Last update: Tue, 26 Jul 2016 09am

BR Research: All


The last monetary policy was nothing but a perplexed statement; and its minutes published recently are also a reflection of policy disconnect from ground realities. Eight of the nine members voted for a 25 bps cut, while only one voted for maintaining status quo.
While the regional officials within Pakistan and Tajikistan have been glossing over Central Asia South Asia Electricity Transmission and Trade (CASA-1000) project, especially with the support from the World Bank for pursuing the regional electricity connectivity, the reality on ground has been quite contrary.
The Senate passed the Corporate Restructuring Companies Bill 2016 two weeks ago with the aim of providing legislation for companies who would like to acquire financially distressed companies and reorganising their business operations and assets to make them more profitable.
The UK's departure from the EU is sending shockwaves around the planet, some of which have been felt here at home too; the PSX has lost some 1400 points in trading since the vote, while the Rupee-Sterling parity is now at Rs139 and falling - the lowest since 2012. At the heart of this is the future of Pakistan's trade relations with the newly-divorced nation.
Earlier in this column, we questioned Pakistani government's insistent that exports had been falling due to global commodity prices. The argument is not compelling enough. Let's examine this a little in depth. First, global commodity prices have in fact been falling for the past six years, having experienced a massive surge between 2000 and 2010. As a result, global exports have also fallen. Global trade in 2015 fell by 13.2 percent to a five year low according to UNCTAD.
Urea off-take in May 2016 was at a 15-year low for the monthly figure at just quarter million tons. That for the first five months of CY16 was at a slightly better 14-year low. For the eleven months starting July 2015, it records another decade low. And surprisingly, it is not even surprising, as urea sales for June are expected to be even weaker.
Once again, our countrys sugar exports are zero despite sitting on a surplus stock that could last us the whole season. There has been no extension in the export subsidy that expired in March, since when exports have ceased. The ECC approved the Rs6.5 billion subsidy on 0.5 million tons of sugar in December 2015, but only half that amount was able to leave the country.