IMF approves $6.68bn loan for
Pakistan
The
Executive Board of
the International Monetary
Fund (IMF) approved today a 3-year arrangement under the
Extended Fund Facility (EFF) for Pakistan
in an amount equivalent to SDR 4.393
billion (US$6.64 billion1, or 425 percent
of Pakistan’s quota) to support the country’s economic reform program to
promote inclusive growth. The Executive Board’s approval enables an initial
disbursement by the IMF of an amount equivalent to SDR 360 million (about
US$544.5 million), and the remaining amount will be evenly disbursed over the
duration of the program, subject to the completion of quarterly reviews.
US ambassador signs agreement for
50MW energy project
United States Ambassador Richard Olson, signed on Wednesday a $95 million, ten-year
loan on behalf
of the Overseas
Private Investment Corporation (OPIC) to Sapphire Wind Power
Company to build a 50MW wind power plant
in Sindh. Situated in
the Ghoro-Keti Bandar wind corridor near
Jhimpir, the plant will be designed to generate 133-gigawatt hours of
emissionfree electricity annually
using 33 General
Electric (GE) turbines.
OPIC has invested in 123 projects
in Pakistan since 1975. Its current Pakistan portfolio includes 14
active projects worth
nearly $300 million
in key industries
including energy, health
care, financial services for
small and medium-sized enterprises, and telecommunications.
D.G Khan Expansion Plans
The DGKC directors also approved
plans of setting up a green field cement production line of up to 2.6m tonnes a
year at Hub, district Lasbela, on the land already acquired. The board also
noted: “On the basis of due diligence we have
decided to abandon
the idea of establishing a
plant in Mozam-bique
due to lack
of major infrastructure required
to set up
a cement plant.” Although
several cement manufacturers admitted
that the plans of D.G.
Khan to go
ahead with its
expansion could widen
the rift among cement producers, no one thought that a
price war among producers was imminent.
T-bills auction: banks reluctant to
invest
Banks are reluctant to invest in the
long-term government securities mainly due to
expected hike in
the key policy
rate. A very
thin participation was witnessed in
the auction of the Market
Treasury Bills held
on Wednesday and not a single bid was received for the sale of 6-month
and 12-month T-bills as banks are expecting some increase in discount rate in
the upcoming monetary policy to
be announced on
September 14, 2013. The State Bank of Pakistan (SBP) on Wednesday conducted
auction of Market Treasury Bills (MTBs) and received bids only for 3-month
T-bills, while not a single bid was received
for 6-month and
12-month bills. As per
expectations high participation
was witnessed in the 3-month MTBs and bids worth Rs 87.925 billion (realized amount) were
received. The cut-off yield for
the three months
T-bills continues to stay unchanged
at 8.9583 percent with
accepted amount of Rs
82.145 billion. As per auction
calendar a target of Rs 250 billion was set for the 5th auction of MTBs, however
against the target only Rs 82.145 billion was borrowed. Overall target for this
quarter was Rs 1.6 trillion, while so far government has borrowed Rs 781
billion through five auctions in first quarter of FY14. Economists said the
realized amount remained far below the targeted amount as the SBP seems
unwilling to increase cut-off yield significantly.
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