Exports reduced by $125m in Nov 2018, $ 400 Million decline in remittances

[SunilM]

But why is a Hindu's knickers in a twist over it all?

Quit your obsessing! It'll kill you eventually.

Do more – talk less

Just as ‘all roads lead to Rome’, all financing needs in Pakistan lead to the IMF. It does not matter whether the government likes it or not, the Fund is becoming the only viable option for a much needed bailout. And the window of opportunity to avert an ugly crisis is becoming short; sooner the government acts, better it is.

The incumbents have to realize that they have overplayed the card of criticizing the previous regime, now the onus of any crisis will fall on them. Market understands that the intention of government is right; but the sentiments are building that the government lacks decision making power. That is not a good omen, as confidence cannot be restored merely on intentions, it requires actions.

The problem is that the PM and his cabinet is still hung on the philosophical levels of what is right and what is wrong, and are deliberating too much on every issue. The key ministers and advisors are too busy in meetings with desires to correct every wrong within the first six months or a year. The wrong is not to focus on key responsibilities of each member.

The government has to now shift gears from thinking to actions. The balance of payment crisis the country was facing when the government assumed power was not as horrific as it was portrayed. After the visits to friendly countries, balance of payment crisis did not end, as claimed by the FM – it created confusion. In the process, the ministry of finance lost the trust of the market.

It appears that the friendly countries’ help is somehow linked to the IMF letter of comfort. Like in the case of FATF, a few months back, when the KSA pulled out from voting in favour of Pakistan as the US exerted pressure. Seeing the KSA, China refused to vote for Pakistan as it would have been of no use.

Now, the buzz is that UAE, China and KSA are not coming with all out support to Pakistan as perhaps the US wants Pakistan to take the IMF bailout package. Only a billion dollar from KSA so far asserts the view. One cannot deny the fact that the IMF is the lender of last resort and the Fund would help the member country anyways. The theory cannot be tested without getting into an IMF programme.

Anyhow, going to IMF or not is only one indecision. There are of other decisions that do not require the IMF’s nod. But the problem is that the economic czars are too busy in finding external support to breathe. You cannot live for years by fetching a billion dollar per month to keep the nose above water.

Balance of payment is not the source of economic crisis and it will never result in collapse of the economy. The core of the macroeconomic problem is fiscal deficit and nothing concrete has been done so far to lower the deficit. Within fiscal, the biggest hole is in the energy chain – circular debt is still growing around a billion rupees per day.

The tariff increase is yet to be notified by Nepra, it has not come up with any smart solution to lower the capacity charge per unit for new plants. There is no apparent plan to pass on the ailing discos to provinces or to empower them.

Then the trade balance is skewed in Pakistan and the low hanging fruit is in rationalizing imports tariffs on raw materials and intermediate goods. But nothing has been heard in this regard either.

In case of the FBR, refunds of businesses are still stuck, but FBR pressure of immediate revenues is not letting the MoF release. There is no word on how to lower the tax concessions which were over Rs500 billion in FY18. There are relatively easier ways to cut down the non-salary current expenditure; but the finance ministry is yet to come up with a game plan.

All what the government is doing is slashing the PSDP, increasing interest rates and devaluing the currency as measures of austerity. These tightening steps are obliviously hurting growth required for creating new jobs. The uncertainty amongst the businesses – be it SME or corporate, is growing by the clock.

This could have both political and economic repercussions. The government has to give some direction by taking solid steps. And soon or else it would be too late.

https://www.brecorder.com/2018/12/12/458499/do-more-talk-less/

Quote of the day. "Just as ‘all roads lead to Rome’, all financing needs in Pakistan lead to the IMF."

 

[nahtanbob]

why is a three month old government being blamed for issues that were created decades ago ?

If there is one critique running to Saudi Arabia and UAE to dodge Uncle Sam does not look like a smart thing. It does not take much for Uncle Sam to slap the Saudis and UAE into line

 

[ziaulislam]

Do more – talk less

Just as ‘all roads lead to Rome’, all financing needs in Pakistan lead to the IMF. It does not matter whether the government likes it or not, the Fund is becoming the only viable option for a much needed bailout. And the window of opportunity to avert an ugly crisis is becoming short; sooner the government acts, better it is.

The incumbents have to realize that they have overplayed the card of criticizing the previous regime, now the onus of any crisis will fall on them. Market understands that the intention of government is right; but the sentiments are building that the government lacks decision making power. That is not a good omen, as confidence cannot be restored merely on intentions, it requires actions.

The problem is that the PM and his cabinet is still hung on the philosophical levels of what is right and what is wrong, and are deliberating too much on every issue. The key ministers and advisors are too busy in meetings with desires to correct every wrong within the first six months or a year. The wrong is not to focus on key responsibilities of each member.

The government has to now shift gears from thinking to actions. The balance of payment crisis the country was facing when the government assumed power was not as horrific as it was portrayed. After the visits to friendly countries, balance of payment crisis did not end, as claimed by the FM – it created confusion. In the process, the ministry of finance lost the trust of the market.

It appears that the friendly countries’ help is somehow linked to the IMF letter of comfort. Like in the case of FATF, a few months back, when the KSA pulled out from voting in favour of Pakistan as the US exerted pressure. Seeing the KSA, China refused to vote for Pakistan as it would have been of no use.

Now, the buzz is that UAE, China and KSA are not coming with all out support to Pakistan as perhaps the US wants Pakistan to take the IMF bailout package. Only a billion dollar from KSA so far asserts the view. One cannot deny the fact that the IMF is the lender of last resort and the Fund would help the member country anyways. The theory cannot be tested without getting into an IMF programme.

Anyhow, going to IMF or not is only one indecision. There are of other decisions that do not require the IMF’s nod. But the problem is that the economic czars are too busy in finding external support to breathe. You cannot live for years by fetching a billion dollar per month to keep the nose above water.

Balance of payment is not the source of economic crisis and it will never result in collapse of the economy. The core of the macroeconomic problem is fiscal deficit and nothing concrete has been done so far to lower the deficit. Within fiscal, the biggest hole is in the energy chain – circular debt is still growing around a billion rupees per day.

The tariff increase is yet to be notified by Nepra, it has not come up with any smart solution to lower the capacity charge per unit for new plants. There is no apparent plan to pass on the ailing discos to provinces or to empower them.

Then the trade balance is skewed in Pakistan and the low hanging fruit is in rationalizing imports tariffs on raw materials and intermediate goods. But nothing has been heard in this regard either.

In case of the FBR, refunds of businesses are still stuck, but FBR pressure of immediate revenues is not letting the MoF release. There is no word on how to lower the tax concessions which were over Rs500 billion in FY18. There are relatively easier ways to cut down the non-salary current expenditure; but the finance ministry is yet to come up with a game plan.

All what the government is doing is slashing the PSDP, increasing interest rates and devaluing the currency as measures of austerity. These tightening steps are obliviously hurting growth required for creating new jobs. The uncertainty amongst the businesses – be it SME or corporate, is growing by the clock.

This could have both political and economic repercussions. The government has to give some direction by taking solid steps. And soon or else it would be too late.

https://www.brecorder.com/2018/12/12/458499/do-more-talk-less/

Quote of the day. "Just as ‘all roads lead to Rome’, all financing needs in Pakistan lead to the IMF."

Month to moonth data has no relevance
Reason likely is exporter holding there returns till ruoee stabilize

And saudis have already released the money so i have no idea where were you..so wake up ..wake up...niw that you are awake..it suppose to be 1b month..so next payment will be announced by end of December (bi monthly update ) while oil credit will start effect now (mid December )

Chinse and UAE exact package details are not known

Chinese did gave exemption that will double our expirts to them(1 to 2 b $ )

why is a three month old government being blamed for issues that were created decades ago ?

If there is one critique running to Saudi Arabia and UAE to dodge Uncle Sam does not look like a smart thing. It does not take much for Uncle Sam to slap the Saudis and UAE into line

True but its not smart to rely purely on one state to keep your monarch..this is true for saudis..they know that how other States sorrounding them collapsed ..remember Pakistan has troops stationed there to protect basically the al saud family from "revolution'

 

[Surya 1]

Exports reduced by $125m in Nov 2018

ISLAMABAD: Despite PTI’s claim of enhancing the exports, the official data shows $125 million (6.35 percent) decline in exports in November 2018 as compared to corresponding period last year.

The country has already witnessed a setback in the form of decline in remittances amounting to $400 million in the month of November 2018, worsening the balance of payments crisis further. In order to resolve the crisis of balance of payment the PTI-led government had announced that the crisis will be avoided through reducing imports and enhancing the exports. However, the official data of Pakistan Bureau of Statistics (PBS) show the exports have declined by 6.35 percent in the month of November 2018 compared to the November 2017.

The government, on the other hand, has also failed to reduce the imports by the same ratio. The official data shows the imports have reduced by only 2.77 percent ($132 million) in November 2018 as compared to the corresponding period of last year.

According to PBS data, Pakistan’s exports in November 2017 were recorded up to $1,968 million but it has declined to $1,843 million in November this year. The data further shows that Pakistan’s exports in October 2018 were recorded up to $1,903 which means the export target in the month of November showed negative growth of $60 million (3.15 percent). Similarly, $4,758 million imports were recorded in November 2017 which now has reduced to $4,626 million in November this year.

The economic experts, who earlier supported government’s measures to reduce imports and increase exports, have expressed their concerns over the economic performance of the PTI-led government. According to these experts, “Both the exports and remittances are primary source of dollar inflow in Pakistan. The crisis of balance of payments might temporarily be postponed as a result of IMF negotiations but the fundamentals depict that it might worsen in future. The mismatch between imports and exports leads to balance of payment issue”.

Though it is difficult to increase the exports within a few months as this needs long term planning but the government could have easily controlled the imports and reduced its volume. However, only two percent decline in the import as compared to 6 percent decline in exports is not a good sign, the experts say.

Though the foreign remittances have increased during last five months but a sudden shortfall of $400 million has surprised many. The overall monthly average of foreign remittances has increased from $1,635 million in first five months of fiscal year 2018 to $1,805 in the corresponding period of fiscal year 2019.

Talking to The News, Spokesperson for the State Bank of Pakistan said the workers’ remittances have increased up to 12 percent during the last five months. However, last month there was a shortfall of $400 million as compared to October 2018.

To a question about the reasons of this shortfall, the SBP spokesperson said no one can predict about the remittances. “There is no such mechanism where we could determine that how much money one will send back to his home”, he said. However, he said the depreciation of rupee might have an adverse impact on the remittances.

https://www.thenews.com.pk/print/404892-exports-reduced-by-125m-in-nov-2018

So much for Umar's false claims. Single Handily he running down the economy after continuously depreciating the currency and imposing new taxes.

Pkr has devalued a lot in last one year. This should give a boost to export. Inspite of currency devaluation if export is not rising, there is something seriously wrong with Pakistan economy.

 

[nahtanbob]

Month to moonth data has no relevance
Reason likely is exporter holding there returns till ruoee stabilize

And saudis have already released the money so i have no idea where were you..so wake up ..wake up...niw that you are awake..it suppose to be 1b month..so next payment will be announced by end of December (bi monthly update ) while oil credit will start effect now (mid December )

Chinse and UAE exact package details are not known

Chinese did gave exemption that will double our expirts to them(1 to 2 b $ )


True but its not smart to rely purely on one state to keep your monarch..this is true for saudis..they know that how other States sorrounding them collapsed ..remember Pakistan has troops stationed there to protect basically the al saud family from "revolution'

in the past saudis have hedged their bets. i doubt UAE will

 

[Wa Muhammada]

The fact is Umar has completely failed in handling trade deficit and the more he delays the IMF decision, the more he creates uncertainty for Pakistan. Remember his first speech where he said he will take decision in a month.

Time to bring Ishaq Dar back?

 

[SunilM]

Month to moonth data has no relevance
Reason likely is exporter holding there returns till ruoee stabilize

And saudis have already released the money so i have no idea where were you..so wake up ..wake up...niw that you are awake..it suppose to be 1b month..so next payment will be announced by end of December (bi monthly update ) while oil credit will start effect now (mid December )

Chinse and UAE exact package details are not known

Chinese did gave exemption that will double our expirts to them(1 to 2 b $ )


True but its not smart to rely purely on one state to keep your monarch..this is true for saudis..they know that how other States sorrounding them collapsed ..remember Pakistan has troops stationed there to protect basically the al saud family from "revolution'

Merchandise exports up by 1.29pc in five months

The country’s merchandise exports during the first five months of the current fiscal year increased by 1.29 per cent as compared to the exports of the corresponding period of last year.

The exports from the country during the period under review reached $9.12 billion against exports of $9.004 billion during the same period of previous year, according to latest data released by Pakistan Bureau of Statistics (PBS) on Tuesday.

Meanwhile, the imports into the country during the period under review decreased by 0.78 per cent to $23.633 billion against the imports of $23.818 billion in July-November 2017-18.

The trade deficit during July-November (2018-19) shrank by 2.03 per cent to $14.513 billion against $14.814 billion recorded during the first five months of last fiscal year.


On a year-on-year basis, the trade deficit posted a decrease of 0.25 per cent as it reduced from $2.79 billion in November to $2.783 billion in the same period of the current fiscal year.

However, the exports in November 2018 decreased by 6.35 per cent and 3.15 per cent when compared with the exports during November 2017 and October 2018 respectively.

The exports decreased from $1.968 billion in November last year to $1.843 billion this year, whereas exports during October 2018 were recorded at $1.903 billion.

Similarly, in the month of November 2018, imports into the country reduced by 4.44 per cent as it was registered at $4.26 billion as compared to $4.841 billion during October 2018.

https://profit.pakistantoday.com.pk/2018/12/11/merchandise-export-up-by-1-29pc-in-five-months/

How many times will I tell you ZIA, don't let your pseudo patriotism and hatred for PML-N blind you. The numbers above speak for themselves.

Time to bring Ishaq Dar back?

Honestly, this guy seems to be a scammer. He is taking the country down the drain with him. He kept saying before the elections he is prepared for step before the election. Gave the 100 day program. You tell me, what steps has he taken? I mean structural reforms? Economy does not require legislation? Crying corruption every day will solve the problems in the economy? Will billions of dollars come back in the the next few months or years? What has he done about circular debt? What has be done about bleeding PSEs? What has he done for steel mills and PIA? If taking loans and aid from Ummah and China is considered an achievement, then prey tell me how is he any different from Ishaq Dar?

 

[Super Falcon]

When asad umar and his policiez is only to snatch from public and give nothing this will happen people will loose faith

 

[Wa Muhammada]

Discussion on the economic condition including the dismal state of affairs in the Fiance Ministry. Interesting to Aleem Dar backstabbing Asad Umar publicly.

Watch for 36:30 onwards.

Good watch this

I’m not a supporter of the big 3 (PTI/ PMLN/ PPP.... but I agree with the anchor, that the rule of law is being abused and if PTI politicians are being accused of crimes why aren’t they in prison? We are becoming a banana republic in this respect. Is this democracy? IK promised a lot but I can see this govt failing.