Category: Economy

Gonzalo Varela from The World Bank identifies areas of improvement: – Reduce import duties on raw-materials to enable businesses to compete with India, Bangladesh, Cambodia and Vietnam. – Introduce sun-set clause: protect domestic industries “temporarily” from global competition so that they achieve the scale and efficiency with falling protection levels each year. Incentivise to “Think Global” – Promote… Continue reading Pakistan’s sustainable growth : Exports, Exports and Exports

Pakistan Steel Mill: Government paid Rs 55bn over 5.5 years to bear losses. Total employees are down from 30,000 to 9,300 (with monthly salaries of Rs 700mn, these too are being laid off with Rs 20bn generous exit package). Total debt of Rs 230b/$1.5bn (forget the present values of the money lost or that could… Continue reading PIA implied annual loss of Rs 72bn ($440mn) born by taxpayers.

No noise, no machoism and no bold promises. The federal budget, presented on June 12, 2020, sounded a lot more like a humble and sombre prayer wishing that the economy is able to shake off the disastrous ramifications of the pandemic. On the one hand, coronavirus cases are rising at an alarming pace in Pakistan, while on… Continue reading Breaking down the budget

State Bank of Pakistan released the remittance numbers for Pakistan yesterday. Inbound Remittances registered a 5% M/M increase in May’20. On the yearly basis, remittances dipped by 19% from USD 2,302mn in May’19 to USD 1,873mn in May’20. In the 11MFY20 period, remittances increased by 3% Y/Y from USD 20.1bn to USD 20.7bn. In terms… Continue reading Remittances decline by 19% Y/Y to USD 1,873mn in May’20

Pakistan’s total FX reserves decreased by 9% W/W (USD 1,678mn) to USD 16.92bn on May 29th , 2020. SBP reserves decreased by 14.2% W/W(USD 1,712mn) to USD 10.36bn while commercial bank reserves increased by 0.52% W/W(USD 34mn) to USD 6.56bn. SBP reserve now provide an import cover of approx. 3.63 months.

Pakistan Bureau of Statistics released Balance of Trade data for May20. Pakistan’s trade deficit shrank by 35% M/M from $2247mn in Apr’20 to $1460 in May’20. On yearly basis, trade deficit fell by 50% from $2,921 in May19 to $1,460 in May’20. Signs of recovery were observed in exports from the April low. They rose… Continue reading Trade deficit shrinks by 35% M/M and 50% Y/Y to $1,460mn in May’20

Petrol prices affect the psychological inflationary number for most middle & lower classes. However, the govt is usually a “price taker” dependent on global oil prices. Brent has fallen from $60sh to $38 today. In May, ex-refinery prices fell month on month while international prices rose. Expect reversal in ex-refinery prices, government should (is) pass… Continue reading Great News: Petrol prices have fallen Rs 40/liter!