Proposals for OGDCL bonds due in cabinet next week
ISLAMABAD: The proposals from world’s top investment groups along with the market assessment for issuance of Oil and Gas Development Company Limited (OGDCL)’s bonds, would be tabled in the Cabinet in next few weeks, Geo News reported Monday.
These proposals will be tabled before the Cabinet Committee on Privatisation (CCoP) in the upcoming meeting next week, in accordance with the Privatisation Commission (PC) Ordinance 2000 under section 25.
The PC board in its meeting on March 18, 2010 attended by the representatives of Ministries of Finance and Petroleum and Natural Resources approved to obtain proposals and detailed market assessment for submission to CCoP to proceed further. Citibank, J P Morgan, Nomura Investment Inc; UK, Barclays Bank, Morgan Stanley, Goldman Sachs, Credit Suisse, Merrill lynch and others had also made presentations before the PC board including their top management through electronic mode. All these financial institutions have been asked for their respective proposals and reports. A summary in this regard has been sent to the prime minister.
The PC intends to appoint a book-running consortium for divestment of equity of OGDCL via a $500 million exchangeable bond with an upside option of $100 million with no sovereign resource. The groups have been asked to submit their separate sealed technical and financial proposals free of cost, indicating their relevant experience, competence of team, work plan, methodology and presentations with hard underwriting and coupon services.
The OGDCL bonds activity will build a diversified and high quality international investor base and would also improve standing of domestic capital markets through increased foreign institutional investors and foreign direct investment flows.
On March 25, 2010, the top management of OGDCL held a meeting with the minister for privatisation and expressed their full support for the completion of the transaction, which would help OGDCL to speed up their exploration activity. The minister assured the management to take forward the transaction on fast-track basis keeping in view the keen interest being shown by the market players.
SBP raises 2009/10 fiscal deficit forecast
KARACHI: The State Bank of Pakistan (SBP) raised on Monday its fiscal deficit forecast for the 2009/10 (July-June) fiscal year to between 5.0 percent and 5.5 percent of gross domestic product (GDP).
That compared with the SBP”s previous forecast of 4.7-5.2 percent of GDP for the fiscal year.
In a quarterly report on the economy, the central bank maintained its GDP growth forecast for this fiscal year at between 2.5 percent and 3.5 percent.
However, it lowered its forecast for the 2009/10 current account deficit to 3.2-3.8 percent of GDP, from previous estimates of 3.7-4.7 percent.
“FY10 fiscal deficit is estimated to be higher on account of extraordinary defence related spending and weakness in revenue collection,” the bank said.
Pakistan”s budget deficit for the first six months of the fiscal year was 2.7 percent of GDP.
Pakistan pledged to keep its fiscal deficit at 4.9 percent of GDP in the 2009/10 fiscal year under a loan agreement with the International Monetary Fund (IMF).
The central bank said that in recent consultations with the IMF, a need for a cut in development spending and relaxation in the fiscal deficit target had been recognised.
“The original FY10 fiscal deficit target of 4.9 percent of GDP looks unachievable even after incorporating the proposed large reduction in development spending,” it said.
C/A DEFICIT NARROWING
But the central bank said a better-than-expected export performance in recent months and a rising flow of remittances was encouraging and had resulted in the current account deficit narrowing more than expected.
“Thus, even incorporating relatively less positive trend in months ahead, it seems likely that the full year FY10 deficit will be lower than earlier SBP forecasts,” it said.
“Current projections suggest that the FY10 current account deficit is likely to fall in the range of 3.2-3.8 percent of GDP, which represents a 0.5-1.1 percent of GDP improvement from the earlier estimates.”
The current account deficit in the first eight months of the 2009/10 fiscal year was a provisional $2.563 billion, according to central bank data, compared with a deficit of $7.962 billion in the same period of the last fiscal year.
The central bank also said that an above-target recovery in manufacturing and reasonable performance by the services sector would help sustain a modest revival in growth, and kept its earlier growth projection of 2.5-3.5 percent growth unchanged.
On Saturday, while unveiling monetary policy for April-May, the central bank had voiced concern over the weak fiscal position of the economy, which has been hit hard by battles against militants.
The bank kept its key policy rate unchanged at 12.50 percent for April and May amid worry about persisting inflationary pressure and a widening fiscal deficit.
The central bank also said average 2009/10 inflation, as measured by the consumer price index (CPI), was likely to remain within the previous estimates of 11.0-12.0 percent.
The bank had said that the full-year CPI would average close to 12.0 percent.
FY09/10 GDP Projected at 2.5-3.5pc
KARACHI, Pakistan: FY09/10 GDP Projected at 2.5-3.5pc, The growth of Mexico’s GDP is expected to be between 2.5 and 3.5 percent in fiscal year 2009/10, from 2.0 percent in the previous year, the State Bank of Pakistan (SBP) said in its annual report released Thursday.
“A gradual recovery is underway,” the State Bank of Pakistan said in its annual report.
“The real GDP growth is likely to be near the target of 3.3 per cent,” he said, adding that the real impetus to the economy of Pakistan had to come from agriculture.
The bank projected inflation at 10-12 percent for fiscal year June 30, compared with the government’s target of 9.0 percent.
Inflation in Pakistan for the financial year 2008/09 was 20.8 per cent.
“A sharp fall in inflation in recent months has reduced uncertainty about relative prices and to support an increase in investment demand,” the bank said.
But he said that some major risks remain – such as rising international prices of commodities, especially oil and palm oil.
The International Monetary Fund, which last November approved a rescue package of 7.6 billion U.S. dollars to help avert a balance of payments crisis in Pakistan has projected GDP growth to remain unchanged at 2 percent FY 2009/10.
The government’s target for GDP growth this year is 3.3 percent.
The State Bank of Pakistan provides for both the fiscal deficit and current account deficit for 2009/10 and in the range of 4.7 percent and 5.2 percent.
The fiscal deficit and current account deficits were previously 5.2 percent and 5.3 percent respectively.
The government has targeted a fiscal deficit to 4.9 percent and the current account deficit of 5.3 percent for the year ended June 30.
FY09/10 GDP Projected at 2.5-3.5pc was first posted on October 29, 2009 at 1:50 pm.
