Pakistan says economic problems easing: Forbes

Economic woes complicating Pakistan's struggle against Islamic militants are easing thanks to a tough rescue plan backed by the International Monetary Fund, but the program needs more than a year to succeed, the country's finance chief said Friday.

The perilous state of Pakistan's economy - which faced trouble even before the global economic crisis - is raising concern that unemployment and inflation will destabilize the nuclear-armed nation's pro-Western government and fan Islamist violence.

Shaukat Tarin told reporters the country's budget and trade deficits have already narrowed considerably.

The government's budget deficit will decline from 7.4 percent of gross domestic product in the past fiscal year, when ended in June, to between 4 percent and 4.2 percent in the current year, Tarin said.

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Pakistan To Get $700 Million More In Loans From WB, ADB - Official: EasyBourse

ISLAMABAD-(Dow Jones)- Pakistan is likely to get a combined $700 million worth of loans from the World Bank and the Asian Development Bank, the country's Finance Advisor, Shaukat Tarin, said Monday.
"Pakistan has received $200 million from the Asian Development Bank, while the country is expected to receive $500 million from the World Bank within a fortnight," Tarin told reporters.
"We are also expected to get another $200 million from the Asian Development Bank during the second quarter of 2009."
The new loans will boost the country's foreign-exchange reserves, Tarin said.
Last week, the country received a $500-million loan from China, a senior government official had said Saturday.

By Haris Zamir and Islamabad Bureau, Dow Jones Newswires

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Saudi Arabia commits $100 million for quake victims: Business Recorder

RECORDER REPORT

ISLAMABAD (November 01 2008): Saudi Finance Minister Dr Ibrahim Al-Assaf on Friday committed immediate transfer of $100 million relief and rehabilitation support for earthquake victims of Balochistan. Dr Ibrahim further said that Saudi government would be providing a package of health and relief support along with the financial assistance already committed.During a meeting with advisor to the prime minister on finance and economic affairs, Shaukat Tarin, Al-Assaf expressed sympathy over the loss of precious lives and property during the earthquake, which devastated many areas of Balochistan.

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Pakistan Extends August Stock Trading Curbs Until Oct. 31: Bloomberg

By Farhan Sharif
Oct. 26 (Bloomberg) -- Pakistan extended trading restrictions on its stock market for the third time in a month to prevent a further slide.
``Some time is still required for the implementation of market stabilization measures,'' Adnan Afridi, managing director of the Karachi Stock Exchange told reporters today. Shaukat Tarin, the Prime Minister's finance adviser will visit the exchange on Oct. 31, after which a decision about ending curbs will be taken, he said.
The Karachi Stock Exchange's benchmark KSE 100 Index has lost more than one-third of its value this year. Board members met over the weekend to discuss extending the curb, which was scheduled to be lifted on Oct. 27. The board also discussed ways to prevent possible violence by angry investors.

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Pakistan to Start Put Options for Overseas Investors: Bloomberg

By Farhan Sharif and Pooja Thakur

Oct. 23 (Bloomberg) -- Pakistan's stock regulator will allow foreign investors to buy put options in seven state-run companies, before lifting trading curbs that have prevented equity sales for almost two months.

The government will guarantee up to 30 billion rupees ($369 million) to enable state-run funds to write put options on Oil & Gas Development Co. and six other stocks, the Securities & Exchange Commission said yesterday. The regulator also approved a 20 billion-rupee fund to buy equities.

The measure may encourage investors to hold onto their shares when trading restrictions are lifted on Oct. 27, capping further declines in the KSE100 Index that has lost more than a third of its value this year. Since the limits were imposed, the government has approached the International Monetary Fund for a bailout to avoid defaulting on its debt, deterring investors.

``If in one year's time, the situation improves globally and in the local market, they will benefit instead of selling their holdings at this point,'' said Tariq Iqbal Khan, chairman of National Investment Trust, Pakistan's biggest asset manager. ``If these foreign investors accept the option, and do not sell in the ready market, the overall selling pressure will be lightened.''

Overseas investors who held shares in the market on Aug. 27, when the government capped a decline in its benchmark KSE100 Index, will be able to buy these options, the regulator said.

A put option is an agreement that gives the buyer the right to sell a specific quantity of a particular security by a certain date. The option is not obligatory and is traded during its life. The holder hopes the stock will drop in price.

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Pakistan banks on other lenders saving it before IMF: Reuters

Pakistan - (Releads)

By Augustine Anthony

ISLAMABAD, Oct 18 (Reuters) - Pakistan might need to borrow from the International Monetary Fund if other multi-lateral lenders and friendly governments fail to help out in the next few weeks, the country's new troubleshooter said on Saturday.

A balance of payments crisis is expected to climax soon, but there was no danger of Pakistan defaulting on its international debt obligations, Shaukat Tarin said a day after returning from overseas visits to Washington and Beijing to drum up support.

"I am very confident that I have plans to make sure, whatever it takes, that we should build our reserves and that we do not default," said Tarin, appointed last week as adviser to the prime minister on economic affairs.

"Now, there is no danger," he told journalists after a news conference, but he said lenders were running out of time to come to Pakistan's rescue.

"We think we will be in very good shape ... within the next 30 to 60 days," Tarin said of the prospects of sewing up funds to cover a balance of payments financing gap that the IMF estimates at up to $4.5 billion, and Pakistan reckons at $3.0 billion for the fiscal year ending on June 30 next year.

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KSE to remove ‘floor’ on 27th: Dawn

By Dilawar Hussain
KARACHI, Oct 14: The Board of directors of the Karachi Stock Exchange (KSE) decided on Tuesday to remove the ‘floor’ from under the KSE-100 index on Oct 27.“Normal trading parameters of 5 per cent upper and lower circuit breakers will be imposed from that day onwards,” a spokesman for the bourse said.The KSE had fixed a ‘floor’ under the index at the 9,144 points level on Aug 27 to prevent a further fall, after a fearful plunge in equity values by 41 per cent in less than four months. The measure had brought the market to a virtual halt with volume of shares traded at 11-year low on Tuesday, at just over half a million shares.The Chairman of the Securities and Exchange Commission of Pakistan (SECP), Raziur Rehman, told Dawn that the ‘floor mechanism’ had been put in place to give the market a ‘breathing space’. He expressed the hope that as the world equity markets were heading towards stability, the KSE would be able to absorb the shock, if any, from soft landing.Incidentally, the announcement of ‘floor’ removal coincided with the arrival of Prime Minister’s Adviser on Finance Shaukat Tareen, who had expressed his disapproval of the ‘floor’ and turned down a request for closure of the market.Analysts were worried over a possible 20 per cent drop in the index in the first week after the planks are pulled from under the ‘floor’. The big scare was the foreigners’ selling, who still held $2 billion in equities.The KSE spokesman said the board had discussed with the finance ministry, SECP, SBP and other stakeholders three critical areas of liquidity; risk management and restoring investor confidence. It said the ministry and the SECP would “implement full set of stabilisation measures prior to Oct 27”.

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