaint, NIPPON ODOUR-LESS AIRCARE. It is thefirst paint innovation in the country using activecarbon technology, which refreshes the air by ab-sorbing the indoor air pollutant, formaldehyde.Speaking at the launch event today, Nippon Paint(Pakistan) (Private) Limited’s general manager,Mr. Samad Zaheer said “Nippon Paint Pakistanhas been supporting initiatives to encourage envi-ronmental sustainability and to protect the worldwe live in. In 2009, we have pro-actively startedthe ball rolling in the paint industry by being thefirst to launch almost odourless paint – our Nip-pon Spot~less, which has almost no paint odour,and is near zero volatile organic compounds

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

oGDCL achieved significantsuccess in FY 11-12

ISLAMABAD: The 15TH Annual General Meet-ing (AGM) of OGDCL held here at OGDCL HouseIslamabad which was presided by Ch. Muham-mad Shafi Arshad Chairman of the Board of Di-rectors. Mr. Masood Siddiqui MD/CEO OGDCLalongwith other directors of the BOD were alsopresent. Ch. Muhammad Shafi Arshad Chairmanwelcomed the shareholders and thanked Govern-ment of Pakistan to repose confidence of the GOPto the present management and Board of Direc-

tors. He said that appointment of Mr. MasoodSiddiqui as MD/CEO would bring a positivechange in the Company due to his professionalbackground experience and good performance inthe past. The OGDCL officers / employees wouldtouch high professional performance under theguidance of the present management. He ac-knowledged and lauded the performance of theex-Chairman of the Board and other directorsand former MD/CEO. He welcomed the newmembers of the BOD and congratulated OGDCLemployees on completion of 50 years of contin-ued service to the nation by achieving significanthydrocarbons discoveries.

etihad Airways to increaseflights to IstanbulLAHORE: Etihad Airways, the national airlineof the United Arab Emirates, has announced itwill fly daily between Abu Dhabi and Istanbulfrom January 1, 2013. The Abu Dhabi-based air-line launched services to Istanbul, the largestcity in Turkey, with four non-stop flights a weekin June 2009, increasing to five services perweek later that same year. The daily flights to Is-tanbul will be operated by a two-class AirbusA320 aircraft, configured with 16 Pearl Businessclass and 120 Coral Economy class seats andpassengers from Pakistan can enjoy two waysmooth connections from Karachi, Lahore andIslamabad every day.

CORPORATE CORNER

HONG KONG

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Asian markets mostly rose on Thurs-day as investors cheered upbeat USeconomic data, but nagging concernsover Europe kept advances in check.Tokyo gained 0.62 percent by thebreak, Hong Kong was 0.10 percenthigher and Sydney gained 0.10 per-cent while Seoul eased 0.54 percent.Shanghai is closed for a week-longpublic holiday.

Regional shares took their cuefrom Wall Street, which ended in pos-itive territory after jobs and servicesfigures provided some hope for theeconomy. The Institute for SupplyManagement released its services in-dustry index Wednesday, whichshowed the crucial sector picking uppace, though hiring remained flat.

Separately, payrolls companyADP released a report showing pri-

vate sector hiring was better than ex-pected in September, with 162,000jobs added. Despite being down 14percent from August the slowdown isless than expected.

US dealers welcomed the an-nouncements. The Dow finished up0.09 percent, the S&P 500 was 0.36percent higher and the Nasdaqclimbed 0.49 percent.

Eyes are now firmly on policymeetings over the next two days forthe European Central Bank, the Bankof Japan and Bank of England, whileclosely watched non-farm payrolls aredue out of Washington on Friday.

“There is a little bit of a wait-and-see attitude in Asia this week,” saidWee Khoon Chong, Asia rates strate-gist at Societe Generale in HongKong.

On currency markets the eurorose to $1.2923 and 101.61 yen inearly trade, compared with $1.2903

and 101.31 yen in New York lateWednesday. The dollar was at 78.63yen against 78.51 yen.

However, Europe’s debt woescontinue to weigh after Spanish PrimeMinister Mariano Rajoy said Tuesdayhe would not request a bailout anytime soon despite the parlous state ofthe country’s finances and its danger-ously high borrowing costs.

Spain, the eurozone’s fourth-biggest economy, is required to makea formal demand for help to triggerthe release of eurozone rescue fundsand supportive bond-buying actionfrom the European Central Bank.

Oil prices eased with New York’smain contract, light sweet crude fordelivery in November, shedding 10cents to $88.04 a barrel and BrentNorth Sea crude slipping a cent to$108.16. Gold was at $1,780.35 at0300 GMT compared with $1,778.50on Wednesday.

PMN launchesPakistan MicrofinanceReview

ISLAMABAD

app

Pakistan Microfinance Network (PMN)has launched the “Pakistan MicrofinanceReview 2011” for the microfinanceindustry. The initiative is supported by thePakistan Poverty Alleviation Fund (PPAF),UKAID and the Citi Group, says astatement issued here Thursday. The eventwas well attended by representatives fromthe State Bank of Pakistan (SBP), UKAID,PPAF, Commercial Banks, PMN members(Microfinance Banks, MicrofinanceInstitutions, Rural Support Programmes)and other stakeholders. PMN CEO, SyedMohsin Ahmed highlighted theachievements, challenges andopportunities of the microfinance industry.Chairperson PMR Editorial board, GhalibNishtar along with other editorial boardspeakers including representatives of SBP,PPAF, UKAID and Urban PovertyAlleviation Program (UPAP) of NRSP helda discussion session. The year 2011 wasdeclared as a watershed period for themicrofinance sector in Pakistan as theindustry achieved sustainability despite achallenging macroeconomic environment,rains and floods in Sindh, securitysituation and persistent energy crises inthe country. The sector is provingsuccessful in making the transition tocommercial finance and witnessed thelaunch of first money market financinginstrument with a number of new products& services for credit as well as remittances.The portfolio at risk remains withinacceptable thresholds reflecting positivelyon the quality of portfolio. The industrycontinued growth in branchless bankingtransactions despite the deployment ofonly two models and saw MFBs and MFIslinking up to provide financial services tothe microfinance clientage. Withnationwide launch of Microfinance-CIB(Credit Information Bureau), theindustry will have the option to bettermanage credit risk and reward clients withgood credit history. Given these positivedevelopments and the upgraded businessenvironment ranking by EconomistIntelligence Unit a number of deep pocketinvestors expressed interest in exploringthe market for potential investment and anumber of transactions were successfullyconcluded. In presence of an enablingenvironment and the industry attainingsustainability, the sector is poised forgrowth. With the entry of new players andconsolidation taking place, the industry isideally positioned for expansion andprovision of a wide array of servicescovering the entire spectrum ofmicrofinance.

Dollar stable onhopes for easingin Japan TOKYO: The dollar stayed within anarrow range in Asian trade Thursday aslingering hopes for further monetaryeasing were offset by worries abouteconomic fundamentals, analysts said.The dollar bought 78.47 yen in morningtrade, little changed from late Wednesdayin New York, where it stood at 78.51 yen.The euro bought $1.2913 and 101.33 yenin Asian trade, compared with $1.2903and 101.31 yen in New York. The dollarwas well supported in the short term,because of increased risk appetite, saidOsamu Takashima, Citibank Japan chiefcurrency strategist. The greenback hasrisen against the yen over the past fewdays, but there is little in the way ofeconomic fundamentals to back that up,he said. “The dollar likely won’t rise abovea mid-term important technical point,” hesaid, noting 78.90 as the resistance. aFp

Asian markets mostly up on US data

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